CITIZENS NEWS

Solar panel giant SunPower files for bankruptcy as Biden's economy unravels

By bellecarter // 2024-08-19

One of the country's largest residential solar installers has just declared Chapter 11 bankruptcy, marking the end of the 39-year-old business. The green energy company cited a "severe liquidity crisis caused by a sharp decline in demand in the solar market and SunPower's inability to obtain new capital." "In light of the challenges SunPower has faced, the proposed transaction offers a significant opportunity for key parts of our business to continue our legacy under new ownership," SunPower Executive Chairman Tom Werner said of the California-based firm. "We are working to secure long-term solutions for the remaining areas of our business while maintaining our focus on supporting our valued employees, customers, dealers, builders and partners." In a July 17 release, the solar panel giant said that it would no longer support new leases or power purchase agreements and advised its dealers who sell its systems that it could not support the installation of panels that had been delivered but not yet installed. Back in December, SunPower said it might not be able to continue as a growing concern because it breached a key term in a credit agreement. Then in February, it reported it needed additional time to complete its quarterly financial statement; the Nasdaq later informed SunPower it was out of compliance for not filing its forms in a timely fashion. SunPower also acknowledged that past financial reports had a lot of accounting errors. On July 3, it reported that its independent accounting firm Ernst and Young had resigned because of a disagreement over an audit, according to later filings. Back in July, SunPower shares were trading at 72 cents, which is a 98-percent decline from their peak in 2021. The company's business sheet also reflected that it made $14.8 million in 2019 but lost $200 million in 2023 as its operating expenses doubled. President Joe Biden promised with his Inflation Reduction Act (IRA) that this "green deal" would create millions of jobs and boost solar subsidies; however, demand has instead fallen. (Related: EPA is dumping $4.3 billion in taxpayer-funded grants into climate change projects before Biden leaves office.) According to the Wall Street Journal editorial board, one reason for the slumping demand is that higher interest rates have made rooftop panel leasing less attractive to customers. "Some states like California have scaled back programs that pay customers to send solar power they don't use to the grid. Such subsidies raise the cost of power for people who don't have panels. In California the grid is often overloaded with solar power," WSJ wrote. The cost of panels has also increased amid overall inflation and Biden's tariffs that were backed by domestic manufacturers and Democrats in Congress. Solar installers have previously warned that the tariffs would hurt their industry. What jobs that Biden's subsidies gave, his tariffs and inflation took. For MishTalk, an American investment advisor and financial commentator, the attempt to force the production of solar panels in the United States only resulted in prices so high that just a few users were demanding it. As a result, a lot of installers also lost their jobs. Other solar panel rooftop installation companies Titan Solar and Sunworks have also both filed for bankruptcy earlier this year.

SunPower's customer service was inefficient even before its bankruptcy

Local media outlet's "Let ABC15 Know" team reported to have received numerous concerns from viewers about the company's poor customer service practices even before the bankruptcy filing. Ten years ago, Barbara and Charles Murrell acquired a solar system from the company that was first called Solar Tops. It was later taken over by SunPower Corporation. "When everything is working, it is a great benefit. It cut our electric bill and electric costs in the summertime way, way down," said Charles. However, when the solar equipment began having issues in the summer of 2023, they found it hard to get assistance in the repair. They have a broken panel and they were told by SunPower that their inverter will need to be replaced, but it's been months trying to get those issues fixed. They also contacted SunPower to report that the meter was down, and they just got a case number. They said their energy meter showed their solar system produced no solar energy at all in 2023. When ABC 15 reached out to SunPower, the Murrells said they soon after received an email from a SunPower executive escalations specialist that said they were looking into getting the inverter removed from their home to repair and/or be replaced. The couple was also told a replacement panel was ordered but it wasn't clear when the repairs for the equipment would take place. When the Murrells also inquired about production guarantee reimbursement, the specialist stated she was looking into it. SunPower said there was a deal where a company will buy some of its assets but that doesn't include its installation network. For consumers, this means SunPower can't service their systems, they must wait until the company reaches a service agreement. The company said it's working on an agreement with a service provider but customers who own their solar panels can have their systems repaired by other service providers. Head over to SolarPanels.news for similar stories.

Sources for this article include:

MishTalk.com Time.com ABC15.com

collapse power grid bankruptcy market crash climate change energy green living electricity solar panel inflation solar energy Joe Biden bankrupt tariffs Green New Deal power supply energy supply Chapter 11 green deal IRA liquidity crisis SunPower clean energy goals solar subsidies