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PV module warranties: separating fact from fiction

on Oct 1, 2017


Timo Moeller, global director for customer support, product field performance, and commitments, First Solar
Timo Moeller, global director for customer support, product field performance, and commitments, First Solar

The commonly accepted approach is for manufacturers to pay the asset owner the value of the shortfall between the actual power output of the affected module and a predetermined power output threshold. This threshold is based on the market price of the module at the time of the claim or the original sales price of the panels - as module prices have steadily fallen, it’s easy to see which option would be of greater value.

Central to this calculation is the Power Warranty Start Value and the Warranted Degradation, which represent the manufacturer’s commitment to the amount of power a module will produce. A robust warranty will account for a Power Start Value of 98 percent in the first year – in other words, the manufacturer guarantees that the module will deliver at least 98 percent of its nameplate power output in the first 12 months of its operation. Modules delivering less than 98 percent are subject to remediation in line with the warranty terms.

Beyond the first year, the module’s performance warranty is benchmarked to the Warranted Power Output level. A module with a no more than 0.5 percent annual drop in power – which is what the industry’s leading OEMs offer – guarantees that the power output of a module will not reduce by more than 0.5 percent per year, from the second year of its operation. Once again, a degradation that exceeds this limit per year from the third year of operation will attract a penalty, requiring the manufacturer to compensate the asset owner for the shortfall between the actual power output of the affected module and the power output threshold. The payout will be based on the market price of the module at the time of the claim or the original sales price of the panels.

The bottom line is that a warranty is only as good as the remedies it offers. Decision-makers can ensure that they secure the best terms available simply by doing their homework and ensuring that, at the very least, someone picks up the phone when they call the helpline to make a claim.


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