utis rising refrigerator: As the new year unfolds, consumers in India may find themselves paying more for refrigerators, with prices expected to rise by up to 5%. This price increase comes in the wake of revised Bureau of Energy Efficiency (BEE) norms that took effect on January 1. Major manufacturers like Godrej Appliances, Haier, and Panasonic have already indicated that the new regulations will lead to higher costs for consumers, driven by the need for enhanced energy efficiency and revised labeling requirements.
What’s Behind the Price Hike?
The BEE’s updated norms have introduced stricter energy efficiency standards and new labeling requirements for refrigerators. These changes are part of a broader effort to reduce energy consumption and help consumers make more informed choices. However, implementing these changes comes at a cost, which manufacturers are now passing on to consumers.
Kamal Nandi, Business Head and Executive Vice President of Godrej Appliances, explained that the new norms require separate star labeling for the freezer and refrigerator provisioning units (storage part) of frost-free models. “Now, we have to declare labelling for both. That is the new change,” Nandi said, highlighting the additional complexity and cost involved.
How Much More Will You Pay?
According to Nandi, achieving the enhanced energy efficiency required by the new norms will necessitate improvements in insulation and other components, leading to an estimated 2-3% increase in prices across various models and star ratings. This is in line with previous energy efficiency upgrades, where costs have similarly risen.
Haier Appliances India President Satish NS echoed this sentiment, noting that some compressors will need to be reloaded or replaced to meet the new standards. As a result, Haier is anticipating a price increase of 2-4%. Panasonic Marketing India’s Managing Director, Fumiyasu Fujimori, went further, predicting that prices could rise by up to 5% as manufacturers absorb the costs of compliance.
New Labeling for Net Capacity
In addition to energy efficiency, the new BEE norms also mandate that manufacturers declare the net capacity of refrigerator units rather than the gross capacity. Net capacity refers to the actual usable space within a refrigerator, excluding gaps between shelves and doors that do not contribute to storage. This change is designed to provide consumers with a clearer understanding of how much storage space they are actually getting, allowing for more informed purchasing decisions.
“For example, there are gaps between the door and shelves, which are not usable. So, those will not be considered,” Nandi explained. This shift to net capacity labeling is expected to help consumers better assess the true value of their purchase.
What Does This Mean for You?
For consumers, the immediate impact will be felt in the form of higher prices, particularly for entry-level buyers who may find affordability becoming an issue. However, the long-term benefits of these changes include lower energy consumption and more accurate information when selecting a refrigerator, which can lead to savings on electricity bills over time.
Despite the anticipated price increases, manufacturers like Panasonic are committed to minimizing the impact on consumers. “We at Panasonic are keeping a close eye on the development and will try to absorb maximum costs,” Fujimori said.
The Bigger Picture: A Growing Market
Despite these changes, the Indian refrigerator market is expected to continue its rapid growth. According to a report from Research And Markets, the market was valued at USD 3.07 billion in 2022 and is projected to reach USD 5.88 billion by 2028, growing at a compound annual growth rate (CAGR) of 11.62%. This growth suggests that even with higher prices, demand for refrigerators in India will remain strong as consumers continue to prioritize modern appliances in their homes.
Conclusion
As the revised BEE norms take effect, consumers should be prepared for a modest increase in refrigerator prices. While these changes may strain budgets, especially for entry-level buyers, they also promise long-term benefits in terms of energy efficiency and more transparent product information. When shopping for a new refrigerator, paying close attention to the updated labeling and understanding the real storage capacity can help ensure that you get the best value for your money.
