WWhen a door-to-door salesman showed up on Christine Palmer’s door in 2022 telling her she could save money by going solar, she and her husband decided to make the investment.
Two years later, the panels were never turned on and the company that installed them – Titan Solar – abruptly went bankrupt, leaving Palmer with a shiny but useless array on his roof.
Even if she got someone to fix the panels, Titan installed them in a way that didn’t pass inspection in her town of Lindenhurst, Illinois, meaning someone would have to redo the entire installation before the panels could be turned on, she says. .
Meanwhile, GoodLeap, the company that loaned her the money to buy the panels, is still calling constantly, trying to collect the loan, she says. Titan was supposed to go out to try to fix the panels on a Friday, after dozens of previous attempts, but on Thursday night she started seeing on Facebook that Titan was closing. Palmer confirmed that the company was bankrupt and his emails to representatives were returned as undelivered. “Our system hasn’t worked for an hour,” she says. “However, there is no protection for us at all.”
See more information: Another solar company goes bankrupt
Titan was the largest solar installer to go out of business when it closed on June 13, according to research firm Wood Mackenzie, but customers like Palmer aren’t the only ones who have panels that don’t work in their homes and whom to resort. Thousands of customers of a company called Pink Energy were put in the same position when Pink filed for bankruptcy in October 2022. Dozens of other solar companies also went bankrupt this year, including Infinity Energy, Solcius and Kayo Energy.
“We pretty much have a $70,000 roof ornament right now,” says Jasmine Hendrickson, who had a system installed by Pink Energy a week before the company went out of business. The system has not passed inspection and is not connected to the mains.
Of course, the overwhelming majority of residential solar systems work perfectly. But if just one percent of the panels in the 4.5 million homes with solar energy fail, that will be 45,000 unhappy customers. And there aren’t many protections for homeowners because the solar industry isn’t yet regulated. In most states, anyone can knock on your door and try to sell you solar panels, even if they don’t actually work for a solar company. (Solar companies contract out sales to something called dealer networks, which are essentially sales outlets.) The salesperson may promise that you won’t have an electric bill, that you’ll receive tax incentives from the government, and that you’ll save money on solar power, but By the time your panels are actually installed, that salesperson may be gone and the company installing your panels may be on the brink of failure.
See more information: How Solar Sales Brothers Threaten the Green Energy Transition
Installers who face difficulties often do shoddy work, says Ara Agopian, CEO and founder of SolarInsure, which manages and insures solar systems, including about 10,000 that have been “abandoned,” meaning the installer has gone bankrupt. “Finishing isn’t great when a company is about to go out of business,” he says.
Additionally, some solar companies have offered warranties on solar panels, promising to fix broken panels for up to 25 years, but then haven’t set aside money to fulfill those warranties and fix systems that don’t work, Agopian says. This means they can’t fix the panels – and the cost of trying to maintain all these systems drives them out of business.
Analysts predict even more solar bankruptcies this year as high interest rates and policy changes about how much people can be compensated for their solar energy dampen consumer enthusiasm. Wood Mackenzie says residential installations will decline by around 14% this year.
See more information: The solar energy industry is in trouble
Even if the bankruptcy rate decreases, some in the solar industry think there will be many more people with solar panels stuck to their homes. When customers sign a solar lease or power purchase agreement (PPA), the solar company agrees to cover the cost of panel removal when the lease ends, typically after 20 years. But large companies like SunRun assume that 90% of customers will renew their contract and keep their panels, according to one study. report by research firm Muddy Waters. (Muddy Waters is shorting or betting against SunRun stock.)
Muddy Waters says this promise also “fails the laugh test” because, at the end of 20 years, most homeowners will have to replace their roof and because solar panel technology will be obsolete by that time. She estimates that SunRun will have to spend $668 million on system removals when leases and PPAs end — and that the company hasn’t set aside that money. (On a detailed answer to Muddy Waters, SunRun states that it believes “the assumptions, estimates and disclosures we provide are market appropriate.”)
The idea that large companies are not accounting for the cost of removing panels from homes is a theory that Pol Lezcano, a senior associate at BloombergNEF, finds credible. Big companies use their money “to originate and sell new systems,” he says. “I doubt they are planning to have money aside to remove the panels when the contracts expire.”
Some homeowners have tried to take repair and removal into their own hands. They include Johann Bowman. His 83-year-old uncle purchased $110,000 worth of solar panels from Pink Energy in 2021, but one of the parts in the installation was defective. The system didn’t work, so Bowman started calling electricians and solar companies to see if anyone could fix it.
The first three companies said they wouldn’t touch the system once they knew Pink Energy was involved, he says. The fourth company wanted $50,000 to fix the system, which Bowman considered too high. “He told me, ‘Without me, you’re dead in the water,’” Bowman says. He finally called a fifth company, which got the system up and running for $2,500. But it still doesn’t produce what the seller promised his uncle. His uncle’s house, Bowman says, is covered in trees — the seller should never have registered the house for solar in the first place.
This story originally appeared on Time.com read the full story
