As more and more homeowners make the switch to solar and the necessity of adding solar to your home rises, so do the solar scams. Unfortunately, as popularity increases, so does the number of people looking to prey on homeowners via reselling models, finance scams and false advertising. Luckily, our experts worked to find the most-popular, current solar scams so you know exactly what to look out for.
Solar Scam: Door Knocking & Reselling
One of the most common solar scams, and hardest to identify, comes from door-to-door sales. This provides a level of convenience for homeowners, since they typically don’t need to do any research or put in any legwork. The salesperson just shows up to your home and offers to give a pitch on why you should go solar.
However, while some major and legitimate companies, like SunRun, leverage these practices, most of the door knocking salespeople are resellers.
In theory, there is nothing inherently wrong with resellers. In fact, most large-scale solar companies use resellers via dealer programs. The issue comes in the form of price markups.
Since door-knocking resellers rely on larger organizations to supply the actual service, purchasing through them can drive your price up drastically. For example, a typical California solar dealer will sell solar home systems for almost double what you would pay if you went directly through the company that supplies them. If the average price per watt is $2.45, dealers will often use high-pressure tactics to sell the exact same service at $4-5 per watt.
Apart from the crazy markups, solar resellers often lack the financial resources to maintain business longevity. This means every year a ton of resellers will pop up, out-of-the-blue, offering over priced solar solutions right at your doorstep. Then, since they don’t have the cash flow or momentum to stay in business, they disappear. Depending on their affiliate dealer program, homeowners may find the low stability impact warranties, services, etc.
Finance Scams
The two biggest finance scams currently facing homeowners revolve around “free installations” and hidden fees.
Free Solar Scams
Under no circumstances should making the switch to solar ever cost nothing. Going solar includes pulling permits with local municipalities and utility companies, as well as paying for labor, materials, time and more.
When you pay to a credible solar company, you are, in turn, paying these fees simultaneously. If for some reason, someone approaches you, in person or online, offering free solar, run!
Not literally, of course, but that should be a huge red flag. There is no feasible way in which solar costs nothing.
Hidden Dealer Fees
Similar to offering free solar as a scam, many solar companies will hide certain “dealer fees” associated with financing companies to make it seem like your solar array costs much less than it actually costs.
NRG Clean Power was one of the first solar companies to offer transparent pricing, demonstrating cash and financing costs, dealer fees and more!
Don’t get caught up with a contractor that hides financing fees in a bid to get you to sign a contract. Unfortunately, it is common practice; however, not all solar companies invoke these deceitful practices.
Solar Advertising Scams
Another extremely common solar scam revolves around advertising practices, especially with door-to-door sales and social media advertising.
Bait-and-Switch Scams
As a result of an extreme amount of competition in the solar space, dishonest solar companies will try to hook you with incredibly low prices. The goal of these sales techniques is to get you interested as quickly as possible, and they know homeowners will gravitate towards affordable options.
The problem? Change orders. And many of them.
The final amount you end up paying could increase significantly when compared to the original quoted price. Either the extremely low price comes as a result of building in a bait-and-switch tactic or by leveraging cheap products. If the installer provides low-quality materials, in the worst case scenario, you run the risk of failing city inspections.
To avoid getting caught in this sales trap, get a feel for how much solar panel installations cost in your city. Just remember, even though solar panels are an investment, they don’t have to break the bank. Finding the right solar company is key to getting the best price and quality for your money.
Government Incentives
Another all to common solar advertising scams facing homeowners involves promising government incentives that, frankly, do not exist. Unfortunately, that solar ad you saw on your Facebook feed advertising that the government will pay for 100% of your solar installation isn’t real.
Currently, homeowners can take advantage of a few federal and local government incentives. However, the dollar amount associated with these incentives typically comes in the form of a percentage of the total project cost.
The federal Solar Investment Tax Credit (ITC), for example, allows homeowners to claim tax credits. These tax credits, however, only offer up to 26% of their solar investment. While this drastically reduces the cost of going solar, it in no way eliminates the cost altogether.
Depending on where you live, you may have the ability to also take advantage of local incentives. Keep in mind, however, that if someone offers a solution that uses government incentives to completely offset the cost of going solar, something fishy is probably going on.
Avoiding Solar Scams: Conclusion
The experts at NRG Clean Power understand the innumerable benefits of going solar. Homeowners can take back control of their energy, reduce their monthly bills and lower their carbon footprint. However, the level of competition within the industry has sparked a growing amount of solar scams.
While the information presented does not act as a comprehensive list of all the current solar scams, it can give you a good idea of what to look out for. That said, the best thing you can do is find a reputable company that offers reasonably priced solutions. Solar doesn’t have to cost an arm and a leg, but it always has some cost.
If you want to make the switch to solar with a reputable installer that leverages almost 40 years of experience, then contact the experts at NRG Clean Power. We guarantee a fair, transparent and direct quote.
Authored by Ryan Douglas
NRG Clean Power's resident writer and solar enthusiast, Ryan Douglas covers all things related to the clean energy industry.
