A billion new air-conditioners will save lives but cook the planet
NEW DELHI – Summer in India has always been hot. Increasingly, it is testing the limits of human survival.
As temperatures climbed across the world’s most populous nation in recent weeks, more than a dozen people died at an event in central India and thousands crowded hospitals with heatstroke symptoms.
Hundreds of schools were closed and the mercury is still rising: Temperatures will hover around 45 deg C across the northern plains this weekend.
The most immediate fix is mercifully affordable, at least in the short term.
Demand for air-conditioners is surging in markets where both incomes and temperatures are rising, in populous places such as India, China, Indonesia and the Philippines.
By one estimate, the world will add one billion air-cons before the end of the decade. The market is projected to nearly double before 2040.
While that is good for measures of public health and economic productivity, it is unquestionably bad for the climate, and a global agreement to phase out the most harmful coolants could keep the appliances out of reach of many of the people who need them the most.
The logic behind the air-con boom is simple.
Economists note a spike in sales when annual household incomes near US$10,000 (S$13,400), a tipping point many of the world’s hottest places touched recently or will soon.
The Philippines passed the US$10,000 threshold roughly in 2022; Indonesia within the last decade.
In India, where more than 80 per cent of the population do not yet have access to air-cons, per capita gross domestic product (GDP) – adjusted for purchasing power – will top US$9,000 in 2023 for the first time.
“We are operating in a limitless opportunity,” said Mr Kanwaljeet Jawa, who heads the India wing of Daikin Industries, the world’s largest air-con manufacturer.
In recent years, he said, “our sales have grown more than 15 times”.
This development has far-reaching consequences for public health, well-being and economic growth.
Purchasing an air-con is a pivot away from poverty for individuals and for their communities.
People in hotter countries, which also tend to be poorer ones, suffer from worse sleep and impaired cognitive performance, both of which drag on productivity and output.
In a study looking at thousands of Indian factories with different cooling arrangements, researchers found that productivity fell by around 2 per cent for every 1 deg C increase.
This is a big deal for Prime Minister Narendra Modi’s push to boost sluggish export numbers, lure business from China and move up the global value chain: The declines due to heat over the past 30 years may equate to roughly 1 per cent of India’s GDP, or about US$32 billion, according to ISI Delhi economics professor E. Somanathan, author of the report.
But expanding air-con coverage too quickly also threatens to worsen the crisis it is responding to.
Most units use a refrigerant that is far more damaging than carbon dioxide.
The nations where demand is growing fastest remain deeply reliant on coal-fired power, and most people can afford only the cheapest, most energy-inefficient units.
If efficiency standards do not improve, “then the planet will literally be cooked”, said Mr Abhas Jha, a World Bank expert on climate change based in Singapore.
Wealthier, more temperate countries have tightened regulations on air-cons, requiring better energy efficiency and less-toxic coolants.
That adds to the cost of units, making those kinds of measures less palatable where affordability is paramount.
International climate bodies are pressuring developing countries to lower their carbon footprint, but India and its peers point out that they still contribute far less to global emissions than places like the United States, where nine out of 10 people have access to air-cons.
“We’re facing a situation where extraordinarily harsh conditions are being imposed on growing economies,” said Mr Jose Guillermo Cedeno Laurent, an assistant professor of public health at Rutgers University in New Jersey.
In Delhi’s working-class neighbourhoods, these debates are abstractions.
For many, access to an air-con is a matter of survival.
Ms Piyu Haldar, who works as a maid, said her shanty turns into a furnace in the summer.
The tin roof gets hot enough to cook roti on it. Before sleeping, Ms Haldar and her husband used to splash water on their bed to cool down the room.
When her son was born in 2016, he suffered fevers from the heat. That was the breaking point.
To afford an entry-level Voltas air-con, Ms Haldar stopped buying clothing, cut down on meals, took out a loan and doubled the number of houses she cleaned.
Ms Haldar, 27, avoids turning on the unit during the day. But as night falls, she flips on the switch and closes the door, keeping the mosquitoes out and preserving the cool air.
In a windowless bedroom decorated with teddy bears and toys, her son, Yasir, pushed his face against the air-con, delighting in the “cold chilled air!”
“Relatives visit just to sit next to it,” Ms Haldar said.
“People think we’ve become very fancy.”
Since purchasing the air-con, she and her husband have more energy in the day, she said, and Yasir no longer falls sick from the heat.
As more people like Ms Haldar buy air-cons, cooling companies are trying to improve energy efficiency without pricing out their biggest growth markets.
Most Group of 20 nations, including India, use labelling systems to rate the efficiency of products, and stricter standards in the US and European Union have lowered energy use from appliances by 15 per cent in recent years, according to BloombergNEF.
Ms Haldar chose a three-star unit from Voltas, which cost about 27,000 rupees (S$440), or roughly 15 per cent less than comparable higher efficiency options.
Three-star units comprise about 60 per cent of total air-con sales at Godrej Appliances, one of India’s largest retailers, said business head Kamal Nandi.
One way to encourage consumers to buy more efficient models, the company says, would be to lower taxes on the units to 18 per cent, down from the 28 per cent luxury tariff that currently applies.
“The AC has become a necessity,” Mr Nandi said. “It is no longer a luxury item.”
For cooling companies like Daikin and Haier, the growing demand for air-cons could be quashed by regulation designed to slow climate change.
Part of the problem will be solved if and when countries move towards cleaner sources of power.
The other issue – the refrigerants that turn that electricity into cool air – is trickier.
One of the most common coolants, hydrofluorocarbons (HFCs), can have 1,000 times the warming potency of carbon dioxide.
Scientists estimate that failing to drastically lower dependence on HFCs could result in 0.5 deg C of warming by the end of the century, an enormous contribution to a rise that would trigger deadlier storms, droughts and, yes, more heatwaves.
In 2016, more than 170 nations agreed to start phasing out HFCs beginning in 2019, with wealthy industrial countries required to make the first deep cuts.
There are less environmentally harmful coolants on the market, made by Chemours Co and Honeywell International. Daikin and Mitsubishi Electric are working on their own products.
“If you don’t have a green refrigerant, you are going to be the loser,” said Daikin’s Mr Jawa.
Daikin India, which became a billion-dollar company in the last financial year, expects to double that number within three more.
Cooling companies are hunting for new options.
The Kigali Amendment to phase out HFCs is legally binding, and though many of its goals are still far in the future, developed nations have picked up the pace.
As at now, though, the alternatives are often more expensive.
That has prompted opposition even in wealthy countries.
The US Senate recently agreed to reduce HFC consumption by 85 per cent within 15 years, and the conservative Heritage Foundation has warned Americans to get “ready to pay a lot more for air-conditioning”.
For India, the challenge is to implement cleaner technology before millions of new consumers purchase the dirtier air-cons, locking in their use for another decade.
In 2022, the country logged some of its hottest weeks since 1901.
Brutal heatwaves pushed temperatures to 50 deg C on the subcontinent.
Mr Naresh Tatavet, a personal driver in Delhi, is among those who have had enough.
In May, he bought his young family their first air-con, calling it one of the biggest financial investments he has ever made – on a par with purchasing a motorbike.
In his neighbourhood, after somebody purchases an AC, “we bring them sweets to celebrate”.
Whatever happens in Washington, Brussels and other faraway places, Mr Tatavet is sure of one thing: His family will not go back. He can no longer watch his baby throw up from the heat.
“I don’t want to wake up drenched in sweat any more,” he said. BLOOMBERG
This article was originally published on The Straits Times.
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