The government is about to launch an excellent scheme that will provide you with incentives and rebates in order to upgrade your outdated air conditioner to a new 5-Star model. The Ministry of Power and the Bureau of Energy Efficiency, or BEE, are now reviewing this plan. You can reduce your yearly electricity bill by up to Rs 6300 by doing this.

AC Scheme: The central government will soon launch a massive financial incentive scheme that will provide you with a refund to upgrade your old air conditioner (AC) to a new, five-star model in an effort to curb rising power use and encourage energy-efficient technologies. The Ministry of Power and the Bureau of Energy Efficiency, or BEE, are presently assessing this initiative, which is expected to have a significant influence on home doing and urban electricity use, according to a report published by the Business Standard. Tell us all about this special plan in detail.

Sales of air conditioners are always increasing.

The nation’s yearly sales of air conditioners grew from 8.4 million units in 2021–2022 to over 11 million units in 2023–2024. But this quick expansion has a price tag. About one-fourth of the 500 terawatt-hours (TWh) of power used by buildings last year was for cooling, according to government data.

How will this scheme work?

Buyback via recycler: Consumers who donate their old air conditioner to a recycler receive a certificate that may be used to receive a discount on a new, five-star air conditioner.

Manufacturer discount: In exchange for old models, AC manufacturers may provide immediate savings on the purchase of new versions.

Electricity bill discount: By working with power distribution companies, the government can provide electricity bill discounts to homes that switch to more energy-efficient equipment.

A part of a long-term plan

With the India Cooling Action Plan (ICAP), which seeks to cut cooling energy demand by 40% by 2038, this program is also connected to India’s long-term plan. Thus, switching to energy-efficient appliances is crucial for both climate action and energy security.