[Scott] Next on "Energy Switch," we'll look at a technology that has changed the world: air conditioning.

- The developing world needs to have access in order for them to be able to have productivity, health, resiliency.

And so how do we provide access to this technology while at the same time, not creating environmental and climate catastrophes?

- Right.

- Is one of the key issues of our lifetime.

- But if periods of time with very high temperatures continues, this electricity growth could be even higher.

- Right.

- And it is something that needs to be taken into account when planning for the electricity grid.

- Right.

- It needs to go in parallel to have a reliable energy supply.

[Scott] Coming up, the benefits, challenges and surprising potential future of air conditioning.

[Narrator] Major funding for this program was provided by Arizona State University.

Shaping global leaders, driving innovation, and transforming the future.

Arizona State, The New American University.

[upbeat music] - I'm Scott Tinker, and I'm an energy scientist.

I work in the field, lead research, speak around the world, write articles, and make films about energy.

This show brings together leading experts on vital topics in energy and climate.

They may have different perspectives, but my goal is to learn, and illuminate, and bring diverging views together towards solutions.

Welcome to the "Energy Switch."

Air conditioning has changed the world, allowing hot regions like the Southern U.S.

to develop, providing comfort, improved health, and increased productivity.

These benefits, as always, come with challenges, increased electricity demand, and the emissions that come from that.

But there are new ideas and technologies that could bring the benefits of cooling to more people, more affordably, with less environmental impact.

My expert guests are Chiara Delmastro is an energy analyst for buildings at the International Energy Agency in Paris.

Formerly, a research fellow at the Politecnico di Torino in her home country of Italy.

Daniel Betts, he's a mechanical engineer, and CEO of Blue Frontier an air conditioning technology company.

The former CEO and CTO of Be Power Tech.

And former president of EnerFuel.

On this episode of "Energy Switch," an eye-opening discussion of air conditioning.

Chiara, Daniel, great to have you with us today.

Looking forward to this topic a lot.

What were some of the impacts of air conditioning on human development, and, you know, what are some of the trends?

- So air conditioning is an enabler of population growth in the equatorial belt and also the great population growth in the south of the United States.

So one of the elements of air conditioning is that it privatized comfort into your own home.

So if you see where the world lives nowadays, it tends to live in large cities that have very high density with economies that are surrounded around service industries with a periphery of industrial capabilities.

And that's all possible due to the advent of air conditioning, both in the industrial, commercial, and now residential space.

- Right, and even in the U.S., even with the threat of warming, migration is all south.

- It's all south.

- I mean, and that's air conditioning.

- Exactly.

- So who has the most AC today?

Which countries in the world have the most AC?

- The United States - Okay.

- Has the most AC and the highest level of penetration of air conditioning, and second is China.

- Oh, really?

- But they have... - I'm surprised by that.

- They have a large number of air conditioning.

- Yeah.

- But they don't have the level of penetration of the market that the United States has.

So their potential-- - Okay.

- Of their market and their growth of their market is much faster.

- If you know, who per capita who has the next, besides the US what country would come next?

- The Middle Eastern countries - Oh, sure.

Yeah.

- That's the second largest so they need air condition in order to survive.

[Scott] Yeah, it's hot.

- And they have inexpensive energy, yeah.

- Right, interesting.

What are those growth trends?

Do you know, Chiara?

- The percentage of households that do own air conditioners doubled from 2000 to now.

So it was really a fast growth and-- - Is that globally or in the--?

- It's really growing everywhere.

Not equally, but everywhere.

- Interesting.

- So as Daniel was saying, we have 90% diffusion in the U.S., also in Japan.

Some countries very high, but also countries with less tradition of air conditioners.

For example, in Europe, they see strong growing trends even in cold climates.

- Right.

- But as I said, is not equally - Okay.

- Distributed in particular in countries very warm and humid.

So for example, if we look at India, the number of families that do own air conditioners is just about 20% of the total.

If we look at Brazil, 30%.

