China: are air conditioners at odds with climate ambitions?

Glob­al warm­ing is chan­ging even our simplest habits. The wide­spread increase in the use of air con­di­tion­ers in remote regions around the world is proof of this. Ensur­ing the well-being of pop­u­la­tions, par­tic­u­larly in hot regions, is a goal that largely explains the increase in the pur­chase and use of these cool­ing elec­tric­al appli­ances. How­ever, these devices, which are so bene­fi­cial in sum­mer, have a dark­er side: their par­tic­u­larly high energy and car­bon foot­print. Of all white goods¹² [Edit­or­’s note: kit­chen and bath­room appli­ances], air con­di­tion­ers are said to con­sume the most energy, cre­at­ing a vicious cycle – they help us cope with the heat, but also con­trib­ute sig­ni­fic­antly to glob­al warm­ing. Yet, ccord­ing to the 2023 IPCC report³, one of the greatest poten­tials for redu­cing GHG emis­sions lies in energy sav­ings and improv­ing energy effi­ciency [Edit­or­’s note: meth­ods of redu­cing a sys­tem’s energy con­sump­tion while main­tain­ing the same end ser­vice or improv­ing its qual­ity]. Are air con­di­tion­ers at odds with our cli­mate ambitions?

Chin­a’s air con­di­tion­er stock will rep­res­ent nearly 37% of the glob­al stock.

To mit­ig­ate glob­al warm­ing, developed and devel­op­ing coun­tries are imple­ment­ing strategies to improve the energy effi­ciency of their appli­ances. The European Uni­on, for example, has set itself an ambi­tious tar­get: to achieve at least a 32.5% improve­ment in energy effi­ciency by 2030⁴. But are all coun­tries fol­low­ing suit?

In China, demand for air con­di­tion­ers has exploded over the past dec­ade, doub­ling the aver­age num­ber per house­hold. Between 2010 and 2020, sales of air con­di­tion­ers rose from 51.5 mil­lion units per year to nearly 100 mil­lion⁵. The scale of the phe­nomen­on is such that by 2025, Chin­a’s air con­di­tion­er stock will rep­res­ent nearly 37% of the glob­al stock⁶. How­ever, the pur­chase of numer­ous air con­di­tion­ers by Chinese house­holds and the high energy con­sump­tion of these appli­ances could have a sig­ni­fic­ant neg­at­ive impact on Chinese house­holds’ energy sav­ings and car­bon emis­sions reduc­tion. But is China imple­ment­ing meas­ures to improve the energy effi­ciency of its air con­di­tion­ers? Are Chinese house­holds buy­ing energy-effi­cient air con­di­tion­ers? What are their air con­di­tion­ing habits?

To answer this ques­tion, a study entitled Impli­cit Dis­count Rates and Energy Effi­ciency Gap in Air Con­di­tion­ing: Evid­ence from the Chinese Mar­ket was pub­lished in May 2025 in the journ­al Resource and Energy Eco­nom­ics. We know, for example, that adopt­ing energy-effi­cient air con­di­tion­ers would reduce house­hold energy con­sump­tion, lower­ing elec­tri­city bills and redu­cing cli­mate impact. How­ever, these units usu­ally come with high­er upfront pur­chase costs. Do Chinese con­sumers take these cri­ter­ia into account in their eco­nom­ic behaviour?

To con­duct this research, sci­ent­ists used detailed data on air con­di­tion­er sales and prices in 274 Chinese cit­ies between 2013 and 2018. The res­ults of the study indic­ate that Chinese con­sumers place too much import­ance on the price of air con­di­tion­ers when mak­ing pur­chases, to the det­ri­ment of their long-term energy costs, which is not bene­fi­cial for them.

Chinese con­sumers may not fully appre­ci­ate the energy sav­ings offered by energy-effi­cient air conditioners.

Spe­cific­ally, Chinese con­sumers only take 41% of oper­at­ing costs [Edit­or­’s note: i.e., the costs of use and main­ten­ance incurred after pur­chas­ing a product] into account in their pur­chas­ing decisions. This means that they achieve an impli­cit dis­count rate of around 24% when choos­ing air con­di­tion­ers. How­ever, a high impli­cit dis­count rate reflects how an indi­vidu­al favours short-term pur­chases over future sav­ings. In this case, the high dis­count rate sug­gests that Chinese house­holds pur­chas­ing air con­di­tion­ers gen­er­ally place much less import­ance on future energy sav­ings than they should rationally.

