Cooling Without Warming: Policy Solutions for Asia’s Rising Cooling Demand

Rising temperatures, due in part to climate change and urbanization, are making people everywhere seek relief from the heat. At the same time, growing populations, greater energy access, and rising incomes, particularly in developing Asia and the Pacific, are enabling more people to afford cooling technologies such as air conditioners. This confluence of factors is driving a surge in the demand for cooling solutions around the world.

Cooling performs a range of critical functions that underpin human health, economic productivity, and the delivery of essential goods, such as food and medicine. However, many cooling systems and technologies rely on environmentally harmful refrigerants and electricity generated from fossil fuels. As a result, cooling is responsible for a significant and growing share of GHG emissions—estimated to account for nearly 10% of the world’s total, with cooling-related emissions rising by 10%–15% annually (Shen et al. 2023). Asia and the Pacific alone contribute 62% of these emissions (ESCAP 2021).

Compounding the issue, the GWP of cooling agents used in air conditioning and refrigeration can be hundreds of thousands of times more potent than CO₂ per unit of mass, though these have a shorter lifespan of 15 years. HFCs currently contribute to 2% of global GHG emissions directly (roughly the same proportion as the civil aviation sector) and require extensive amounts of electricity to run. Their use is growing rapidly, at around 10% per year (CCAC 2024).

Older cooling agents, which are being phased out in the People’s Republic of China (PRC) and advanced economies under the Montreal Protocol, remain widespread in other parts of developing Asia and possess ozone-depleting properties (Jaiswal 2017). To ensure the sustainability of cooling systems, significant progress is needed in improving energy efficiency, accelerating the adoption of climate- and ozone-friendly technologies, and decarbonizing the energy grids on which these systems depend. This underscores the urgency of transitioning to sustainable cooling solutions.

Develop an effective legislative framework for climate-friendly cooling.

For developing Asia, establishing a robust legislative framework is essential to enable climate-friendly cooling. Best practices from advanced economies, such as the European Union (EU), Japan, and the United States, can inform the development of integrated energy conservation and clean air legislation to support commitments to carbon reduction and the phaseout of high-GWP refrigerants. A strong legislative foundation allows for the phased implementation of more specific policies and measures.

Within such frameworks, several countries and regions have developed sector-level strategies and action plans. Examples include the EU’s Heating and Cooling Strategy and the PRC's National Green Cooling Action Plan, which enforce targeted measures and standards. Others have launched directives and programs focused on deploying low-carbon cooling technologies in buildings, households, and appliances, such as California’s Building Energy Benchmarking Program, Home Energy Rating System, and Energy Partnership Program. Some jurisdictions have also integrated cooling sector policies with renewable energy initiatives, such as the EU’s Renewable Energy Directive.

Improve standards and labeling systems, and enhance compliance with efficiency standards.

Governments across Asia should consider establishing minimum energy efficiency standards for cooling appliances and phasing out outdated or inefficient equipment. Japan’s Top Runner Program offers a valuable model—setting energy efficiency requirements based on the most efficient product currently available in the market. These standards should be regularly reviewed and progressively tightened. Benchmarking against the most stringent global standards and developing a clear timeline for alignment can help accelerate progress.

Enforcing a mandatory labeling system is also highly beneficial. Energy labels provide consumers with essential information about the energy performance and refrigerant type of air-conditioning and refrigeration products, enabling more informed purchasing decisions. To be effective, this information should be prominently displayed and easily understood by the average consumer.

Promote low-carbon cooling in public buildings.

Governments can support this goal by implementing procurement policies that prioritize low-carbon cooling equipment in the public sector. For example, the government of the PRC maintains a catalog of recommended energy-saving products for government procurement, which includes high-efficiency air conditioning and refrigeration systems. Public institutions are encouraged to prioritize items from this list when purchasing energy-consuming equipment. Regular updates to the catalog are essential to ensure that selected products maintain optimal energy performance and continue to deliver environmental benefits.

Governments can also introduce policies and pilot programs to integrate renewable energy into public sector cooling systems. For instance, regulations could require that a minimum percentage of available rooftop or surface area on public buildings be dedicated to photovoltaic (solar) power generation.

Develop incentive policies to encourage behavior change.

For low-carbon cooling projects that are not yet widely adopted but offer significant social and environmental benefits, governments should prioritize providing incentives and support to scale up their implementation. For example, the Japanese government has promoted the use of low-GWP natural refrigerants as alternatives to HFCs. However, adoption has been limited due to high upfront costs. To address this, Japan’s Ministry of the Environment offers subsidies covering a portion of the machinery and installation costs for companies that replace or install equipment using natural refrigerants, thereby encouraging the transition to more climate-friendly refrigeration technologies.

Governments should design incentive policies that motivate individuals to adopt energy-efficient behaviors. The PRC, through its Green and High Energy Efficiency Cooling Action Plan, encourages local governments to introduce incentives for purchasing high-efficiency cooling appliances. These may include rebates for energy-efficient products and trade-in programs that allow consumers to exchange low-efficiency appliances for more efficient alternatives.

Monitor and regulate refrigerants and cooling equipment from a life-cycle perspective

Governments should require the registration of all stages of high-GWP refrigerant handling, including production, import, sale, and recycling. Additionally, mandatory regular leak inspections and maintenance record-keeping for existing cooling equipment should be enforced.

Finance large-scale deployment.

One effective strategy is to establish co-financing mechanisms through partnerships among the public sector, multilateral development banks, and private investors. By leveraging government incentive funds and concessional loans from development banks, these partnerships can unlock commercial capital and reduce financial barriers.

Creating revolving loan funds dedicated to low-carbon cooling projects can also expand financing opportunities. These funds can provide continuous support for new initiatives by reinvesting repayments into future projects, thereby sustaining momentum and scaling up deployment across regions.

Take an integrated approach and encourage collective efforts.

Policy solutions for climate-friendly cooling should be designed as part of a holistic package. This means that regulations, policies, standards, and tools must be coordinated to support and reinforce one another, rather than functioning in isolation.

For example, under its net-zero emissions commitment, the EU has implemented a suite of interconnected regulations including the Energy Efficiency Directive, Renewable Energy Directive, Industrial Emissions Directive, European Commission-mandated regulations, and governance regulations. These high-level frameworks are complemented by specific policy measures and initiatives that ensure effective implementation and alignment across sectors.

Build capacity for low-carbon cooling.

Capacity building and knowledge dissemination are key for promoting energy efficiency improvements. Governments in Asia can take policy measures (e.g., promoting the use of appropriate cost–benefit assessment tools) to help customers understand that the long-term economic losses from using low-efficiency equipment often outweigh the initial investment in high-efficiency alternatives.

Poor operational management also contributes to unnecessary energy waste. Therefore, capacity-building efforts should focus on equipping users with the skills needed to manage and operate cooling equipment more efficiently.

It is also necessary to strengthen the capacity of financial institutions to address the financing gaps that hinder the adoption of low-carbon cooling technologies.

Asian Development Bank (ADB). 2024. Sustainable Cooling: How to Cool the World Without Warming the Planet.