And then is even more impressive when we look at countries like Sub-Saharan African countries where just five percent of the families do have air conditioners.

- Yeah.

- But it's also growing fast in some areas, so we actually do expect the stock of air conditioners to more than double by 2050.

- 2050?

- Yeah, and we expect the growth to occur everywhere, but 90% of it in emerging markets and developing economies because of improved living conditions.

And, also, you know, rising temperatures and increased urbanization, - Okay.

which really makes-- - Okay, so what proportion of the whole world actually has air conditioners, individuals?

Is it 25% or 30% of us?

- It's 40.

- It's 40%.

- Today, yes.

- Yes, we've got a long way to go.

- Yeah.

- Okay.

- And we're touching on a very interesting point, which is that level of staggering growth, in particular in developing nations, puts at risk capacity to generate electricity to power those units.

- Yeah, yeah, sure.

- Which pushes this infrastructure of electricity towards cheap, dirty electricity.

Like for example, you were talking about Sub-Saharan Africa, it's very common for people to power air conditioning units using a generator, right?

- Like a diesel generator.

- So operational generator.

- Like a diesel generator.

- Okay.

- In their home or in their business.

- Yeah.

- Because they cannot rely on the access of electricity from the central utility.

The developing world needs to have access to this technology, air conditioning, in order for them to be able to have productivity, health, resiliency, and so, how do we provide the world with this technology, access to this technology while, at the same time, not creating a, you know, environmental and climate catastrophes is one of the key issues of our lifetime.

- Absolutely.

- And air conditioning actually has another perverse side to it from the relationship to electricity production.

So the moment when we all turn on our air conditioners, that establishes the peak electricity demand on the grid.

In the south Florida region, for example, you're talking about around 30% to 50% of the peak electricity consumption for the grid is associated with air conditioning.

- Here in Texas where we're doing this, that corresponds to 50% to 60% of the peak electricity demand.

- Right.

- So everything you must build in order to provide electricity to a certain city is determined by how much air conditioning you have to put in today and how much is gonna grow into the future.

- Mm, it's not simple, is it?

- It's not simple.

- Yeah, who makes the ACs?

Who are the big countries that manufacture it today?

- China is today producing 80% of small air conditioners.

And there are also some other emerging economies like Thailand, Mexico, or Malaysia, which play a very important role, but then also markets like Europe, Japan, and the U.S.

are key markets.

But to put things into perspective, like China exports $10 billion U.S.

dollars equivalent of units, while for example, Europe or the U.S., they export $4 billion U.S.

dollars of units equivalent each.

And it's quite interesting to look at why one key aspect is the supply chains.

So if we look at China, they also produce not only assemble the units, but they also produce the components.

Rotary compressors, 95% are produced in China.

- I'm not surprised that China is making all this, but I bet our viewers might be.

- Yeah.

- You know, Daniel, in simple terms, how does it work?

It seems magic.

It's hot inside and now it's cold air coming out.

How did that happen?

- So it is magic.

[everyone chuckles] In that the science of air conditioning is astounding.

Modern air conditioning was first developed by Willis Carrier, and funny enough, he wasn't really thinking about keeping people cool, but he was trying to figure out how to remove humidity.

- Oh.

- From a printing press.

In this process called vapor compression cycle, which is the process by which if you expand the gas, it cools down.

And with that cold expanded gas, you can cool down a space and in the process condensed water from that space and dehumidify it.

But on the other side, once you've, you know, collected the heating to that gas, then you can compress that gas again, increase its temperature and throw that heat out into the environment.

[Scott] And when did he start that?

[Daniel] 1904.

- Oh, really?

- Was was when that was first-- - 120 years ago.

- Yeah, now, a really interesting characteristic of this is that when you do that, you are swimming against the current.

So you are pushing heat into heat.

So the hotter it gets outside, the more difficult that is-- - The harder it is.

- Which means that a conventional air conditioning technology today when you need it the most, as the temperatures increase, they consume more electricity and they give you less cooling.

