The drawbacks of solar energy

On Oct 13, 2023

TL/DR –

The US government’s Inflation Reduction Act offers a 30% tax credit on solar panels and eco-friendly technology to encourage greener energy use. However, issues within the solar industry, such as companies going bankrupt, have made maintaining and repairing these panels costly for consumers. There has been a surge in complaints to the Federal Trade Commission since 2020, with about 5,000 registered this year alone, indicating widespread problems in the industry.

Government Incentives for Greener Grid May Have Hidden Costs

The Inflation Reduction Act offers a 30% tax credit on solar panels and eco-friendly tech to encourage a greener grid. Despite cost-saving benefits of this credit, early adopters report challenges within the solar industry impacting panel maintenance and repair.

TIME’s Senior Economic Correspondent, Alana Semuels discovered her leased rooftop solar panels weren’t grid-connected. Worse, the leasing company had gone out of business, reflecting a broader industry trend where many solar companies fail to survive. Semuels discussed her experience and the wider issues in the solar panel industry with Marketplace host Kai Ryssdal. Here’s an edited transcript of their conversation.

Semuel’s Solar Panel Saga

Semuels purchased a house with leased solar panels, later discovering they weren’t working despite assurances from the leasing company. The process of having them fixed was fraught with difficulties. Using her influence as a reporter, she managed to get a response and ultimately resolution, an advantage many homeowners lack.

With solar panel systems having been costly a decade ago, many were leased, leading to complex financial arrangements. Many of these leasing companies also went bankrupt, leaving homeowners to deal with defunct panels. The trend of companies coming and going in the industry continues today.

Complaints on the Rise

Semuels filed a Freedom of Information request to the Federal Trade Commission to gauge the extent of the problem. She found complaints in the FTC’s fraud database skyrocketed since 2020. A lot of money is being poured into this sector due to the Inflation Reduction Act, but there are also many bad actors exploiting the situation.

Lessons Learned

While Semuels acknowledged a few of her solar panels are now working, she wouldn’t recommend leasing solar panels with a home due to the hurdles she faced. Despite the challenges, with today’s housing market pressures, she concedes it’s unlikely that potential solar panel issues would deter buyers.

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