The solar energy industry has grown rapidly over the past few years, but some installers have not been able to scale up as they had planned. Many solar installation companies went bankrupt or went out of business for various reasons. Some of these companies were quite large, operating in multiple states and employing many workers.
Unfortunately, this leaves homeowners with orphaned solar modules on their roofs and can make consumers less confident in the solar industry as a whole. Some of these solar systems have permitting, interconnection or maintenance issues that can significantly affect the payback period. In some cases, the homeowner has taken out a solar loan and has to pay it back, but the solar energy system does not generate renewable energy and does not offset electricity bills. In fact, many photovoltaic systems do not work at all.
While this is certainly a huge problem, it also creates opportunities for qualified solar providers to remedy the situation. In some cases, the financier is required to ensure the proper operation of these solar panels, leading to partnerships to complete the work.
What is an orphaned photovoltaic project?
There are many reasons why a photovoltaic panel system is orphaned. In some cases, the photovoltaic projects were not fully installed or fully functional, so the homeowners never fully benefited from the savings on their utility bills. In other cases, the PV system was completed, but the installer went out of business while the PV system was still under labor and service warranty. If repairs are needed, they will have to find another installer and likely pay for labor and possibly equipment.
Solar system owners are often upset when they realize that their system has been orphaned. They usually pay thousands of dollars for a solar installation, but it doesn’t work as promised. If they financed the project, they will still have to make payments, but without the same benefits.
Other reasons why a solar project may be abandoned.
Unfortunately, not all solar installation companies do quality work. Some contractors abandon solar projects because of problems with permits or equipment malfunctions. For example, the installer may not have completed the interconnection application process correctly.
Perhaps some of the equipment malfunctioned, but the installer didn’t know how to fix the problem or was overwhelmed and never resolved it. Unfortunately, in some cases it is not obvious that the equipment is defective until some time has passed and installations become commonplace.
Some installers become discouraged if an inspector uncovers violations and never properly address them. However, there are many common reasons why solar systems fail inspections, including improper grounding installation, improper wiring, inadequate labeling of the solar system and failure to follow the approved plan. While some issues are relatively easy to resolve within an hour or two, others may require significant labor and material purchases.
This scenario is particularly likely when the installer encounters something unexpected or poorly planned, such as not understanding offset requirements or soil composition, making it difficult to properly anchor a ground-mounted system. In particular, permit requirements for pole-mounted systems can be difficult to meet in order to obtain a permit to operate (PTO). In other cases, costly grid upgrades are required that the customer did not anticipate. In other cases, solar equipment has not been properly installed, causing premature failure and potentially voiding equipment warranties.
Some homeowners purchase homes with existing PV systems, and in rare cases, warranties are not transferred to the new owners. In addition, some PV companies have been acquired, but the new owner does not honor existing warranties. This is particularly problematic if the solar system requires repairs that would be covered under warranty.
In other cases, the photovoltaic system is working properly, but the homeowner wants to add a battery or additional solar panels. Some photovoltaic companies reject such projects if they were not the original installer.
A chance to save orphaned solar systems.
While orphaned PV systems can hurt consumer confidence in the solar industry, they can also create opportunities for new revenue streams for installers. Repairing orphaned PV systems and becoming a PTO can create hundreds or even thousands of new project opportunities, especially in areas where PV companies have gone out of business.
Even if a solar installer has gone out of business, a solar financier may need to oversee the repair of solar systems to honor its contracts with customers. Otherwise, these solar systems may be liabilities, and customers may even take legal action against the financier.