Be wary of solar lease deals for home owners
A different sort of green energy issue has sparked bipartisan action on Capitol Hill as lawmakers move to address allegations of deceptive practices in sales of rooftop solar panels.The solar energy is far from free, and with the falling prices of fossil fuels it is probably less competitive despite the falling price of the panels. They are still not as efficient as more traditional fuels.
Earlier this month, 12 Republican members of the House of Representatives wrote to the Federal Trade Commission, warning that leasing solar panels from a third party may be a harmful investment for homeowners.
Four House Democrats sent a letter in November to the U.S. Consumer Financial Protection Bureau, expressing similar concerns. In making sales pitches, they wrote, leasing companies “may be overstating the economic benefits of signing a long-term solar lease while failing to disclose important information.”
“To a lot of folks, these leases sound really good,” said Jeff Small, legislative director for Rep. Paul Gosar, R-Ariz., who spearheaded the letter to the FTC. “But when you dive into the details, it proves too good to be true.”
The House Democrats who wrote to the Consumer Financial Protection Bureau are Arizona’s Ann Kirkpatrick, Kyrsten Sinema and Ron Barber, along with Gene Green of Texas.
Solar leases are becoming a popular arrangement for those who don’t want to pay an upfront fee for rooftop solar panels, consumer advocates say. Leasing companies have access to federal tax credits for installing solar.
Leases usually have terms of 20 years and require monthly payments.
The congressmen suggest it’s difficult for consumers to calculate whether those payments will be less than the amount they save by generating their own electricity with solar power.
To encourage introduction of rooftop solar panels, many states approved a billing system called net metering, where homeowners can sell any excess power generated to their region’s electric company.
Steve Pociask, president of American Consumer Institute, a nonpartisan, nonprofit group, says third-party solar leasing companies “oversell” potential benefits to consumers from selling unused power.