Industry Responds to Consumer Reports Claim that Solar Power is One of "America's Scams"

Rachel Simmons
September 25, 2012 | 19 Comments

Consumer Reports is a reputable publication that prides itself on informing its readers and empowering consumers through education. At Brightergy, we also believe in those principles.

The October issue of Consumer Reports contains an article on rising scams and fraud in multiple industries - including solar energy. We encourage you to read the report and consider what the magazine has to say before making the decision to purchase solar.

Brightergy is a member of the Solar Energy Industries Association (SEIA), a trade group dedicated to advancing the solar industry. Brightergy subscribes to the organization’s code of ethics, and we do not practice or condone the kind of behavior described in the article. And neither does SEIA. The association’s President and CEO, Rhone Resch penned the letter below (reprinted with permission) in response to the Consumer Reports article.

We encourage you to educate yourself about how solar works and properly vet solar companies before choosing to install with them. Are they members of SEIA? Do they adhere to the SEIA code of ethics? And if you do choose to install solar with Brightergy, we will work with you to make sure you are equipped with the system and financing that make the most sense for you and your building.

Solar Working for America Today

To the editors,

As president of the Solar Energy Industries Association (SEIA), I was disappointed to read how our industry was characterized in the October 2012 issue of Consumer Reports. We take compliance with ethical codes of conduct very seriously. All SEIA member companies (our directory is available to the public) must sign a code of ethical conduct and we have a standing ethics committee that tackles ongoing issues in this arena. Were SEIA to learn of wrongdoing by a solar company, we would not hesitate to expel them from our association and notify the proper authorities. Yet, this is something we have encountered extremely rarely, hence my consternation over money-saving solar energy being listed alongside phishing as a ‘scam’ in your latest issue.

Today, solar is working across the nation, producing enough electricity to power nearly a million American homes. Also, there are tens of thousands of solar water heating systems. The industry employs 100,000 Americans at 5,600 companies, mostly small businesses, across all 50 states. Over the last year, the industry grew by over 100 percent. Solar energy costs have indeed dropped dramatically, making solar an affordable and money-saving option to many American homes and businesses. Third-party ownership and solar leasing agreements, used in 70% of residential installations for some areas, allow homeowners to go solar with no upfront costs, while saving 10 to 20% on their energy bills. Walmart, Walgreens, IKEA, Kohl’s, Macy’s, Safeway, Target are just some of the companies that have embraced solar energy because it lowers their power bills.
That’s not a scam.

The reputation of an industry should not be besmirched due to supposed unethical acts of a handful of bad players. I encourage Consumer Reports to take a substantive look at the wide range of benefits that solar delivers to consumers, companies, governmental agencies, schools, hospitals, churches, and individuals before using its widely-read and respected voice to damage a growing part of our economy.

Rhone Resch
President / CEO
Solar Energy Industries Association

The information and views expressed in this blog post are solely those of the author and not necessarily those of RenewableEnergyWorld.com or the companies that advertise on this Web site and other publications. This blog was posted directly by the author and was not reviewed for accuracy, spelling or grammar.

19 Comments

Joe Barnes
October 5, 2012

Gerald,
Why do you think these whirlybirds are being dismantled and sold on for peanuts to other enthusiastic users that think they are going to reap a small fortune for doing very little work. If they lived up to their claims they would stand on their own two feet without being propped up by Governments and shareholders. Obviously I am biased with regards to my outlook on them, simply because I have a real wind powered wind farm about to get a grant of patent for.My output figures will speak for themselves without any exaggerated,
claims and at a hundreth of the cost of existing wind farms.
Gerald I am not going into the output data claims as I will bore everyone that reads this to death. In your mind you must know that this technology of using the wind is totally outdated and about as useless as a black eye on a Jamaican man.Please stop being so uptight in defending these silly gigantic bits of junk and look to the new ideas that are already waiting for investors that will earn them real money.

Gerry Wootton
October 4, 2012

JHB - now you're being willfully blind. "Perhaps you could direct me to the site with these ALLEGED outputs listed on it." perhaps I could, but you wouldn't go there anyway.

