Is there a relationship between the "tier" of a solar company and the quality and reliability of its module?
“The tier structure became a way for buyers to differentiate the rapidly proliferating multitude of manufacturers, particularly those from China,” explained SolarBuyer Managing Director Ian Gregory. The tier was primarily defined by the manufacturer’s size and balance sheet and by brand awareness. “It was used to make default bankability assessments. It didn’t look at the quality or reliability of the finished product. There was no information on that.”
SolarBuyer has made an assessment of tier versus manufacturing quality, he said. “We have not found a clear correlation. In fact, we’ve audited one manufacturer six times and each time the picture is different. The relationship between quality and tier structure seems to change every six months.”
“This idea of tiers is mostly a marketing construct,” observed kWh Analytics CEO Richard Matsui. “If the industry could do away with it, we would be better off. When we look out our dataset across systems, we find only a very loose correlation between the performance and the tiers.”
The larger firms perpetuated the idea of tiers, Matsui said. “They also have a lot of marketing dollars, so it is propagated through the industry. I’m not surprised that my colleagues here who test performance are not seeing a correlation with tiering.”
“The tier classification is probably good as a general concept,” said PV Evolution Labs co-founder and CEO Jenya Meydbray. “But it needs meat behind it rather than just marketing. It needs actual information and intelligence. If we can quantify what reliability and performance need to be for each tier, then it can be valuable to communicate with credit committees and risk committees, and to use to set insurance premiums and costs of capital.”