Most Australians are used to the plethora of scams that pervade their email inboxes and phone messages. Most of them are obvious but some, just like solar scams, can be well disguised as genuine.
We have compiled a list of 5 common solar scams to help you make an informed decision
Table of contents
Solar Scam 1: The Product Swap
While this scam has been mostly weeded out, it is still prevalent and should be looked out for. The Product Swap is where you are sold on a specific make and model of solar panels and an inverter but are installed with cheaper products. This scam relies on naivety, which is where you won’t be caught out!
What to look for
First and foremost, you must have an understanding of the products you will have installed. This means taking note of:
- The manufacturer: Your solar panels and inverter will have a manufacturer name, such as REC, LONGi, GoodWe, and sonnen. These are the companies that manufacture the products.
- The model: The inverter and the solar panels will have model names. These names stipulate the size and type of product you will have installed. For example, if you have chosen a Sungrow 5kW inverter then the model may be SG5.0RS.
The products you have selected will be noted in your contract.
On the day of installation, ensure that you request to see the panels and the inverter. On the solar panels, you should see a label on the back, close to the cable connections, which display the make and model. The inverter should arrive in the manufacturer’s box, which will make identification easier. However, ensure that you check the inverter’s label (found on its side) once it has been mounted and installed.
These simple steps will ensure that you receive the products that you have paid for. In the event that your installer arrives with the incorrect product, do not allow them to install it and do not sign any documentation. Request that they contact their office to rectify the matter, or you can do so yourself.
Solar Scam 2: Fake solar installers
This scam is one of the more insidious and not an easy one to spot. Fake installers exist to take your money with no intention to install solar on your home or business. They generally ask for a large upfront deposit. Now, this isn’t uncommon for genuine solar installers to request, as a deposit is generally required prior to installation, but it’s usually the size of the deposit to be wary of. These fake installers may also use your information for identity theft.
How to spot a fake solar installer
Fake solar installers can go to great lengths to scam unknowing homeowners and businesses. They may have a genuine-looking website and run ad campaigns on social media. Here are some easy steps to identify a fake installer:
- ABN lookup: One of the quickest ways to see how long a business has been operating is to look up their ABN. You’ll first need their ABN so identify it on their website or on the documentation they provide you. If you cannot find it, ask them for it. A major red flag will be if they are unwilling to provide it. If this happens, run far away! If you do manage to obtain their ABN, use ABN Lookup and find out how long they have been in business and if they have operated under different names. If they have been operating for less than a year then be very wary.
- Google footprint: Search Google for the business’s name and reviews. Search both the business name and the ABN. You may just find that other people have reported the business as fake.
- Clean Energy Council: The Clean Energy Council maintains a list of accredited solar installers. If your installer is accredited then they are likely to be reputable.
If you are unsure, it pays to play it safe. Seek quotes through Energy Matters who work with pre-vetted and trusted installers in your local area.
If you believe you have fallen victim to a fake installer scam, contact your bank immediately. We have provided some handy contacts and links at the bottom of this page to assist you further.
Solar Scam 3: Shonky solar contracts
Signing contracts are a part of life and, as much as we don’t like to admit it, we don’t always read the fine print. Common contract scams in the solar industry are usually found in Power Purchase Agreements (PPAs) and financing. While these are both ordinarily safe, it is the specific terms you unwittingly agree to that may catch you out. These contracts can be nearly impossible to get out of once signed, so it is important to know what to look for.
Reading the fine print
Understanding what you are signing up for is paramount:
- Interest rates: Look out for the terms attached to the interest rates. Are they fixed for the life of the agreement or are they variable after a fixed term?
- Contract duration: What is discussed in person may not be what you sign up for. Look for the duration as well as early termination fees and provisions.
- Performance guarantees: If your system does not perform as expected, you must understand the penalties that may apply.
- Hidden costs and fees: Ensure that you have a complete understanding of the terms and conditions of your agreement.
- Maintenance responsibility: Understanding the responsibilities of maintenance is important. Liability may fall on you if you do not maintain the system as required.
PPAs and financing are both fantastic ways to access solar for your home or business. Understanding your contracts and agreements is vital so that you are not left paying unwanted or unexpected amounts for years.
