Find out the truth about Tier 1 and Tier 2 panels and whether its worth paying extra.
The life of a solar farm is well over 25 years and the solar panel cost component is the single most expensive item in a solar installation costing as much as 40% of the total project cost. When investing in a solar farm one needs to select the right solar panels to ensure he gets the expected power and energy production across the life of the project.
Most homeowners are confused in solar panel selection. The most frequently asked questions when deciding to select a solar panel are the following.
The short answer to the above question is that solar panels are broadly classified into Tier 1, Tier 2 and Tier 3. Tier 1 solar panels are more reliable and it's advisable to buy them.
Solar panels are made using six main components and assembled in advanced manufacturing facilities with extreme accuracy. These six components are junction box, back sheet, encapsulant EVA (ethylene vinyl acetate) film, solar cells, tempered glass, and aluminum frame. Many well-known solar panel manufacturers are vertically integrated, which means one company supplies and manufactures all the main components used to make a solar panel including the silicon ingots and wafers used to make the solar cells. By doing this the manufacturer can ensure there is no drop in quality in any of the key components used to manufacture a solar panel.
However, many solar panel manufacturers also assemble solar panels using externally sourced parts including solar cells, polymer back sheet and encapsulation EVA film. Unfortunately, it’s very difficult for the manufacturer to control the quality of the products sourced.
Based on how the key components are sourced and assembled, solar panels are broadly classified into Tier 1, Tier 2, and Tier 3. One of the main differences between the different tiers of solar panels is based on the manufacturing process. The more automation the lower the chances of human error. Also being more vertically integrated reduces any quality related issues in procurement and manufacturing. Tier 1 solar panels are considered premium quality.
Tier 1 solar panels use the best grade of silicon to produce solar cells. Higher the silicon grade the better the solar panel will perform. In addition, Tier 1 manufacturers control the manufacturing process using advanced robotic processes thereby minimizing or eliminating any human errors in the manufacturing process. They also invest heavily on research and development to stay top of their game. These manufacturers are vertically integrated, that is they tend to manufacture all key components used in a solar panel by themselves. They tend to have an annual production capacity of over 1 GW and have been supplying solar panels for over 5 years.
Tier 1 manufacturers use the best grade materials to produce a solar panel, hence the solar panels are much more expensive. The solar panels from a Tier 1 manufacturer could be as high as 30% more expensive than others.
Tier 1 manufacturers generally provide a 12 year product warranty and 25 year linear performance warranty on the solar panels. They have a highly regarded reputation within the industry for quality and service and are either publicly listed on the stock exchange or have a strong and stable balance sheet. Tier 1 solar panel examples are Jinko Solar, JA Solar, LONGi, Trina Solar and Canadian Solar.
Tier 2 manufacturers use partial robotics in their manufacturing process and rely more on manual work through human production lines. There is a chance of human error in the production line that could lead to lower performance of the solar panel. However, the aim for these manufacturers is to produce good solar panels at a good price. They generally invest very little in research and development and the companies are small to medium in size producing solar panels between 2 and 5 years.
Tier 2 manufacturers also provide product and linear performance warranties on their solar panels but are considered inferior to Tier 1 solar panel warranties. Tier 2 solar panel examples are RenewSys Solar, Luxor Solar and Axitec Solar.
Tier 3 manufacturers are typically assemblers rather than pure panel manufacturers. They assemble other manufacturers' cells into a panel. They generally use human production lines for manual soldering of solar cells instead of advanced robotics because of which the quality can vary based on operator skill set. They have zero investments in research and development.
Tier 3 manufacturers also provide product and linear performance warranties on their solar panels but are considered inferior to Tier 2 solar panel warranties. Tier 3 solar panel examples are Tanfon Solar, Dongson Solar and Lovsun Solar.
When buying a solar panel, you are essentially buying two things, a physical product that generates electricity and a guarantee from a manufacturer that specifies the performance of the solar panel year on year. Keeping this in mind, let's answer the below questions.
The life of a solar panel is well over 25 years. There are two types of warranties generally offered. One is a product warranty that ranges from 5 years to 12 years and the second is a linear performance warranty that ranges from 15 years to 25 years again based on manufacturer.
Ideally you want to select a supplier who gives you the longest product warranty and longest linear performance warranty.
Tier 1 solar panels are built with higher standards (to last longer and produce abundant solar power) and have a highly regarded reputation within the solar industry for quality and service so one can expect Tier 1 manufacturers to honor their product warranty compared to Tier 2 and Tier 3 manufacturers.
Selecting any manufacturer from Tier 1 list of manufacturers is considered reliable. Some of the top performing solar panels are supplied by Jinko Solar, JA Solar, LONGi, Trina Solar and Canadian Solar.
One can expect to spend between 10% to 30% more on Tier 1 solar panels.
Going with a trusted brand from Tier 1 manufacturers removes most of the risks associated with quality of the product and will the solar panels continue to produce power over its lifetime.