Joe Barnes
October 4, 2012

Gerald,
The data can suggest what it likes and it is up to you if you believe it.Perhaps you could direct me to the site with these ALLEGED outputs listed on it. If you have any knowledge of these "windmills" you will be able to watch them in real life and work out what they are capable of producing for yourself. They are nothing more than childrens toys in the hands of lying salesmen that will flog their granny for a few pence if it makes them a profit. You are obviously defending these people so may I assume that you are one of them????

Gerry Wootton
October 2, 2012

JHB - 'if I can witness for myself' ... the data is on-line in near real time. You are free to witness all you like.
You claim that CF for wind is <17% while the data suggests ~30% for onshore; the long term average is 27% in the UK which includes maintenance time and dispatching. Is your estimate based on data you can't see? 'no one has the courage to allow me to check their output CLAIMS' - simple solution: get an internet connection and use it.
But capacity factor is not the issue since you allege financial fraud. The quarterly reports of these shareholder corporations should be sufficiently informative reading. Point us to some quarterlies that show the 'massive' losses you claim.

Joe Barnes
October 1, 2012

Gerald R,
I do not have a specific list of shareholders in the US or here in the UK but I do know that they are a very bad investment if anyone is to make money out of them. The largest of these wind turbines cost approx £4.5 million to install and here in the Uk they produce modest amounts of electricity for an average of 63 days per annum. Even if these duff machines were running at full throttle for those days they still would not produce the alleged energy that the salesmen are convincing us of.I have asked the big Corporations if I can witness for myself the output of these machines but so far no one has the courage to allow me to check their output CLAIMS.
I would say, like you, that this is deception worthy of being called a scam.A young investor will be old and grey before they reap the rewards of these monstrosities.

Gerry Wootton
October 1, 2012

Not everything that flops is a scam; not everyone that makes a bad purchasing decision has been scammed. For proof, see kijiji adds for new furnishings that 'is too large/too small', 'doesn't match decor', 'looked good in the store', can't be moved, etc.My fave: 'golf clubs only used once'. We're all easily persuaded to see an upside. The downside has a name:'buyer's remorse'. I've seen plenty of times where big corporations made similar mistakes. One of the issues: it's not just hard to predict the future, it's not even easy imagine.
Some bad stuff is just bad workmanship, not always intentional(America today ... craftsmanship is a lost art). In some cases the purveyors deluded themselves or were mislead by associates so the scam is somewhere else. Some bad stuff is willfull deception and malfeasance. But let's start with politicians that claim to support the program and then don't abetted by civil servants expert at jamming the gears and utilities that are simply out of their depth.
It's just dang hard to get the cost model right. First, the administrative costs are unpredictable - the little Caesars of inspection and permitting will see to that. Second, utilities keep adjusting their pricing - in collusion with politicians and regulators enabling them to keep their revenue constant; the last thing they're going to do is let an individual save on electricity. Look even farther: taxation of consumption is a government revenue stream - they're going to find ways to keep the cash coming too (some jurisdictions impose a production tax on the 'free' energy). Then an electricity bill that's nearly impossible to fathom- deception worthy of being called a scam.

Gerry Wootton
October 1, 2012

JHB - name names! Please enlighten us with a few examples where the 'shareholders' have been taken for a 'massive' ride. If that is the case the financial gurus at a number of large corporations, especially the ones buying up existing wind farms, should be under investigation. Testify.

Joe Barnes
October 1, 2012

In my opinion, wind energy falls into the same scam as solar. The share holders have been taken for a massive ride. Only time will diminish these lawful con tricks.

