As temperatures rise across tropical and subtropical regions, air conditioning (AC) is no longer a luxury – it’s rapidly becoming essential. In India alone, the number of room air conditioning units is set to soar from around 110 million today to more than 1.1 billion by 2050. This sharp increase is being driven not only by population growth, but also by rising incomes, urbanisation and increasingly extreme heat due to climate change.  

Globally, electricity demand for space cooling is expected to triple by 2050, growing even faster than the rise in data centre energy use. In Indian cities, AC already accounts for up to half of electricity use during extreme heat. Left unchecked, this growth could place serious strain on electricity grids, drive up coal use and require vast infrastructure investment.  

To confront this challenge, the Global Cooling Efficiency Accelerator (GCEA) was launched by RMI and the Clean Cooling Collaborative (CCC) to reshape the sector. The initiative builds on the Global Cooling Prize – a 2018 competition supported by the Indian government – which aimed to identify and demonstrate residential air conditioners (ACs) with radically lower climate impact. The Prize invited manufacturers, startups and researchers to create ACs capable of reducing climate impact five-fold compared to the most commonly-sold products, by slashing energy consumption and using ultra-low-GWP (global warming potential) refrigerants. In 2021, manufacturers Daikin and Gree were announced as winners.  

‘We began by asking: can we reduce climate impact by 5x using existing technologies – and the answer was yes,’ recalls Ankit Kalanki, who led the Prize’s technical team and now heads the cooling initiative at RMI. ‘But proving that in the lab was just the beginning. The real challenge is bringing those technologies to market.’  

Globally, electricity demand for space cooling is expected to triple by 2050, growing even faster than the rise in data centre energy use.

The technical breakthrough – humidity-first operation 

One of the most important insights from the Prize was that transformative efficiency gains are possible using current technology – if applied differently. Most of AC’s climate impact comes not from its refrigerant, but from the energy needed to power it. In fossil-fuel-based grids, this translates into indirect emissions. About 80% of a typical AC unit’s climate footprint stems from its energy use.  

To achieve the 5x goal, energy consumption had to be reduced by at least 75%. But doing so meant rethinking what thermal comfort actually means. ‘In hot and humid countries like India, people often set their ACs to 19°C or 20°C just to stop feeling sticky,’ explains Kalanki. ‘It’s not really about the temperature – it’s about poor humidity control.’  

That insight shifted the design strategy. Rather than just cooling the air, the prize-winning prototypes focused on managing both temperature and humidity in the space without needing to significantly overcool it, allowing people to feel comfortable at 26°C or 27°C while using far less energy in the process. These systems relied on sensors that monitored both humidity and temperature, and used smart design and algorithms to adjust how compressors, fans and heat exchangers ran.  

‘We didn’t see a change in the core technology in the prize-winning prototypes,’ explains Yash Shukla, Principal Researcher and Head at the Centre for Advanced Research in Building Science and Energy at CEPT University in Ahmedabad, Gujarat, who led the Prize’s testing process. ‘The breakthrough was how these units were designed, as well as how their performance was controlled and optimised for real-world conditions.’  

The prototypes featured variable-speed compressors, innovative heat exchanger and component designs, adaptive fans, coil bypass valves and real-time monitoring. These enabled high efficiency under part-load conditions – the state in which most ACs operate for much of the day. (Traditional units are typically designed to run best at full capacity, which leads to inefficiencies during everyday use.)  

Taking prototypes into homes 

To test performance in practice, Daikin and Gree’s top-performing systems were installed in homes in Mumbai’s Palava City. The test site offered high humidity, dense housing and regular usage patterns.  

‘This wasn’t just a showpiece,’ says Shukla. ‘We wanted to understand how the systems would work in real households over a full season.’  

Over nine months, the super-efficient units cut electricity use by 60% compared to conventional models sold in the Indian market in 2023. Much of the savings came from eliminating unnecessary overcooling – the space was still maintained at occupant comfort conditions of ≤27°C and ≤60% relative humidity. ‘About a quarter of conventional AC energy use comes from compensating for poor humidity control,’ Kalanki notes. ‘Fixing that made a huge difference.’  

The systems also reduced peak demand by up to 50% during hot afternoons – a major benefit for grid stability.  

The AC field testing site, Palava City, near Mumbai, India, offered high humidity, dense housing and regular usage patterns 

Photo: RMI

Why that performance matters 

The implications of these findings stretch far beyond individual buildings. In rapidly urbanising countries like India, wide-scale adoption of super-efficient cooling could drive down electricity use, ease grid stress and curb emissions.  

By cutting peak loads in half, utilities could avoid or delay expensive investments in new substations, transmission infrastructure or peaker plants. Lower demand during critical hours also reduces reliance on coal-fired power generation.  

