“I am the CEO of an accounting firm that is looking into leasing a solar system for our 8,000-square-foot office building. Some of your articles on solar have been very negative as to leasing options. We have met with solar salespeople who have given us energy-saving projections that seem reasonable, as well as the impression that leasing is the best way to go. Are you still to opposed to leasing these systems, and if so, why? Thanks, ‘Mike.’”
Yes, I am strongly opposed to leasing solar, and I’ll tell you that not a week goes by when I have not heard via this column from businesses and homeowners who are pulling their hair out and going crazy while trying to obtain service on their leased unit because their seller went out of business, as thousands have across the country. For a real eye-opener, I recommend reading Time magazine’s September article Rooftop Solar Power Has a Dark Side.
For a CPA to ask these questions makes me wonder a lot about his ability to do the math, or to have researched the false economy of leased solar systems and the sheer number of solar companies that have failed in recent years.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
But, first, let me tell you about Brenda, Chris and his mother’s 2023 Christmas that never really happened. Back in 2017, the couple moved into his mother’s home to help care for her ailing husband. They were looking for ways to save money and met with a sales rep from Vivint Solar, “who showed us realistic-appearing projections of huge energy savings on a system we could lease from them. There was nothing due up front: They would install, maintain the system — which they owned — and we would pay them for the energy produced over 20 years.
“We were promised prompt service if anything broke down, and all worked fine for about two years, and then the inverter failed — as they often do. Despite repeated calls for service, we were ignored for months, paying the normal rates of our expensive utility.”
Surprise! You owe us $4,000!
As Chris explained, every month, Vivint, which was taken over by Sunrun in 2020, would make automatic deductions from his bank account to pay for the energy the system produced. “The amounts varied greatly,” he pointed out. “And then, on December 15, we got a bill for over $4,000 with no explanation, no justification beyond the statement that they had failed to properly make deductions over 18 months.” Chris confirmed that they did make monthly deductions over the 18 months, but this $4,000 was in addition to those charges.
Request for proof falls on deaf ears
“I asked them for a detailed accounting (of what the extra charges were for), which they refused,” Chris said. “Then someone from their collections department phoned and insisted on large payments, again refusing to justify the amount. We had no Christmas, no presents, afraid to spend money. That is when I found your articles, and we spoke.”
In our phone conversations, I learned that Chris is an unemployed agricultural worker, and Brenda is off work, being treated for breast cancer. None of that mattered to the bill collector. So on January 26, I emailed Sunrun’s general counsel, with a cc to the company’s media department, simply asking them to look into this and work out something fair. Later the same day, Chris phoned and told me, “Mr. Beaver! They are forgetting the entire balance! They confirmed it via email.”
So, hats off to Jeanna Steele, Sunrun’s general counsel. This was a powerful example of the power of the press and an attorney who did the right thing, the fair thing. So, in my book, Jeanna is a real gem.
So, how much energy savings have Brenda and Chris realized all these years? “Around a thousand dollars a year, and it wasn’t worth all the recent grief,” Chris said.
Why leasing is often a lousy idea
Let me be blunt. If you can buy a system with cash or obtain a loan for a solar system at a reasonable interest rate, owning solar panels directly is the way to go, rather than going with a leased system.
Also, if there are tax breaks and incentives — which just got nuked in California, and sales are down 82%, according to CalMatters — they are not available with a lease.
Next, selling a property that has an active solar lease is often difficult to impossible, as the buyer must agree to assume the remaining contractual obligation. I have never spoken with one real estate agent who’s had anything good to say about trying to sell a property with a leased solar system.
Finally, I do not want anyone to walk away from this story thinking that I oppose solar energy in general. Quite the contrary! Friends who own their systems generally are delighted with the energy savings and budget for replacement of inverters and backup batteries.
There is one more consideration: your age. Will you live long enough to recover the out-of-pocket cost or complete a 20-year lease? Do you want to burden family with that “brilliant” solar idea?
Dennis Beaver practices law in Bakersfield, Calif., and welcomes comments and questions from readers, which may be faxed to (661) 323-7993, or e-mailed to Lagombeaver1@gmail.com. And be sure to visit dennisbeaver.com.
Related Content
-
Three Ways President Trump Could Impact the EconomyThe Letter Some of Trump's top priorities could boost economic growth, but others risk fueling inflation.
-
Average Health Care Costs by Age: Can You Afford It?Expect to pay more as you age. We've got solutions for how to cover these costs, which can exceed $1,000 per month in your 60s.
-
Will You Be Able to Afford Your Dream Retirement?You might need to save more than you think you do. Here are some expenses that might be larger than you expect, along with ways to ensure you save enough.
-
More SECURE 2.0 Retirement Enhancements Kick in This YearSaving for retirement gets a boost with these SECURE 2.0 Act provisions that are starting in 2025.
-
Saving for Your Emergency Fund: As Easy as 1-3-6An emergency fund that can cover six months' worth of expenses is far easier to build if you focus on smaller goals at first.
-
The Wrong Money Question to Ask After Trump's ElectionIf you're wondering what moves to make with a new president moving into the White House, you're being dangerously shortsighted. Here's what to do instead.
-
An Investing Plan for This Year: Doing Less Can Lead to MoreAchieve more when investing in 2025 by planning to work smarter, not harder. These three strategies can help put you on the right track and keep you there.
-
All About Six Types of Auto Insurance CoverageDo you know what your auto insurance policy covers? Here's a primer on some coverage categories, along with examples of how each type of coverage works.
-
Social Security and Medicare Funding: Is the Sky Falling?Social Security and Medicare are slowly running out of money, but what does that mean for the retirees counting on them? Actually, it's not all bad news.
-
What We Need to Do to Protect Retirees' Financial SecurityCognitive decline and aging in general put older retirees at risk of losing their financial security when they're the most vulnerable. What can be done?