- When I stand under that vent though, and there's air coming out, it feels like there's cool air.

- That's coming from an apparatus called an evaporator, which has cold refrigerant, colder than that air.

- Ah, okay.

- And that's cooling down that air.

The air gets colder, that refrigerant gets warmer and so the heat is transferred there.

- It is magic.

- There's a lot of it that is occurring in the realm of things that we don't see.

- Right.

- And, therefore, it feels like magic, but it's extraordinary science.

- What's a refrigerant?

- It can be a liquid or gas and it has properties to absorb or release heat when it is expanded or compressed.

- Yeah.

- Which is the same that is used in our refrigerator.

So the operating function, the cycle is exactly the same as the one of air conditioners.

- Okay.

- These refrigerants have a, you know, very high global warming potential.

Meaning that if CO2 has a global warming potential of one with AC refrigerants can have thousands of time larger, like 2000s to 4000s.

- If it gets into the atmosphere itself.

- If it gets into the atmosphere.

- Okay.

- And it does-- - But volumetrically, it must be much smaller than CO2 emissions coming out of a coal power plant or something.

- But it has a very big impact.

- But it has- - Because of this higher - Interesting.

- Global warming potential and also a long lifetime, and it doesn't have natural ways of breaking.

So for example, CO2 can be absorbed by oceans or plants, but these refrigerants are stuck there.

So today governments are very concerned and over 160 countries actually ratified what is called the Kigali Amendment of the Montreal Protocol.

- Right.

- Defining timelines to phase out and phase down these refrigerants.

- Really?

- Yeah, there is a lot of R&D for new refrigerants with lower global warming potential.

- Interesting, we learn as we go, don't we?

- Yeah, and there is, you know, trade off between the efficiency because you want to have the same efficiency of the refrigerants- - Right.

- That are currently used.

- Yeah, yeah.

Interesting.

- And you also fight a bit with flammability or toxicity because these refrigerants have different properties than the previous one.

- So don't just go chunk your old fridge in the backyard.

Dig a hole.

- No, think about it.

- Yeah, okay.

- Before doing that.

- Okay, we're talking about electricity a lot.

How much does AC use?

- You're looking at around 10% of building electricity.

- Yeah.

- But is the peak load.

- Right.

- Of electricity consumption.

And it's also the fastest growing portion of the spectrum of electricity consumption in buildings.

- Okay.

- So if you think about it, we have done a really good job of increasing the efficiency and doing basically a technology transformation around almost everything we use, you know, lighting now it's all LEDs increasing the efficiency of appliances.

- Oh, yeah.

- Air conditioning has had efficiency gains, but it's harder and harder to gain greater levels of efficiency.

- Yeah.

- While at the same time deal with all the other problems of like refrigerant- - Interesting.

- Replacement for low global warming, potential refrigerants, etcetera.

- So not as much headroom.

- There's less headroom with that technology.

- How is it expected to grow?

- Under current policies, we do expect this electricity to grow by 1200 terawatt hour by 2045, and this- - In what region?

- Yeah, globally.

- Globally?

1200 terawatt hours?

- Yeah, and this, to put into perspective, would be 50% growth from now and would be the same energy electricity that is consumed today, but in Japan, Australia, and New Zealand combine.

But if periods of time with very high temperatures continues, this electricity growth could be even higher.

- Right.

- And it is something that needs to be taken into account when planning for the electricity grid.

- Right.

- It needs to go in parallel to have a reliable energy supply.

- So what energy sources are gonna meet this giant electricity demand that's coming at us?

- Today, if we look at the power mix is generated, 30% is renewables and- - Solar, wind?

- Yeah, solar wind, bio energies.

- Hydro.

- Hydro, geothermal.

And if we look at nuclear, this adds another 10%.

- For the electricity?

- For the electricity generated.

- Component, okay.

- And what we do see is if demand grow will be faster than what we expect over the short term, of course fossil fuel generation will increase.

- Yeah.

