Washington lawmakers move to rein in unscrupulous rooftop solar companies

Spend much time online and you are bound to be served a few ads tempting you to go solar at no cost. But there is no such thing as “free” rooftop solar power systems in Washington, according to local utilities and the state’s lead trade association for the solar sector. 

Out-of-state sales lead generators and marketing companies are responsible for many of the dubious solar energy ads you encounter online. Deceptive and high-pressure in-person tactics are also generating complaints to state government, notably when salespeople overpromise on incentives and electricity bill savings. And, in some cases, homeowners have reported flawed installs that left their homes damaged and their new solar panels not working correctly.

In Olympia this winter, state lawmakers took a stab at addressing these issues by strengthening consumer protections for solar installations. The resulting bill now awaits Washington Gov. Jay Inslee’s signature.

Until now, the state’s consumer protection code did not have provisions specific to this fast-growing sector. The Washington State Department of Commerce, solar contractors and electric utilities teamed up at the state Legislature to come up with the new rules and enforcement mechanisms. 

“This bill would help residents and businesses understand what they will and will not be getting with a solar energy install, and prevent deceptive solar sales tactics and create an ability to hold bad actors accountable,” said Nora Hawkins, senior energy policy specialist at the state Department of Commerce.

Hawkins said Commerce took the initiative after hearing of an increase in consumer complaints about promised savings that didn’t come true and faulty solar array installs. In an interview, she said the complaints came to her agency mainly through utility companies and reputable solar contractors who had to pick up the pieces.

In a departure from the usual Capitol script, the affected trade association and individual solar companies spoke up in favor of more regulation of their industry. They want to protect their reputations and growth prospects. The bad actors targeted by the consumer protection bill were neither seen nor heard from during the legislative session.

A key element of the legislation now on the governor’s desk, Hawkins said, is a list of mandatory disclosures that a salesperson or contractor must make to a prospective solar customer. Those include a good faith, written estimate of the projected electricity bill savings in the first year alongside the itemized total cost of the install.

Hawkins said her agency originally wanted to add a requirement for an estimate of the payback period, but solar installers pushed back on that because they said there were too many assumptions and variables involved.

‘A defective product that did not deliver’

A lawsuit brought by a Longview, Washington couple against their solar installer and lender this past year illustrates some of the pitfalls that lawmakers sought to fix. 

The suit was settled out-of-court after mediation in January. But the complaint and response read like a textbook example of residential solar gone wrong, including misunderstandings about the federal tax credit, an electricity meter installed backward, and tar “inexplicably” spread all over the homeowners’ roof.

Seattle attorney Christina Henry alleged in U.S. District Court that Pasco-based solar company Solgen Power “deceived” her clients into believing that an expensive, 77-panel design was a financially sound investment for them.

“Solgen misled Mr. and Mrs. Cummins to believe their electricity bills would reduce more than 85% after purchase of the solar panels when it only produced less than $15 to $20 in monthly savings and financing a defective product that did not deliver as intended,” wrote Henry on behalf of the homeowners.

Henry declined to make the Cummins available for comment because the case was settled.

Solgen Power sought to have the case dismissed because the homeowners signed a contract full of disclaimers. For starters, Solgen’s attorney quoted directly from the contract stating that the customer assumes all risk and the company makes no representations about the accuracy of the information it provided.

“The Company does not guarantee any energy savings, efficiencies, or cost savings through the use of the Solar Array. Information provided about energy savings, efficiencies, and cost savings is solely for illustrative purposes,” the contract said.

Further, Solgen Power noted the signed contract stated that anything its salesperson might have said about timely delivery, tax credits or system performance could not be relied upon.

“No sales representative has the authority to add, delete, or modify the typed terms of this agreement, either in writing or verbally. Customer agrees it is not relying on verbal assurances or statements of any person,” read the defendant’s court filing.

‘Puts them on the civil liability hook’ 

Had Washington’s solar consumer protection legislation been in place two years ago, the installer company would have been required to provide an honest estimate of the electricity cost savings. It would also have had to clearly spell out the terms of the large loan the Longview couple was saddled with.

“HB 2156 puts them on the civil liability hook for misleading, if not predatory, sales tactics as well as lending violations,” said Bill Will, senior policy advisor at the trade group Washington Solar Industries Association, referring to the new legislation by its bill number.

The prime sponsors of the solar consumer protection bill, state Rep. Kristine Reeves, D-Federal Way, and Sen. Derek Stanford, D-Bothell, said that homeowners will now have more tools to make informed decisions.

The Washington Solar Energy Industries Association said the required new disclosures are mostly standard procedure already among its membership. Solgen Power, which is not a WASEIA member, did not respond to an emailed request for its take.

“For most WASEIA members, it’s not going to be a big impact,” said Will.

Will was particularly pleased by one provision of the newly passed legislation that requires anyone advertising or soliciting rooftop solar sales to be directly employed by an electrical contractor licensed in Washington.

“The most common abuse that we’ve seen is fly-by-night companies that swoop in and overpromise and underdeliver,” Will said. “We feel it would definitely curtail the door-to-door marketing that is less than savory.”

Electric utility lobbyists were also highly visible as the Legislature considered what to do. 

The utilities succeeded in getting a provision that addressed a major pain point for them, which is finding out too late that a customer’s rooftop solar installation is unsafe or incompatible with the grid. The legislation on the governor’s desk generally requires an approved interconnection agreement before a solar installer can begin a job.

State Department of Commerce Energy Policy Office Director Glenn Blackmon said he expected the newly passed legislation would make it easier for private attorneys and the consumer protection division of the state attorney general’s office to police the rooftop solar industry. 

He and others stressed that most businesses in the sector are upstanding and that the state needs them to flourish to meet its clean energy goals.

“We don’t expect all deceptive practices to stop because of this; the internet is too big for that,” Blackmon said. 

If signed by the governor, the new solar consumer protections would take effect in June. There’s every reason to believe Inslee will sign the legislation, which sailed through the state House and Senate on unanimous votes.