League City homeowners shopping for solar panels have new state protections against high-pressure and deceptive sales tactics under a Texas law that took full effect Tuesday, Sept. 1.
The final provisions of Senate Bill 1036, the Residential Solar Retailer Regulatory Act, took effect this week, KPRC 2 reported. The law requires solar salespeople and the companies they work for to register with the Texas Department of Licensing and Regulation (TDLR). It also gives regulators the power to penalize violations for the first time.
State Sen. Judith Zaffirini, D-Laredo, authored the bill after hearing from consumers statewide. She said in a KXAN report published Sept. 1 that Texans deserve honest and transparent transactions, not deceptive sales tactics.
A 2024 Texas Appleseed report found solar-related complaints to the Texas Attorney General's office rose 818% from 2018 to 2023. Complaints to TDLR jumped 576% over the same period. Residents in 141 of Texas' 254 counties filed complaints.
Ann Baddour, director of the Fair Financial Services Project at Texas Appleseed, told Houston Public Media on Monday, Aug. 31: "We heard story after story of people in their 80s with $100,000 in solar panel loans."
What the law requires
The law's key consumer protections include:
- Five-day cancellation window. Homeowners get five business days after signing a solar contract to cancel without penalty. The contract must state the exact cancellation deadline and provide a mailing or email address for the notice.
- Registration. Solar salespeople must register with TDLR and work for a registered retailer. TDLR extended the registration deadline to Nov. 1.
- Insurance. Retailers must carry at least $1 million in general liability coverage per occurrence and $2 million in the aggregate.
- Licensed contractors. Installations must be performed by a licensed electrical contractor, and the contract must name the contractor and license number.
- No deceptive claims. Salespeople cannot make false or misleading statements, falsely claim affiliation with a utility or government agency, or knock on doors where "no soliciting" signs are posted.
If a solar deal involves a lender referred by the retailer, that lender must cancel the loan if the homeowner cancels the contract within the five-day window.
Penalties and enforcement
Violations carry civil penalties of up to $2,500 each, capped at $50,000 for similar offenses. When a person over 65 is harmed, penalties jump to $10,000 per violation or $100,000 for similar offenses.
TDLR can deny or refuse to renew registrations. After a hearing, regulators can order a solar contract canceled and require a refund of money the homeowner paid.
In April, the Texas Attorney General issued civil investigative demands to four solar companies, Freedom Forever, Sunrun, Lone Star Solar Services and CAM Solar, citing more than 100 consumer complaints, according to the HCH Lawyers legal blog.
What homeowners should know
League City processes residential solar permits at a $300 fee, according to the city's Development Handbook. The new state law adds consumer protections on top of local permitting.
The law applies only to contracts signed on or after its effective date. Homeowners locked into older solar agreements are not automatically covered.
TDLR has paused enforcement of contract disclosure requirements and the development of consumer education brochures until November. Sen. Zaffirini told KXAN she plans to monitor the law's implementation and revisit it during the 2027 legislative session.