These res­ults there­fore imply that Chinese con­sumers may not fully appre­ci­ate the energy sav­ings offered by energy-effi­cient air con­di­tion­ers. In oth­er words, there is a gap between what is fin­an­cially optim­al for households—the increased adop­tion of energy-effi­cient air conditioners—and their actu­al choices, which are less expens­ive but more energy-intens­ive air conditioners.

What are the con­crete con­sequences of Chinese house­holds under­es­tim­at­ing future energy sav­ings when pur­chas­ing air con­di­tion­ers? The air con­di­tion­ing habits of Chinese con­sumers could primar­ily affect their well-being and over­all energy con­sump­tion. Accord­ing to the study, high dis­count rates in the Chinese air con­di­tion­ing mar­ket would lead to an increase in annu­al energy con­sump­tion of around 7.5% and a loss of well-being of 30.3 yuan per con­sumer. Accord­ing to coun­ter­fac­tu­al estim­ates, if con­sumers did not under­es­tim­ate future energy costs in the Chinese mar­ket, the mar­ket share of energy-effi­cient air con­di­tion­ers would increase from 35.1% to 39.3%, which is all the more reas­on to draw con­sumers’ atten­tion to the long-term energy costs of these appliances.

This study on Chinese air con­di­tion­ing habits is also import­ant because it addresses dif­fer­ences in pur­chas­ing beha­viour based on city and social group (fig. 1). Chinese con­sumer pur­chas­ing beha­viour is not homo­gen­eous but var­ies accord­ing to geo­graph­ic­al and soci­olo­gic­al criteria.

In Chinese cit­ies with high­er GDP per cap­ita, con­sumers place less emphas­is on the long-term costs of air con­di­tion­ing than those in cit­ies with lower GDP per cap­ita. The same is true for lar­ger house­holds, those that invest more in their chil­dren’s edu­ca­tion, and res­id­ents of south­ern China, where air con­di­tion­ers are more widely used than in the north due to high­er temperatures.

In con­clu­sion, this study provides insight into the pur­chas­ing beha­viour of Chinese con­sumers with regard to air con­di­tion­ers.  How­ever, it has lim­it­a­tions that war­rant fur­ther invest­ig­a­tion through addi­tion­al research. First, data on air con­di­tion­er usage in dif­fer­ent regions of the coun­try is obtained from house­hold sur­veys and may there­fore be less accur­ate than data derived from elec­tri­city load data. One aven­ue for future research would there­fore be to use elec­tri­city grid load data to estim­ate future energy costs more accur­ately for each mod­el of air con­di­tion­er on the market.

Fur­ther­more, the study does not explore the reas­ons why some con­sumers place less emphas­is on the short-term energy costs of air con­di­tion­ers than on the long-term costs. A study on this issue would, how­ever, offer new dir­ec­tions for this research. It would allow for the explor­a­tion of vari­ous hypo­theses, such as cred­it con­straints⁷, myopia⁸⁹¹⁰¹¹, inat­tent­ive beha­viour¹²¹³¹⁴, and lack of sali­ence¹⁵¹⁶. Finally, the adop­tion of new energy-effi­cient air con­di­tion­ers could lead to a rebound effect [Edit­or­’s note: increased use of air con­di­tion­ers by con­sumers due to improved energy effi­ciency], which could push house­holds to con­sume more energy than ini­tially planned^17181920.

This study there­fore provides new data on the beha­viour of Chinese house­holds when pur­chas­ing air con­di­tion­ers. It shows that they tend not to take suf­fi­cient account of energy costs over the long term. That is why it is time to act: this beha­vi­our­al bias is lead­ing to an increase in elec­tri­city con­sump­tion in China and could have con­sequences for glob­al warm­ing. Nev­er­the­less, coun­ter­meas­ures can be imple­men­ted. These include set­ting min­im­um energy effi­ciency^21222324 stand­ards, provid­ing inform­a­tion, and offer­ing incent­ives for energy effi­ciency. Address­ing the issue of high energy con­sump­tion by air con­di­tion­ers in China could improve people’s well-being and mit­ig­ate cli­mate change.

Lucille Caliman