A Residential & Commercial Solar Installation Company Solar Repair & Maintenance

What do you do if you have purchased solar panels for your home installation from a manufacturer that goes out of business? The best thing to do is to avoid this situation altogether. Solar is a growing industry that is just now going through a period of consolidation and massive growth from the major manufacturers. And yet in years past a tremendous number of prominent solar brands have gone out of business. Since solar is not yet in a mature phase of the industry, it is possible to choose a solar brand and see that company go under.

A situation that a YellowLite client faced was that of installing a brand of panel from the German solar manufacturer Mage. Mage was a growing brand until their parent company found themselves in financial difficulties and went under. Now the client is selling his house and wants to know if the warranty from Mage is still valid and if not, what his options are.

The first thing to figure out is whether your solar installation company purchased the panels through a distribution company. If so, there may be stipulations through the distribution company that a warranty might be extended. So it is good to check with a third-party distributor. In this case, the purchase order for the YellowLite client was made through Mage Solar directly.

We first took a look at the Mage warranty. There is a power performance and a manufacturer’s warranty. However, there was nothing we could find that made arrangements in case the company went bankrupt. Here is what the performance warranty states:

Mage Solar gives a 10-year product warranty and a 30-year 80% performance guarantee. The company gives a 90% performance warranty for the first 12 years which decreases to 80% for the next 10 years. The company has an Underwrites Lab certification and is also ARRA-compliant.

We called the American customer service numbers but they have been disconnected. We tried calling and emailing the contact info on the Mage website (translated from their native German), but never heard a response.

What happens if a solar manufacturer goes under?

So what can you do to avoid a bad situation when it comes to navigating a warranty on a solar panel manufacturer who has gone bankrupt? Solartown.com makes the case that there are three options available in the event that a solar manufacturer goes out of business:

1.      Buy an extended warranty through the solar panel retailer. This would mean it would still be legally valid in the event that the manufacturer goes bankrupt.

2.      Insure your installation through an insurance provider such as Solarinsure. Link:http://www.solarinsure.com/. Another big insurance provider would be Travelers insurance.https://www.travelers.com/business-insurance/energy. I called and left messages with those companies to give me information on pricing.

3.      Buy from a warranty-insuring manufacturer. This is the best risk mitigation option for the home solar consumer. You want to purchase solar panels from a manufacturer who has insured their warranties against bankruptcy.

One option is for the manufacturer to have insurance on their panels. For example, Canadian Solar has a 25-year insurance backed warranty on their panel lines. Here is the key paragraph,“Canadian Solar’s customers, whose panels have been registered by Canadian Solar, will enjoy a global, irrevocable, immediate coverage based warranty which provides third-party rights to the policy in case of insolvency or bankruptcy.”

In the case of bankruptcy, Canadian Solar customers are still under warranty. This is partly what separates them from their competitors and should be more clearly stated as a point of differentiation when it comes to our sales practices.

YellowLite sells the majority of our panels from three main brands in “good,” “better,” and “best” designations. These three would be Canadian Solar, SolarWorld, and Sunpower. Canadian Solar is the 2nd largest solar manufacturer in the world, while Sunpower is the 9th largest company. SolarWorld is just outside the top-10 but has been measured as the best overall solar panel brand in the world by at least one major review.

In order to avoid a situation where a panel manufacturer could potentially go bankrupt and leave the client without a valid warranty, YellowLite prefers to go with established, financially secure companies with a track record and a contingency plan in case they do go under. There is virtually no chance that the panel manufacturers we normally offer will ever go bankrupt.

If a client wants to go with a different panel brand than what we normally install, we can accommodate just about any request. However, if you are interested in a new panel manufacturer, it cannot be stressed enough that you should do your homework and find out if that company is financially stable and whether they have a warranty that is covered in case they go bankrupt.

Worst Case Scenario

If there is no warranty extension offered on a discontinued panel brand from a manufacturer that has gone bankrupt, then in the case the client decides to sell their house, the panels on their installation will have to be transferred over and sold as-is with no warranty. This may not make the homeowner happy, and may cost them a discount on the value of their solar installation during their home sale, but there is no other option. The only question that would remain is if the YellowLite craftsmanship and labor warranty is transferred over. The answer is yes. The craftsmanship and labor warranty is covered for the 10-year duration of the installation. We just need to be informed that the transfer is being taken.

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