Inverter AC sales swell, ahead of new energy efficiency rules

The share of energy-efficient inverter air conditioners touched 31 per cent during the first six months of 2017, a new high since their introduction in the country.

While the sale of ACs fitted with smart compressors have been on a rise for some time, the recent surge is attributed to manufacturers' growing interest in the segment. Thanks to the new energy-efficiency norms, to take effect from January next year.

LG is one company to have completely moved towards inverter split ACs. Others are preparing to align with the change. B Thiagarajan, joint managing director at Blue Star, says: "Realignment of manufacturing lines is not an issue; technologically, we are fully prepared."

LG stopped producing split ACs not fitted with inverter technology from January 2017, a year ahead of the deadline. "Moving to inverter technology at one go was a more preferred idea for us, as it offers economies of scale. Also, the positioning of our products is sharper, with a single key proposition to lure consumers," said Vijay Babu, head of air conditioning at LG India. During the January-June period, it had a 27 per cent rise in the sale of inverter ACs.

According to Ajay Seth, head of channel operations at Panasonic India: "We will be expanding our product portfolio in the inverter AC segment and have witnessed five per cent growth compared to last year."

The new norms on energy efficiency for ACs, issued by the Bureau of Energy Efficiency, has led to fast adoption. By the rules, mandatory from next year, inverter ACs and those with smart compressors would have to be promoted. ACs continue to be one of the most energy consuming of home appliances, taking at least five times more electricity than a refrigerator. The initiative is part of the steps taken for meeting the Paris climate change agreement.

Globally, use of inverter ACs is on a rise. Unlike a normal AC, inverter ACs work primarily on smart compressors that reduce wastage of power due to thermostat cutoffs. In Japan, all ACs work on inverter technology; in China, 60 per cent. In India, the share of inverter ACs was four per cent in early 2015, rising to 12 per cent during January-June 2016. The size of the AC market, however, is still quite low at 4.5 million units a year, compared to a little over 40 million in the largest market, China.