Solar energy has been mainstream for a long time now, and since it is a lucrative business, most scammers take advantage of the situation so that they can make a quick buck.
Since there are many scams, in this article, I will explain the five most common solar panel scams and how to avoid them.
What Are Solar Panel Scams?
Solar panel scams are fraudulent or deceptive practices that unethical companies or individuals employ to take advantage of homeowners.
These frauds often combine elements of traditional door-to-door sales tactics with more modern contracting schemes.
Scammers may misrepresent services, make false promises about savings or incentives, or use high-pressure sales tactics to push customers to make hasty decisions.
How Common Are Solar Panel Scams?
Solar panel scams have become common, especially in those countries or states with robust solar markets or those with strong incentive programs.
What Are Common Types of Solar Panel Scams?
Solar panel scams come in different forms, each with its own set of deceptive tactics aimed at taking advantage of homeowners.
Deceptive Lease Agreements
One of the most prevalent solar scams involves misleading lease agreements or power purchase agreements (PPAs).
The scammers will intentionally misrepresent these agreements. Scammers often advertise “$0 down on owning solar panels” or “solar panels at no cost” but don’t disclose that the homeowner won’t own the panels.
Yes, the government might give you an incentive, but they will not install solar panels at your home at $0; if you see these types of claims, run away.
Fake Utility Representatives
Another common scam is someone posing as a utility company or government agency.
Usually these people will contact you and offer something crazy, like dramatic savings on electric bills or a new discount.
If the offer seems excessively attractive, it’s likely not genuine. Please call the utility company or that government agency and verify if that is true.
Unethical or High-Pressure Sales Tactics
Scammers want to make quick money before you realize that they are scammers. To push you to act quickly, they will always use high-pressure selling tactics. These are some of the common tactics used by scammers.
- Pressuring homeowners to sign contracts without thorough property inspections
- Making unrealistic promises about savings or system performance
- Offering “limited-time” deals to create a false sense of urgency
- Misrepresenting the company’s credentials or affiliations
Bait-and-Switch Tactics
The bait-and-switch tactic occurs when a company presents an attractive offer featuring a significant discount, but once you choose to proceed with that company, they alter the offer or add clauses that result in higher costs than initially agreed upon.
How to Avoid Solar Panel Scams
Here are some things and actions you can take to avoid solar panel scams.
Know Your State’s Average Solar Panel Cost
I have been a solar installer for a long time; trust me, no one sells too low or too high from another installer.
The trick here is to find the average cost in your state and compare it with the quote you are getting; if it is too low, it is probably a scam.
Get Multiple Quotes
Another way you can use to avoid scams is by getting multiple quotes. Make sure that you compare them and figure out what they offer at what cost. This will help you to discover anomalies with some of the solar installers.
Thoroughly Vet Companies Beforehand
If a company is offering you a solar panel installation service, you can Google them and read reviews online.
If they scammed people before, for sure someone will post it online, and if you do not find any reviews, that also can be a red flag.
My recommendation is to work with companies that you know you can trust; you may have been referred by a friend or family.
Never Sign a Contract Without a Quote
Most scammers will try to make you sign a contract without a quote, then they will apply a bait-and-switch tactic to you and change the price in the quote.
Never sign a contract without a quote.
Check for Licensing and Insurance
A valid solar energy company will have a license and insurance; possibly they will also have some kind of certification. If you are in doubt, ask them, and if they cannot provide them, run for your life.
Thoroughly Review Contracts and Warranties
If a solar company is legit, they will offer you a warranty of some kind; read the contracts; check the warranties; if you are in doubt, you can hire an attorney to help you with this.
Red Flags to Watch Out For
When considering solar panel installation, look out for the following warning signs that may indicate a potential scam:
- Promises of “free” solar panels or unrealistically low prices
- Claims of affiliation with government agencies or utility companies
- Pressure to sign contracts immediately without time for review
- Reluctance to provide company identification, licensing, or insurance information
- Offers of free add-ons like solar batteries or extended warranties
- Warnings about imminent increases in utility costs
- Claims that only one specific brand or technology is allowed in the area
What do you do if you fall for a solar panel scam?
Here are few things you can do if you fall into one of these solar panel scams
Document Everything
Take note of every step you take with the solar panel company. I know in some states it is illegal to record someone without their consent, but if possible, please do. You need to gather as much evidence as possible.
Consult with a Specialized Attorney
Seek an attorney with experience in scams and solar energy disputes to assist you.
Understand Your Legal Remedies
Most people think that when you are scammed, the money is gone, but you can sue for fraud, misrepresentation, and breach of contract.
Evaluate Your Financial Recovery Options
A common misconception is that victims of solar scams have no recourse for financial recovery. However, you may be entitled to compensation for any losses incurred, such as inflated electricity bills, repair costs for property damage, and the burden of fraudulent loans. Your attorney will work to maximize the compensation you receive.
Report the Scam
If you raise your voice and denounce scammers, many people will become aware. Raise awareness and prevent further victimization by reporting the scam to appropriate authorities.
Takeaways
Scammers are out there to take your money; if you are planning on going solar, be aware. Solar panels might be the second or third most expensive investment most people make in their lives, usually after the house itself and a car.
