How to read your solar contract
You have received a solar proposal and contract to sign from an installer. Now what? It is important that you have confidence you are making the right decision for you and your family. Confidence comes from knowledge. Knowledge comes from asking questions. We have a list of common questions in our How to read your solar proposal to reference during the process.
1) Look for items from your proposal
Some solar companies provide a contract with terms and conditions right up front. Others provide a proposal that is not a legal document that you may sign agreement to before being presented with the actual legal contract. If you get a contract after seeing a proposal, it’s important to make sure things in the proposal are reflected in the contract.
A few things to check:
- System size (in kilowatts or kW) is the same.
- Amounts and the payment due dates match what you are expecting.
- Contract includes that the installer is responsible for handling all design, permitting, inspections, and interconnection agreements
- Who owns the SRECs (“Solar Renewable Energy Credits”) generated by the system and who will be handling the registration?**
- Includes an estimate of annual production of the proposed solar array and the resulting percentage of annual electricity consumption the system is expected to offset.
- Specifies who owns the solar array and the options for selling SRECs (in applicable areas)
- Warranty claims match what you are expecting. This information should tell you:
- Who to call for a warranty repair
- How long your labor and workmanship warranty last
- The specifics of how any water leak/roof penetration claims are handled
- Who to call for a system repair if the labor and workmanship warranty are expired
** SREC registration is not applicable for all states. See our SREC guide for more information.
2) Familiarize yourself with common addenda found in contracts
If your contract doesn’t have these, ask your installer about these items
- A “cool down period” or standard three-day period to change your mind? The required length of this period can vary by state.
- A breakdown of essential information such as this purchase disclosure from SEIA (the Solar Energy Industry Association).
- In Florida, includes the required provisions from statute 520.23
3) Read the required contract terms for Solar United Neighbors co-ops
If you are part of one of our co-ops, these terms are applicable as well:
- Pricing based on the terms agreed to in the bid for the solar co-op? Reference your offer details page that came with your welcome letter from the installer for the co-op, or compare pricing or ask the SUN staff in your area. (Not sure how to contact us? Send us a message.)
- Includes all disclaimers, contract cancellation notices, and other language required by applicable jurisdictions, the installed system cost and cost per Watt ($/W); any milestone payments required, and clear indication of when payments are due, and a clear description of installation and roof penetration warranty terms.
- Contains arbitration terms that include requirements that, (1) the arbitration shall be governed by the rules and regulations of the American Arbitration Association (“AAA”), (2) a single, neutral arbitrator will be appointed in accordance with the rules of the AAA, (3) the Co-op Member(s) shall be eligible to recover arbitration costs (including attorney, consultant and expert witness fees) should the Co-op Member be the prevailing party, (4) the Installer shall be eligible to recover arbitration costs (including attorney, consultant and expert witness fees) should the Installer be the prevailing party, and (5) establish a mutually agreed upon location as the location for any arbitration proceedings.
- Solar Energy Industry Association transaction disclosure samples – You can review these examples for cash, lease, and power purchase agreement (PPA) contracts to make sure your agreement with your installer answers all the important questions.