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Oct 17, 2024

SunPower declares bankruptcy: What this means for valley customers

SunPower, the company that provides the solar panels many Coachella Valley residents have on their roofs, filed for bankruptcy on Monday. It is the latest development in a saga that has seen the

SunPower, the company that provides the solar panels many Coachella Valley residents have on their roofs, filed for bankruptcy on Monday.

It is the latest development in a saga that has seen the company facing numerous serious and seemingly escalating challenges over the past several months, including allegations about executives' misconduct related to the company's financial statements and a recent decision that SunPower would no longer offer new solar leases.

Days after the latter announcement, Coachella Valley-based Renova Energy, which markets and installs SunPower systems, said it was ending its partnership with SunPower and temporarily pausing operations after not receiving required payments from SunPower.

SunPower's executive chairman wrote in a letter posted on the company's website on Monday that the company had reached an agreement to sell certain divisions of its business and suggested it was looking for one or more buyers to take on the rest, including the company’s responsibilities to maintain solar systems it has previously sold or leased.

Some customers who lease SunPower systems also have been told to begin making payments for those systems to other companies.

Here is the latest on what is known about the evolving situation and what it means for SunPower customers in the Coachella Valley.

SunPower filed for Chapter 11 bankruptcy, which it says will give it time to try to sell its assets, which the company says includes its responsibilities to maintain and service SunPower systems. A press release posted online states that the company is seeking court approval to access cash to fund its operations and administrative expenses during the bankruptcy proceedings and has filed motions asking the court to allow it to "meet its obligations to its employees."

One local SunPower customer posted an emailed letter he had received from the company on social media which stated that he should now send payments for his SunPower solar system lease to a company called Launch Servicing. The letter explains that Launch Servicing will now be responsible for billing and support related to those leases including their warranties.The CEO of Renova Energy, the Coachella Valley company that cut ties with SunPower and initially furloughed all of its staff after not receiving expected payments from SunPower, said he has been hearing from hundreds of SunPower customers instructing them to send payments to various finance companies.

However, it is unclear if all SunPower customers or just some are now having their leases serviced by third parties. The company did not provide a written response to an inquiry from The Desert Sun seeking clarification on this and other points. Its representative instead directed the newspaper to the online press release, which did not answer the questions.

It appears as if SunPower is still responsible for its leases and warranties in California, at least for now. However, multiple letters sent to customers by the company viewed by The Desert Sun state that SunPower is currently unable to service its solar systems but "diligently working to find a provider to do so," leaving uncertain how customers will get any needed repair services that should be provided under their leases or warranties.

The statement on the company website states that SunPower is “aiming to support” its lease customers for the duration of their solar contract. However, it does not elaborate beyond stating that customers should call the phone number listed on their billing statements when they need support.

The letter states that customers who either own or are financing their system can contact any solar servicing company for repair work. However, it appears unclear if and how customers with warranties covering their system will be reimbursed for repairs they pay for themselves – the letter states only that the company will share details about “how this will impact manufacturer-supported equipment warranties as they become available.”

SunPower Chairman Tom Werner wrote that an agreement has been reached to sell the following portions of the company to Complete Solaria, another company that sells solar systems:

The sale of these portions of the company does not appear to have any direct impact SunPower’s existing customers in the Coachella Valley and California. It also does not appear that SunPower has sold any of its existing California leases or warranty obligations to other companies, only transferred the responsibility for servicing at least some leases.

"If the company is unable to facilitate sale transactions, these businesses will undergo an orderly and efficient winddown," according to the press release. It does not elaborate on what that will mean for those remaining customers.

Renova Energy CEO Vincent Battaglia told The Desert Sun on Tuesday the company has brought back about 10% of its employees who are now doing installations that had to be delayed and helping with any customer issues that come up, including answering questions surrounding SunPower's situation. He said he hopes to have about 100 of the company’s roughly 300 employees back to work by mid-August, at which time it hopes to begin installing systems for new customers.

He said that will be possible because the company has found two new companies to partner with that will provide leasing and financing for the systems Renova will install following last month’s dissolution of its partnership with SunPower.

He also said the company has secured an investor that will be putting new money into the company to fuel further growth and bringing back the rest of the employees.

Paul Albani-Burgio covers growth, development and business in the Coachella Valley. Follow him on Twitter at @albaniburgiop and email him at [email protected].