The air conditioner (AC) market in Africa is growing rapidly due to rising temperatures, increasing demand for better lifestyles, and rapid urbanization with sales reaching 3.4 million units in 2021 and a revenue of US$1.23 billion in 2024. One of the positive effects of this growth noted by experts is the increasing number of jobs in the heating and ventilation and air conditioners sector (HVAC). However, a negative aspect is the ozone-depleting and greenhouse gas-increasing refrigerants that are used in ACs, and rising energy consumption also is putting pressure on local electricity grids and causing power outages.
In this DevelopmentAid article, we consider the economic opportunities that ACs are creating and also how the environment is being negatively impacted.
The opportunities offered by the growth in the AC market for African developing nations
The African AC market has experienced steady growth since 2021 when it expanded by 3.1% with almost 3.4 million units being sold and, by 2023, the market value amounted to approximately US$3.5 billion. The core drivers of this growth are climate change (rising temperatures), increasing demand for better lifestyles, an emphasis on energy efficiency and rapid urbanization in middle-income countries, particularly South Africa, Nigeria and Kenya. Despite ACs being largely powered by fossil-fueled electricity, some African countries are implementing solar-powered air-conditioning technologies, which leverage abundant sunlight thus reducing electricity consumption and increasing renewable energy use.
With more air-conditioners installed, more employment opportunities involving specialized installation and maintenance are required.
The expansion of Africa’s AC market is driving increased revenue generation opportunities for the economies on the continent. According to Statista, Africa’s AC market will generate a revenue of US$1.23 billion in 2024 and is expected to grow at an annual rate of approximately 6.2% from 2024 to 2029. The revenue surge is boosting local economies and also attracting investments in the renewable energy sector leading to further growth and innovation.
The challenges of the growth of the AC market for developing nations
Driven by rising temperatures, the expanding AC market is providing job opportunities and fueling economic growth. However, it is also resulting in hidden environmental costs. From the emission of high Global Warming Potential (GWP) refrigerants to the increased energy requirements that are straining local power grids, the cooling comfort provided by ACs is posing significant challenges to Africa’s efforts on climate change. ACs are complex machines that use chlorofluorocarbons (CFCs) and hydrofluorocarbons (HFCs) as cooling agents and when some of these refrigerants (particularly the older types) are released into the atmosphere, over time they increase the holes in the ozone layer.
Are the cooling agents used by ACs unsafe for the environment?
CFCs and HFCs are potent greenhouse gases (GHGs). Although CFCs are now used less due to their impact on ozone depletion, they still remain in the atmosphere and contribute to global warming. In Africa, low-efficiency AC units are often ‘dumped” by other markets and installed as ‘viable’ solutions despite using CFCs.
While HFCs cause less damage to the ozone layer, they are effective at retaining heat in the atmosphere which causes high global temperatures. The Scientific Assessment of Ozone Depletion 2022 Report indicates that the stationary air conditioning and refrigeration sector will produce the largest amount of HFCs by 2050, as shown in Figure 2. Middle East and North African countries will produce approximately 10% of HFCs, the third largest region, by 2050 (Figure 2).
Figure 2: Regional and sectoral contributions to HFC CO2-eq Emissions by 2050
Source: Scientific Assessment of Ozone Depletion 2022 Report
Obsolete and substandard AC appliances that are imported from developed countries by Africa often contain prohibited ozone-depleting gasses and GHGs that are the main contributors to climate change. A 2018 research report by the Institute for Governance & Sustainable Development and non-profit CLASP indicated that almost 790,000 AC units imported by Africa were sub-standard and contained the ozone-depleting greenhouse gas referred to as R-22, which is being gradually eliminated through the Montreal Protocol. The report also noted that an additional 820,000 outdated AC units had an R-410A cooling agent which is a potent GHG gas with 2000 times more GWP than carbon dioxide.
“The dumping of outdated and substandard cooling tools, particularly ACs, costs Africans enormously in terms of electricity bills, energy efficiency and the broader impacts on fighting climate change.” Brian Holuj, Programme Management Director at UNEP’s United For Efficiency.
ACs energy demand strains African power grids
The current growth of the AC market is putting pressure on the power grids of developing nations by increasing electricity consumption, which depends on fossil fuels and consequently intensifies GHG emissions. The International Energy Agency estimates that by 2050, global energy demand from ACs will triple, which is akin to adding 10 new AC units every second in the next three decades. It is estimated that high temperatures and urbanization will expand global AC ownership from almost 37% to at least 45% by 2030, putting further pressure on the already overwhelmed power grids. The energy requirements for the current number of ACs produce approximately 4% of global GHG emissions, significantly contributing to climate change.
Final word
The growth of Africa’s AC industry has led to an interplay between economic development and environmental sustainability. Despite the industry’s growth that is providing opportunities for employment, revenue generation, and improved living standards, it is posing challenges with regard to climate change. AC’s dependence on electricity is also straining already overwhelmed power grids and increasing GHG emissions. To address the challenges brought about by the growth in the AC market, African governments are implementing policies such as the Kigali Amendment to the Montreal Protocol that is eliminating the use of high-GWP hydrofluorocarbons in HVAC units. African nations are also promoting the use of solar-powered AC units and providing subsidies for energy-efficient appliances to reduce the pressure on power grids.