- Because, for example, you will use more of a fleet of generation capacity that you already have.

But over the long term, we really expect renewables to make their ways into power generation.

- So the issue is that you need to put dispatchable electricity infrastructure, that is able to withstand the variations in electricity consumption that occur and separate that from when renewable energy is being generated.

- Yeah.

- And that is the expensive part.

- Yeah.

- You know what's driving that?

Air conditioning.

Air conditioning, air conditioning usage.

The peak electricity consumption of air conditioning is the thing that's driving the market for battery and peaking plants.

So once again, our dreams of that lower cost electricity that comes from clean sources and it's spread out across the entire rate payer base is being thwarted by our need to put air conditioning.

[Scott laughing] And that is why we care about this, right?

- Yeah.

- So innovation is required in that space-- - Sure.

- To keep us on target.

- But it's a lot of the challenges, you know, when you line 'em all up.

I mean, how do we make AC more efficient and less emitting?

What are some of the strategies?

- Today, the average equipment sold in the market is half as efficient as the best available technology.

So we do see that there is a huge gap of efficiency that we could try to close.

But in the past we also see that there has been improvements in the efficiency because of innovation, but also because of certain policies that have been deployed in several countries.

Minimum energy performance standards and labeling.

- Standards and labeling?

- Yeah, standards and labeling.

- Okay.

- So these standards, what do they do?

They help to phase out from markets the less efficient units.

And labeling is a compliment because can help the consumers to have information on the efficiency of the unit.

So one question that is interesting here is like, will these efficiency improvements leads to extra cost?

And initially on the manufacturing side there is an extra cost, but as soon as the market matures, this cost gap decrease.

- Yeah.

- And so the standards at the end doesn't really lead to an increasing cost.

- Yeah, nice.

So a lot of, some good things there.

- And I will add, most people buy air conditioning based on the capital cost regardless if there is efficiency and you end up buying the lowest efficiency unit even if you know that it's gonna cost you more on the operational side.

But with access to financing for these types of systems, you can open up the market for advanced air conditioning products that pay for themselves in a very short period of time.

- Interesting.

- Other thoughts on that?

- Maybe just to add on that.

- Yeah.

- There are some quite interesting business models that, I mean, caught our attention around that.

So some utilities can, for example, loan the equipment to the consumers is called the cooling as a service.

So the utility gives you the very high efficient equipment and then you pay every month.

- Like a rental?

- Yeah, it's like a rental.

Other options for government for instance to buy bulk of equipment.

So with the economy of scales, you can have this high efficient equipment at a lower cost and have the consumers benefit from that.

And then something also that to me is quite important is for the operating cost.

So sometimes especially the most vulnerable or in low income families cannot afford to pay the air conditioners when it's very, very warm, putting people at very high health risk or having to choose between eating or being cool at home.

And in this cases, potentially, some preferential tariffs or special electricity prices during very hot days, especially for this target audience can make the difference.

- You know, we've talked about technology and the evolution of technology.

What are some things that might be able to start to address this combination of challenges with AC?

- So I'm the CEO of one such technology company in the air conditioning space.

- Okay.

- Air conditioning, we talk a lot about temperature and how cold it feels, but remember Willis Carrier invented air conditioning first to deal with humidity - To humidify.

- And it turns out that humidity is a stronger component of your feeling of comfort within a very wide room temperature range than temperature itself.

And so we are playing with technology that uses something called a liquid desiccant, which is a solution that absorbs humidity right out of the air as the driver of an air conditioning process that is many times more efficient than the conventional technology.

- So a liquid desiccant instead of a refrigerant?

- Instead of a refrigerant.

- Traditional refrigerant.

- Okay.

- And it eliminates then the issues associated with the global warming potential of refrigerants, et cetera.

- And desiccant means to dry up.

- That little pouch in your protein shake.

- Yeah, yeah, sure.

- That's a desiccant.

Ours happens to be a liquid.

- Right.

- Which means that you can transport it across heat exchangers and across a building, etcetera.

