How much does it cost to run air conditioning?

Whether you use a split system, ducted air conditioning, or a portable unit, the cost to run an air conditioner depends on a few key factors.

In this article, we explain how air conditioning running costs are calculated, how much electricity air conditioners typically use, and what the average hourly cost is in Australia. We’ll also cover simple ways to reduce running costs without sacrificing comfort.

A quick guide to air conditioning running costs

In Australia, the cost to run an air conditioner depends on the size of the unit, how long you run it, and your electricity rate. Most air conditioners cost around $0.20 to $1.50+ per hour to run, depending on system type, efficiency, and usage, whether you’re cooling or heating, and how hard the system is working. Using the right settings and an efficient system can significantly reduce running costs.

Here’s the formula to use when calculating the costs:

Running cost per hour = Input power (kW) × electricity rate ($/kWh)

Note: “Input power” refers to the electricity the system uses, not its cooling or heating capacity.

What actually affects your air conditioning running costs

There’s no single answer to how much it costs to run air conditioning, because running costs depend on a mix of system details, usage habits, and electricity pricing. Understanding these factors makes it much easier to estimate costs and spot ways to reduce them.

Key factors that influence running costs include:

• Electricity rates – What you pay per kilowatt-hour has a direct impact on running costs. Higher tariffs mean higher hourly costs, even with an efficient system.
• System size (kW) – Larger systems typically have higher input power, but actual electricity use depends on efficiency, system design, and the unit's workload.
• Hours of use – Running your air conditioner for longer periods naturally increases total costs, particularly during peak summer months.
• Heating vs cooling – Heating and cooling modes can use different amounts of electricity depending on outdoor temperatures and system efficiency.
• System type – Split systems, ducted systems, and portable units all have different operating costs and efficiency levels.
• Zoning and controls – Zoning allows ducted systems to condition only the areas in use, helping reduce unnecessary electricity use.
• Home insulation and layout – Well-insulated homes hold temperature better, meaning the air conditioner doesn’t need to work as hard.
• Maintenance and condition – Dirty filters, low refrigerant levels, or poor airflow can increase electricity use and push up running costs.

The average cost to run air conditioning per hour in Australia

To accurately estimate air conditioning running costs, it’s important to base calculations on power input (electricity use). Reverse cycle systems are highly efficient, typically producing 3–5 kW of heating or cooling for every 1 kW of electricity used.

The table below shows realistic running costs based on typical input power and an average electricity rate of ~$0.30 per kWh in Australia.

*Estimates based on ~30c per kWh electricity and typical real-world usage.

How these costs are calculated:

Running cost = Input power (kW) × hours used × electricity rate ($/kWh)

For example: A 3.5 kW split system typically draws ~1 kW → 1 kW × $0.30 = $0.30 per hour

How much electricity does an air conditioner use?

Air conditioners use electricity based on their power input (kW), not their cooling or heating capacity. While systems are often labelled as 2.5 kW or 5.0 kW, this refers to their output capacity, not the amount of electricity they consume.

Modern reverse-cycle air conditioners are highly efficient and typically operate with a Coefficient of Performance (COP) of 3 to 5. This means they produce 3–5 kW of heating or cooling for every 1 kW of electricity used. 

For example:

• A 2.5 kW system will typically use around 0.6–0.8 kW of electricity per hour, not 2.5 kW
• This equals ~0.6–0.8 kWh per hour of use, depending on conditions

In real-world use, most modern air conditioners don’t run at full power continuously. Inverter systems adjust their output as the room reaches temperature, meaning actual energy use is often lower than the maximum input rating.

Does heating or cooling cost more to run?

Whether heating or cooling costs more to run depends on outdoor temperatures, system efficiency, and how the air conditioner is used. In many cases, reverse-cycle air conditioning is very efficient for both heating and cooling, but heating can use more electricity in colder conditions because efficiency (COP) drops as outdoor temperatures decrease, requiring more input energy to deliver the same output.

Setting sensible temperatures, using zoning where available, and avoiding extreme settings can help keep running costs under control in both modes.

How to reduce your air conditioning running costs

While air conditioning can be one of the biggest contributors to electricity use, a few simple habits can make a noticeable difference to running costs without compromising comfort.

Here are some practical cost-saving tips:

• Set sensible temperatures – Cooling to around 24°C in summer and avoiding extreme heating settings helps reduce electricity use.
• Use zoning and timers – Only run air conditioning in areas you’re using and schedule it around daily routines.
• Keep filters clean – Dirty filters restrict airflow and make the system work harder, increasing running costs.
• Seal your home – Closing doors, curtains, and sealing drafts helps keep cool or warm air inside longer.
• Use fans to assist – Ceiling or pedestal fans can help distribute air more evenly, reducing the need to lower settings.
• Service your system regularly – A well-maintained air conditioner runs more efficiently and is less likely to drive up power bills.

If your running costs still seem unusually high, it could be a sign that something isn’t working as it should.

How can I estimate my air conditioning running costs using my power bill?

You can estimate running costs by checking your electricity rate in cents per kilowatt-hour on your power bill, then multiplying that rate by the estimated electricity use of your air conditioner and the number of hours it runs. This approach gives a more accurate picture than relying on generic averages, as electricity rates and tariffs can vary between households.

Do inverter air conditioners really cost less to run?

Inverter air conditioners are designed to adjust their output based on demand, rather than switching on and off at full power. This can help reduce electricity use once the room reaches the desired temperature, which may lower running costs compared to older fixed-speed systems, especially during longer periods of use.

Does leaving the air conditioner on all day cost more than turning it on and off?

In many cases, turning the air conditioner off when it’s not needed can help reduce running costs. While inverter systems are efficient at maintaining temperature, running an air conditioner continuously will still use electricity. Using timers or schedules is often a better way to balance comfort and energy use.

Why does my air conditioner cost more to run during extreme weather?

During very hot or cold weather, air conditioners need to work harder to maintain the set temperature. This increases electricity use and can push up running costs. Factors such as insulation, sun exposure, and how well the system is maintained also play a role during extreme conditions.

Can solar energy reduce the cost of running air conditioning?

Using solar energy can help offset the electricity used by your air conditioner during daylight hours, potentially reducing power bills. The impact depends on system size, usage patterns, and whether cooling or heating is needed during peak solar production times.

Are there rebates or support options available for air conditioning upgrades in the ACT?

ACT homeowners may be eligible for support through the ACT Sustainable Household Scheme, which helps households upgrade to more energy-efficient heating and cooling systems, including reverse-cycle air conditioners. The scheme offers approved loans and support for eligible installations, making it easier to manage upfront costs while improving energy efficiency.