Solar Panels Not Producing Promised Energy: Can You Dispute the Contract?

You can dispute solar panels not producing promised energy when your contract promised a minimum amount of electricity and the system, measured the way the contract measures it, falls short. Production guarantees are common in leases and power purchase agreements (PPAs), while a solar loan usually carries none, so with a system you own the dispute usually runs through the equipment warranties, the installer’s workmanship, or a claim that the production estimate was misrepresented when you signed. Either way, start by measuring the shortfall against the contract’s own number and ruling out normal aging and fixable faults.

If the panels make their expected power and your bill is still high, see why your electric bill is still high after solar; if the problem is the savings you were promised, see what to do when a solar salesperson lied about savings.

What does a solar production guarantee promise?

A production guarantee, also called a performance guaranty or a minimum energy guarantee, is a contract term in which the solar company promises the system will produce at least a stated amount of electricity over a stated period, and says how it will compensate you if it doesn’t. The California Public Utilities Commission (CPUC) tells buyers to ask, “Does the solar provider offer a minimum energy guarantee (common with leases and power purchase agreements)?” and how they will be compensated if the system falls short. The FTC tells lease and PPA customers to check “whether the contract guarantees a minimum level of power, and how the company will pay if the system doesn’t produce the minimum amount of power.”

Treasury’s consumer advisory uses the term too, telling buyers to find out “If the contract includes a ‘performance guaranty’ and how the company will pay if the system doesn’t produce the minimum amount of power.” Treasury’s separate lease and PPA guides don’t use that phrase. They ask “How many kilowatt-hours per month would this system produce on average?” and what recourse you have with the company “to cease payment if it not repaired or replaced in a timely manner” (Treasury’s wording).

Read your own guarantee for the minimum in kilowatt-hours, the period it’s measured over, whether it steps down each year, what it excludes, and how a shortfall is paid and claimed. That minimum may sit below the production estimate printed elsewhere in the same contract, so note both.

How do a lease, a PPA and a loan treat low production?

	Lease	PPA	Loan or cash purchase
What you pay for	A payment for the equipment, flat or rising each year	Each kilowatt-hour delivered, at the contract rate	The system itself
Who maintains it	Generally the leasing company	The PPA company	You, backed by warranties
Production promise	Often a minimum energy guarantee	Often a minimum energy guarantee	Usually none in the loan
Where a shortfall hurts	Same payment, more power bought from the utility	Smaller PPA bill, more power bought from the utility	Same loan payment, more power bought from the utility

The CFPB describes a PPA as “paying for energy,” since the consumer pays “for the electricity they consume rather than a fixed cost for the panels.” Treasury says the leasing company “owns the system and is generally responsible for system maintenance,” and the CPUC says that with a lease or PPA the “Solar provider is responsible for all monitoring, maintenance, and repairs.” With a purchased system, the CPUC says, “You are typically responsible for repairs and maintenance.” For loans, the CFPB’s 2024 report observes that “Some solar loan agreements note that the consumer’s financial obligation does not depend on the system’s performance.”

How much should solar output drop each year?

Degradation is the slow, permanent loss of a solar panel’s output as it ages. NREL’s review of nearly 2,000 measured rates found “a median value of 0.5%/year,” with a mean of 0.8 percent and 78 percent of reported rates below 1 percent a year. At 0.5 percent a year, a panel makes roughly 95 percent of its first-year output in year 10 and about 88 percent in year 25 (our arithmetic).

Most systems land close to their estimates. In NREL’s 2014 study of almost 50,000 systems installed from 2009 to 2012, “About 90% of the systems with no reported issues produced more than 90% of the predicted electricity.” A system running more than 10 percent below its estimate is doing worse than most problem-free systems in that study, which is reason to look for a fault or a flawed estimate. Panels also carry their own performance warranties, so check the output floor in yours.

What else makes solar panels produce less than promised?

• Inverter failure. NREL’s 2018 maintenance guide calls inverter failure “one of the most frequent causes of PV system performance loss.” The CPUC says the inverter “may need to be replaced sooner than other equipment.” A sudden drop, rather than a slow slide, points toward equipment like this.
• Shade, dust and snow. The FTC lists “environmental factors like snow, dust, or shade” among the things that set a system’s output, and the CFPB names “tree growth” among the factors that affect performance.
• A system that’s off. Output of zero can mean the system never received permission to operate or has shut down; see solar panels never activated and solar panels not working.
• An estimate that was too high from the start. The CFPB found that some installers “overestimate the amount of electricity that solar panels will produce.” A system that has run well below its estimate since the first month, with no fault found, points here.

How do you measure the shortfall against the contract’s estimate?

1. Find the contract’s numbers: the estimated first-year production, any contractual minimum, the measurement period and any yearly step-down. A monthly figure the salesperson quoted counts as evidence too.
2. Get the production record. Export the history from the monitoring app or portal, and ask the company in writing for its own records. Your utility bill can’t stand in for it: the CPUC says the bill summarizes “how much electricity your home bought from and sent to the electric grid,” which leaves out the solar power your home used directly.
3. Match the contract’s period. One cloudy month proves little, since weather is on the CFPB’s list of performance factors.
4. Adjust for degradation if the contract’s estimate doesn’t already step down.
5. Log every outage with dates, error messages, service visits and photos.

