Brad DeLong's Semi-Daily Journal (2004)

Seems to me that the upward trend of oil/energy prices might put a damper on the number of air conditioners that can be deployed. (cooling being approximately 7 times the cost of heating). And Peking summers are notoriously hot. China will just have to export more stuff to the US to pay for it. Can we afford it?

I've always thought the next Bond movie should be another China one. Some leader is mobilizing people in the backwoods of China to overthrow the communists and wants to set up a democracy in their place. Because of our huge trade deficit with China, MI-6 sends Bond to stop this dangerous man. So Bond has to fight his way to the jungle fortress and discovers that this rebel is really, I don't know, Lenin. To show that all revolutionaries are really evil.

The bond girl could be Trotsky reincarnated as a Victoria's Secret model.

I have no idea what sort of air conditioners they use in Peking, but in the US the conventional electric window-type conditioners tend to at least as efficient (based on COP) as the conventional electric central type. Presumably because you don't have to move the air/heat as far.

If you could use ground-source heat pumps, that would give central cooling an edge, but that sounds fairly unlikely in Peking...

I would also like to know what is meant by "cooling being approximately 7 times the cost of heating". I would think that would depend overwhelmingly on the climate, electric rates, heating technology, etc. I can assure you that in central Massachusetts, cooling is way cheaper than heating.

'Standiing up'?
Show your elders some respect kid

Chinese air conditioners are why you need to be long on energy.

China, India and Indonesia are all using more and more energy, every year for air conditioners and cars.

This process will continue, and once people have paid for the things, they use them, regardless of the marginal costs of use.

Oil prices of $30/bbl are a thing of the past, and if consumption keeps going up by 3+% year in year out, then the bottom each each trough in oil prices will be higher than the last.

The oil story isnt a supply story ... it's a demand story.

Ian Whitchurch

Retrofits using window units is the least capital cost, and if the cooling is confined to a single area, least operating cost. Even increasing power cable size to match demand is not a major problem. Follow on maintenance is a simple remove/replace, Overall the cheapest solution. Except...can you imagine the decibel levels in and around densely sited 8 story buildings and cities with millions of window A/Cs? Yikes!

This phenomenon isn't confined to older buildings... it's just that the newer ones are often designed with alcoves and boxes that disguise the units or tuck them out of the way. The only buildings that predominantly have central-conditioning are larger Western office buildings.

Incidentally, people use the same units for heating too. That surprised me.

Donmaj is right. A Maytag 12000 BTU, 10 EER (energy efficiency ratio) out of window air conditioner is $238 at Home Depot. A central air 60000 BTU, 10 SEER (seasonal energy efficiency ratio, EER at 85F outdoor modified by some cycling numbers) is over $1200 alone, plus the cost of ducting and labor. Ducting requires skilled labor and specialty tools. It costs more to install in pre-existing construction that wasn't designed with ducts in mind.

10 EER means you can, under ideal conditions, transfer 10x as much heat as you put in the air conditioner.

Since an air conditioner is a one-way heat pump, you can turn it around to get heat transfer the other way. It becomes a heater that, under most conditions, is more efficient that an electric resistance heater. Efficiency depends on the operating temperatures. A statement about "cooling being approximately 7 times the cost of heating" is meaningless without the operating temperatures, equipment, cost of fuel, and thermodynamic design of the building, which must consider heat losses (e.g. drafts, insulation) and gains (e.g. sunlight).

The cheapest device, in both operating costs and capital investment, to cool is sometimes an evaporative cooler, or "swamp cooler", which just evaporates water over a fan. It only cools a moderate amount, causes high indoor humidity, and works poorly with high outdoor humidity. Some swamp coolers are small out-of-window installable units.