Solar Scam 4: Promises, promises
The reality of the solar industry is that it is populated with salespeople! We all know that one salesperson who could sell honey to a bee. While some sales tactics are questionable, there are some promises made by solar installers that are simply lies.
Lies to spot
Some lies are easier to spot than others. Let’s take a look at some common ones:
- Output promises: This would have to be the most common promise that is made for a quick sale. A reputable solar installer will calculate the system size, inverter and panel efficiency, and your location and orientation of installation. These all determine the expected output of your system over a set timeframe. A not-so-reputable installer will inflate these figures. A simple way to see if your installer is blowing hot air is to use our solar calculator to see what the expected daily output of your system size is in your location. If the output quoted by your installer greatly exceeds this, ask for the reasoning and request to see their calculations.
- Longer warranties: Your solar panels and inverter will come with manufacturer warranties for the product and the performance. Compare the warranties provided by the installer with the warranties on the manufacturer’s website. You will need the make and model for this. Some installers will inflate the warranties. Some manufacturers offer a 10-year warranty for one model of inverter but a 7-year one for others. Understanding what product you will have installed is paramount to avoiding this simple scam. Always read the fine print for the installation warranty, too.
- Higher feed-in tariffs: Your installer cannot advise you what feed-in tariff you will be eligible for (unless you are installing a system through an electricity retailer). If the installer uses a higher-than-average feed-in tariff to provide you with a calculation of expected savings, then that figure may be off by hundreds or thousands of dollars.
- Money saved: This one is often the most abused figure in a quote. Installers should be giving you a figure based on your current energy usage, but it is important that you understand that it is impossible to give accurate predictions of solar savings. Ask for a detailed breakdown of how the savings are calculated.
- Zero-dollar bills: No doubt you’ve heard this one before; your solar system will result in zero-dollar bills. It sounds too good to be true because it mostly is. An installer cannot promise you this. They don’t know what your future energy consumption will be, nor the fluctuating energy market. If you are promised this, walk away!
Salespeople will use sales tactics, but it’s important to know when you are being taken for a ride. Absurd promises should be scrutinised and walked away from.
Solar Scam 5: Going small
A little-known scam has been doing the rounds for many years, and it catches many unsuspecting people off-guard. When doing your due diligence and obtaining quotes, you may come across an installer who talks you out of the ‘larger’ system quoted by others. Where you were quoted for a 6.6kW system for $7,000, they will install a 3kW system for $3,500. They’ll tell you that the other installers were quoting you for a ‘huge’ system you don’t need and sell you on the ‘crazy cheap’ price of the smaller system.
Not only will you be left with a small system that is unlikely to cover your needs, but you may be ineligible for state rebates or incentives if you choose to upgrade later.
What to look out for
Unlike the upselling of other installers, down-selling is a little more insidious. Here’s what to look for:
- Your electricity consumption: Your solar system size should be selected based on your current and future needs. A simple way to see what size system you need is to locate your recent electricity bills and look at your average daily consumption in kWh. Once you have determined your average consumption, use our solar calculator and find out what size system would best suit your home. If the installer suggests a system much smaller, you need to question them as to why.
- Your budget: How much you are willing to spend may dictate the offers a solar installer provides you. You can give an indication that you are not willing to spend too much but don’t give exact figures.
- Play your cards close to your chest: We advise all our customers to request a quote BEFORE offering the details of previous quotes. You are free to negotiate after this, but if your installer already knows what you have been quoted elsewhere, they may choose to down-sell you.
A smaller and cheaper system may seem attractive but may just nullify the reason you’re going solar in the first place.
What do I do if I have been scammed?
First and foremost, ensure that your finances are secure by contacting your bank or financial institution.
The following are some resources that you can access:
- Report the scam to ScamWatch.
- Contact the Australian Competition and Consumer Commission (ACCC) to report the business.
- Contact your state consumer protection agency. A list can be located here.
- If you are in danger, contact emergency services on 000.
How can I avoid solar scams?
Research, research, research. Arm yourself with all the knowledge you need to make an informed decision. Whether that be solar panel and inverter brands and models, finance options, or the rebates and incentives available, it is important to know what you are signing up for. It is also vital that you select a reputable and trusted installer to work with.
Energy Matters has done the hard work for you! We can connect you with trusted, local installers to provide you with FREE quotes for solar, batteries, and more. These quotes are also obligation-free, so you can interact with the installers free of worry.
