India Pushes Higher AC Efficiency as Cooling Demand Surges
- brg_news_room
- 14 minutes ago
- 3 min read
As rising temperatures, longer heatwaves and rapid urbanisation fuel a surge in cooling demand, India is taking decisive steps to improve air conditioner (AC) energy efficiency and reduce pressure on its power grid. Policymakers believe that stricter efficiency standards and responsible cooling practices could significantly curb electricity consumption, lower household bills and cut carbon emissions.
India currently adds an estimated 13–15 million new air conditioners every year as incomes rise and cooling becomes a necessity rather than a luxury. Without policy intervention, the country could add 130–150 million room ACs by 2035. Energy experts warn that this could increase peak electricity demand by as much as 180 gigawatts, nearly 30% of India’s projected peak load, placing immense strain on power infrastructure and driving up costs for utilities and consumers alike.
To address this challenge, the Union Government has proposed a series of measures aimed at standardising AC operations and improving efficiency across residential, commercial and automotive sectors. One of the most debated proposals would require all new air conditioners sold in India to operate within a preset temperature range of 20°C to 28°C. This would prevent users from setting temperatures as low as 16–17°C or as high as 30°C, practices that significantly increase electricity use without providing proportional comfort benefits.
Officials estimate that raising the AC temperature setting by just 1°C can reduce electricity consumption by around 6%. Encouraging consumers to operate ACs at 24–26°C could save tens of billions of units of electricity annually, reduce peak demand by several gigawatts and potentially eliminate the need for multiple new coal-fired power plants.
In parallel, the Bureau of Energy Efficiency (BEE) has introduced revised star‑rating norms for appliances, including air conditioners, that came into force from January 1, 2026. Under these updated standards, the criteria for energy efficiency have been tightened significantly, meaning products must perform substantially better to achieve the same star level. As a result, manufacturers are expected to incur higher production costs to meet the new benchmarks, which is likely to push air‑conditioner prices up by around 5–10 per cent despite recent tax reductions. This strengthening of the star‑labelling programme aims to move today’s high‑efficiency models toward becoming the new baseline, encouraging the adoption of more efficient technologies and enabling consumers to make more informed purchasing decisions.
While some high-efficiency AC models may carry higher upfront costs, policymakers argue that lower electricity bills over time will more than offset the initial expense. Beyond consumer savings, reduced electricity demand will help stabilise the national grid, cut fuel imports and support India’s climate commitments by lowering greenhouse gas emissions.
The proposed measures have sparked debate. Some consumers view temperature limits as an intrusion into personal choice, while manufacturers have raised concerns about redesign costs and market adjustment. The government, however, maintains that these steps are essential to prevent future power shortages and ensure affordable, reliable electricity in a warming climate.
Overall, India’s push to improve air conditioner efficiency reflects a broader strategy to balance growing comfort needs with energy security and environmental sustainability. As cooling demand continues to rise, efficient technologies and responsible usage are emerging as some of the most cost-effective tools to manage peak power demand and safeguard the country’s energy future.
Find out more in our latest edition of India HVAC report.
Source: Geetika Tandon, BRG Research
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