Ian Whitchurch says that the price of energy is a reason to buy oil. Chinese use of oil for power production is a short term phenomenum because coal based electricity is so much cheaper. Only the Chinese government's shut in of the illegal, unlicensed, and unauthorised Chinese coal mines has caused coal production in China to decrease, or at least not increase as fast as demand.
Oil is for truck, automobile, aircraft, and ship transportation fuels, residential heating, and some plastics. It is not for making electrical energy except on islands that aren't large enough for coal based power plants, or that don't have peaking power gas, hydro, or solar.

My fantasy when I'm older and (if I ever am) richer is to build an underground house, like a hobbit hole, but with several stories, to keep cool. I'd be able to have a garden or patio or something on top, on the surface. I even have mental blueprints of my dream house. It'd be rather costly, though.

I think "seven times as expensive" might mean, "it costs seven times as much to cool a given quantity of air by a degree than it does to heat the same quantity of air by a degree."

In a way, I think that air-conditioning is an ill to our society. Not only does it suck up power, but it directly contributes to the problem it amelliorates by heating things up outside. Now, I've tried to convince people that what we need to do is construct brownian ratchet systems, in which random motion of air particles turns ratcheted paddle-wheels that would turn only one direction, with tiny ratchets to prevent them from going the other way, that would suck energy out of the air and turn it into electrical power. The physicists just laugh at me and tell me about the second law of thermodynamics. Pfeh: mere prejudice.

Air conditioning took off in the US in the 1960s. I lived in a six floor apartment building in NYC, and we didn't have any big noise problems, except for condensation drip in which your upstairs neighbor's unit dripped on yours. The co-op required people to get side drip trays, but newer units had side discharge as a standard feature.

I remember that they actually had to rewire the building to provide sufficient power and grounding. Most of our plugs were two prong, and the entire apartment was rated at maybe 30 or 40 amps. The new wall outlets each had a 10 amp breaker so you could run an air conditioner, but you had to pay a fee for each unit. I think there was a $10 or $20 a year power surcharge for each air conditioner you had sticking out of your windows. Our coop with 17 buildings purchased electricity on a peak half hour basis, and we did not have individual meters.

Wow, I'm sounding like an old timer explaining how radios cost more in NYC because half of Manhattan was still DC in the 1930s. Even though radios are DC internally I think they had to convert it to AC first and then back to low voltage DC. DC was the standard back in 1883 when Edison lit up Pearl Street.

Of course, Chinese cities are a lot like NYC in that most people live in apartments, so they are MUCH more energy efficient than suburbs. Most apartments only have one or two outside walls, so less heat gets in to be pumped out. Apartments are also generally smaller, so there is less space to heat and cool. Commutes are shorter, so even if they take just as long, and drive you just as crazy, they use less energy. If I remember correctly, people in NYC use about 1/3 the energy of ordinary Americans. So, if China urbanizes and everyone moves into apartments, they might have 1.2 billion people burning the same energy as 400 million Americans.

I remember looking at power demand trending in the early 70s, and you could see air conditioning emerging as the summer load. In the 50s and early 60s, peak electrical power demand was in the winter, but a summer peak soon appeared and grew and grew to rival the winter peak in size.

The 50s were an interesting decade for power dispatchers. Apparently, every Sunday there was a notable power peak after church. Mom would come home, take off her gloves and pretty hat and put a chicken in the oven to roast. They could actually see all those ovens turn on at power central.
In New York State, winter and summer demand for electricity are commensurate. In the winter, NYC wheels power upstate for heating. In the summer, upstate wheels power to NYC for cooling. My guess is that demand levels for electricity are rather similar to this day, but heating takes more energy all told, since a lot of people use oil and gas, while almost all air conditioning is done with electricity.

Needless to say, air conditioning led to the rise of the Sunbelt. Let's face it, there is no way to lead an active year round busy beaver life without air conditioning. I will not say that this is all to the good. This wasn't the only technological change brought about by flowing electrons though. A friend of mine from the South claims that television destroyed the Klan, since it gave people something to do on those hot, dull evenings.

