What to know about protecting your solar investment

If you're considering solar panels for your home, there are a few things you'll need to be aware of to select the best option for you. While installing solar panels can put money back in your pocket in a few different ways (such as reducing or eliminating your electricity bills, providing you with incentives, and getting your credits through net metering), they are no doubt an expensive purchase, so you'll want to make sure you're confident and feel secure in protecting your investment.

Disclaimer: This article is intended to provide an informational overview of consumer protections for interested homeowners. It's not designed to serve as official financial guidance. If you're interested in installing solar products, use your best judgment and seek advice from a licensed professional, if necessary, before making any purchase or investment.

While solar is still growing compared to credit, banking, and other larger, more established industries, there are still consumer protection agencies and oversight throughout government agencies and the solar industry to help you feel confident in making a solar purchase. Some of these organizations include:

Federal Trade Commission

The Federal Trade Commission (FTC) is dedicated to prohibiting unfair and deceptive trade practices to help you protect yourself and your bank accounts against scammers and fraudsters. Since its inception in 1914, various issues have been addressed, and settlements have been reached with the FTC's help.

The FTC Act regulates advertising, bans deceptive advertising, and requires specific disclosures to explain any claims. Additionally, FTC guidelines warn that "free" claims require caution. The FTC states, "Offers of 'free' products need to list all conditions and obligations in a clear and conspicuous location."

Consumer Financial Protection Bureau

The Consumer Financial Protection Bureau (CFPB) is the primary federal financial regulator, enforcing laws regarding consumer leases and financial products. So, any solar loans fall within their purview. You can get resources on loans and scams on the CFPB website.

Your state's Attorney General office

These officials and their organizations exist in each state throughout the U.S. Attorneys General (AGs) are the top legal officers of their state or territory, and they advise and represent their state's legislature and agencies, acting as an attorney of sorts for their citizens. Most are elected officials, though in a few cases, the governor appoints their state's AG. You can search for your state's AG on usa.gov. AG offices often coordinate with the FTC and other agencies when pursuing complaints and lawsuits for issues related to consumer protection.

Your state's consumer protection offices

Many states have other agencies besides the AG offices dedicated to various areas, including banking and finance, insurance, securities, and utilities. These entities may sometimes be involved with solar consumer protection related to financing loans or the state's utilities, but this varies by state. In some cases, major cities may also have dedicated consumer protection agencies.

Learn more about if your state has other consumer protection agencies.

Solar Energy Industries Association

Founded in 1974, the Solar Energy Industries Association (SEIA) is the national trade association for the solar and solar-plus-storage industries, working to build a clean energy economy and support solar energy in the U.S. One of their key focal points is ensuring that consumer protection is at the forefront of the solar industry. SEIA created a consumer guide for going solar that you can use to understand financing options, contracting terms to be aware of, and other helpful tips.

In addition to the agencies helping protect consumers in the solar industry, safety and quality standards are in place to protect both solar employees and you as a consumer. These include electrical codes, oversight, certifications, and residential codes for photovoltaic (PV) systems. The Institute for Building Technology and Safety (IBTS) also provides guidelines for the solar industry for quality management and assurance.

Some states also have regulations to protect their residents when going solar. The National Renewable Energy Laboratory (NREL) notes on its website that "Arizona, New Mexico, and Utah have passed mandatory rooftop PV disclosure laws, while Minnesota and Maryland have instituted mandatory community solar disclosure regulations." CESA also outlines specific contract disclosures by state for both rooftop and community solar.

Over the last decade, several settlements have been made to help remedy issues when they arise and help repay consumers who've been taken advantage of, including:

• April 2022: Minnesota AG Keith Ellison announced a lawsuit against four solar companies, three executives at those companies, and several lenders that partnered with the solar companies engaging in deceptive and fraudulent practices in marketing and selling residential solar panel systems that cost homeowners between $20,000 to $55,000. The charges include misrepresenting cost savings, not connecting panels to the utility grid as promised, panels not working properly, and not getting the utility-bill savings or tax credits they promised.

• February 2021: An April 2020 lawsuit by Massachusetts AG Maura Healey was settled when a Pennsylvania-based solar energy developer agreed to pay a total of approximately $1.14 million on allegations that its violations of federal stormwater requirements damaged protected wetland resources in the town of Williamsburg, MA.

• November 2017: A solar panel lead generation company that pitched energy savings settled FTC charges for $155,000 for making millions of illegal pre-recorded telemarketing calls to consumers on the Do Not Call Registry.

• November 2015: The Texas AG office announced penalties for a North Texas solar company that was ordered to pay $5.8 million in penalties and legal fees and $2.7 million to customers for importing unsafe solar panels from China and falsely labeling the items as U.S.-made.

• April 2012: The FTC stopped a company offering a supposedly "free" book falsely promising that it would show them how to power their cars and homes at no cost, and then billed them for an online magazine they never ordered. They were also ordered to pay nearly $2 million in customer refunds. The FTC settlement notes that their ads falsely claimed the book would describe "how to get free gas for life," "how to put solar panels on your roof for free," and "how to make your electricity meter go backward paying you," with phony testimonial statements such as "I don't pay for electricity" and "I don't have car payments, and I don't pay for fuel."

As with any other industry, solar has some scammers and fraudsters. Just like you would for any major purchase, it's essential to review all of the information when it comes to what you're paying for, what your installer is committing to doing, what warranties cover your purchase, and what agreements and contracts you're committing to with your solar system.

If you're financing your solar purchase with a loan, there are also specific questions to ask your lender or installer to ensure you understand the total cost, any loan fees, and monthly payments.

If you have issues with your solar system, your best first move is to contact your installer. Usually, they can help troubleshoot remotely to identify the problem and work with the equipment manufacturer if you need to repair or replace equipment or a part under warranty.

SEIA also has a Complaint Resolution Process so that anyone from a homeowner to a solar company can voice a complaint within the solar industry. SEIA encourages you to resolve your issues directly, but their Resolution Panels present a more formal complaint review process if that's not possible. You can learn more about their consumer protection resources on SEIA's website.

Choosing a reputable, vetted, well-reviewed installer is one of the best ways to minimize your risk when going solar. While there are no guarantees, you can learn if the installer has a solid track record by reading reviews and speaking to neighbors or friends about installers they've used and recommended. You can also review the solar equipment you're quoted, including solar panels and inverters, to understand their efficiency, ratings, and warranties.

What is the best way to find a reputable installer? On the EnergySage Marketplace, you can read reviews, compare multiple quotes, and request financing options from our network of pre-vetted, reputable installers and lenders (for free!).