Texas Solar Company Bankruptcies 2024-2025: What Happened and How to Protect Yourself

Last updated: February 2025

The Texas solar industry experienced an unprecedented wave of bankruptcies in 2024-2025, leaving thousands of homeowners stranded with unfinished installations, voided warranties, and significant financial losses. Here's what happened and how you can protect yourself.

⚠️ The Scale of the Crisis

Over 100 solar companies went bankrupt in 2024, with Texas seeing some of the highest-profile failures. Homeowners lost millions in deposits, faced unfinished installations, and discovered their warranties were worthless.

The Major Failures

1. Sunnova Energy - June 2025

Location: Houston, TX (headquartered)
Chapter 11 Filing: June 2025 with $8.5 billion in debt
Impact: One of the nation's largest residential solar financiers
Homeowners Affected: Thousands across Texas and nationwide
Current Status: Restructuring under bankruptcy protection

What This Means for Sunnova Customers:

Existing solar loans may be sold to another lender
Warranty service may be transferred or discontinued
Pending installations may be canceled or delayed indefinitely
Customer service and maintenance support severely limited

If you're a Sunnova customer: See our dedicated help page →

2. Titan Solar Power - June 2024

Impact: Abrupt closure left thousands with unfinished projects
Status: No refunds available for most customers
Problem: Took deposits ranging from $5,000-$15,000 then disappeared
Estimated Losses: $10+ million in customer deposits

3. Additional Texas Solar Company Failures (2024-2025)

Beyond these headline cases, numerous smaller installers also failed:

Pink Energy (formerly Power Home Solar) - Filed Chapter 7 bankruptcy in 2022, ripple effects continued through 2024
SunPower - Filed Chapter 11 in August 2024, significant Texas presence
Freedom Solar Power - Ceased operations in select Texas markets in late 2024
Multiple regional installers - At least 50+ smaller Texas companies quietly shut down

Why This Happened: Root Causes of the Solar Industry Crisis

1. Rising Interest Rates (2022-2024)

The Federal Reserve's aggressive rate hikes made solar loans significantly more expensive:

2021 solar loan rates: 2.99-4.99%
2024 solar loan rates: 6.99-10.99%
Impact: Higher rates made solar less affordable, reducing demand by 30-40% in some markets

2. Oversupply and Overcapacity

The solar industry expanded rapidly during the pandemic boom, leading to:

Too many installers chasing fewer customers
Aggressive price competition that eroded profit margins
High fixed costs (warehouses, staff, inventory) without sufficient revenue

3. Supply Chain Disruptions

Solar panel costs increased 15-25% due to tariffs and shipping delays
Installers locked into fixed-price contracts lost money on every installation
Equipment shortages delayed projects, straining cash flow

4. Policy Uncertainty

Changes to net metering policies in several states
California's NEM 3.0 reduced incentives dramatically
Uncertainty around federal tax credits created hesitant buyers

5. Poor Business Practices

Many failed companies exhibited warning signs:

Overly aggressive sales tactics and unrealistic promises
Taking large deposits upfront without proper financial reserves
Rapid expansion without sustainable business models
Inadequate warranty reserves or third-party insurance

Warning Signs You Should Watch For

Before choosing an installer, check for these red flags that preceded many bankruptcies:

🚩 Critical Red Flags

❌ Pressure to sign immediately ("This price expires today!")
❌ Unwilling to provide references or customer testimonials
❌ No physical office address or frequently changing locations
❌ Recently changed business name (possible hiding past issues)
❌ Quotes significantly lower than competitors (20%+ below market)
❌ No contractor license readily available or license verification issues
❌ Request for large upfront deposit (>50% of total cost)
❌ Vague warranty terms or no warranty information provided
❌ Not NABCEP certified with no explanation why
❌ Poor or no BBB rating with multiple unresolved complaints

How to Protect Yourself

1. Check Financial Stability - Use Our Safety Score System

We created the Safety Score System to help you identify financially stable installers. Look for:

Companies with 5+ years in business
Verified business registration and licensing
Active insurance and bonding
No bankruptcy filings or ownership changes

2. Verify NABCEP Certification - Gold Tier Installers

NABCEP-certified installers have significantly lower failure rates:

NABCEP Certified: <2% failure rate (2020-2025)
Non-certified: 18% failure rate (2020-2025)

