Over the last decade, solar has grown significantly more inexpensive, making it a popular solution for households to save money on their energy bills while reducing their carbon impact. Nationally, over 2.7 million homes have solar panels, but as solar has grown in popularity, so has the frequency of solar panel frauds and fraudulent firms.

Look for red signals and always do your homework before picking a solar installation to avoid being taken advantage of and possibly losing hundreds of thousands of dollars on a non-existent or non-operational solar system.

This blog will discuss the most common solar scams you should know about.

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Common Solar Scams

Solar frauds can take many forms, some as simple as higher-than-average pricing and some as heinous as misrepresenting incentive schemes. As a homeowner, you must exercise caution when dealing with any contractor, including solar panel businesses. Here are some of the most typical frauds afflicting solar-focused states.

Deceptive Lease Agreements

Some shady solar companies may try to sell you a lease or a power purchase agreement (PPA), which are alternate financing choices for solar energy installations. They frequently offer "zero down on solar panels" or "free solar panels." Leasing and PPAs, when done properly, could be fantastic solutions to harness solar electricity, especially if you lack the finances for an initial down payment.

Power Purchase Agreement (PPA): PPAs allow solar businesses to install panels on your property and sell you the power they generate. This power is often less expensive than a utility provider's fuel, and the corporation pays for installation, maintenance, and removal.

Solar Leasing: As the name implies, you lease solar panels from a firm and pay a monthly charge to use them. Homeowners suffer no upfront fees in this arrangement and benefit from the energy produced by the boards, lowering their electricity bills.

Misconceptions about panel ownership contribute to the fraudulent nature of these financing options. During the deal, a fraudster can erroneously state that you would own the panels while also offering prospective rewards from big incentive programs or rebates.

However, because neither method of financing requires ownership, you may be ineligible for many federal and state incentive programs. PPAs and leases may also contribute little to the value of your house since they frequently involve additional expenditures, unfavorable rates, and tight restrictions that can be difficult (or costly) to negotiate.

Utility Reps Who Aren't Real

It is the most common type of solar panel fraud, similar to door-to-door scams. To persuade homes, these false companies frequently pose as state or utility staff and use different approaches, such as showing up at people's doorsteps, sending emails, or making phone calls. They make numerous assertions while communicating with locals, including:

  • There are currently no new state or federal tax credits available.
  • Federal and state tax advantages are going to expire.
  • You may cut your energy bill by up to 70%.
  • You may remove your electricity bill.

While several governments provide incentives and reimbursement schemes, there must be a record of randomly sending staff to individuals' houses to convince them to install solar panels. Furthermore, many of these assumptions are only partially accurate because federal and state incentives sometimes have time limits or are altered yearly. While some houses may achieve a 70% decrease in electricity expenses under ideal conditions and by utilizing programs such as SREC and net metering, it is critical to exercise vigilance with any email, phone call, or sales pitch, providing rates that appear too good to be true. To ensure accurate information, conduct extensive research on state and municipal incentives.

Unlawful or High-Pressure Sales Techniques

Unfortunately, many industries, including solar panel installations, frequently use assertive, aggressive, or dishonest sales practices. Untrustworthy organizations may pursue sales at any cost, even if it means overlooking critical facts that might hurt the homeowner. Salespeople use a variety of devious ways to close a transaction, some more obvious than others.

When dealing with a suspect vendor, watch for the following signs. They could:

  • Attempt to reach an agreement without a formal contract.
  • Push for a sale without giving you enough time to consider¬†your choices.
  • Skip property inspections and produce estimates and warranties quickly.
  • Make bold claims, such as excessively cheap rates, free solar panels, or no upfront costs.
  • Allege affiliation with or employment with a utility company.
  • Show that you are unable or unwilling to offer an unambiguous business identity.
  • Avoid providing insurance, license, or certification information.
  • Provide free extras such as solar batteries or warranty programs.
  • Warn of an impending increase in utility rates.
  • Inflate your system's worth by pricing it much more than the existing market value.
  • Insist on a specific brand or technology offered or permitted in your area.
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False Promises Regarding Ineligible Tax Credits

Understanding solar tax advantages and rebate schemes is critical for any household considering solar. For example, there is a 26% federal solar tax credit, but it is only available to individuals who satisfy the eligibility requirements. Some states offer extra tax breaks that, in some cases, can be combined with the federal credit. Additionally, utility providers may offer homeowner programs in certain localities or communities.

However, regulators overseeing these state and municipal incentive schemes alter and have tight eligibility conditions or time limits. Unethical businesses take advantage of the complexities of these restrictions, making promises based on faulty, obsolete, or completely erroneous information.

Fraudulent advertisements, phishing emails, and other unethical online marketing schemes

Online frauds have become a modern-day plague, impacting almost everyone at some point. These frauds use fast-rising movements, leveraging their popularity to lure people while posing as legitimate businesses. Advertisements, pop-ups, emails, banners, and social media links touting "free solar panels," "zero-down solar energy systems," and "free Tesla power wall" are almost certainly hoaxes. We strongly advise completing extensive research on local solar panel businesses and scheduling an in-person estimate through their official channels.

Avoiding Solar Panel Scams

Make sure your solar provider is reputable before signing any contracts. Take the time to conduct an independent investigation to confirm their reliability.

Make Informed Decisions: Only enter into contracts quickly. Legitimate businesses provide you with all of the required information and time to make your decision. Be wary of scammers that put pressure on you to sign right away. If your queries are unanswered, you should leave.

Obtain Multiple quotations: Get quotations from different solar contractors for second viewpoints. Shopping around helps assure accuracy because other salespeople may present various pricing and system specifications.

Check for authenticity: Confirm the authenticity of your selected solar provider by reading internet reviews, visiting the Better Business Bureau (BBB) page, and verifying licenses and credentials. Among the reliable sites are the SEIA's national solar database and IREC's solar licensing database.

Final Word

Opting for solar energy is a smart decision for sustainable power. Nevertheless, it's crucial to stay vigilant against potential scams and disreputable companies in the solar industry. Always conduct thorough research before selecting an installer to ensure trustworthiness.

For a dependable provider, consider one of the top-rated solar installers, Energy Bill Cruncher. We can link you with the best options in the market. Reach out to us today to explore the possibilities.