As incomes rise in cities in India, China, and other quickly growing economies, people tend to make three major purchases first: a TV, a refrigerator, and an air conditioner. The number of AC units may swell from 1.2 billion worldwide today to 4.5 billion by 2050–and household air conditioning, alone, could push global warming up half a degree by the end of the century, according to a new report.
“The increase in energy consumption for cooling represents a massive risk to meeting our climate goals,” says Richard Branson, who today helped launch both the report and the Global Cooling Prize, a $3 million competition to spur new technology. The prize, he says, “can literally help save the world from the disaster it’s facing.” It’s supported in part by the Indian government, as that country alone will add around 1 billion room air conditioners by the middle of the century.
The new competition is designed to provide an incentive to create higher-efficiency air conditioners and support startups in a field that’s currently dominated by a handful of major corporations. To participate, companies need to submit a solution that has five times less climate impact than a standard air conditioner, at no more than twice the cost, so it has a payback period of less than four years.
“This is a $20 billion market ready for a shake-up,” says Branson. “The challenge is that the market is broken. Incumbent manufacturers follow market signals, which currently reward high volume and low price. High R&D costs present a major barrier to entry.”
Through the competition, the organizers hope to speed up the industry’s rate of innovation. Consumers tend to buy air conditioners based on the sticker price, not how much they’ll end up spending on electricity over time. “The market is not demanding high-efficiency equipment,” says Iain Campbell, a managing director at Rocky Mountain Institute, a nonprofit that wrote the new report and is helping lead the prize. “So industry isn’t responding with higher-efficiency equipment.”
This has created a situation where “small players with new technologies don’t ever get sufficient access to the market,” Campbell says. As such, they’re not able to scale their innovations to the extent that they could become more affordable and widely adopted.
When Rocky Mountain Institute modeled other ways to make cooling more efficient–such as improving building design, or changing behavior so consumers don’t dial up the AC quite as much in the summer–they found that those changes aren’t sufficient to solve the problem. “We still have, effectively, climate disaster associated with just room air conditioners,” says Campbell.
One aspect of the climate challenge of the cooling industry is being addressed: The Kigali Agreement–a global climate deal from 2016 that the Trump administration hasn’t yet ditched–will require manufacturers to phase out AC refrigerants that are thousands of times more potent than carbon dioxide at trapping heat in the atmosphere. But the electricity use of air conditioners is a much bigger problem than refrigerants. We’re not adding renewable energy to the grid quickly enough to keep up with the growing number of air conditioners–which is why it’s imperative that air conditioners become more efficient even as renewables scale up.
The competition is targeting a small group of researchers and startups that are already working on solutions that could meet the goals of the challenge. Startups like SkyCool Systems, for instance, are looking at the potential for deep space radiative cooling–technology that essentially helps throw heat into outer space with far less energy use. Others are working on systems that use semiconductors in a heat pump, or devices that use sound to turn heat into cold.
In 2019, 10 applicants will get $200,000 to build prototypes. When the prototypes are built, they’ll be tested in a lab that simulates the climate in different Indian cities, and they’ll also be tested on 10 actual apartments in the heat of the Indian summer. The winning technology will get at least $1 million. Scaling it up, the organizers say, could be the most effective solution to avoid hitting another degree of global warming and wreaking havoc on the climate.
“The good news is that none of this is insurmountable,” says Branson. “If we can disrupt the airline industry, where a single Boeing 737 can cost north of $70 million, then I’m pretty sure we can do it with air conditioning.”