And so we're looking for characteristics of non-toxicity, non-volatility, non-flammable and non-corrosivity.

So we have eliminated that.

But one thing that this liquid desiccant technology enables is that because the cooling of the air conditioning is being created by the liquid desiccant, you can store the liquid desiccant and recover its desiccating capacity at a different time than when you provide cooling to the building.

- Little battery.

- Making it-- it's a battery, exactly.

- How how long does it store?

Like is it a day or two or can you?

- Our standard unit is doing six to eight hours of energy storage and we have deployed units that can do 12 to 18 hours of energy storage on the worst day of the year.

- On the worst day.

I could see that being good at scale too and like in a data center.

- The process by which a liquid desiccant is regenerated or recharged is by heating it up.

- Thermal, yeah.

- So if you have available waste heat, you can now create air conditioning and store it in a box that can go in a distributed way across a city like we were doing with heating.

Or you can use it locally to eliminate or dramatically reduce the energy consumption of that data center.

- Right, I hadn't heard of this, but that's a nice-- I like that a lot.

- Yeah, absolutely.

And liquid desiccant systems have another advantage because of that heat driven regeneration process.

The hotter it is outside, the less electricity you need to run that unit and the more cooling it gives you.

So it's exactly the opposite.

- Yeah.

- Of a conventional unit.

So that moment when you need it the most-- - It's there.

- It gives you the most for less.

- 'Cause the heat' there.

- Because the heat's there.

- Yeah, interesting.

- Yeah, maybe one point on this, but for me it's very important to raise awareness of these technologies that are alternative to the most traditional air conditioners.

There are many of the sequences one, but there are also others and there no consumers knows about that.

Also, when the designer of the buildings come, easy solution, you put the air conditioners, but it is very good to have more training and available information around all the possible alternatives.

And there are several not even expensive solutions that can enable that.

- Insulations and from the windows - Yeah, from shading, special materials that reflect the solar radiation.

- Right.

- Maybe the green roofs.

- Right.

- Cross ventilation.

Natural, natural ventilation.

So this is really something that would be great if designers and the policies they could prioritize these solutions, and then after you've reached your potential of the passive solutions, you put your active solutions being the alternative to air conditioners or very high efficient air conditioners.

- Right, ancient people had some of this figured out with thick adobe walls and other things.

- Yeah, traditional architecture.

- Yeah.

- Isn't it interesting?

Like every time we go to a beautiful city out there and we go as a tourist, we tend to go to the ancient side of the city-- - Right.

- The older side of the city.

That's because the architecture tends to be more pleasing and less- - And it's nice and cool.

- And it's nicer and cooler.

[Scott laughs] - Well, incredible amount of information and knowledge you guys have shared and experiences.

I think people will be fascinated by this.

Chiara, it was wonderful to visit with you.

- Yeah, likewise.

- I enjoyed it.

Daniel, thank you.

- It's a great pleasure.

- Scott Tinker, "Energy Switch."

Forty percent of the world has air conditioning, but it's unevenly distributed.

Ninety percent of the U.S., Japan, and the Middle East have it, but only five percent of Sub-Saharan Africa.

Increased access to AC and its health and productivity benefits remains a challenge, but is rapidly growing.

Chiara said the IEA predicts AC penetration will double in the next 25 years, but with it a huge increase in electricity demand.

At peak times, when the grid is already stressed with a corresponding increase in CO2 emissions, today's refrigerants have an even greater warming potential.

So efforts are underway to replace them and to develop new AC technologies like Daniel's that use less power and could even store energy to help moderate peak electricity demand.

Utilities are experimenting with financial tools to make AC more affordable for more customers while cities look to passive cooling techniques to moderate the need for air conditioning.

[upbeat music] ♪ ♪ ♪ ♪ [Narrator] Major funding provided by Arizona State University.

Home to the Julie Ann Wrigley Global Futures Laboratory, addressing critical challenges toward a future in which all living things thrive.

Arizona State, The New American University.