Southeast Asia is experiencing another intense heatwave this year, with temperatures soaring to new heights across Vietnam, India, and the Philippines, significantly impacting power demand and sales of cooling appliances.
In India, the temperature in Delhi spiked to a scorching 47.4ºC (117.3ºF) on Monday, while the Philippines reported potentially "dangerous high temperatures" above 42ºC (107.6ºF) in 44 regions. The extreme heat is causing a surge in electricity demand, with Delhi experiencing its fourth consecutive day of peak power demand exceeding 7,000 megawatts, breaking the record set in May 2022.
In Vietnam, the government has started requesting factories like Foxconn to implement "power limits" to prevent power shortages in the coming months. Last year, a heatwave led to widespread power outages, causing losses of up to $1.4 billion for manufacturers in Northern Vietnam.
Meanwhile, the soaring temperatures are also driving up sales of air conditioners and beverages. In India, the air conditioning industry is expected to grow by 15%-20% this fiscal year. The demand for air conditioning services and maintenance has also surged, increasing by more than 40% from last year.
Heatwave Sweeps Across Southeast Asia
India's capital, Delhi, recorded an extreme temperature of 47.4 degrees Celsius this Monday, with the Indian Meteorological Department issuing severe heatwave alerts in Rajasthan and anticipating similar conditions in parts of Uttar Pradesh on May 23. The heatwave enveloping central and northern India is expected to intensify, with temperatures projected to rise by 2-3 degrees Celsius over the next five days.
The Philippine Atmospheric, Geophysical and Astronomical Services Administration (Pagasa) warned that on Wednesday, 44 regions might face temperatures exceeding 42ºC, with three areas potentially hitting 46ºC. Temperatures between 42ºC and 51ºC are automatically classified as "dangerous," increasing risks such as heat cramps, heat exhaustion, and even heatstroke.
Surge in Power Demand; Vietnam Imposes Factory "Power Limits"
The fierce temperatures have pushed local power demands to all-time highs. Delhi has seen its peak power demand surpass 7,000 megawatts for four consecutive days, breaking the record set on May 19, 2022.
The Indian Ministry of Power anticipates that the peak power demand in May will reach an astonishing 235,000 megawatts, with a potential increase to 240,000 megawatts in June. The government has assured that all necessary measures are being taken to meet the power demand this summer.
The Ministry of Meteorology expects that temperatures across India will remain above normal this summer, with peak power demand having increased by 12.7% from 215,888 megawatts in 2022-23 to 243,271 megawatts in 2023-24.
In Vietnam, companies like Foxconn have been asked to reduce electricity usage to avoid potential shortages in the coming months. Authorities have requested that Foxconn cut power usage by 30% at its assembly plants in Northern Vietnam, where last year's outages caused significant financial losses.
The World Bank estimates that last year's power shortages resulted in losses of $1.4 billion, representing 0.3% of Vietnam's GDP.
Surge in Sales of Air Conditioners and Beverages
Simultaneously, sales of summer cooling products like air conditioners, freezers, and beverages have skyrocketed. As temperatures rise, the demand for air conditioners and coolers has significantly increased, prompting many manufacturers to expand their production capacities. Daikin India's Managing Director K J Jawa mentioned that the air conditioning industry is expected to grow by 15%-20% this fiscal year, with the rate potentially exceeding 25% in June alone due to the heatwave, low penetration rates, and consumer financing options.
The business of air conditioner services and maintenance is booming. Vinit Kumar, head of repair and air conditioning business at Urban Company, noted that demand has increased by more than 40% compared to last year, with over 15,000 professionals on their platform specializing in air conditioning repair and service.
