SLM Law warns clients: be wary of solar panel stress

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The nature of our job as lawyers means we often have to deal with problems after they have already arisen, rather than being able to avoid problems.

In some instances, we see the same issue recur and we feel frustrated that our clients go through the same difficulties and cannot learn from each other’s experiences.

This is why we think it is important to notify South West residents, business owners and farmers of the potential pitfalls of entering into an agreement to lease or purchase solar panels.

While solar is certainly becoming an option for people concerned about the environment and reducing their electricity bill, people should be wary of door to door salespeople offering the sale or lease of solar panels, as quite often these contracts can be onerous.

If you are considering entering into a solar panel lease or purchase arrangement, you should take into account the following matters:-

  • Are you likely to want to sell your property or your business at any time during the term of the solar panel contract? Generally, ownership of the solar panels is not transferred to you during the term of the contract. The solar panels are therefore not yours to sell. If there is a chance you might wish to sell your property or business, there is no guarantee that you’ll be able to transfer your interest in the contract, or that the purchaser will agree to take over your existing contract. There are usually limitations in the contract on your ability to remove the solar panels from the premises, which can make for a messy situation.
  • If you do not own the premises where you propose to install the solar panels, have you received the written consent of your landlord before proceeding? Without this, you may be in breach of your lease.
  • Have you done your research- are the solar panels going to be fit for your purpose? Although solar panels come in different sizes, depending on the existing infrastructure this does not necessarily mean that the power generated will be able to be put back into the grid. Solar panel technology is advancing very rapidly and you should also consider the longevity of the solar panels. In years to come, your solar panels could become outdated due to new technology rendering your panels almost worthless, but you could still be stuck in a contract making significant repayments.
  • Have you done your due diligence? These types of contracts can go on for a number of years, often at a cost of tens of thousands of dollars. Read the fine print in the contract, and if you need help understanding the terms, seek legal advice.
  • Salespeople in our experience are often optimistic about your ability to generate power and re-sell it into the electricity grid. Check any statements made to you about these matters with your electricity supplier.

Door to door salespeople can be pushy, but there are laws in Victoria that govern the way they are able to approach you and are there are cooling off rights (although strict deadlines apply).

If you need advice about solar panels or another consumer law or contract issue please contact SLM Law on (03) 5231 9400.