What Is A Tier 1 Solar Panel And How Do Tier Ratings Work?

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Shopping around for solar PV systems can be a daunting experience with so many brands, types and models out on the market and with them all looking fundamentally the same. How are you suppose to know what is a reliable product and what panels are going to live out their 25-year expected lifespan?

Tier Rating System

If you’ve been shopping around for a solar then you’ve most likely heard of the Tier rating system or seen solar providers advertising or claiming panels as Tier 1 or 2 (Tier ratings range from 1-3).

The Tier Rating is used amongst the solar industry as a tool to avoid dodgy solar panels and promote high quality panels. Generally speaking, when a solar panel is ranked or advertised as Tier 1 it is claiming that it is of high quality and has been constructed and designed to live out the 25-year life expectancy in good form.

However, what a lot of consumers don’t know is that the Tier system is not based on the quality of the solar panels at all. The Tier system is a scale coordinated by Bloomberg New Energy Finance Corporation and is used to rank solar panel manufacturers in terms of their bank-ability or financial stability. The scale was put together to create a transparent differentiation between the hundreds of manufacturers of solar modules on the market.

Bank-ability – whether projects using the solar products are likely to be offered non-recourse debt financing by banks – is the key criterion for tiering.

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To be classified as Tier 1 (highest ranking) manufacturers need to have provided own-brand, own-manufacture products to six different projects, which have been financed non-recourse by six different (non-development) banks, in the past two years.

The reason this Tier rating has now gone on to reflect a solar panels quality is that we can safely assume a bank would not back or fund a large-scale project, worth millions if the products supplied by the manufacturer were of poor quality or likely to fail.

It is for that reason that when a solar panel is referred to as Tier 1, they are actually saying the panel has been made by a manufacturer that has been rated as Tier 1 by a reputable independent PV industry analyst.

It’s important to note that while tier rankings can be a tactical way of avoiding panels by dodgy manufacturers and poor-quality solar panels, the ranking does not directly reflect the panels themselves.

Where can you find a list of Tier 1 Rated Manufacturers

Unfortunately, the list of manufacturers and their Tier ratings are not readily available to the general public. Due to the amount of work and importance of the information involved in Tier Ranking Reports the results are sold as industry intelligence. Some solar providers and installers will have purchased access to these lists, which is the only way to prove whether the panels they are selling have been manufactured by a Tier 1 manufacturer.

If a company is trying to sell you panels which they are claiming as Tier 1, ask for proof via an up to date Tier ranking report or ask how they can prove the panels are manufactured by a Tier 1 manufacturer.

Tier Rating Doesn’t Cover All Important Criteria

Whilst the Tier ranking is a safe way of avoiding any dodgy manufactured panels, unfortunately the ranking does not take into account which manufacturers or solar providers have offices in Australia, which can be a make or break when deciding which brand, provider or manufacturer to select when purchasing a solar system.

The importance of an office or presence in Australia comes down to your warranty. Should anything happen or you have any issues with your solar system, you’ll want to be able to reach out to the providers or manufacturers easily, so they are able to sort out any issues and adhere to what you are entitled to in your warranty.

Need some more advice for selecting solar panels? Read our solar panel purchasing tips!

Panel Purchasing Tips

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Understanding Batteries

Off-Grid Systems

For some households a battery system can be of great benefit and minimise a home’s reliance on the grid. However, it’s important to understand for a battery to be useful your solar system needs to be generating excess energy for the battery to store, which you can then use at night or when the sun is not out.

When selecting a battery, you’ll want to invest in a system that is most suited to your home and can drive the best return on investment (ROI). Despite a larger upfront cost, a higher quality battery may significantly increase your ROI.

    Battery systems start from $6,000 and costs can vary greatly based on the following factors:

  1. Cycle Life-Time

    The number of times a battery can fully charge and discharge.

  2. Battery Power (kW)

    How fast it can be charged or discharged.

  3. Storage Capacity (kWh)

    The maximum amount of energy a battery system can store.

  4. Battery Management System (BMS)

    An electronic ‘smart’ system that gathers data and manages the battery ensuring it does not overload or operate outside of its safe functioning zone..

  5. Inverter

    Battery systems require their own inverter if your solar system does not have a hybrid inverter.

  6. 'All-In-One Unit’

    A system which includes the battery, BMS and an inverter all in one unit.

  7. Warranty

    Length of time or cycles the battery system is under guarantee.

  8. Blackout Protection/Backup

    It’s important to note this is not a common feature of a battery system and could cost thousands of dollars to include. Blackout protection not only requires additional components but also a specialised installation and rewiring. For grid-connected homes, the cost for blackout protection can outweigh the benefit.

Additionally, if your purpose for adding battery is to go Off-Grid and become completely independent from the grid you will need to ensure your solar system can generate enough energy to power your home and your battery system is large enough to store this energy. For homes in metro areas going Off-grid is not cost effective and is only recommended for those in remote areas with limited access to the grid. Off-grid solar systems with battery start at approximately $30,000.