BBB Offers Tips for Investing in Solar Energy

July 09, 2014

Homeowners looking for new ways to go green and save money, may find solar energy to be a great alternative. But like other home contracting scams, solar energy contractors may prey on those who are unfamiliar with their products.

In 2013, BBB received 259 complaints ranging from contract to service issues with solar energy dealers.

The mildest complaints are those focused on installations found to have defective equipment, which limited their solar production and required households to continue to purchase electricity.  The most extreme complaints are those seeking thousands of dollars from the solar energy “brokers” who install residential solar panels defined as small customer-owned generators of electricity with promises to sell Alternative Energy Credits.  AEC (also referred to as Renewable Energy Credits) is earned when a specified quantity of electricity is generated, resulting in a “certificate” that can be sold or traded.

Consumers need to be familiar with solar panels and how the benefits will affect them before investing their money. Better Business Bureau advises:

Determine if solar energy is right for you. Discuss it with your energy company.  Due to the high costs associated with the initial investment of solar power, it is important to conduct a self-energy audit to determine if solar energy is right for you. Be sure to ask about local, state, and federal laws concerning the standards and codes of the solar panels.

Stay informed about state and federal incentive programs. Some state and federal programs can save you as much as 50 percent on installation costs. Inquire about tax credits.  Find out the amount of tax credits you will receive for the amount of energy that is generated. Ask about the length of time you will receive tax credits and if you will be taxed on the credits. Be sure to understand the terms and conditions of the incentive programs and conduct your own research prior to signing a contract with an installer. For the latest information on state programs, visit

Keep in mind that solar energy requires the sun. So, find out how many sunny days your home sees annually. Consider the amount of shade your home receives. Understand how your solar energy works. You can take full advantage of the benefits in solar energy once you know how it works. For instance, panels facing south with no shade obstructions receiving maximum sun exposure during the hours of 9 a.m. and 3 p.m., will provide the greatest percent of energy. Significant savings occur when you have excess energy that is not consumed by your household. This excess energy can then be credited to your utility bill, saving you money.

Check with your insurance company. Inquire about the impact of solar panel installation on your homeowner’s insurance premiums as most often, the equipment must be insured in order to be covered.

Settle the details. Be cautious of installers who promise no out-of-pocket costs prior to reviewing your specific situation. Be wary if an installer suggests obtaining credit for the full amount of the system even though they are promising very low or no costs due to rebates. Ask what will happen if the business promises a certain percentage of savings from your utility bill and the amount of savings is not achieved.  

Make sure the roof of your home is equipped to sustain a solar panel system. Even though a properly installed solar system will not damage your roof, make sure your roof is in good condition before you begin the installation to avoid any future problems.