ANONYMOUS
September 27, 2012

There's a sucker born every minute.
At times we are all suckers - it's hard to go through life and never get taken - some cons are just too good at what they do. Really, they have few choices - commit fraud or run for office - and those are the nice ones.
Cons chase the money. The fact that solar is a platform merely speaks to its prevalence not its obscurity. Unfortunately, rooftop solar falls under home improvement, an area that is statistically speaking rife with both cons and quacks; moreso than used car sales. Buyer beware sounds good but how many of us really know the right way to pour a foundation or have the time and energy to find out? BBB is only useful if a company has been in business for a long time and even then, if you never made a mistake, you probably haven't done much - worse, it's so easy to register a business, a scammer can create a new identity overnight. If you want references, how about you just look at these nice pictures of someone else's work? Sadly, ..it happens. It doesn't help that it is so hard for these people to get a criminal record and so easy to get it expunged. And why be an idiot and rob people at gun point for what's in their wallet and go to jail when you can take them for their bank account and never even see the inside of a police station.

Comments about products that came and went in the market being scams as evidenced by their absence are dumb. Possibly the Pontiac Firebird and the hula-hoop were scams? (I owned both).

Of course, at the best of times, you only get what you pay for - now let's talk about cheap energy.

September 26, 2012

The Solar Industry in Americorp is quickly becoming a joke, politicians use it as a political platform, and since it is no longer their little darling, they are withdrawing their support in the way of subsidies for the purchaser. Out of work real estate salespersons and used car sales people have entered into the arena, and the results have been frightening and for many, quite disappointing. Promises of immense savings, tax breaks, and yes, the consumer is partly at fault. Few see the need to do their homework, and investigate the true story behind a solar electric investment.

I have been in the solar business for over 30 years, and believe me, they were tough years. All the while, those few of us realized that to see solar power blossom into a real industry we would have to welcome Big Biz to sit at the table.

Today, they are here, but they are likely to fade away, just like those subsidies.

The truly funny part of all of this is that one of the biggest in the Biz is True North Partnership...think WalMart or as they are known, First Solar.

One last thought about this story, I wonder how many of YOU have solar installed on YOUR home or business.

Thom at Spiffy Solar
September 26, 2012

George, yes, the article is unnecessarily stirring the pot. It is purely conjecture, but one can't help but wonder if there are elements at or connected to the publisher with memories of those earlier days, with lingering biases, assuming that the situation is no different now. I also wonder if the decision-maker —the higher-up as opposed to the actual author— could even explain the difference between solar thermal and PV?

George Reynoldson
September 26, 2012

Doesn't this Consumer Report solar "scam" reference seem like a repeat of what happened to American solar space heating and solar water heating in the late 1970s and early 1980s when solar was over stimulated by government incentives which were later abandoned (politically) during the Reagan-Bush administration?

Then, when the industry collapsed and experienced an almost instant 40% drop in sales followed, most manufacturers were forced to shut down leaving emerging solar systems distributors and solar builders without maintenance parts and unable to honor their warrantee obligations. Though the solar space heating and water heating business did attract some green-washing utilities and undercapitalized and unknowledgeable sales persons which oversold solar, for the most part as now, the bad rap they got as fly-by-nighters was unjustified and more due to underperformed maintenance on systems that were either not quite ready for market or dependent on replacement parts and skilled technicians were became nonexistent after industry collapse. Solar's problem then was capacity not ethics!

Similarly, to call solar today anything more than just an industry paralyzed by economics seems a lot more like political rhetoric than actual statistical analysis would likely reveal. This may prove especially unjust if the (behind the scenes) sources of these "scam" claims turns out to be fossil fuel or nuclear interests, or even financial interests like those who sold the subprime mortgage idea through their proxies... DC politicians, think tanks and the US Chamber of Commerce.

The early 1980s featured a lot of traditional energy lobbyists (pots) calling the (solar) kettle black then too. Fortunately the industry today is much better self-regulated and will likely stand up much better to false and even justifiable "scam" claims now. This is not to underestimate the amount of damage that this Consumer Reports article might do in the short run.

Mike O'Grady
September 26, 2012

Consumers is a good organization and looks out for people, which is great for the industry. However, I did read the "scam" article in the last issue and was more interested in having CR do comparisons on Manufactururers of panels, inverters, mounting systems etc as a new entry in their catalog of product reviews.

Has the SEIA approached CR on doing this by chance?

Douglas Prince
September 26, 2012

27940 - You're kind of an idiot, aren't you?

