solar company bankruptcy

What happens when a solar company files for bankruptcy?

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The solar industry is growing rapidly, which means solar installers and manufacturers are competing with ever-growing numbers of companies for space in the market. This can lead to bankruptcy cases for solar companies who fall behind in the industry, as seen recently with Sungevity and SolarWorld. As a solar shopper you may be concerned about the state of warranty coverage for your panels in the event that the solar company you are working with goes under. In this article, we will look at solar manufacturers and installers, and what their financial positions mean to you as their customer.

Equipment manufacturer bankruptcy

The fact that a company has filed for bankruptcy doesn’t mean that their customers will lose support for the products or services that they’ve purchased. In the U.S., filing for Chapter 11 bankruptcy sets off a reorganization process where the company will sell its assets, and in many cases the buyer also takes over responsibilities like upholding warranties.

There are a few ways to avoid being left without a production or equipment warranty in the event that your solar equipment manufacturer files for bankruptcy:

1. Buy an extended warranty

One option for hedging against solar manufacturer bankruptcy concerns is to purchase an extended warranty from your solar installer. Extended warranties can be purchased through most solar installers, and in the event that your equipment manufacturer goes out of business, your installer is still contractually obligated to honor your warranty. However, if both your installer and manufacturer end up bankrupt, you could be at risk for losing any kind of warranty protection.

2. Insure your solar installation

Many insurance companies now offer plans for renewable energy and solar, and covering your installation with one of these plans will protect you from defective panels, decreasing output, and other damage to your solar array. While expensive, these types of policies can cover installation and operations damage, power output, and general equipment health. It is important to keep in mind that you may end up spending the same amount of money to replace parts like inverters or single panels as you would entering an insurance agreement.

3. Buy from a warranty-insuring manufacturer

The safest way to prevent being left without a warranty from a bankrupt solar manufacturer is to buy your panels from a warranty-insuring manufacturer. A warranty-insuring manufacturer commits their warranties to being held up through third-party backing even if they themselves declare bankruptcy. One example of this kind of policy is SolarWorld’s Extend Warranty coverage.

Solar installer bankruptcy

A question that EnergySage Solar Marketplace users frequently ask is, “What happens if my solar installer goes out of business?” Depending on if you are working with a large installer with business across the country or a local company only servicing areas near you, installer bankruptcy may affect you differently.

Large/national-scale installers

Large solar companies declaring bankruptcy have been making news headlines recently as the solar market space becomes more mature and solar prices continue to fall. One such recent case was Sungevity’s bankruptcy: after declaring bankruptcy in March of 2017, Sungevity was purchased by Northern Pacific Group, and their existing solar financing agreements were acquired by the solar company Sunrun. As part of the agreement, Sunrun becomes the solar service provider for Sungevity customers. As a result, Sungevity customers saw no interruption in service, and Sunrun took over management of Sungevity’s solar lease agreements.

Cases like Sungevity and Sunrun’s are somewhat of the norm for large solar installation companies. When these large companies declare bankruptcy, they are almost always bought by another solar company or an equity fund. This means that as a customer, you shouldn’t worry about losing your installer services because they will most likely be transferred to another experienced solar company.

Small/local installers

As with large installers, local companies will often be bought by a separate entity that will take responsibility for all of the installer services that were originally promised to you. In this type of small company bankruptcy, the installer that is servicing your panels may change, but the installer warranty and originally promised installer services for your panels will still be available to you.

However, not all small installers will be bought by a larger company. Because of this, it may be smart to consider investing in a solar panel operations and maintenance (O&M) plan. O&M plans are purchased through separate companies not involved in the installation of your solar panels, and provide long-term services for your solar panels. In the case that your local installer goes bankrupt, your O&M provider will still work to diagnose and repair issues with your solar energy system that your installer would have handled, like cleaning, electrical systems maintenance, and general system inspections.

If you don’t have an O&M plan, there are still resources to help you make sure your solar energy system is running properly. Whether your solar installer is a national company or a mom-and-pop setup in your area, you will still be covered by the equipment and production warranties provided by the manufacturer of your solar panels even if your installer goes out of business. These warranties typically guarantee around 80% electricity production capacity over 25 years and materials coverage for 10 to 25 years. You can contact your equipment manufacturer, who will likely be able to connect you with a contractor who can diagnose and repair your damaged or faulty system for a one-time fee.

Compare your solar options with EnergySage

On the EnergySage Solar Marketplace, you can solicit quotes solar projects from qualified, pre-vetted installers in your area. Installers on the EnergySage marketplace provide quotes with all types of solar panels, inverters, and racking systems, and comparing quotes side by side is the best way to make sure you are getting the best package deal for your solar project. If you have a question, concern, or preference regarding your solar equipment, you can leave a note on your profile outlining your question, and installers will know that you want more information about specific product offerings.

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About Jacob Marsh

Jacob is a researcher and content writer at EnergySage, where he focuses primarily on current issues–and new technology!–in the solar industry. With a background in environmental and geological science, Jacob brings an analytical perspective and passion for conservation to help solar shoppers make the right energy choices for their wallet and the environment. Outside of EnergySage, you can find him playing Ultimate Frisbee or learning a new, obscure board game.

14 thoughts on “What happens when a solar company files for bankruptcy?

  1. Alfonso Rojas

    Peter Dean filed for Chapter 11 how can I find out if any other solar company has taken over responsibilities like upholding warranties for Peter Dean I live in Fullerton CA

  2. joe cassidy

    i signed a contract with petersen dean in december of 2018 for $216,000 .00 the panels were delivered in december 24 th 2018 they are still sitting on the ground since .i am out of pocket $108,000.they are now in bankrupcy .am i completely screwed

  3. D. Zizzo

    My problem is microinverters. Sunpower purchased Solarbridge(my inverters). Sunpower was covering the warranty, but when they sold this division to Enphase, now neither company wants to accept responsibility for the “25 year warranty” that originally came with the Solarbridge microinverters. Sunpower changed the microinverters for their own customers, but for those of us who were not originally Sunpower customers they did not. In the meantime Enphase has stopped making the microinverters and replaced them with another. I have 7 units out of 29 not working. Sunpower says I must go through my panel manufacturer (ET Solar), but this game wound up throwing them into bankruptcy, as they were heavily dependent on Solarbridge for their microinverters.

  4. David from Vail, AZ

    I bought my 11.5 KW solar panel system in 2016 from a company Preventive Solar from Utah, and they’re gone now. I am now having issues with my system and the former owner “President” is not responding to my calls. Can I sue somebody. This is a pretty sad fraud happening in the USA!!

  5. Jennifer Mouton

    We purchased our solar panels 3 years ago. I have 25 panels for 2000 sqf house. In the 3 years one time i may have made 20klw for ONE month they produced . Most are 14 or less each month. I did the math for 2017 & 20!8. I got a total money back for both years is about $100.
    I have been calling my company who would not answer my call until i put a negative review. They sent someone out and he said we were making 400klw per month. My bill never shows that amount! I contacted the guy again and he is no longer working for the company. I have called the electric company, the company who made the panels and now the company we bought them from is recently no longer i. Business. KT Solar in Houston Tx. I feel we got scammed. I have had other people using the same electric company they were making $100 credit in one month. I totally do not believe in solar after this experience i am going through.

  6. Maureen Vance

    My eurosolar system has ceased working. Have found out the company is no longer. Our system is under warranty. Who do I get in touch with regarding this.

  7. Sandra

    GoSolar in my area went out of business. They installed Hyundai panels and a Solar Edge Inverter. One of my panels is cracked and I have no idea how to get it replaced. My system was purchased in 2016. So it is only 4 years old.


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