BEE Energy Ratings For Solar Panels

One of the few major Indian successes in the energy efficiency (EE) sector has been the energy star ratings started by the Bureau of Energy Efficiency (BEE) which is the nodal agency for defining policies and standards in the field of EE. In the past five years, BEE has started giving energy ratings on a scale of 1 to 5 to a large number of electrical appliances such as refrigerators, air conditioners, televisions, etc. These are easy to understand with an energy rating of 1 meaning low in energy efficiency, while 5 means excellent in energy efficiency.

These ratings have been a great hit with citizens and have dramatically helped improve the energy consumption with high energy rating appliances commanding a better presence and premium in the market. Now BEE along with the Ministry of Renewable Energy wants to extend the concept of energy ratings to solar panels as well.

India is now installing millions of solar panels not only in large ground-mounted utility projects but also in the rooftop solar segment, as well as solar pumps. The consumption of solar panels is expected to continue growing at a rapid pace as the prices of solar panels have decreased dramatically from around USD 4/watt around 10 years ago to around 20-25 cents/watt implying a cost reduction of almost 95%!!!!!!

However, the quality of solar panels sold in India has left a lot to be desired with a number of plants underperforming due to poor quality cheap solar panels being used.  Given that the life of solar panels is 25 years, it is imperative that high-quality products be used in order to ensure the efficient performance of solar products for their entire life. While solar panels degrade by a small percentage every year, poor quality panels can degrade faster leading to poor performance and destroying the trust of customers in solar products. MNRE has in the recent past made it mandatory that the Bureau of Indian Standards (BIS) certify solar panels before they are used in India. However, these standards focus more on the safety and conformity of solar panels to standards rather than focus on their efficiency, reliability, and longevity.

BEE with its energy ratings now hopes to fill this vacuum by making it easier for consumers to differentiate solar panels of lower quality from that of higher quality. Given that solar panels are mostly sold like commodities with the lowest price generally working out, energy ratings will help solar panels with better quality get better prices. This will also help ensure that large scale solar projects are able to perform better over the long term ensuring that the cash flows are as per projections for both developers and investors.