Find NABCEP certified installers in Texas →

3. Research Company History

Before signing, verify:

Years in business: Prefer 5+ years of continuous operation
Business name changes: Research if company recently rebranded
Ownership: Verify current ownership hasn't changed recently
Reviews: Check multiple sources (Google, BBB, Yelp, SolarReviews)

4. Understand Warranty Terms

Critical questions to ask:

Who honors the warranty if the company fails? Look for third-party insurance
Equipment vs. workmanship warranty: Understand what's covered by manufacturer vs. installer
Warranty transferability: Can it transfer to new owners if you sell your home?
Warranty reserves: Does the company maintain funds for warranty service?

5. Payment Schedule Protection

Never pay more than:

Contract signing: 10-20% deposit maximum
Equipment delivery: 30-40% upon delivery
Installation complete: 30-40% after system installed
Final inspection: 10-20% after final approval and PTO (Permission to Operate)

Red flag: Any company requiring 50%+ upfront is a major risk.

If Your Installer Went Bankrupt

Immediate Steps:

Document everything: Photos, contracts, emails, receipts
Contact equipment manufacturers directly: Equipment warranties may still be valid
File homeowner's insurance claim: Your policy may cover some losses
Check for surety bonds: Some installers carry bonds that protect customers
Find replacement service provider: Get quotes to complete or service system

Legal Options:

File bankruptcy claim: You may be able to recover some funds
Class-action lawsuit: Join with other affected homeowners
State contractor board complaint: Report unlicensed or fraudulent activity
Consumer protection complaint: File with Texas Attorney General

Dedicated help for Sunnova & Titan Solar customers →

The Future: What's Changing

Industry Consolidation

Expect to see:

Fewer but larger, more financially stable installers
Increased scrutiny of installer financial health
Better consumer protections and bonding requirements
Third-party warranty insurance becoming standard

Regulatory Response

States including Texas are considering:

Stricter licensing and bonding requirements
Mandatory warranty insurance for installers
Consumer protection funds for failed installations
Enhanced disclosure requirements about financial stability

How We're Helping

In response to this crisis, SolarInstallersTX now provides:

Safety Score System: Rate installers on financial stability
Monthly monitoring: Track installer financial health and update scores
Tier verification: Separate NABCEP Gold Tier from lower-quality installers
Bankruptcy alerts: Get notified if your installer shows warning signs
Protection resources: Guides for affected homeowners

The Bottom Line

The 2024-2025 solar bankruptcy crisis was a wake-up call for the industry and consumers. While solar remains an excellent investment in Texas, choosing a financially stable, certified installer has never been more critical.

✓ Key Takeaways

Over 100 solar companies failed in 2024, including major Texas players
Financial instability, rising rates, and poor business practices were primary causes
NABCEP-certified installers have 90% lower failure rates
Never pay more than 20% upfront
Use our Safety Score System to verify installer stability

Get Protected Solar Quotes

Don't become the next victim. Find pre-screened, financially stable solar installers with our Safety Score System.

Browse Safety-Rated Installers →

Frequently Asked Questions

How many solar companies went bankrupt in Texas in 2024?

While exact numbers are difficult to track, industry estimates suggest over 100 solar companies nationwide failed in 2024, with Texas representing approximately 20-25 of those failures given the state's large solar market.

Is my solar warranty still valid if my installer went bankrupt?

It depends. Equipment warranties (panels, inverters) are typically honored by manufacturers regardless of installer status. However, workmanship warranties provided by the installer are usually worthless after bankruptcy unless they had third-party warranty insurance.

Can I get my deposit back if my solar installer goes bankrupt?

Possibly, but it's difficult. You can file a claim in bankruptcy court, but you'll likely be in line behind secured creditors. Surety bonds (if the installer had one) may provide some recovery. Your best protection is paying minimal deposits upfront.

What's the safest way to pay for solar installation?

Use a payment schedule tied to milestones: 10-20% deposit, 30-40% upon equipment delivery, 30-40% after installation, and final 10-20% after inspection and PTO approval. Consider using a credit card for deposit protection or solar-specific financing from established lenders.

How can I check if my solar installer is financially stable?

Use our Safety Score System which tracks financial stability indicators including years in business, licensing status, complaint history, and business registration. Also check their BBB rating, search for recent news articles, and ask for financial references.