Promoting Energy-Efficient Air Conditioners and Transformation of the Air Conditioning Appliance Market in Southeast Asia

Project General Information



Climate change

Climate Change


Heating, ventilating and air conditioning are among the basic needs when operating residential and commercial buildings. Air conditioning (AC) systems represent a major energy end-use in several countries and contribute to peak load growth and energy consumption in the commercial and residential sectors. This trend has been recently increasing due to rising living standards combined with a cost reduction of AC products. Air conditioners have a significant potential for being improved in order to reduce their environmental impacts and to achieve energy savings through better design, which in turn leads to economic savings for businesses and end-users. This is because the efficiency of AC units varies according to the design of the systems. The amount of electricity consumed by an AC to produce cooling is determined by its Energy Efficiency Ratio (EER). The EER is obtained by dividing the measured cooling capacity of the unit (Btu/hour) by its total electrical input (Watts). The lower the EER, the less efficient the AC is, and therefore, the more electricity it will consume to produce a given amount of cooling. At national level the EER is determined through testing in specialized testing centers under standard conditions as defined by the testing protocols by different countries. The EER of ACs vary over a wide range from as low as 2.2 to as high as 3.6 or more. With the advent of new inverter based technology which has a higher efficiency for which the ASEAN countries have not yet identified any testing protocols, it is difficult to estimate the EER of such ACs.  In most of the countries in ASEAN region, there are no mandatory requirements regarding the EERs to be met by ACs and other electrical appliances.

The energy consumption of the compressor, which is a key component of an AC, ranges from 80% to 88% of an air conditioner’s total electricity consumption. This indicates that the greatest energy saving opportunity lies with improving compressor energy efficiency. This can be accomplished by using more efficient compressors or improving the heat transfer process of the evaporator and condenser coils. Of course, since fan motor energy use accounts for at least 12% of the total energy consumption, energy savings could also be achieved by improving the efficiency of the air delivery system. Technology development and transfer is achievable due to the current state of the art in technology development around the world in terms of AC system design.

According to international statistics, the current electricity consumption of households related to ACs is estimated at 56.3 TWh per annum in the ASEAN region. As of today, the market share of ACs with an EER equal to or above 3.2 (which is China’s EER for Minimum Energy Performance Standard [MEPS]) is around 25% only. Assuming all ASEAN countries adopt an MEPS of 3.2, electricity consumption in the residential sector would be reduced by 5,373 GWh per annum, corresponding to a reduction of 2.7 million tons of CO2 emissions per annum. This is the major overall objective of the action plan.

The proposed project intends to provide assistance to ASEAN countries, thereby addressing the problems that these countries face in their efforts to harmonize EE standards for air conditioners. It also aims to address subsubsequent challenges and to induce a market transformation in favor of higher efficiency ACs that requires countries to be equipped with relevant energy performance standards and adopt Minimum Energy Performance Standards (MEPS), as well as remove non-tariff barriers to trade (one of the major goals of the ASEAN’s vision for 2020).

Full Size Project(FSP)


Asia and the Pacific

Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam

GEF Trust Fund

Stage Grant to UNEP Grant to other IA Co-Financing UNEP Fee Other IA Fee
$ 3,000,000.00 $ 0.00 $ 9,000,000.00 $ 300,000.00 $ 0.00



Executing Agency Category

Partner Category

Name Category Period
Geordie Colville

Substantial Risk

Risks identified are: - Weak commitment from governments to transform the AC market in Southeast Asia - The harmonized standards are too stringent - Ineffective regional platform due to conflicting interests and agendas - Unwillingness of end-users to buy energy-efficient ACs due to high initial cost


Fiscal Year Project activities and objectives met

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