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Solar Scams and Red Flags: 15 Questions to Ask Before You Sign
Protect yourself from misleading solar claims, high-pressure contracts, hidden financing fees, fake incentives, and unrealistic savings promises.
Quick answer
Major warning signs include claims of free government solar, guaranteed zero electric bills, pressure to sign immediately, refusal to show the cash price, unexplained financing fees, missing license information, and savings forecasts that cannot be traced to written assumptions.
Start with the claims that sound too certain
Solar production and savings depend on weather, shade, household usage, equipment, utility rates, and policy. A salesperson cannot honestly guarantee every future bill or utility-rate increase. The FTC warns consumers about promises of free rooftop systems, government affiliation, huge guaranteed savings, and demands for immediate payment.
A professional can provide a production guarantee with written remedies, but that is different from casually promising the electric bill will disappear. Ask what is guaranteed, for how long, by which company, and what compensation applies if performance falls short.
15 questions to ask the installer
Ask these questions by email or request answers inside the proposal. Written responses reduce misunderstandings and make competing bids easier to compare.
- What is your legal company name, license number, insurance, and local experience?
- Will employees or subcontractors perform the work, and who holds their licenses?
- What are the exact panel, inverter, optimizer, and battery models?
- What is the system’s DC size and estimated first-year production?
- What shade, weather, direction, tilt, and loss assumptions were used?
- What is the full cash price and cash cost per watt?
- What is the loan principal, APR, dealer fee, term, and total of payments?
- Which utility tariff and export-credit assumptions support the savings claim?
- What annual utility-rate increase does the forecast assume?
- Which federal, state, local, or utility incentive is included, and who confirms eligibility?
- What work is excluded, including roofing, electrical upgrades, trenching, and permits?
- Who provides workmanship service if the sales company closes?
- What do equipment and production warranties actually cover?
- What happens if I sell the home, refinance, replace the roof, or pay the loan early?
- What is the cancellation period and process?
Watch the financing—not only the panels
A low monthly payment can hide a long term, loan fees, or an expected prepayment that causes the payment to rise if it is not made. Read the credit agreement separately from the installation contract. Confirm whether a lien or security interest is involved and how it affects a future home sale or refinance.
Never let urgency replace comparison. The FTC advises consumers to compare bids, investigate the company, review warranties and cancellation policies, and avoid unusual payment demands. A reputable installer should be willing to explain the complete deal without taking control of your email, utility account, or financing login.
Verify before you sign
Check the contractor license with the state licensing agency, confirm local permitting responsibility, call the utility using a number from its official website, and look up every incentive independently. Search the company name with terms such as complaints, reviews, and lawsuits, while remembering that reviews alone can be manipulated.
Keep copies of the advertisement, proposal, production model, contract, financing disclosure, and messages. If you believe a company misrepresented the offer, contact the relevant state regulator and report suspected fraud to the FTC.
Frequently asked questions
Is free solar a scam?
Broad claims that government programs provide free solar to everyone are misleading. A limited program may serve qualifying households, but verify it directly with the administering agency.
Can a solar company guarantee a zero electric bill?
Be skeptical. Fixed charges, usage changes, weather, utility rules, and grid purchases can keep a bill from reaching zero.
Where can I report a solar scam?
Report suspected fraud to the Federal Trade Commission at ReportFraud.ftc.gov and contact your state contractor or consumer-protection agency.
Primary sources
This guide was written for homeowners and reviewed against the following government and research resources. Programs and utility rules can change, so verify current details before making a financial decision.