SF5053

Purpose

• Establish a Solar Energy Systems Consumer Protection Act to protect consumers who buy, lease, or finance solar energy systems. The act creates registration and reporting requirements for solar energy companies and salespeople, requires a standardized disclosure form and agreement content, and sets enforcement and consumer-rights provisions to curb misleading sales practices and improve transparency.

Scope and applicability

• Applies to agreements entered into on or after the act’s effective date.
• Does not apply to the transfer of title or rental of real property where a solar energy system is installed.
• If an energy storage system is connected to a solar energy system, the act applies to the energy storage system (or as interconnected) rather than the solar system alone.
• A solar energy system installed as a feature on a newly constructed residence is subject to specific sections of the act.
• A “fixture filing” can be used to treat a solar energy system as part of real property for lender priority.

Key terms and definitions (selected)

• Solar energy system: as defined by the act, including interconnected energy storage where applicable.
• Solar energy company: entity that designs, finances, installs, sells, or maintains solar energy systems; excludes individuals who self-install, third-party owners who do not sell or install, or lenders.
• Solar energy salesperson: person who solicits, sells, negotiates, procures, or executes agreements for solar energy systems.
• Energy storage system: device that stores electricity for later use, connected on the consumer’s side of the meter.
• Power purchase agreement (PPA): contract where a solar company installs system and sells the generated power to the consumer.
• Fixture filing: UCC filing that makes the solar energy system part of real property and guides lender priority.
• Interconnection: process of connecting the solar energy system to the electric grid.
• Disclosure form: mandated form with required information provided before signing an agreement.
• Agreement types: purchase, lease, or PPA.
• Registration: formal registration with the commissioner of commerce for solar energy companies and salespersons.

Registration requirements and fees

• Registration is required for solar energy companies and salespersons to engage in related activities.
• Applications and renewals must include: company name and contact information; owners, officers, and primary work location of salespersons; any assumed names; contact info (phone, email, website); and disclosures of criminal convictions, civil judgments, government orders, prior settlements, past government actions, and any prior professional sanctions.
• Businesses must report changes within 30 days (name, addresses, contact info, etc.).
• Records must be kept for at least six years, including all sales proposals, disclosures, and agreement terms.
• Registration fees: a set fee for solar energy salespersons and a separate fee for solar energy companies; the commissioner may adjust these fees annually based on processing costs.
• The commissioner may suspend, revoke, or deny registration for misrepresentation, failure to meet requirements, or engaging in high-pressure sales or other violations.
• The act also allows enforcement actions against both the company and the salesperson for violations.

Disclosure form requirements

• The commissioner must develop a written disclosure form (at least 10-point font) to be provided before signing.

• Required disclosures include:

  • Consumer and project details (names, contact info, license/registration numbers for the installing company).
  • Project description: capacity (kW DC), energy storage capacity (kWh) if applicable, brand/type of solar modules, inverters, monitoring devices, and statement about backup power dependency on storage or other equipment.
  • Technical specifications: production estimates (adjusted for shade, snow, soiling), expected degradation, and the fact that the utility bill remains, with no control over electricity rates by the solar company or lender.
  • Estimated price and any incentives (tax credits, utility/state/federal incentives) and steps to receive them.
  • Warranties and transferability.
  • How to file complaints and the regulatory agency’s contact information (including data privacy details and consumer rights under 325M.10 to 325M.21).
  • Information about data collection, use, storage, sharing, and consumer data rights (access, corrections, deletions, opt-out).
  • A statement that the solar energy system does not provide electricity during a power outage and will disconnect from the grid to protect utility workers.
  • The consumer’s right to withdraw from the sale without penalty under section 325G.08 (home solicitation rights).
  • Requirements for pre-installation activities, backup-power options, post-installation assumptions and methodologies, and estimated post-installation utility bill savings.
  • The presence of any performance or production guarantees or warranties and how they transfer.
  • Notice that the owner of the system may file a fixture filing as a security interest.
  • A notice regarding cancellation rights and a requirement to affix a durable sticker with warranty/service contact information near the main electrical service panel.

• If a material change occurs after disclosure, the company must inform the consumer in writing and provide an amended disclosure form.

Agreement content by type

• Purchase agreements: must include required disclosures, design/engineering completion timing, warranties, total price, payment schedule, maintenance responsibilities, interconnection and permit responsibilities, security interests (UCC), and home solicitation rights.
• Lease agreements: must include payment terms (total number and amount, schedule), loan interest rate, right to purchase during or at termination, transfer options, lender-fee disclosures, and any filed security interests.

• Power purchase agreements (PPAs): must include contract length, payment amounts and dates, rate increases, any fees (one-time or recurring), invoicing details, right to purchase, notice of fixture filings, transferability on residence sale, and related disclosures.

• In all agreements, the consumer is not required to make a payment before utility permission to operate is granted; lenders must withhold at least 10% of the total amount owed until permission to operate is received.

Other notable provisions

• Durable sticker/plaque with warranty and service contact information must be affixed near the main electrical panel or primary disconnect.
• Agreement review meeting: required to occur a specified number of days before signing; must be audio and video recorded and available to the consumer on request; recordings must be retained for at least two years and conducted in the language of the disclosure form.
• Data privacy and consumer rights: disclosures must explain how data is collected, used, stored, shared; provide rights to access, correct, delete, opt out of data sharing, and file complaints.
• Compliance and enforcement: the commissioner enforces the act; remedies under section 8.31 apply to violations by companies or salespersons (with liability maintained for salespersons even if the company bears primary responsibility).

Enforcement and potential consequences

• The commissioner may suspend, revoke, or refuse to issue or renew registrations for misrepresentation, fraud, failure to meet requirements, or high-pressure sales tactics.
• A solar energy company may be held responsible for the actions of its salespersons.
• Remedies under existing consumer protection provisions apply to violations, and the act allows enforcement actions against both the company and the salesperson.

Timing and transitions

• The act specifies that it applies to new agreements after its effective date; existing arrangements or transfers of property are largely outside its scope unless otherwise noted (e.g., fixture filings or interconnection provisions).

Summary of significance

• Creates a comprehensive regulatory framework for solar energy transactions in Minnesota, focusing on transparency, consumer protection, and accountability.
• Introduces mandatory registration, standardized disclosures, and detailed agreement content for all major solar arrangements (purchase, lease, PPA).
• Enhances consumer rights around data privacy, cancellation, and verification of costs and incentives.
• Establishes proactive enforcement mechanisms and clear responsibilities for solar companies and their salespersons.

Relevant Terms - solar energy system - solar energy company - solar energy salesperson - energy storage system - agreement - purchase price - lease - power purchase agreement (PPA) - fixture filing - Uniform Commercial Code (UCC) filings - interconnection - disclosure form - registration - registration fee - consumer protection - home solicitation - warranties - production estimates - data privacy - access, corrections, deletions (data rights) - cancellation rights - agreement review meeting - enforcement (commissioner, remedies under 8.31)