That’s where the solar tier system comes in. Manufacturers are classified as Tier 1, Tier 2 and Tier 3 to help homeowners recognise the longevity and financial stability of the companies actually making the panels used in their solar system. This article explains what these classifications mean and how they can help you make wiser solar choices.
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What’s a tier solar panel system?
A tier scheme is a solar manufacturer ranking system designed to help Australian solar customers choose which solar panel best suits their needs. It helps buyers differentiate between reliable manufacturers and those that are emerging or, at worst, worth being cautious of. Tier 1 is considered the best and Tier 3 is the worst.
While the tier system can be an indicator of quality, and is sometimes used by providers to promote specific panels, it’s important to keep in mind that this system ranks manufacturers’ bankability, not the panels themselves that they manufacture. Bankability, put simply, means that the manufacturer can get bank loans secured on collateral such as property or shares – it’s a measure of the manufacturer’s financial status, not the panels it makes. Manufacturers may offer panels of varying quality and even Tier 1 retailers sometimes sell inferior products.
There are actually several tier systems but research providers PIKE Research and BloombergNEF are most often referenced in Australia. Bloomberg – we’re talking about the global financial information, data and media company here, with the NEF standing for New Energy Finance, thus the focus on bankability – itself published a statement warning against the use of its tier list as a sales tactic or measure of panel quality.
“We strongly recommend that [solar] module purchasers … do not use this list as a measure of quality, but instead consult a technical due diligence firm,” it said. “These would usually consider what factory the module comes from, as well as the brand, and give an informed opinion on whether the modules will perform as expected.”
Another consideration is methodology. Tier rankings are weighted in favour of manufacturing volume, so Tier 1 manufacturers are usually the largest in the world. This system also considers whether a manufacturer has staff in Australia to assist with warranty claims.
Tier ranking considerations include:
- Financial backing
- Geographic coverage
- Market position
- Panel quality
What does Tier 1 solar panel mean?
Tier 1 solar panels are produced by carefully vetted, credible Tier 1 manufacturers. The methodology to be ranked as Tier 1 varies between solar research groups but some core principles remain the same. Here are some features shared by Tier 1 manufacturers.
- Experience: Tier 1 manufacturers have at least five years’ experience.
- Reputation: Manufacturers must be known for high-quality products and services.
- Scale: Most Tier 1 solar module manufacturers are large, publicly listed companies.
- No outsourcing: Manufacturers must assemble their panels using only their own products. This includes everything from PV cells to metal frames.
- Innovation: Manufacturers must regularly improve their products and processes through research and development (R&D).
- Automation: Tier 1 manufacturers must consistently produce high-quality products through automated factory processes.
Things get a little more specific when looking at the 2020 BloombergNEF PV Module Tier 1 List Methodology report. Tier 1 manufacturers must produce PV modules themselves, under their own brand umbrella, with at least six 1.5MW+ projects or products. Tier 1 manufacturers must also have been financed by six commercial banks in the past two years.
Tier 1 solar panels Australia retailers
The BloombergNEF PV Module Tiering System 2022 Q2 report lists the following providers as Tier 1. For the full list, contact email@example.com.
- Sunpower/ Maxeon
- LG Solar
- Trina Solar
- REC Group
- Canadian Solar
- Risen Energy
- JA Solar
What does Tier 2 solar panel mean?
Tier 2 solar panels are sourced from Tier 2 manufacturers, which share some of these features:
- Less experience: Tier 2 manufacturers have operated for two to five years.
- Emerging reputation: Manufacturers must develop a reputation for high-quality products.
- Smaller scale: Tier 2 manufacturers have comparatively mid-to-small operations.
- Reduced innovation: Manufacturers invest less money in R&D.
- Less automation: Manufacturers may only partially use robotic processes.
While many Tier 2 manufacturers have Tier 1 ambitions, they’re yet to meet the experience and scale criteria.
Tier 2 solar panels Australia retailers
Many research groups, including BloombergNEF, don’t list rankings for Tier 2 companies. Solar retailer Evergreen Electrical Services has listed the following Tier 2 manufacturers.
- RenewSys Solar
- Luxor Solar
- Axitec Solar
What does Tier 3 solar panel mean?
Tier 3 manufacturers share the following features:
- Least experience: Tier 3 manufacturers have operated for less than a year.
- Outsourced parts: Manufacturers outsource solar panel components.
- Small scale: Tier 3 manufacturers have small operations.
- Minimal automation: Manufacturers rely heavily on manual labour.
Keep in mind that Tier 3 manufacturers are new to the market, meaning they might not yet qualify for higher tiers even if they produce quality solar products.
Tier 3 solar panels Australia retailers
Like Tier 2, Tier 3 manufacturers can be hard to spot. BloombergNEF doesn’t name low-tier companies. Solar retailer Evergreen Electrical Services has provided these examples of Tier 3 manufacturers:
- Tanfon Solar
- Dongson Solar
- Lovsun Solar
Tier 1 vs Tier 2 vs Tier 3 solar panels
Here’s a snapshot of the differences between Tier 1, Tier 2 and Tier 3 solar panel manufacturers. This table simplifies the solar tier methodology outlined by BloombergNEF and PIKE Research.
|Tier 1 Solar Manufacturers||Tier 2 Solar Manufacturers||Tier 3 Solar Manufacturers|
Fully automated processes
Most experience (5+ years)
Typically highest prices
|Average quality products
Partially automated processes
Some experience (2-5 years)
Typically mid-range prices
|Lowest quality products
Little experience (<1 year)
Typically lowest prices
How to choose the right solar panel manufacturer
While following the tier system seems easy enough, there’s one unfortunate hiccup — access. Tier rankings aren’t usually free to the public so verifying whether your installer is using panels from a high-tier manufacturer can be difficult.
The good news is your installer may have a copy of the tier report they’re referencing, which you can ask to see. If they don’t, you can dig deeper with questions about the manufacturer’s service team, experience and reputation.
To ensure you’re getting the best possible service and installation, choose a trusted solar installer. Visit our Solar Installer ratings page to see how businesses rank on customer service, solar system performance, installation process, durability and set-up costs.
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