5 star rated appliances just might reduce your energy costs

So, if you are going to buy an AC these days, the seller will try to tell you about the latest model which can help you reduce your electricity bill. “You will save up to 25% on your electricity bill,” a salesperson at a leading retail chain of consumer electronics told Mint. Display ACs that have been labeled 5 stars by the Bureau of Energy Efficiency (BEE), and are more energy efficient than ACs with lower ratings. But, here’s the caveat: ACs with 5 star labels are costlier than 9,000 as compared to 3 star rated models with similar features.

Also, the claim of the salesman is wrong as buying a 5 star rated AC does not reduce the electricity bill by 25%. Rather, the appliance will consume 25% less power than the 3 star rated one.

BEE introduced star labeling of electrical appliances including TVs, refrigerators, geysers, fans and tubelights in 2006 to enable consumers to choose these appliances based on their energy efficiency. Appliances are given a star rating between 1 and 5, with 5 stars denoting the lowest power consumption. In addition, the BEE label on each product also gives an approximate estimate of how much electricity is consumed by the appliance. This information can be useful for a quick cost analysis of how much you will be billed for using the equipment. Those purchasing equipment online can view labeling information on the BEE Mobile application.

cost benefit

With a higher star rating, the upfront purchase price of the appliance also increases. The difference in price for different devices can be anywhere between 10-25%. For example, the price of a 3 Star 1.5 Ton Daikin AC is 39,490, while the 5 star variant of a similar product costs 48,890, a mark-up of around 24%. The star labeling of each product will show the difference in power consumption by the respective AC, but it does not clearly reflect the cost-savings that one can expect by spending extra. 9,400 upfront.

It is true that a higher-end appliance will consume less power and, consequently, fewer power units in a month, but the purchase will actually be financially beneficial to you only if the savings on the cost of running the appliance outweighs the additional expense. Offset it. The price paid at the time of purchase over a period of time. Mint did some number crunching to find out how long it typically takes to recoup the purchase cost and the net savings you can expect over the life of the appliance (see graphic).

In our example, a 5 star AC consumes 2.8 units less than a 3 star AC in a day when it is run for an average of eight hours. In a month, this adds up to 84 units. assuming an average tariff of 5 per unit, your monthly savings would be 420. In Delhi, ACs generally run for about six months during summer, so the annual savings (run time of six months) would come to about 2,560. At this rate, it would take three years and nine months to recoup the additional upfront cost.

But consider this. A Bengaluru resident does not use AC for more than 45 days collectively in a year. Average electricity tariff in Bangalore 6.6 per unit, the annual savings comes to about the same 830, which would mean that it would take around 11 years 6 months for the user to recover the additional upfront cost (assuming all factors remain unchanged). Doesn’t sound like a good deal, does it?

On the other hand, a Mumbai resident would be able to break even sooner than someone in Delhi as AC usage in Mumbai is high given the city’s year-round humid climate and electricity rates are also much higher there, About 8 per unit. In the above example, a Mumbai resident can easily recover the upfront cost in 18 to 30 months if the AC is used for five to eight months in a year. Essentially, in less than three years after buying an AC, you will start saving around 25% annually on the cost of running the AC alone.

Two conclusions can be drawn. First, if you live in a city where electricity rates are very high, you’ll be better off using higher-rated appliances. Two, cost savings by using high consumption 5 star labeled appliance compounds. This also means that if you include 5 star labeled variants of electronic items that inevitably require high consumption in the household, such as fans, tube lights or fridges, your total electricity bill will be much higher. will decrease. Also, the difference in the upfront cost of powering small appliances is so slim that there may not be much of a pinch before selecting a higher-rated appliance. For example, a 5 star 215-litre fridge costs approx 3,500 extra than a 3 star in Mumbai. Compared to this the annual savings is approx. 4,480 annually, which means you not only recover the upfront cost within a year but also start saving on electricity bills from the first year itself (see graphic).

It should be noted that the calculations taken above are indicative as there are other variables that can affect the final power consumption of the equipment. For example, a study by the Center for Science and Environment (CSE) states that during peak summer, when the temperature ranges between 40°C and 50°C, a 5-star AC can deliver 10- to 20% of its declared efficiency. Can start consuming 28% more power. Capacity. This may affect people living in northern states as it is common for the temperature to go above 40 degree Celsius during May and June in this region.

Similarly, from January 2020, BEE has mandated all AC manufacturers to set the default temperature of all ACs at 24 degree Celsius. The mandate came after studies found that every 1% increase in temperature saves about 6% of electricity. This means that buying only a 5 star AC will not be enough to save energy if you want to use it at a temperature of 22 degree Celsius or less. In fact, a CSE study found that the performance of a 5-star rated AC becomes at par with a 2-star or 3-star rated AC when the temperature drops as low as 20°C.

Apart from a star rating of 1 to 5, each appliance has a range of efficiency parameters which further widens the scope of power saving. For example, Energy Efficiency Ratio, or EER, is a parameter for ACs and it ranges between 4.5-6 for a 5 star AC. Choosing a model with a higher EER will result in additional savings for you.