In 2023, an Insurer Warned 75% of California Solar Companies Were at Risk. Here's What Happened Next.

In 2023, an Insurer Warned 75% of California Solar Companies Were at Risk. Here's What Happened Next.

In December 2023, a warning went out that most California homeowners never saw. It didn't come from a regulator or a consumer watchdog — it came from Solar Insure, an insurer that backs many of the state's residential solar installers. Its data showed that roughly three out of every four solar companies operating in California were now classified as "high risk" for bankruptcy. CEO Ara Agopian told pv magazine USA the company expected another wave of installer failures to hit within months.



That warning turned out to be conservative. Two years later, the list of casualties is long enough that we track it on its own dedicated page.

What Triggered the Warning

The root cause was a policy change most homeowners had never heard of: NEM 3.0, a rulemaking decision by the California Public Utilities Commission that took effect in April 2023. NEM 3.0 slashed compensation for excess solar energy exported back to the grid by roughly 80% compared to the prior program. For homeowners, that meant the savings math they'd been sold on — often years earlier — no longer held up. For installers, it meant a sudden, sharp drop in new customer demand.

The effects showed up fast. Utility interconnection applications dropped by roughly 80% in the months following the rule change, and the California Solar and Storage Association reported nearly 17,000 solar industry jobs lost in a single year — about 22% of the state's solar workforce.

Solar Insure's "high risk" rating wasn't a guess. It was based on the insurer's own underwriting data across the installers it covers — and it came four months before what the industry would later recognize as the start of a two-year bankruptcy wave.

The Companies That Followed the Warning

Here's what happened to some of the state's largest residential solar installers in the two years after that warning:

• Sunworks filed Chapter 7 in February 2024 — just over two months after the warning — and liquidated entirely.
• Titan Solar Power filed Chapter 7 in 2024 with no successor company to take over customer contracts.
• SunPower, one of the industry's oldest names, filed Chapter 11 in August 2024. Read what that means for SunPower customers →
• Sunnova, one of the largest lease and PPA providers in the country, filed Chapter 11 in 2025. See who owns your Sunnova contract now →
• Freedom Forever, the second-largest residential installer in the U.S. at the time, filed Chapter 11 in April 2026, affecting an estimated 190,000 systems nationwide. Read the full story →

That's five major installers — not counting the smaller regional companies and lenders that also went under in the same window, including Sunlight Financial's Chapter 11 filing in October 2023. See the full list of companies that have gone bankrupt or shut down →

The Warning vs. What Actually Happened

Prediction: 75% of CA solar installers rated "high risk" for bankruptcy
Timeframe given: "Another wave" expected in Q1 2024
Basis: Underwriting data following NEM 3.0's April 2023 implementation

What actually happened:

Outcome: Continuous wave of major bankruptcies from Feb 2024 through April 2026
Scope: Spread beyond installers to lenders and national players, not just regional companies
Duration: Longer and broader than the initial Q1 2024 estimate — still ongoing more than two years later

The prediction wasn't wrong. If anything, it understated how long the pressure would last and how far up the industry's largest players it would reach.

Signs Your Solar Company May Be at Risk Right Now

If your installer hasn't gone bankrupt yet, that doesn't mean it's in the clear. A few warning signs worth watching for:

• Your installer has gone quiet — slow callbacks, unanswered service requests, or a support line that's been disconnected or rerouted
• Your installer has laid off a significant portion of its workforce or closed regional branches (a pattern that preceded several of the bankruptcies above)
• Your installer relies heavily on third-party dealers or subcontractors rather than in-house installation crews
• Your monthly payment is going to a lender you don't recognize, separate from the company that sold you the system
• News coverage or SEC filings mention "going concern" language about your installer's financial health

None of these guarantee a bankruptcy is coming. But if two or more apply to your situation, it's worth understanding your contract now rather than after a bankruptcy notice arrives in the mail.

If Your Company Is Already Gone

If your installer or lender has already filed, we've covered the practical next steps in detail elsewhere — what to do first, whether you're still required to keep paying, and how the FTC Holder Rule protects your claims even after your contract changes hands. Start there for the action steps; this piece is about understanding how we got here.

Frequently Asked Questions

Did Solar Insure's prediction turn out to be accurate?

More than accurate — the pace and scale of bankruptcies since December 2023 arguably exceeded what the original warning anticipated, both in the number of companies affected and how long the pressure has lasted.

Is NEM 3.0 the only reason so many companies have failed?

No. Rising interest rates, over-expansion during the 2020–2022 boom years, and heavy reliance on dealer-network sales models all compounded the effect of reduced NEM 3.0 compensation. Companies with thinner cash reserves or weaker underwriting were hit hardest.

Should I be worried if my solar company hasn't gone bankrupt?

Not necessarily — many installers have weathered this period without financial distress. But it's worth periodically checking your installer's financial health, especially if you notice service slowdowns or executive turnover.

What should I do if I think my solar company is at risk, or already went under?

Start by pulling your contract and identifying exactly what type of agreement you have — lease, PPA, or loan. If your company has already filed, our step-by-step guide walks through exactly what to do first.

If your solar company is one of the names on this list — or you're worried it might be next — a free contract review can tell you exactly where you stand before anything changes hands.

Call Daniel Merritt, Senior Solar Contract Analyst at California Solar Exit, at (213) 579-5156, or visit californiasolarexit.com for a no-pressure review of your lease, PPA, or loan.