China not standing up that far; I saw buildings sprouting those rinkydink aircon units in Hanoi as long ago as 1999.

If its retrofitting old buildings- the individual units can't be helped.

Unfortunately condos sold in places like Shanghai are sold absolutely empty: the buyer puts in everything from the sheetrock on up. So everyone buys single unit AC, and the outsides of otherwise beautiful buildings quickly are ruined by the stains of AC drips. Interesting public good/ private good / free rider problem.

Walter,

I said go long on energy, not specifically oil.

As well, burgeoning use of air con units mean that you use more power each year, and oil-fired generators are a fast way to fix that problem ... in any case, the air con units are a symptom of energy-hungry demand, and I'd be expecting oil-hungry cars to be growing at the same rate.

See http://www.smh.com.au/articles/2003/12/19/1071337155742.html?from=storyrhs for an example of how first-world Australia is having a issue with this same issue.

Ian

I would second Trevelyan's observation, adding only that many buildings that I've seen don't bother with hiding exterior units. The relatively new apartment building observable from my window has several exterior concrete shelves per apartment on which owners can mount exterior AC units. BTW, these units aren't window ACs, but instead are split ACs with heat pump outside and indoor unit either mounted on the wall or free-standing in a corner... and as Trevelyan pointed out, they can also serve as heaters.

As for going long on oil, though the increasing use of ACs in China may not justify doing so the increasing number of cars clogging China's street just might.

Like here in the USA the appearance of air-conditioners is going to mark a huge increase in electricity production and distribution requirements. I just hope that the city planners and engineers of China are up to the challenge. Does anyone have any first hand information on how good their electricity grid is?

But Ian, electricity isn't produced primarily using oil or kerosene - unless you're in Iraq. Normally it's coal, nuclear, hydroelectric, or more recently natural gas. Natural gas prices might indeed explode but that's no reason why crude itself should get jacked up.

I don't know the first thing about appliances, but all the AC units I see here in Beijing look the same: a box with a fan outside, mounted on brackets or exterior concrete shelves as Ken G writes, and connected by a two-inch diameter duct to a remote-controlled blower on the inside. My indoor component is about 80+ cm wide, 220V 50 Hz. Doubles as a cooler or heater.

While it does get hot in the summer, it's the bone-chilling cold air down from Siberia that I've found most remarkable weather-wise here. I live in a suburb of Beijing, and they also turn on community-shared steam heat from November to early March, which emanates from vents below the windowsill. Trouble is perhaps not the efficiency of either the wall units or the steam heat, but the very large (2 meter-square) single-pane windows directly adjacent them. The heat in winter goes directly out the window.

Coincidentally, my driver just this weekend got an aftermarket AC unit installed in his car. Speaking of cars,
"As for going long on oil, though the increasing use of ACs in China may not justify doing so the increasing number of cars clogging China's street just might."

My morning commute - once a guaranteed 10-minute drive with no delay, same time each morning - has now doubled to 20 minutes; I once waited for an hour. Last September there were never more than 6-7 cars lined up to exit the expressway; now there's a multilane jam nearly everyday.

In my neighborhood, most cars are Chinese Volkwagen sedans, hatchback taxis, or something like a MiniCooper; where I work, a few Hondas, Jeep Cherokees, and other SUVs. In the Chaoyang District, or up at Dongzhimen, I've seen more BMWs, Mercedes, even a couple Hummers.

”Does anyone have any first hand information on how good their electricity grid is?"
Rolling blackouts in several Chinese cities, according to my girlfriend who travels widely here as a translator. They have water supply problems, too, which feeds the electricity supply problem.

Julian wrote:
I think "seven times as expensive" might mean, "it costs seven times as much to cool a given quantity of air by a degree than it does to heat the same quantity of air by a degree."

