Thoughts on Solar

California law requires that the California Public Utilities Commission (CPUC) and the Contractors State License Board (CSLB) publish a new, “Solar Energy System Disclosure Document” for solar contractors to provide to clients as of July 1, 2018.  We just learned that the CPUC is yet to act on the SESDD draft, and isn’t expected to for months.  Moreover, the draft that we have seen falls far short of what the public really needs to protect them from those Shady Solar Contractors.

We received an email yesterday from the CSLB advising us of the delay in finalizing the SESDD, and highlighting the law’s requirements.  Frankly they are pretty meager:

• The SESDD has to be provided to the client “prior to completing a sale, financing, or lease of a solar energy system to be installed on a residential building” - presumably as part of the contract itself.  Gee, what about disclosures as part of the sales proposal?  (More on that below.)
• The SESDD has to be in the same language as the sales proposal - and you might say “yeah, duh!” but we have heard of companies targeting Spanish-speaking consumers with the proposal in Spanish, but the contract in English!
• If PACE financing is used, then the PACE-specific proposal should be provided.

Interestingly, those are the only requirements called out in the CSLB email.  Unstated, but a part of the bill, is the discretion granted to the CSLB under the law to add any additional requirements that it deems “appropriate or useful in furthering the directive described” in the law.  Apparently CSLB doesn’t see a need to go any farther.

The CSLB has a draft document on its website, and if that is all that is mandated, this whole exercise will have fallen woefully short.  (You can find CSLB’s draft here.)  In a nutshell, all that one-page document discloses is the total system cost, how to contact the CSLB if you have a complaint, and your “three-day right to cancel."  Not surprisingly we have always provided all of this information in our contracts, and it is pretty shocking that some contractors have to have a mandated disclosure of how much the bloody thing costs!

So what should be here that isn’t?  How about:

• A disclosure of the specific equipment that is going to be put on your roof. (Can we please eliminate “generic” solar systems?)
• The proposed start date.
• The expected duration for the project.
• Any known contingencies or delegation of work to third parties (such as trenching, tree removal, etc.) that could delay or disrupt the project.

And while we are at it, where are the disclosure requirements for solar proposals? Such as:

• Equipment specifics down to model numbers that can then be compared to the contract disclosures.
• Savings analysis methodology and assumptions including:
• Anticipated annual increase in utility costs
• Means by which system performance was computed and annual degradation
• Utility rate structure used to compute Year 1 savings
• Assumed discount rate for valuing future cash flows
• Proposed system layout on the roof.

We have a long way to go before homeowners can be assured that they are being treated fairly by solar contractors.  This delayed SESDD is but a tiny step in the right direction.