India Decarbonization HVAC Market Size - By Product type (Heating equipment, ventilation equipment, Air conditioning equipment), By Operation (Direct, indirect), By Capacity, By Energy source, By End-use, By Distribution Channel & Forecast, 2024 - 2032

India Decarbonization HVAC Market Size

India Decarbonization HVAC Market was valued at around USD 1.71 billion in 2023 and is estimated to register a CAGR of around 18.8% between 2024 & 2032. India's demand for decarbonized HVAC systems is rising, driven by a focus on environmental sustainability and energy efficiency. With global climate concerns increasing, reducing carbon emissions, especially in industrial and commercial sectors, is crucial. India is adopting energy-efficient HVAC solutions with sustainable technologies. Government initiatives like the Energy Conservation Building Code (ECBC) mandate superior energy performance in buildings, boosting the adoption of decarbonized HVAC systems.
 

Strong government support propels the growth of decarbonized HVAC systems in India. Policies promoting energy efficiency and sustainability in building infrastructure are in place. The ECBC sets higher efficiency standards for HVAC systems. Financial incentives, such as subsidies and tax rebates, encourage investment in greener technologies.
 

Additionally technological advancements are reshaping the future of HVAC systems, greatly optimizing their operations. AI-driven automation for heating and cooling stands at the forefront of this revolution, offering improved efficiency and performance.
 

Energy shortages and crises significantly impact the HVAC market in India. Rising electricity and fuel prices increase operational costs for HVAC systems. Irregular power supply and frequent load shedding during energy crises compromise the reliability and performance of these systems. This instability disrupts HVAC operations, causing discomfort and inefficiencies in both commercial and residential sectors. Higher energy expenses often lead to financial constraints, delaying necessary maintenance and upgrades of HVAC infrastructure. Deferred maintenance reduces system efficiency, increases breakdown risks, and disrupts overall operations. Integration remains a significant challenge in India's HVAC sector.
 

Many HVAC systems are installed but Building Management Systems (BMS) often lag behind. India’s HVAC energy efficiency is hindered by its three distinct seasons, each requiring specific adjustments.
 

India Decarbonization HVAC Market Trends

The Indian government, through initiatives like the National Action Plan on Climate Change (NAPCC) and the National Mission on Energy Efficiency (NMEE), is spearheading efforts to enhance energy performance. The Perform, Achieve, and Trade (PAT) scheme, a part of NAPCC, mandates energy consumption cuts for major industries and fosters a market for energy-saving certificates. Complementing this, the Bureau of Energy Efficiency's Standards & Labeling Program assigns star ratings to HVAC systems, guiding consumers towards energy-efficient choices. These policies collectively bolster the adoption of advanced HVAC technologies, in line with India's sustainability targets.
 

India Decarbonization HVAC Market Analysis

Based on the product type, air conditioning equipment accounted for revenue of around USD 953.9 million in 2023 and is expected to reach USD 4.34 billion by 2032. Air conditioning equipment plays a crucial role in India's decarbonization efforts within the HVAC market due to its significant impact on energy consumption and carbon emissions. Enhancing the efficiency of air conditioning systems presents a substantial opportunity to reduce overall carbon footprints. Technological advancements, such as variable refrigerant flow (VRF) systems and inverter-driven compressors, have markedly improved the energy efficiency of these systems.
 

Additionally, regulatory pressures from the Bureau of Energy Efficiency (BEE) standards and growing consumer demand for sustainable solutions are driving the market towards more eco-friendly options. The integration of air conditioning systems with renewable energy sources, supported by government incentives, further facilitates the transition to low-carbon technologies. Consequently, air conditioning equipment remains a pivotal component in India's decarbonization mission.
 

Based on operation, the direct method segment dominated a market share of around 60% in 2023 and is anticipated to grow at a CAGR of 19.2% through 2032. Direct operations are preferred in decarbonization efforts because they provide immediate and tangible reductions in carbon emissions by directly implementing low-carbon technologies. For instance, the use of heat pumps and advanced HVAC systems immediately lowers emissions by reducing reliance on fossil fuels. Integrating renewable energy sources, such as solar or geothermal power, further supports this goal by powering HVAC systems with clean energy.
 

Additionally, adopting natural refrigerants like CO2 or ammonia, which have a lower global warming potential compared to traditional refrigerants, directly cuts down the carbon footprint of cooling systems. This direct approach ensures that emissions are reduced efficiently and promptly, aligning with rapid decarbonization goals further growing the HVAC market.
 

India decarbonization HVAC market size crossed USD 1.71 billion in 2023 and is likely to exceed USD 7.72 billion by 2032. The country's commitment to reducing greenhouse gas emissions and transitioning to cleaner energy sources drives this growth. The Indian government's ambitious targets under its Nationally Determined Contributions (NDCs) and the Paris Agreement push for sustainable, energy-efficient HVAC technologies. Rapid urbanization and expanding infrastructure also increase the demand for advanced HVAC solutions that enhance energy efficiency and comply with environmental regulations.
 

