Solar company Sunnova Energy, which received a $3 billion federal loan from the Biden administration, now faces potential bankruptcy amid allegations of predatory business practices targeting vulnerable elderly Americans.
At a Glance
- Sunnova Energy International’s stock plummeted 71% as the company expressed doubt about its ability to continue operations
- Despite receiving a $3 billion loan from the Biden administration, the company now warns of potential bankruptcy
- Republican lawmakers are investigating allegations that Sunnova scammed dementia patients into signing long-term solar leases
- The company is part of a broader crisis in the solar industry, with multiple firms filing for bankruptcy in 2024
- Sunnova has connections to Biden administration officials, raising questions about the massive federal loan
Biden-Backed Solar Company Faces Financial Collapse
Sunnova Energy International is facing a severe financial crisis that threatens its very existence, despite having received the largest federal loan to a solar company in history from the Biden administration. The company’s shares have crashed by 71% as investors reacted to warnings about its ability to continue as a going concern. “Sunnova Energy International Inc. shares plunged 71% as the company warned there’s substantial doubt it will remain in business,” according to Bloomberg Law reporting on the company’s financial state.
The Houston-based solar provider’s financial woes come even after securing a $3 billion loan guarantee from the Department of Energy last year. This massive federal investment now appears to be at serious risk as the company acknowledges its financial resources are insufficient to sustain operations for at least another year without implementing additional measures. The company’s cash flow problems have become so dire that bankruptcy appears increasingly likely, making this potentially another failed green energy investment backed by taxpayer dollars.
Allegations of Exploitation and Government Connections
Compounding Sunnova’s financial troubles are serious allegations about its business practices. Republican lawmakers have launched investigations into claims that the company specifically targeted elderly individuals, including dementia patients, to sign them up for long-term solar panel leases they did not understand. These concerning accusations have led to at least 50 consumer complaints filed against Sunnova in Texas since 2022 alone, according to reports.
Further scrutiny has emerged regarding Sunnova’s connections to Biden administration officials, raising questions about how the company secured such a substantial federal loan. The Department of Energy’s loan program has a controversial history, most notably with the Solyndra bankruptcy scandal after that company received a $535 million loan guarantee. The DOE’s own Inspector General had previously called for the suspension of the loan program due to non-compliance with conflict-of-interest rules and substantial risk of fraud.
Struggling Despite Government Support
Sunnova CEO John Berger attempted to explain the company’s financial struggles despite the massive government support. “While total cash increased, unrestricted cash remained relatively flat, below our estimated $100 million increase,” Berger stated regarding the company’s disappointing financial results. He further explained, “This miss was primarily due to lower tax equity contributions stemming from timing delays of ITC sales, fewer installed systems and funds received in December classified as restricted.”
The company’s problems reflect broader challenges in the solar industry. Sunnova has already lost its Better Business Bureau accreditation and cut over 15% of its workforce, eliminating approximately 300 positions in February 2025. New tariffs on solar manufacturers are expected to increase costs for solar installations in 2025, potentially further complicating Sunnova’s path to recovery. The company has proposed measures including refinancing obligations, taking on additional debt, reducing expenditures, and revising dealer payment terms, but there is no guarantee these efforts will succeed.
Industry-Wide Solar Crisis
Sunnova’s troubles are part of what industry analysts describe as the most significant crisis the US solar industry has faced since becoming mainstream over a decade ago. Several major solar companies including ADT, Titan Solar, SunPower, and Lumio have either declared bankruptcy or gone out of business in 2024. First Solar Inc. has reported increasing customer delays, while Sunrun Inc. announced expectations for flat installation volumes this year after previous growth.
Rooftop solar businesses have been particularly hard hit by high costs and changing market conditions. The industry’s struggles raise serious questions about the viability of current green energy policies and whether massive government subsidies are creating sustainable businesses or merely postponing inevitable failures. For homeowners who have invested in these systems or signed long-term contracts, the industry’s instability creates uncertainty about future service and support for their solar installations.
