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Grading appliances on basis of energy consumption opens up new possibilities of long-term savings for buyers who can now look beyond just the MRP.

By Namrata Dadwal | Print Edition: May 3, 2007

Seems the stars have decided to smile on your electricity bill. Awareness of energy conservation in India has led the Bureau of Energy Efficiency (BEE), a body under the Ministry of Power, to grade electrical appliances on the basis of power consumption. These appliances will have an energy efficiency label affixed to them. The labels will have a star rating—ranging from one to five. The more the number of stars, the more energy efficient the gadget. A product that is awarded five stars would consume about 30% less energy than that which has been awarded one.

Though higher-graded products will also be more expensive at point of sale, in the long run they would be cheaper. Take, for example, a one-tonne air conditioner which has five stars. Its price is about Rs 23,500 (see table) but consumes only 1,140 watt of power. A two-star, one-tonne air conditioner though cheaper by Rs 1,000 consumes 1,310 watt. In other words you are consuming 170 watt less of power every hour by purchasing the fivestarred model. If you use the air conditioner for eight hours every day it amounts to a saving of Rs 120 in your monthly bill. You would have recovered the extra cost of the higher rated air conditioner within the year.

Says Gaurav Malik, senior marketing manager, Voltas: “Taking all other considerations to be the same the difference between a zero-star product and a two-star product will help you save Rs 350 a month and if you go in for a four-starred model then your monthly savings could be as high as Rs 570.”

While refrigerators are rated according to units of electricity consumed, tube lights are rated according to their brightness after 100, 2,000 and 3,500 hours of use. These ratings will help consumers make a more intelligent purchase, especially keeping their electricity bill in mind. Electricity consumption by an appliance is referred to as its operating cost and is also known as the “second price tag”. The electricity bill throughout the life of an appliance is usually higher than its purchase price. Therefore, with the knowledge of the “second price” consumers and can make a more informed choice between models.

The star rating is calculated from the star rating band which is a range of energy efficiency ratios (EER). The parameters to be tested for refrigerators are energy consumption and storage volume; for tube lights it is electrical, luminous and colour characteristics and for air conditioners the tested parameters are energy consumption and cooling capacity. The band parameters will also depend on the year of manufacture or import. Hence ratings will differ from year to year. Even variants in the same model can have different ratings.

Right now the ratings are voluntary but BEE plans to soon make them mandatory for all electrical appliances including those that are imported. Till date BEE has rated tube lights, refrigerators and air conditioners. The next phase is likely to include ceiling fans, submersible pumps, CFL lamps and diffusion transformers. “It will take up to two years for us to include all the products available in the market since it requires in-depth technical study and benchmarking,” says G Pandian, energy economist, BEE.

BEE’s guidelines are likely to impact the pricing of electrical products. “The input costs have gone up linked with changes being made in some components,” says Pradeep Tongatta, director sales, Samsung India. But companies are certain that the higher price will be offset by a lower electricity bill.

Companies are also encouraging consumers to look at the broader picture. As Malik says, “Not only do the consumers benefit, less usage of electricity helps the country overcome energy shortage. It also helps curb global warming.” BEE hopes star ratings will also boost technological advancement and innovation. Looks like it is gains for personal finance, environment and technology.

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