Ceiling fans get costlier as BEE’s revised norms mandate star labelling

Ceiling fans would get costlier by 8% to 20% as the category has come under the ambit of mandatory star labelling from January 1, as per the revised Bureau of Energy Efficiency (BEE) norms.

Star labelling denotes energy savings of minimum 30% for one-star rated fans to over 50% for five-star rated fans.

Though leading manufacturers such as Havells, Orient Electric and Usha International have welcomed the move, they also believe it would lead to cost increase of 5% to 20% as high energy efficient five-star rated fans will require new imported motors and electronic components.

Under the new mandate, manufacturers would have to display the star ratings on their fans. The star rating is dependent on service value (air delivery in cubic metres per minute divided by energy consumption in wattage).

‘Superior products’

Terming it a “massive shift”, Orient Electric MD & CEO Rakesh Khanna said, now consumers will get access to a superior product that consumes far less energy.

However, he added that there would be price increase to a certain extent as manufacturers will incur additional costs on account of modifications required in non-star rated fans to make them more efficient and compliant with the new star ratings.

“While we are trying to absorb the price hike to a feasible extent, it will be imperative to pass on some impact to customers. We are looking at containing the price increase to the tune of a reasonable 7% to 8% across the range,” Mr. Khanna said.

On an average, ceiling fans account for 20% of the electricity consumed by an average Indian household. These star-rated fans are ultimately going to benefit the end consumer and save energy and reduce carbon footprint, he added.

Usha International CEO Dinesh Chhabra said the star labelling denotes energy savings ranging from a minimum of 30% for one-star rated fans to over 50% for five-star rated fans.

On the price hike, he said, “Yes, there will be an increase in the prices of Usha fans ranging between 5%-7% for one-star rated fans and 20% for five-star rated fans.”

The cost of fans depends on the existing design of the product, star rating (one to five) and performance (air delivery), Mr. Chhabra added.

“As for the five-star fans, the cost implications will be higher at almost 20% as these fans will have the newer BLDC (Brushless Direct Current) motors vis-à-vis the older induction motors, which need electronic components and magnets, both of which are imported,” he said.

Havells India stated that though the price of ceiling fans will increase, the rating of fans will provide an opportunity for the manufacturers to raise consumer awareness about energy efficiency. The marginal cost increase will be passed on to the consumers, said Havells India president Saurabh Goel.

The Indian fan market is estimated to be around ₹10,000 crore.

According to a report by Indian Fan Manufacturers Association (IFMA), there are over 200 entities operating in the segment.

Leading brands operating in the segment are Orient Electric, Havells, Crompton Greaves Consumer Electricals, Usha International,  Luminous Power etc.

The category is witnessing a rise in rural penetration with increased electrification, while in urban markets, the replacement cycle is getting shorter due to premiumisation, the IFMA report said.

Moreover, there is also a faster shift towards the organised sector.

The demand for premium fans with better aesthetics has been on the rise over the past three-five years with increasing consumer preferences towards enhanced and appealing interiors, it added.