What is the future after the bankruptcy of solar panel installer SunPower?
In the energy industry, it’s known as the solar coaster: the ups and downs in the solar industry that can cause companies to grow quickly and disappear just as quickly. So far, customers of more than one major installer have felt those big drops in 2024.
The latest solar giant to run into trouble is SunPower Solar, one of CNET’s picks for best national solar companies. The company is now filing for Chapter 11 bankruptcy and selling off most of its assets in a company-wide wind-down, according to a recent statement.
As part of the bankruptcy, Complete Solaria will acquire SunPower’s Blue Raven Solar and New Homes subsidiaries, as well as other parts of SunPower’s dealer network.
“Given the challenges SunPower has faced, the proposed transaction presents an important opportunity for key parts of our business to continue our legacy under new ownership,” SunPower Executive Chairman Tom Werner said in the announcement. “We are working to secure long-term solutions for the remaining areas of our business while remaining focused on supporting our valued employees, customers, dealers, builders and partners.”
For SunPower customers, this news mainly raises questions: What happens to my solar panels?
Here’s what you need to know about SunPower Solar and the information you need if your chosen solar installer goes out of business.
What We Know About the State of SunPower Solar
SunPower’s common stock has officially been delisted from the Nasdaq Stock Exchange, according to a press release the company issued Monday. The delisting is the result of SunPower’s failure to comply with Nasdaq’s listing rules, including filing for Chapter 11 bankruptcy and failing to file periodic financial reports.
The IPO will take place on August 16. After that date, SunPower’s common stock is expected to begin trading on the Pink Open Market, commonly known as the “pink sheets.”
Three weeks ago, SunPower notified California that it planned to lay off 290 workers in the state. In the company’s WARN notice, it attributed the layoffs to “recent financial conditions.”
“SunPower is working as diligently as possible to find a long-term solution for the company in the coming weeks to avoid certain layoffs,” the company said. “However, at this time there is no guarantee that the company will be able to do so or that all employees will be retained.”
SunPower exited its solar leasing and power purchase agreement business in July, with the change taking effect immediately after the announcement. Reuters was the first to report this about the end of SunPower’s leases and PPAs after letters SunPower sent to dealers came to light investment notes (PDF), in which the company’s shares are reduced.
CNET’s review of SunPower praises the company’s solar equipment but notes that many of the company’s products and services are out of reach for many people. The company’s Maxeon panels (made by a company that spun off from SunPower in 2020) are among the most efficient solar panels on the market. The end of solar leasing and power purchase agreements has taken away those cheaper financing options for SunPower customers.
In February, the company was subpoenaed by the U.S. Securities and Exchange Commission for information about allegations of financial misconduct by senior executives. SunPower’s CEO resigned that month. The auditor, Ernst & Young, stepped down in June.
The company eliminate other industriesincluding direct sales, in April. That month, SunPower underwent a much larger round of layoffs, laying off about 1,000 workers.
What’s Still Unclear for SunPower Solar Customers
Complete Solaria has purchased Blue Raven Solar, New Homes and other parts of the SunPower dealer network, assuming responsibility for the continued service and operations of those businesses’ customers. However, we do not yet know what assets will be purchased from SunPower.
There is no clear indication of what assets SunPower is selling to Complete Solaria or liquidating elsewhere.
It remains unclear what will happen to existing solar leases and PPAs after these operations cease, or how the recent layoffs will impact service to SunPower customers in the Bay Area.
CNET has reached out to SunPower for comment.
When a solar company pulls out of the market, people usually have questions about the continuation of their products and services. What happens to the solar panels installed on your home? What about the warranties?
SunPower has not yet commented on these specific issues. Below is some general advice to help you prepare in the event that your solar installer withdraws from the market.
What do you need to know if your solar company goes bankrupt?
The best way to avoid being caught off guard by a solar company restructuring is to be prepared before it happens. Here are some situations you might find yourself in — and how to understand them.
What happens to the warranties on your solar energy equipment?
The simplest answer to this question is that if you have a warranty with the actual manufacturer of the equipment (for example, a warranty with Maxeon), then you should be fine if your installer goes out of business. If you are unsure whether your warranty is with the manufacturer of the equipment or with your solar installer, then you will need to call and ask some questions.
In the wake of SunPower’s bankruptcy announcement, Maxeon a blog post published clarifying that the company has been completely independent from SunPower since 2020. The company reaffirmed that it will honor product warranties for SunPower solar panels in the same manner as before the bankruptcy announcement.
Customers with Maxeon SunPower branded equipment installed before August 5 can: Register for warranty coverage on the Maxeon websiteMaxeon said customers must register by Dec. 31, 2024.
However, if your warranty is with your solar installer, things can get a bit more complicated. If the solar company sells you that warranty, they are obligated to honor it under all circumstances. In many cases, there is fine print in the paperwork that explains what a transfer of the warranty will look like. The good news is that this means that reputable solar companies should still cover your warranties in the event that they go belly up.
Now would be a good time to take out the documents you have tucked away and go through them to figure out how that transfer would work in your particular case. As always, if you have any questions, it is best to call your installer and resolve them before a problem arises.
What if you have a solar panel lease agreement or a power purchase agreement?
If you have a solar loan or solar lease that is independent of your solar installer, then nothing should change in your agreement. You will continue to make payments as if nothing happened.
If your solar lease was through your solar installer, the lease must be transferred to another company. The same goes for power purchase agreements; you must be able to maintain your agreement while making payments to another company.
If you have a contract with a reputable solar company, all of these details should be included in your signed documents. If you can’t find information about where your solar leases or power purchase agreements will transfer to in the event your solar installer goes out of business, you should start making calls to protect yourself.
Why is this happening now? And should it affect your decision to go solar?
SunPower is the longest-running national solar company in the U.S., founded in 1985. The company is one of the few solar installers operating in all 50 states.
While the U.S. saw record numbers of residential solar installations in 2023, market changes have led to a decline in the number of new solar roofs so far in 2024. California’s NEM 3.0 policy has been particularly disastrous, stunting solar growth in one of the country’s largest markets.
Energy consultancy Wood Mackenzie expects the residential solar market to grow. shrink by 14% this yearwith California’s changes taking the biggest brunt.
While some solar companies are struggling in the current market conditions, this may be one of the best times for U.S. residents to go solar. The Inflation Reduction Act expanded the residential clean energy tax credit, allowing homeowners who install a solar panel system to recoup 30% of the cost come tax season.
To learn more about how these financing options can impact your decision to go solar, check out CNET’s articles on solar lease agreements and power purchase agreements.
