Sunnova is laying off almost 300 workers

Sunnova Energy on Monday announced the reduction of nearly 300 positions in the name of streamlining operations and driving efficiency. 

The Houston-based solar company expects to deliver approximately $70 million in annual cash savings, primarily by reducing overhead costs. Half of those savings will come from layoffs.

“As we continue to focus on capital efficiency and our high-margin core customers through TPO origination, we must always optimize within the current economic and policy landscape,” said John Berger, chief executive officer of Sunnova, in a press release. The layoffs will mainly affect its commercial organization.

Of the estimated $70 million in annual savings, $35 million will come directly from workforce reductions. The layoffs will affect more than 15% of Sunnova’s employees, marking a significant shift for the company.

Sunnova isn’t the only solar company to layoff employees within the last year. These staff reductions underscore a broader trend in the solar market, where even industry leaders are facing financial headwinds due to a multitude of factors. In April 2024, SunPower laid off about 1,000 employees before ultimately filing for bankruptcy in August. Meanwhile, Sunrun let about 100 people go in January as it faced mounting pressure to improve profitability. 

The Sunnova layoffs are another example of this trend, reinforcing that the challenges facing SunPower and Sunrun are not isolated incidents, but part of a larger industry-wide struggle. With high financing costs and policy uncertainty looming, solar companies are making tough decisions to stay afloat.

It’s no secret that the solar industry has faced setbacks in recent years. After experiencing years of growth and falling manufacturing costs, the onset of the COVID-19 pandemic in 2020 disrupted supply chains and operations across industries, leading to price increases. High interest rates over the past two years have also made solar loans more expensive and dampened demand from homeowners looking to invest in rooftop solar.

Before the presidential election, the Federal Reserve was expected to continue lowering its benchmark interest rate this year. But as the Trump administration shows support for policies that are likely to increase inflation, most economists expect rates to remain where they are and not drop further anytime soon. Other factors continue to sow uncertainty in the industry, too.

The first month of President Trump’s second term also brought renewed challenges for clean energy. His recent order to pause Inflation Reduction Act (IRA) funding has cast doubt on the future of key programs like the federal solar tax credit. The IRA was expected to provide long-term stability and financial incentives for solar adoption, but with Trump’s latest executive orders, the industry is left navigating an increasingly uncertain policy landscape.

Sunnova’s layoffs are a sign of an industry in flux. While solar remains a key player in the transition to clean energy, economic pressures and shifting government policies will continue to shape its trajectory. As companies adapt to these challenges, the coming months will reveal whether cost-cutting measures like Sunnova’s can help stabilize the industry.