Many countries in the Asia-Pacific region have committed to achieving net-zero greenhouse gas emissions by the middle of the century. To meet these ambitious goals, national governments are revising their energy and climate strategies. Currently, cooling accounts for roughly 10% of global GHG emissions. However, with rising temperatures combined with population and economic growth in some of the world’s hottest areas, the demand for cooling is projected to triple by 2050 if no measures are implemented. This growing challenge has led to cooling sometimes being referred to as the “elephant in the waiting room,” highlighting its critical role in the energy transition and as an emerging leading contributor to global warming. District Cooling (DC) systems provide an efficient solution to address this surging demand and are poised to play a significant part in advancing the energy transition across the Asia-Pacific region.
By Mikael Jakobsson, President, and Peter Lundberg, Executive Director, Asia Pacific Urban Energy Association (APUEA)
Published in Hot Cool, edition no. 8/2024 | ISSN 0904 9681 |
Cooling demand drivers
The key factors driving the rising demand for cooling include a warming climate, greater use of cooling applications, and the urban heat island effect. Together, these factors are leading to higher energy consumption for cooling and associated environmental impacts, including those from refrigerants. Within the next decade or two, the demand for cooling is projected to surpass that for heating in many parts of the world—a significant shift.
A Complex Challenge Beyond Rising Temperatures
While the Paris Agreement strives to limit global temperature rise to 1.5°C above pre-industrial levels, current trends suggest we are on track for an increase exceeding 3°C. It’s also important to note that the growing use of cooling systems is not solely a response to a warming climate but is also driven by urbanization, comfort requirements, and economic growth. Additionally, the urban heat island effect, common in densely built cities with heat-absorbing surfaces and minimal vegetation, adds to this demand. The heat released from air conditioner condensers and cooling towers can further raise urban temperatures by several degrees Celsius, making the challenge even greater.
Figure 1: AC utilization for selected economies in Southeast Asia (source: APUEA)
District Cooling – what is it?
A DC system produces chilled water in a centralized chiller plant and distributes it to consumers for comfort or process cooling. The definition of DC is not unified and remains a topic of debate. In interviews with academics and professionals across the Asia-Pacific region, definitions were linked to one or more of the following characteristics:
- Centralized cooling serving multiple buildings
- Centralized cooling serving several independent (legal) entities
- Centralized cooling for a neighborhood or a larger area
- Citywide cooling systems, similar to traditional district heating
At APUEA, DC is often defined as: “A centralized cooling system for multiple buildings where economies of scale are achieved compared to individual cooling technologies.”
District Cooling benefits
DC systems are well-suited for cities and urban areas with high cooling demands, which includes many cities in the Asia Pacific. They are also scalable and offer numerous advantages over conventional stand-alone cooling systems, including:
- Up to 50% lower energy consumption
- Up to 30% reduced installed cooling capacity
- Integration of renewable electricity from solar and wind sources
- Potential to reduce peak loads through Thermal Energy Storage (TES) systems
- Reduction of refrigerant volume and leakage
- Mitigation of the Urban Heat Island Effect
- High availability and long lifespan
- Competitive cooling tariffs and lower operation and maintenance (O&M) costs
- Vast market potential in the Asia-Pacific region, particularly for mixed-use developments, central business districts, transit-oriented districts, industrial parks, airports, hospitals, universities, hotels, and data centers.
Figure 2: Urban Heat Island profile (source: Urban Land Institute)
District Cooling developments across the Asia Pacific
The history of DC in the Asia Pacific goes back to the 1970s when the first DC system in the Asia Pacific was developed in the Senri Chuo Area in Osaka (Japan) in conjunction with the Osaka Expo. The system is a combined District Heating and District Cooling System (DHCS), as 150 systems are across Japan.
China: Early Adoption and Integration with Tri-Generation Systems
In China, DC was recognized more widely through the Guangzhou University DC system back in 2004, even though DC schemes had been developed earlier. Another prominent DC system in China is at the Shanghai Pudong International Airport, established in 2001. Many of the more than 150 DC systems in China are today part of DHCS or CCHP (combined cooling, heating, and power – also known as “tri-generation”) schemes.
Southeast Asia: Singapore’s Leadership and Regional Growth
In Southeast Asia, and arguably all of Asia, the Marina Bay District Cooling system in Singapore stands out as the most well-known project of its kind. Beyond this iconic system, Singapore has five (5) additional DC systems in operation and three (3) more under development, making it the leader in DC penetration across the Asia-Pacific region. Malaysia leads in the total number of projects in the region, with over 30 DC systems implemented nationwide. Meanwhile, Thailand is the fastest-growing DC market in Southeast Asia, with eight (8) systems in operation and five (5) more under development.
Emerging DC Markets in the Philippines, Myanmar, Vietnam, and Indonesia
The Philippines has five (5) active DC systems, while Myanmar has developed one system with the Yangon CBD DC project. Vietnam is another economy where DC is expected to see significant growth in the coming decade, driven by urbanization and the push for energy-efficient solutions. In Indonesia, DC has recently started to get recognized with the landmark Smart City project Nusantara Capital City. Bali International Airport is the only DC project in operation, and DC is expected to grow in the coming decade.
India: The Fastest-Growing DC Market in Asia-Pacific
India has eight (8) DC projects in operation and six (6) under development. Looking at the Asia-Pacific region, India is the fastest-growing DC market, with the potential to develop schemes that could total an installed capacity of over 12,000,000 TR in the coming decades. DC is already recognized in India’s Cooling Action Plan (ICAP), and domestic organizations such as the Alliance for an Energy Efficient Economy (AEEE), Energy Efficiency Services Limited (EESL), and the Bureau of Energy Efficiency (BEE) under the Ministry of Power are actively working to advance DC projects across the country. Additionally, UNEP’s Cool Coalition initiative is supporting the development of DC in India.
DC across the Asia Pacific in summary:
- China is the largest DC market
- India is the market with the largest growth potential
- Singapore is the market with the highest DC penetration
- Malaysia is the largest market in terms of DC projects in operation in Southeast Asia
- Thailand is the most rapidly growing DC market at present
- Vietnam and Indonesia are emerging DC markets
In general, urbanization and economic development rates, combined with active DC initiatives, provide a good indication of where DC schemes are likely to emerge. It is important to recognize that a DC market does not grow organically but requires public facilitation and proactive development efforts.
Note from the Authors:
This article provides a brief overview of DC markets in the Asia-Pacific region. A more in-depth analysis and detailed insights into the DC markets in the Asia Pacific region is available for APUEA Members.
For further information please contact: Mikael Jakobsson, mjakobsson@apuea.org
“Asia Pacific District Cooling Outlook” was published in Hot Cool, edition no. 8/2024. You can download the article here:
