According to the International Finance Corporation (IFC)/United Nations Environment Programme (UNEP) report Cooler Finance: Mobilizing Investment for the Developing World's Sustainable Cooling Needs, sustainable cooling represents a $600 billion annual market. This opportunity remains largely untapped, in part because cooling is rarely tracked as a distinct investment category. In practice, cooling is embedded within broader green buildings, energy efficiency or energy lending portfolios, limiting visibility and constraining scale. The issue is particularly acute in residential cooling, which accounts for over 50% of market potential, yet lacks dedicated financing mechanisms for efficient appliances.
Unlocking this segment requires reframing cooling as an identifiable, financeable asset class. This includes developing taxonomies, standards and financial products that allow cooling investments to be tracked, aggregated, and scaled within climate-aligned finance.
In India, IFC has begun to address this gap through the development of a use-of-proceeds taxonomy that enables cooling and other energy-efficient consumer appliances to be explicitly identified and financed. This approach has already contributed to tangible investment outcomes, including $240 million earmarked for energy-efficient consumer goods, and demonstrates how targeted financial structuring can unlock demand at scale.
At the same time, UNEP’s United for Efficiency (U4E) programme provides the technical backbone for this transition through Model Regulations Guidelines covering key product groups such as refrigerators, fans and off-grid cooling. By defining performance thresholds based on energy efficiency and low-GWP refrigerants, these guidelines support governments in setting Minimum Energy Performance Standards and provide a basis for identifying eligible products within financing frameworks.
This Cool Talk will examine how cooling can be positioned as a distinct and scalable investment category, drawing on the India experience to explore practical tools for structuring consumer appliance finance, aligning financial and regulatory frameworks, and replicating these approaches across emerging markets.
