New Texas Law Aims to Protect Homeowners from Solar Scams

AUSTIN, Texas — Texans who shop for rooftop solar systems are gaining new protections as the state implements a law requiring residential solar businesses and salespeople to register with the Texas Department of Licensing and Regulation (TDLR). The change is designed to crack down on deceptive sales practices that have left some homeowners saddled with costly loans, unfinished projects, and promises that never materialized. According to proposed TDLR rules implementing Senate Bill 1036, solar retailers and individual solar salespeople must obtain registrations and operate under a state regulatory framework beginning Sept. 1, 2026.

The new law, known as the Residential Solar Retailer Regulatory Act, was approved in the last legislative session after years of growing concerns from consumers, advocates, and policymakers about abuses in the residential solar marketplace. The law gives TDLR authority to oversee solar retailers and salespeople, establish registration requirements, investigate complaints, and take enforcement action against bad actors.

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Why the Law Was Needed

Residential solar installations have become increasingly popular as Texans look for ways to lower electricity costs and improve resilience during power outages. But with that growth has come a surge in consumer complaints.

AARP Texas and other consumer advocates highlighted a dramatic increase in complaints involving solar sales and financing. Complaints submitted to the Texas Attorney General's Office and TDLR rose sharply between 2018 and 2023, with reports involving misleading sales claims, unauthorized signatures, financing disputes, and systems that failed to perform as promised.

Among the most common complaints were promises of “free” solar panels, claims that electric bills would disappear entirely, and situations where consumers unknowingly signed long-term financing agreements. Other homeowners reported paying for systems that were not properly installed or connected to the grid, while still being responsible for monthly loan payments.

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Why AARP Cares

AARP Texas played an active role throughout the legislative process to pass Senate Bill 1036, providing testimony, working to improve bill language, mobilizing volunteers, and raising public awareness about the problem.

For AARP Texas, the issue is about consumer protection and financial security, particularly for older adults. Deceptive solar sales practices can threaten retirement savings, home equity, and long-term financial stability. Being locked into a $40,000 to $60,000 solar loan for 30 years based on misleading information can have life-changing consequences. Loans and liens associated with solar systems can also complicate selling or refinancing a home.

Why Registration Matters for Homeowners

The registration requirement creates a level of accountability that previously did not exist in Texas. Before SB 1036, residential solar sales operated without a dedicated state registration system for salespeople and solar retailers. The new framework gives regulators a clearer path to investigate complaints, track bad actors, and take enforcement action when businesses violate the law.

For consumers, registration provides a way to verify whether a company or salesperson is authorized to operate in Texas. It also helps ensure that sales representatives are working under the supervision of a registered retailer and subject to state oversight.

Under the new law, residential solar retailers cannot make misleading claims about costs, savings, or government affiliations, and consumers are provided a five-business-day cancellation period after signing a contract.

As Texas continues expanding residential solar use, advocates say the new registration requirements represent an important step toward protecting homeowners while supporting an honest and competitive marketplace. For consumers, the message is simple: before signing a solar contract, slow down, ask questions, review the paperwork carefully, and make sure the company and salesperson are properly registered.