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Centex Clouds Solar Tile Repairs

Recalls can be messy - but they are made worse when the company performing the repairs insists upon a release of all possible claims before starting work.

That is the mess that some homeowners have found themselves facing as they try to find a fix for their Centex "solar homes" that are no longer producing power, just headaches. Here's our take.

Nearly a year ago we first wrote about a recall of Suntech solar roofing tiles. Those tiles - allegedly manufactured for Suntech by a now defunct company called Open Energy Corporation - were recalled over fears that they could overheat and cause a fire. Our post generated a considerable number of comments - many from folks affected by the recall who were wondering what to do.

One such group of respondents were folks living in "solar homes" built and sold by Centex. Indeed, news accounts going back to the housing boom in 2006 show Centex touting these homes, some of which sold for over a million dollars. Now these aren't homes in Beverly Hills - rather, they are in subdivisions of towns like Pleasanton and Roseville in California's central valley. Homeowners were lured to these particular homes because of the promise of lower energy bills thanks to their "solar roof" which Centex estimated could save homeowners 65-70% off their utility bills - a big deal in an area with high air conditioning loads each summer.

Centex Solar Home in Pleasanton, CA

But all of that changed with the recall that began in 2011 and peaked when the Consumer Products Safety Commission issued a formal recall notice in February. The immediate consequence of the recall was that all of these solar power systems had to be shut off while the owners awaited word of how repairs would be handled - so much for energy savings. We understand that originally Suntech paid homeowners for their lost energy production, but that as the investigation proceeded, Suntech backed away, asserting that the panels in question were not their branded products. The manufacturer of the roofing tiles - Open Energy Corporation, which became Applied Solar, Inc., which became Applied Solar LLC - has since gone bankrupt and ceased operations.

Which leaves Centex - the builder of these homes - to make things right.

Now keep in mind that if Run on Sun - or any other solar contractor operating in California - were to install a solar power system on a residential roof, we would be required to provide to that homeowner a ten-year warranty covering our work. These homes, which were built between 2006 and 2009, are well within the relevant ten-year warranty window so it is not unreasonable that Centex should handle these repairs for their customers. Customers, we should note, who paid hundreds of thousands of dollars to Centex for their home.

But the response from Centex has been troubling to say the least. While they notified affected customers that they would provide repairs without cost, they sought to extract a release from liability that is breathtaking in its scope. Here is the release language from the Centex agreement:

Release. In consideration of completion of the CPSC Repair [i.e., repair of the solar tiles] owner releases and fully discharges Centex Homes from any and all liabilities, claims, causes of action, or damages of whatever nature, character, type or description, which Owner may have or may incur in the future, arising out of, or in any way connected with component parts, being replaced/added under the CPSC Repair.

In other words, yes, we will repair your defective roof, but only if you agree that after that, we are done and any future problems you might have with the equipment Centex built into your roof is your problem! Keep in mind that the reason for the recall in the first place was the concern that these tiles could overheat and cause a fire - so the potential future harm at issue here is nothing short of your house burning down! No solar contractor in California could legally extort such a release from a customer as a pre-condition of performing warranty repairs, let alone recall-mandated repairs.

Not surprisingly, some homeowners are uncomfortable signing on to such a one-sided agreement and one of them complained to us. Now while we don't have any skin in this game, the high-handedness of Centex was offensive and we decided ask them the basis for their demand. Somewhat surprisingly we got a response to our inquiry (you can read the complete email here.) In pertinent part, here is what the spokesman for Centex had to say:

If homeowners do not wish for us to do the repairs, they are free to contact Suntech directly and try to get them to make repairs. In addition, if a homeowner has an issue with the contract, we have addressed those on an individual basis.

Of course, Suntech insists that these tiles are not their products and the manufacturer has long ceased to exist so the first option really doesn't apply. The second, however, is quite intriguing in that it makes clear that Centex will give on their overreaching language if the homeowner is willing to push back hard enough. (Although we wonder if that entails hiring a lawyer.)

We asked them for clarification but they declined to comment further.

So that is where things stand.

Centex has a bunch of homeowners with "solar homes" that cannot make use of the sun for fear of having their homes burn to the ground. Everyone else who potentially had anything to do with this problem has either disavowed involvement - Suntech - or has gone out of business - Applied Solar.

Maybe enough people will see this post and put pressure on Centex (a member of the PulteGroup) to do the right thing. (Although a consumer complaint site with more traffic than this blog doesn't appear to have done much to move them.) Perhaps what is needed is an enterprising class action lawyer or a district attorney willing to intervene on behalf of consumers left without a decent resolution to a problem not of their making. We will be waiting, and hoping, for such a result.

SCE Rates Set for 3-Year Climb

The California Public Utilities Commission (CPUC) just approved a modified rate case for Southern California Edison (SCE) that will guarantee rate increases for the next three years. According to an article discussing the decision by Marc Lifsher in the LA Times, SCE's rates will increase on average by 5% this year. But that is just the start of the bad news for SCE ratepayers - SCE's rates will increase by 6.3% for next year and by an additional 5.9% in 2014!

According to a press release put out by the CPUC, SCE has twenty days to file new tariffs with the CPUC which will become effective immediately.

For a commercial SCE customer who presently pays roughly $10,000/month, they can expect to be paying $11,720/month once the three rate increases take effect - an increase of more than $20,000/year.

Not surprisingly, the rate increase sparked protests from SCE's commercial customers:

"California manufacturers already pay 50% higher electricity rates than the national average," said Gino Di Caro, a spokesman for the California Manufacturers & Technology Assn. "Obviously, energy costs are one of the primary budgetary items for any manufacturing operation, and this is all the more reason for California to find ways to offset these costs."

There can be no doubt that comparable - or higher - rate increases will continue. Adding a solar power system to your business or home is easily the best way to "offset these costs." Give us a call (626-793-6025) or click on that big "Go Solar Now" button and let's get started today at putting you in charge of your energy future.

Tesla Model S - Motor Trend's Car of the Year

At Run on Sun we have long been fans of electric vehicles (EVs) - we devoted a page on our website to EVs and their cousins, the plug-in hybrids, years ago. So it is most gratifying to see the traditional auto universe wise up to something we've been saying for a long time - EVs are the future of driving. Now Motor Trend magazine has made it official by designating the Tesla Model S as its 2013 Car of the Year.

By any measure, the Model S is deserving of the title: it is crazy quick with a zero to 60 time of less than 4 seconds, it has great range of well over 200 miles per charge… and it can do all of that while looking great and transporting a real family in great comfort.

But we love the car because of what it's not - a gas guzzling, carbon-emitting dinosaur!

Alas, the Model S is out of our price range but it is a great step forward in producing a "real" car that happens to be powered by the most advanced drive train in the world.

You can learn about other EVs - and how to fuel them with clean solar power - on our website. After all, if you are going to have the most sophisticated car in the world, shouldn't it Run on Sun?