Rising awareness among consumers and businesses about green technologies accelerates the adoption of low-carbon HVAC systems. Technological advancements, such as efficient refrigerants and smart HVAC systems, further support the market. Government incentives, subsidies, and favourable policies for energy-efficient solutions also fuel growth. These factors collectively drive the expansion of India's decarbonization HVAC market, contributing to a sustainable and energy-efficient future.
 

Region-Level Analysis

North zone: Extreme temperature fluctuations and high pollution levels in North India, particularly in cities such as Delhi, Punjab, Haryana, and Uttar Pradesh, are key drivers shaping the region's HVAC market. These areas endure sweltering summers and chilly winters, underscoring the demand for energy-efficient HVAC systems capable of managing such diverse climates. The rapid pace of urbanization and industrial expansion in North India only amplifies the necessity for advanced HVAC technologies. Moreover, heightened pollution, notably in major urban hubs like Delhi, is fueling the demand for cutting-edge filtration and ventilation solutions.
 

West zone: In West India, the HVAC market is moving towards decarbonization due to high industrial activity and commercial real estate growth. Cities like Mumbai, Pune, Ahmedabad, and Surat are key economic centers focusing on sustainability. The warm climate in West India increases the need for energy-efficient cooling solutions. New buildings aim for green certifications and sustainability goals. Strict environmental regulations and government incentives support the use of HVAC systems that reduce carbon emissions. The rapid growth in commercial and residential areas in cities like Mumbai and Pune boosts the demand for advanced, eco-friendly HVA systems that meet the region's sustainability goals.
 

India Decarbonization HVAC Market Share

The India decarbonization HVAC industry is fragmented, with several regional companies operating on a global scale. In 2023, the Daikin corporation ltd, Carrier Group, Voltas group, blue star limited, and Johnson controls plc led the market. To expand their customer base, broaden their product offerings, and establish a stronger foothold in the market, these corporations strategically deploy mergers, acquisitions, partnerships, and facility expansions. They also leverage their vast distribution networks and resources to investigate new markets.
 

India Decarbonization HVAC Market Companies

Major players operating in the India decarbonization HVAC industry are:

• Blue Star Limited
• Bosch Limited
• Carrier group
• Daikin industries ltd
• Danfoss Industries Pvt. Ltd
• Emerson Climate Technologies (India) Pvt. Ltd
• Johnson Controls Plc
• Kruger Ventilation Industries
• LG Electronics Pvt. Ltd
• Midea Group Co., Ltd.
• Mitsubishi Electric Group
• Samsung Electronics Co., Ltd
• Trane Technologies
• Voltas
• Whirlpool of India Ltd
   

India Decarbonization HVAC Industry News

• In July 2024, Samsung India unveiled its latest offering: the Wind Free Air Conditioners, a new addition to its Chilled Water Indoor lineup. This innovative range showcases the Wind-Free™ and 360o Bladeless Technology, specifically tailored for Chilled Water-based Cassette Units. The design prioritizes a superior cooling experience, eliminating the discomfort often associated with direct cold drafts.
  
   
• In April 2024, Voltas unveiled its latest commercial AC line-up tailored for commercial spaces. The highlight of this launch is the Inverter Scroll Chillers, boasting a cooling capacity spanning 12-72 TR and utilizing eco-friendly refrigerants. These chillers are IoT-enabled, compatible with BMS, operate quietly, and offer user-friendly controls via a mobile app. Voltas' strategic intent with these Inverter Scroll Chillers is to bolster its commitment to promoting energy-efficient technology adoption in commercial settings.
  
   
• In March 2024, Whirlpool Corporation unveiled its latest AC range for 2024, featuring the innovative 6th Sense IntelliCool Technology. This cutting-edge technology promises a seamless cooling experience, all at the touch of a button. The 6th Sense IntelliCool system is designed to anticipate and cater to consumers' needs; by harnessing smart sensors and advanced algorithms, this technology can detect environmental and weather changes, allowing it to dynamically adjust temperature, humidity, airflow, and air direction.
   

This India decarbonization HVAC market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue (USD Million) and volume (Thousand Units) from 2021 to 2032, for the following segments:

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Market, By Product Type

• Heating Equipment
  • Furnaces
  • Boiler
    • Electrical Boiler
    • Non Electrical Boiler
  • Heat Pumps
  • Others
• Ventilation Equipment
  • Air handlers
  • Ductwork
  • Fans
• Air conditioning equipment
  • Chillers
    • Conduction
    • Convection
  • Cooling towers
• Others

Market, By Operation

• Direct Method
• Indirect Method

Market, By Capacity

• Upto 8 tons
•  8-15 tons
• 15-25 tons
• Above 25 tons

Market, By Energy sources

• Solar Energy
• Wind Energy
• Hydro Energy
• Biofuels
• Others

Market, By End Use

• Industrial
  •  Food & Beverages
  • Pharmaceutical
  • Oil & Gas
  • Chemical Processing
  • Electronics & Semiconductors
  • Others
• Commercial
  • Data Center
  • Retailing
  • Corporate
  •  Education Institutions
  • Hospitality
  • Healthcare
  • Others

Market, By Distribution Channel

• Direct
• Indirect