Advancing District Cooling as Essential Urban Infrastructure in India

As India’s cities grapple with rising temperatures and accelerating cooling demand, the challenge is how to deliver cooling efficiently, affordably, and at scale. Cooling demand is already placing growing pressure on electricity systems, driving peak loads, infrastructure costs, and emissions. Against this backdrop, District Cooling Systems (DCS) are emerging as a strategic solution that can support urban resilience while aligning with national energy efficiency and decarbonization goals.

On 16 December 2025, policymakers, utilities, financiers, developers, and technical experts convened in New Delhi for the District Cooling Strategy and Stakeholder Dialogue to accelerate the mainstreaming of district cooling in India. The workshop, hosted by Bureau of Energy Efficiency, International Climate Initiative, GIZ, UNEP Cool Coalition and Alliance for an Energy Efficient Economy, focused on policy and regulatory architecture, district cooling India hub and institutional mechanisms for scaling demand. 

In the welcome address, Dr Satish Kumar, President and ED, AEEE highlighted the urgency of addressing cooling demand as a systemic challenge rather than a building-level concern, and the need for district cooling in India. Mr. Arijit Sengupta, Director, BEE, stressed on the regulatory work on district cooling, the creation of enabling institutional mechanisms, and the ambition to support multiple DCS pilots in the near term. Mr. Volker Klima, Head of A&FD, German Embassy and Piyush Sharma, Deputy head, Energy efficiency programs, GIZ reflected on progress under the EE-Cool programme..

A key milestone of the event was the launch of the District Cooling Roadmap drafted by AEEE and GIZ and the Virtual District Cooling Hub – developed by UNEP Copenhagen Climate Centre with Bureau of Energy Efficiency and Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) as part of the EE-Cool project funded by International Climate Initiative (IKI). Together, the roadmap and the hub aim to guide stakeholders from early planning to project implementation. Dr. Satish Kumar outlined the findings of the District Cooling Roadmap, while Mr. Benjamin Hickman, Programme Manager at UNEP India, presented the key activities of the district cooling hub and highlighted its role in advancing District Cooling in India.

The first panel focused on the policy and regulatory frameworks required to treat district cooling as a core component of urban infrastructure.

Panellists discussed the need for regulatory clarity, particularly around electricity and water tariffs, which currently create uncertainty for DCS projects. Speakers emphasised that tariffs for district cooling should be competitive with conventional air conditioning to ensure a level playing field. The absence of technical guidelines and consumer protection mechanisms, especially in business-to-consumer models, was identified as a key barrier to market confidence.

The second panel examined the project development lifecycle for district cooling, from early site identification to financing and implementation, and explored how the National District Cooling Hub can support this process.

Speakers stressed that DCS projects are often delayed by fragmented processes, high transaction costs, and limited familiarity among planners and consultants. Standardisation emerged as a central theme, covering feasibility studies, demand assessment, technical design, and contractual structures to shorten development timelines and reduce risk.

The importance of integrating cooling considerations at the earliest stages of urban and building design was repeatedly emphasised. Participants noted that early government engagement and public investment can play a catalytic role, mobilising significantly larger volumes of private capital, as demonstrated by international experience. The role of the National Hub was discussed as one of coordination and enablement: building capacity, disseminating lessons across projects, strengthening supply chains, and shifting decision-making from upfront cost comparisons to long-term return on investment.

The final panel explored whether and how nodal agencies or aggregators could help create anchor demand and de-risk early DCS projects. Discussions explored aggregator approaches drawn from other sectors, while cautioning that any such model must remain flexible enough to account for local conditions, usage patterns, and climatic variability.

Speakers highlighted the potential role of public entities in aggregating demand within government buildings to create reliable anchor loads for early projects, as well as alternative approaches such as aggregating procurement of key components to build market confidence and drive down costs.

Development finance institutions and risk-sharing instruments were identified as critical enablers to de-risk projects and unlock private capital at scale.

Across all discussions, a consistent message emerged: scaling district cooling in India will require coordinated action across policy, institutions, markets, and capacity building. With growing interest from utilities, state governments, and urban authorities, the foundations are being laid for district cooling to move from isolated pilots to a core component of sustainable urban development.

The Dialogue marked an important step in aligning stakeholders around a shared understanding of the challenges and the solutions needed to unlock district cooling as a cornerstone of India’s low-carbon, climate-resilient cooling future.