In the energy industry, it's known as the solar coaster: The ups and downs in the solar industry can cause companies to grow quickly and fade just as fast. So far in 2024, customers of more than one big installer have felt those big downhill drops.
The latest solar giant to struggle is SunPower Solar, one of CNET's picks for best national solar companies. The company filed for Chapter 11 bankruptcy in August. As part of the bankruptcy, Complete Solaria (a merger of Complete Solar and Solaria) will buy SunPower's Blue Raven Solar and New Homes subsidiaries, as well as other parts of the SunPower dealer network. On Sept. 9, Complete Solar announced that it raised $40.5 million to cover the remaining closing costs of a $45 million bid to take over certain SunPower business units.
On Sept. 16, it was also confirmed that Complete Solar is the winning bidder in SunPower Chapter 11 proceedings. As of Sept. 24, the court approved Complete Solar's purchase of SunPower's assets, with the sale expected to close on or before Sept. 30. The SunPower brand and 1,000 employees will become part of Complete Solar.
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"This is a pivotal moment in the history of SunPower, one of the most storied US solar companies," T.J. Rodgers, Complete Solar's CEO said. "The dark cloud currently hanging over the US solar industry will not bring SunPower's demise. And when that cloud recedes – as it must, since only 3.7% of American homes have solar power in an age when solar energy has literally become cheaper than fossil fuel energy – the New SunPower will re-emerge as a lean and competitive American-owned company with a national footprint."
For customers of SunPower, the news raises questions, chiefly: What happens to my solar panels? Here's what you need to know about SunPower Solar and the information you'll need if your chosen solar installer happens to go out of business.
What we know about the state of SunPower Solar
SunPower's common stock has officially been delisted from the Nasdaq stock market, according to a news release the company issued on Monday. The delisting is a 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 delisting will occur on Aug. 16. After this date, SunPower's common stock is expected to trade on the Pink Open Market, more commonly known as the "pink sheets."
Three weeks ago, SunPower notified California of its intent to lay off 290 employees in the state. In the company's WARN notice, it attributed the layoffs to "recent financial circumstances."
"SunPower is working as hard as possible to pursue a long-term solution for the Company in the coming weeks in order to avoid certain of such 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 would be retained."
SunPower recently ceased solar leasing and power purchase agreement operations in July. The change took effect immediately after the announcement. Reuters was first to report on the end of SunPower's leasing and PPAs after letters SunPower sent to dealers emerged in investment notes (PDF), downgrading the company's stock.
CNET's review of SunPower praises the solar equipment the company provides, although notes that many of the company's products and services might be priced out of many people's reach. The Maxeon panels the company offers (produced by a business that spun off from SunPower in 2020) are some of the most efficient solar panels on the market. The end of solar leasing and power purchase agreements has removed these cheaper financing options available to SunPower customers.
In February, the company was subpoenaed by the US Securities and Exchange Commission for more information regarding allegations of financial misconduct by senior executives. SunPower's CEO resigned that month. Its auditor, Ernst & Young, quit in June.
The company cut other business lines, including direct sales, in April. That month, SunPower underwent a much larger round of layoffs, letting go of about 1,000 workers.
What remains unclear for SunPower Solar customers
Complete Solaria has bought Blue Raven Solar, New Homes and other parts of the SunPower dealer network and thus assumed the liability of continuing existing services and operations for customers of those businesses. We don't yet know the full scope of assets being purchased from SunPower, although it seems that some SunPower employees will receive contingent offers, with 1,925 SunPower and Blue Raven employees signing up for the interviewing site.
It still remains unclear what will happen with existing solar leases and PPAs after those operations were ceased, or how the recent layoffs might affect service for SunPower customers in the Bay Area.
CNET has reached out to SunPower for comment.
When a solar company is pulling out of the market, people typically 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 commented on these particular issues, but here is some general advice to help you prepare in the case that your solar installer drops out of the market.
What do you need to know if your solar company goes out of business?
The best way to avoid getting caught off guard by a solar company shake-up is to be prepared before it happens. Here are some of the situations you might find yourself in and how to make sense of them.
What happens to the warranties on your solar equipment?
The simplest answer to this question is: If you have a warranty with the actual equipment manufacturer (for example, a warranty with Maxeon) you shouldn't have any problems if your installer drops out of the business. If you're not sure if your warranty is with the equipment manufacturer or your solar installer, you're going to have to call up and ask some questions.
In the wake of SunPower's bankruptcy announcement, Maxeon has released a blog post clarifying that the company has been completely independent of SunPower since 2020. The company reaffirmed that it will honor product warranties for SunPower-branded solar panels in the same way they would have been honored before the bankruptcy announcement.
Customers with SunPower-branded equipment made by Maxeon and installed before Aug. 5 can register for warranty coverage on Maxeon's website. Maxeon said customers need to register by Dec. 31, 2024.
If your warranty is with your solar installer, that's where things can get more complicated. In selling you that warranty, the solar company should be obligated to honor it under any circumstances. In many cases, there'll be fine print in the paperwork that explains how a transfer of the warranty will look. The good news is that means that reputable solar companies should still be covering your warranties on the chance that they go under.
Now would be a good time to take out those documents you have stashed away and start combing through them to figure out how that transfer would work in your particular case. As always, if you have any questions, it's best to call your installer and square them away before an issue arises.
What if you have a solar lease or a power purchase agreement?
If you have a solar loan or solar lease independent of your solar installer, then nothing about your agreement should change. You'll continue making payments as if nothing happened.
If your solar lease is contracted through your solar installer, the lease should be transferred to another company. The same goes for power purchase agreements; you should be able to keep your arrangement while making payments to another company.
If you've contracted with a reputable solar company, all of these details should be accounted for in your signed paperwork. If you can't find any information about where your solar leases or power purchase agreements would be transferred in the event that your solar installer goes under, you need to start making phone calls to protect yourself ahead of time.
Why is this happening now and should it affect your choice to go solar?
SunPower is the longest-tenured national US solar company, founded in 1985. The company is one of a small handful of solar panel installers that operates in all 50 states.
The US saw a record number of residential solar installations in 2023, market changes have led to a contraction in new rooftop solar thus far in 2024. California's NEM 3.0 policy has been especially catastrophic, stifling solar growth in one of its biggest markets.
The energy consulting firm Wood Mackenzie expects the residential solar market to shrink by 14% this year, with California's changes mostly to blame.
Some solar companies may be struggling with current market conditions, but this may be one of the best times for US residents to switch to solar. The Inflation Reduction Act expanded the residential clean energy credit, which allows homeowners who install a solar panel system to recoup 30% of its cost come tax season.
If you want to know more about how these financing options could affect your decision to switch to solar, read CNET's articles about solar leasing and power purchase agreements.
