A powerful consumer watchdog founded by former Green Party presidential nominee Ralph Nader is going after the solar energy industry for potentially burdening homeowners with significant new costs and unfair leasing practices.
The group Public Citizen sent a letter to the Federal Trade Commission on Monday describing a changing energy market in which third-party rooftop solar leasing companies are not subject to the same regulatory safeguards meant to protect ratepayers from unfair prices and costs.
The group said solar companies are barring consumers from legal recourse over pricing and leasing arrangements that can leave ratepayers on the hook for more than they expected.
“While third-party solar leasing has experienced explosive growth and has provided financial opportunities for some families, there are a number of significant risks associated with solar leasing contracts,” said Tyson Slocum, the group’s energy director, in a letter to FTC Chairwoman Edith Ramirez.
“State utility regulatory commissions do not have jurisdiction over the solar leasing industry in the same way they do over traditional utilities, a state of affairs that leaves consumers with inadequate protections,” said Slocum. “Unfortunately, the solar leasing industry standard contract features mandatory arbitration clauses, denying consumers access to U.S. courts in the event of a dispute.”
In light of the lack of adequate state oversight over the solar leasing industry, “it is necessary for the FTC to protect consumers by issuing a ban on mandatory arbitration contracts in the solar leasing industry,” he said.
Public Citizen said the commission had solicited comments from it and other groups after a June workshop was convened on the potential consumer protection issues arising from the surge in solar energy leasing.
The commission solicited the comments to assess the “consumer protection concerns with the rooftop solar industry,” said Slocum.
He added that Public Citizen supports increased use of solar rooftop and other distributed energy resources because of the potential to benefit the consumer. “It is important to note, however, that as much as third-party leasing has expanded solar access, millions of low- and moderate-income families are shut out of the solar leasing market,” Slocum wrote.
“Solar leasing is not a low-income access program, and it does not serve the needs of renters, those with poor credit, and those in structures unsuitable for rooftop solar,” he added.
Homeowners that lease solar panels, rather than own them, made up three-quarters of all new rooftop solar that came into the market last year.