A made-up example: the contract estimates 9,000 kWh in year one. At 0.5 percent a year of degradation, year three should bring about 8,910 kWh. If monitoring shows 7,400 kWh, the system is about 1,510 kWh, or roughly 17 percent, short, far beyond normal aging. Then compare the result with the contract’s minimum and with how the guarantee says a shortfall is paid.

Is low production a contract issue or a technical one?

What you see	Likely technical cause	When it becomes a contract issue
Output dropped suddenly	An inverter, breaker or communication fault	The company responsible for repairs doesn’t fix it in reasonable time, or refuses a warranty claim
Output a little lower each year	Normal degradation	Output falls below the contract’s minimum or the panel warranty’s floor
Output low since the first month	Shade, design or an inflated estimate	A lease or PPA guarantee is missed, or the estimate was misrepresented at the sale
Output at zero	A system that is off or never approved	Payments keep running on a system that was never switched on

A technical problem turns into a contract problem when the company with a duty to fix it doesn’t. Even then, cancelling the contract is never automatic: it depends on the contract type, the dates, your state’s law and the facts. On a lease or PPA, that duty usually sits in the maintenance terms and the guarantee; on an owned system, it sits in the written warranties. The federal Magnuson-Moss Warranty Act covers only written warranties on consumer products, and the FTC’s interpretation of the Act says “warranties on services are not covered,” so an installer’s labor-only workmanship warranty is a matter of contract and state law. Inverter warranties can leave labor out: Enphase’s microinverter warranty “does not include any cost of labor related to” uninstalling or reinstalling the product, and SolarEdge’s excludes labor “relating to repairs, uninstalling, and reinstalling.”

Who do you send a production claim to?

Send it in writing to the company that owes the duty; the installer, lender, servicer and warranty provider may be four different companies.

• Lease or PPA: the company that bills you now, citing the guarantee clause. After a bankruptcy that may be a servicer. Connecticut’s attorney general says SunStrong Management manages loans, leases and PPAs from Sunnova and SunPower, and sent it a civil investigative demand in February 2026 after about 65 consumer complaints, including complaints that it was failing to uphold warranties. Those are complaints under investigation, not findings.
• Owned system: the installer for workmanship, and the panel or inverter maker for equipment defects, following the warranty’s claim steps and deadlines.
• Loan: the lender owes no production promise unless the contract says so. If the installer arranged the loan, look for the FTC Holder Rule notice, which makes any holder “SUBJECT TO ALL CLAIMS AND DEFENSES WHICH THE DEBTOR COULD ASSERT AGAINST THE SELLER,” with recovery that “SHALL NOT EXCEED AMOUNTS PAID BY THE DEBTOR HEREUNDER.”

Keep paying while the claim is open. Any right to withhold payment, which Treasury’s guides tell lease and PPA customers to ask about, lives in your contract, so read it with an attorney before you hold anything back; the stop-paying page explains what missed payments can trigger.

What should you do about solar panels not producing promised energy?

Go in this order, which matches the routes in our guide to getting out of a solar contract.

1. Inside a cancellation window? A shortfall usually shows up after the window has closed, but windows vary by state and some run longer than three days. If you are inside one, cancel in writing by the required method and send the lender a copy the same day; check the state cancellation laws and the deadline tool.
2. Identify your contract and every company. Confirm whether you have a cash purchase, loan, lease, PPA or PACE financing, and name the installer, lender, servicer and warranty provider.
3. Ask in writing, and complain for free. Send a written claim with your production figures, the contract clause, the outage log and the remedy you want. For a system you bought, the FTC says: “If you have a problem with a system you bought, try to resolve it with the company first,” and, failing that, to report it to the FTC at ReportFraud.ftc.gov and to your state attorney general. If a loan is involved, the CFPB takes complaints, and its complaint page first asks “Have you tried reaching out to the company?” For a lease or PPA, which the CFPB doesn’t list as a product, Treasury, the CFPB and the FTC jointly encourage people who believe they faced unfair or deceptive practices to complain to the FTC or their state consumer protection office, and your state attorney general and contractor licensing board take complaints as well.

Disclosure: Candid Yak works with Titan Advocacy Group, a solar consumer advocacy firm, and may be paid when readers hire it.

4. If they refuse, and your documents show a gap between the production you were promised and what the company delivers, get a free case review from an attorney-backed firm. Choose one that:

   • reviews your contract, production records and correspondence before it quotes anything, and tells you plainly if a free route such as a warranty claim or written request is still open;
   • names the attorney who will handle your file, licensed in your state, so you can check that attorney with the state bar;
   • states its fee, and what happens to the fee if the company or lender refuses, in writing before you pay;
   • never tells you to stop paying your loan, lease or PPA;
   • never guarantees a result and never claims a connection to your installer, lender or servicer.

   Don’t pay anyone for this before the company has answered your written claim.

5. Other routes. A lease or PPA may allow a buyout, which the exit cost calculator can compare with staying, or a transfer to a buyer if you sell; get any figure in writing. With a loan, a payoff or refinance changes the payment but not the production; see solar loan payoff and refinance and compare debt consolidation loans.

Disclosure: Candid Yak works with Titan Advocacy Group, a solar consumer advocacy firm, and may be paid when readers hire it. This page’s author, Kira Fairbank, is a manager at Vacation Ownership Consultants, a timeshare exit firm.

This is general information, not legal advice. A production claim turns on the exact wording of your guarantee, warranty or loan and on your state’s law, so have an attorney licensed in your state read the contract and your production records before you send a notice, sign a release, or change any payment.