‘Cooling is not just about comfort – it’s the next big disruptor in the power sector,’ says Shukla. ‘If we don’t plan for it, we’ll end up building more power just to run ACs. That’s not sustainable.’  

The climate impact is equally important. If a significant share of new AC installations by 2050 adopt this high-efficiency model, global warming could be reduced by an estimated 0.5°C  It’s one of the largest mitigation opportunities from a single end-use technology.  

‘This is not incremental improvement,’ says Kalanki. ‘It’s a redefinition of what cooling can be. We’re changing the game.’  

From pilot to policy – specification and standards 

To support adoption, GCEA published a performance specification for super-efficient ACs in early 2025. Designed for public and private sector buyers, it sets out clear benchmarks that go beyond nameplate ratings. The spec includes real-world performance metrics like moisture removal, responsiveness and part-load efficiency.  

‘We built it based on data from real-world testing,’ Kalanki explains. ‘Not lab conditions – actual field data. It helps buyers choose systems that work in practice.’  

The team is also working with standard-setting bodies like India’s Bureau of Energy Efficiency to align national ratings with these findings. Current testing protocols often overlook performance under humid or variable conditions, which is where most real-world inefficiencies arise. 

‘If we keep testing for ideal conditions, we’ll keep getting devices that only perform well in labs,’ warns Shukla. ‘We need standards that reflect how people actually live.’  

Cost, uptake and scaling 

The biggest hurdle to wide adoption remains cost. Advanced prototypes are currently more expensive than traditional models – in some cases, twice as much – but prices are likely to become much more competitive after design optimisation and scaling. However, with high cooling demand, the additional cost can be recovered through energy savings in under four years. 

Kalanki believes this is a scale problem, not a tech one. ‘We have the solutions – now we need buyers, financiers and anchor customers to help make them affordable.’  

Institutional buyers are a key part of that puzzle. Hospitals, campuses and government facilities tend to evaluate lifetime cost, not just upfront price, making them ideal early adopters. Their aggregated demand could help manufacturers reduce unit costs quickly.  

‘Demand aggregation creates momentum,’ Kalanki says. ‘Just a few big customers can help shift the market.’  

Mainstream consumers could also benefit. Many households already buy mid-tier ACs with basic inverter features. Upgrading these with better coils, sensors or smarter control software – all developed through the Prize – could deliver real savings with minimal added cost.  

‘You don’t need the fanciest tech to make an impact,’ says Shukla. ‘Even modest upgrades, if applied broadly, could change the story.’  

Integrating policy and building design 

To meet both energy and climate targets, governments must incorporate cooling efficiency into broader planning. Kalanki and Shukla argue that cooling should be treated as central to national climate, energy and building policies.  

If 10% of ACs sold in India over the next decade met the super-efficient standard, modelling suggests that peak loads could drop by 25% in key cities – saving hundreds of millions in avoided infrastructure investment.  

‘This is real climate action,’ says Shukla. ‘It’s measurable, it’s scalable, and it makes people’s lives better.’  

But the solution goes beyond ACs. ‘Efficient systems work better in efficient buildings,’ Kalanki says. ‘It’s a multiplier effect – cool the structure, then cool the air.’  

Shukla agrees: ‘This is about the whole ecosystem. Devices, buildings, grids – they all have to work together.’  

Beyond India 

While India has led the charge, other countries across Southeast Asia, Africa and Latin America face similar challenges – and are now exploring their own programmes.  

Pilots are already underway, with systems being tested in different climate zones and housing types. Initial results show strong energy savings, although outcomes vary depending on conditions and user behaviour.

‘Every place has its own needs,’ says Kalanki. ‘But the principles – humidity control, smart modulation, efficiency under real-world conditions – are universally relevant.’  

The next frontier 

The clock is ticking. Cooling demand is rising fast, and the technologies we adopt today will shape emissions and energy use for decades. The GCEA’s work shows that smarter, climate-conscious cooling is not only possible – it’s ready.  

‘Success means changing the default,’ Kalanki concludes. ‘Not just having a better option, but making it the norm.’  

Shukla puts it simply: ‘Smart cooling isn’t a nice-to-have. It’s a must – for our grids, our climate and our future.’  

• Further reading: ‘COP28: countries have pledged to cut emissions from cooling – here's how to make it happen’. Global energy demand for cooling in a warming world is surely bound to increase in coming years. Dr Radhika Khosla, Associate Professor at the Smith School of Enterprise and the Environment, University of Oxford, suggests ways to keep that increase within limits. 
• There is much concern about the climate impact of the growing use of air conditioning around the world. One step in the right direction would be the adoption of intelligent controls, argues Donatas Karčiauskas, CEO of Exergio, which develops AI-based tools for energy optimisation in commercial buildings.