What cost air conditioning?

As you turn your air conditioner up yet another notch, spare a thought for the environment - and your wallet, suggests Alex Frew McMillan.

Anyone wandering around Hong Kong in the summer months is hit by sporadic blasts of Siberian air as they walk past stores intent on kindly air conditioning not only their own interiors but also apparently the rest of the planet. People put on jackets to watch movies when there’s a heat haze outside, and those with open-toe shoes find their digits numb by the end of the flick. Presumably the operators didn’t get to watch Al Gore’s An Inconvenient Truth when it screened in town.

Excessive air conditioning places a costly burden on the city. Besides the environmental expense, there’s a very real dollar cost when the power bill arrives each month.

“Air conditioning, particularly in the summer, accounts for about 60 percent of the cost of energy used,” Christine Loh, the founder of the think tank Civic Exchange, says. “Obviously that is a big chunk, and you can translate that into money.”

Residential users tend to turn up the air conditioning at night, when they’re back from work. So they are cooling their properties at the coolest part of the day. But stores and offices need to crank up the system when the sun is at its strongest.

Still, one study in 2005, put together by the Hong Kong Polytechnic University, shows that Hong Kong office buildings are the coldest in the world, with an average temperature of 21 to 22ËšC.

You can’t imagine residential users opening their front doors and windows and blasting polar temperatures out into the street. So why do many office tenants, retailers, movie theatres and mall owners continue to waste so much cold air?

“We would like to think that it makes good financial economic sense to use energy more efficiently,” Loh says. “The people who are spending money cooling or warming rooms - obviously there is a cost for them.”

The truth is that many retailers and office tenants do not directly bear the bills for the energy they waste. Smaller shopping centers generally get individual tenants to set up their own electricity service and air conditioning. But because air conditioning systems are often centralised in larger office buildings or malls, landlords may be paying a monthly management fee that covers all the building operating costs, including the air conditioning and electricity bills.

The flat-fee system encourages waste because tenants have no incentive to keep their doors closed or to turn the temperature up a notch. Maybe they would if they realised how much money they are losing. After all, someone, somewhere is footing that bill.

“Even if you are a prudent user, you are not benefiting, and if you are very wasteful, maybe you gain,” Loh says. “And if they don’t have the economic data, then it’s much harder to persuade them that they need to do something.”

It’s tough to get a lowly retail clerk to bother much about saving energy if he isn’t paying the bills. And the owner of the store, or the landlord, likely isn’t around to ensure his staff members are being responsible.

On the other hand, residential users can easily see the difference between their summertime electricity accounts and what they pay in cooler months. It has a lot more impact when you’re paying the bills. Clearly, every degree you turn the air conditioning up will save on your electricity bill.

Purely on an anecdotal basis, it does seem that some shopping malls have adjusted their thermostats to make the climate a little less chilly. And Chief Executive Donald Tsang himself has advocated everyone turn the temperature to 25.5ËšC.

Loh at Civic Exchange suggests that a change in the way bills are prepared for commercial tenants might even be necessary, in order to break down the air conditioning and electricity costs for tenants, even if they pay a flat management fee. “To change that is more at the policy level,” she says. “Maybe we need a new arrangement where tenants are provided with an adequate breakdown of their costs. Otherwise it’s very difficult to persuade people to do the right thing.”

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