India is projected to become the world's largest consumer of space cooling with cooling likely to contribute to 45% of the country’s peak electricity demand by 2050. Driven by key growth sectors including commercial, retail, data centres, cold-chain and agriculture, Cooling as a Service (CaaS) is gaining traction in India as a pay-per-use servitization business model. India Cooling Action Plan (ICAP) advocates for innovative business models that can speed adoption of high-efficiency cooling systems using low-Global Warming Potential refrigerants in an affordable manner, bring in Not-In-Kind technologies and enhance maintenance to ensure efficiency, reduce refrigerant leakage and manage water use.
The model entails third party providers making upfront capital investment, owning and maintaining efficient cooling equipment on behalf of customers who in turn make fixed and variable monthly payments for usage whilst the CaaS provider also guarantees higher reliability, performance standards, energy efficiency and lower costs for cooling. In a country like India, CaaS can eventually serve as an important bridge toward wider adoption of utility-scale District Cooling systems.
International private sector companies like Keppel, and Daikin have taken the lead to bring investments and know-how to execute CaaS projects in the country and several large domestic players like Tata Power, Adani Cooling, Smart Joules and EESL have now also entered the CaaS sector. EESL, one of the implementing partners of the Asis Low Carbon Building Transition (ALCBT) Project has a mandate to undertake 60 cooling projects in India. Despite the new emerging market for CaaS, the sector has several barriers preventing CaaS from scaling to capture its full market potential.