My response:
You have to include the temperature difference between ground-and-indoors, for a ground-source heat pump, or outdoors-and-indoors, for an air-source heat pump, to know the heat pump's efficiency. The greater the temperature difference, the lower efficiency, since, whether you are heating or cooling, you are transfering heat against the temperature gradient. Unless the cost ratio of heating and cooling energy sources, typically electricity and natural gas, changes in lockstep to compensate for temperature-dependent heat-pump efficiency changes -- which would require temperature-sensing electricity and/or gas meters to measure -- it's meaningless to give a fixed ratio of costs to cool versus heat a given volume of air a given temperature.

Pt's ratio of 7 is way too high unless you have a malfunctioning air-conditioner that has an effective SEER in the low single digits or are living in an area where electricity is vastly more expensive per unit energy than coal, oil, or natural gas. The latter is not the case in the U.S..

Expanding on my earlier post, central air is also expensive to install even without new ductwork because you need skilled HVAC techs to to install the condensor outdoors; install the air-handler indoors; and pull, solder, and charge the refrigerant line. Given the much lower installation cost, out-of-window ACs are a good solution if you don't care about aesthetics or noise, and have only modest-sized rooms close to the windows to cool.

A friend who manufactures and installs air conditioning systems in Asia says it's cost-competitive even for new apartment buildings to install individual units rather than building-wide systems. That is before one figures the benefits of being able to monitor each unit's electricity use and bill accordingly.

Of course, in some of these old Chinese buldings, they don't have per-unit meters. And wait until the low level of currency expires on all those ACs!

I've seen individual room A/C units even in new expensive houses in the Taipei suburbs...typically not window units, but an exterior fan/radiator and an internal condensor/fan unit connected by the coolant tubes, one for each cooled area. More like a miniature central A/C, in a way, but one for each room. I assume the (economic) charm is that only occupied rooms need to be cooled, though one does wonder about the cost of multiple units and equipment redundancy in new construction.

Seen now occasionally in the US, but evidently another Asian style is the entirely internal unit that ducts out hot air. But these seem inherently inefficient, since the hot air that is pumped out (admittedly in modest volume but high heat) must result in sucking in outside air (which is hot) into the cooled space, unlike a window unit or a split internal/external unit (no air movement between outside and inside).

One advantage of in-window AC is that it's inexpensive and simple-- units can be installed and maintained by non-experts. The other extreme, say, a heat pump with separate condenser-air handler units, requires installation and maintenance by specialists.

I wonder what kind of freon they are using, and if they follow US/Euro regs? And in their refridgerators?

Maybe I'll go out today to take a last look at the ozone layer....

Isn't going long on energy betting *against* technology?

That's a gamble.

Goethean,

One needn't doubt response of technology to prices in order to buy energy shares. Investment always involves a question of time horizon - how long do you expect to hold the investment? The technology response to high energy costs will occur with a lag. The trick in the recent period is that forecasts of energy costs have largely been too low, so that the surprises have all been positive for investors in raw energy. The question is whether the recent pattern of higher-than-expected prices will persist. Is energy priced right?

Oldman,

Gas is a close substitute for oil. Prices of close substitutes tend to move together. Utilities and some large industrial facilites have the capacity to switch between the two fuels on very short notice, which makes oil and gas direct substitutes in a part of the market. If China's demand for cooler interiors translates directly into higher prices for coal and gas, it is very likely to support oil prices as well.

Julian: http://www.earthship.org/
Is the modern equivalent of your hobbit hole. and you too can customize it to your heart's content. As for energy use and abuse, well the market will start functioning in China with a nasty hook that they never had a long run up to their oil crisis. Thermal insulated window installer in Beijing will be the *hottest* occupation. Next they will get the vinyl/aluminum siding salesmen....

I put a bunch of money a while ago into an world energy fund.

What do people in india and china want - first thing is more and better food. Second is comfort. Comfort for most of India and a large part of China means Air Conditioning. Most of the air conditioning units are made in china. Friend of mine is head of carrier China - he said they can't compete with the local companies on the smaller units. Only industrial - and that is growing 20-30% a year.

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