September 26, 2012

NickDalacu, I find it a shame that you are sooo sensitive, possibly you are under going a change of life.

Bernie Madoff is a jew and those are not my words, but the result of my search into the facts, in relationship to what is wrong with this country and this regime. Much of what is wrong lies in the fact that many "Americans" have become sooo sensitive to what their handlers tell them, your words prove the point.

As for government, they, read Obummer, dumped sooo much money in all the wrong areas of the solar industry. Anyone who has been in the solar industry and was not a Bernie Madoff, knew that Solyndra was a loser, just as Tesla is a loser.

Tesla made 200 million+ on their IPO, 450 million+ on their government bailout. To date; they have sold 100 vehicles. That comes out to 5 million+ per vehicle.

The "cost" to the solar industry has been quite similar and with the same result, public disgust and mistrust.

If government had put the same money in Solar Hot Water Collectors, we would have realized 3X the return as compared to Solar Electric.

What Americorp is experiencing is not an energy scarcity, but a problem much like our shared obesity problem. We are glutinous to the extreme, we run when we hear the word conservation. Americorp is the living example of what Rome looked like during the Fall of the Roman Empire and you are their poster boy.

sincerely, Michael

Thom at Spiffy Solar
September 26, 2012

Very good point, people are the problem. Technology is neutral but it has to be represented by someone.

September 26, 2012

People, The problem is NOT solar, but the many "people" whom have come to represent the industry.

My wife and I have had solar and wind power for over 30 years, truth be known, we had no other choice, given our location. We have all the "things" that the rest of you consider a necessary for life.

Having stated all of that, I would agree that too many used car salesperson and ex-real estate agents have come to represent the solar industry.

Such is not new, Bernie Madoff, a Jewish laborer, working as a lifeguard and sprinkler installer, and in the end, created the largest Ponzi Scam in U.S. History.

He has been followed by many of his ilk, Citicorp, Bank of America, General Motors, Tesla Motors, and others, including the U.S Government.

Yes, American citizens must pay vigilance against such predators, in the words of Willie Sutton. "Why did I rob banks? Because I enjoyed it. I loved it. I was more alive when I was inside a bank, robbing it, than at any other time in my life. I enjoyed everything about it so much that one or two weeks later I'd be out looking for the next job. But to me the money was the chips, that's all.
Go where the money is...and go there often."

VOTE EARLY, VOTE OFTEN.
Once the same words were spent by...Historian James Morgan, in a 1926 publication, identified John Van Buren as the originator of the phrase, an identification supported by Laurence Urdang and Janet Braunstein. Bartlett's Familiar Quotations notes its usage in 1858, by William Porcher Miles.

You be the judge!!!

Thom at Spiffy Solar
September 25, 2012

Consumer Reports is in the business of simplification. Editorial decisions (generalizations) get made in the process with which experts in just about any field would take issue. In this case, the overall cost and significance of living in a cloudy area serve to perpetuate long-standing myths. Information like this stops potential customers in their tracks and prevents them from investigating further, learning the truth for themselves and their specific situation. One of the biggest dangers to perception of the industry is generalization. Factors such as cost, finances, system size and location are complex and do not lend themselves to such simplification. Surprisingly, the largest factors of all have nothing to do with technology, but rather with rebates, legislation, utility costs and other REGIONALLY BASED issues. It would have been hugely beneficial for this distinction to have been included as part of the magazine's caveat.

The Knight
September 25, 2012

While I agree that Consumer reports shouldn´t include solar in that list, what they actually say in the article just tells consumers to educate themselves before investing over $1000 which anyone would do anyway. Its really just a silly article that isn´t specific about anything. I don´t think it is as big a deal as this article is making it sound. Bottom line is that solar shouldn´t be on a list of scams but if you actually read it there is nothing malicious in there.

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Rachel Simmons

Rachel Lora Simmons is the Marketing Coordinator at Brightergy Solar. She graduated from Rhodes College in 2008 with a degree in English, Creative Writing. She is passionate about literature, food and health, the great outdoors, sustainability,...