Solar Energy Protection Act established relating to the sale of solar energy systems.

A bill for an act

relating to consumer protection; establishing consumer protections for the sale of

solar energy systems; requiring registration; requiring reports; proposing coding

for new law as Minnesota Statutes, chapter 81B.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

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[81B.01] SHORT TITLE.

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This chapter may be cited as the "Solar Energy Systems Consumer Protection Act."

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Sec. 2.

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[81B.02] SCOPE.

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(a) This chapter applies to an agreement entered into on or after ..... This chapter does

not apply to the transfer of title or rental of real property where a solar energy system is

installed or expected to be installed.

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(b) A solar energy system installed as a feature on a newly constructed residence is only

subject to section 81B.06, subdivision 1.

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(c) If an energy storage system is operated without being interconnected to a solar energy

system or is interconnected to a solar energy system that was operating before the energy

storage system was interconnected, this chapter applies only to the energy storage system.

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Sec. 3.

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[81B.03] DEFINITIONS.

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Subdivision 1.

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Application.

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For purposes of this chapter, the following terms have the

meanings given.

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Subd. 2.

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Agreement.

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"Agreement" means a contract between a solar energy company

and a consumer to:

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(1) purchase or lease a solar energy system; or

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(2) purchase solar energy under a power purchase agreement.

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Subd. 3.

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Commissioner.

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"Commissioner" means the commissioner of commerce.

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Subd. 4.

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Consumer.

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"Consumer" has the meaning given in section 325M.11, paragraph

(g).

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Subd. 5.

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Energy storage system.

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"Energy storage system" means a device that:

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(1) stores electricity to be used at a later time;

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(2) uses energy generated by a solar energy system or the electric grid to recharge;

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(3) is located at a consumer's residence and connected to a consumer's solar energy

system on the consumer's side of the electric meter; and

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(4) provides stored electricity primarily to offset a consumer's consumption of electricity

from the electric grid.

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Subd. 6.

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Fixture filing.

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"Fixture filing" means a Uniform Commercial Code filing,

recorded at the office at which the mortgage for a consumer's residence is filed, that

establishes (1) a solar energy system is considered part of the consumer's real property, and

(2) a lender has priority over other creditors if the consumer defaults on the loan, sells the

residence where the solar energy system is installed, or declares bankruptcy.

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Subd. 7.

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Lease.

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"Lease" has the meaning given to "consumer lease" under Code of

Federal Regulations, title 12, section 1013.2, paragraph (e).

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Subd. 8.

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Lender.

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"Lender" means a person or entity that makes a loan for a solar energy

system.

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Subd. 9.

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License.

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"License" means:

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(1) a residential building contractor license, as defined in section 326B.802, subdivision

11; or

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(2) a residential remodeler license, as defined in section 326B.802, subdivision 12.

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Subd. 10.

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Loan.

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"Loan" means credit that is (1) offered or extended to a consumer in

order to acquire a solar energy system, and (2) subject to the requirements of Code of Federal

Regulations, title 16, section 433.

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Subd. 11.

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Person.

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"Person" means a natural person, corporation, company, partnership,

joint venture, or business entity.

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Subd. 12.

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Power purchase agreement.

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"Power purchase agreement" means a contract

under which a solar energy company (1) arranges for the design, permitting, financing, and

installation of a solar energy system at a consumer's residence, and (2) sells the power

generated to the consumer.

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Subd. 13.

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Registration.

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"Registration" means registration of a solar energy company

or solar energy salesperson with the commissioner under section 81B.05.

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Subd. 14.

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Solar energy company or company.

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(a) "Solar energy company" or

"company" means a person who engages in one or more of the following activities with

respect to a solar energy system:

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(1) offering or entering into a contract with a consumer to provide for a power purchase

agreement, lease, or purchase;

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(2) installation;

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(3) project development, construction, or management; or

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(4) providing operation and maintenance services.

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(b) Solar energy company does not include:

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(1) a natural person who self-installs a solar energy system on residential property owned

by the natural person; or

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(2) a third-party owner of a solar energy system or a lender for the purchase who does

not sell or install solar energy systems.

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Subd. 15.

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Solar energy company fee.

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"Solar energy company fee" means the amount

paid or incurred by a solar energy salesperson or solar energy company to a lender for

providing credit to a consumer. Solar energy company fee does not include an amount paid

or incurred by a consumer to obtain financing, including a time-price differential or other

finance charge, as defined under United States Code, title 15, section 1605.

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Subd. 16.

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Solar energy salesperson or salesperson.

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"Solar energy salesperson" or

"salesperson" means a person who is an employee or independent contractor of a solar

energy company and who solicits, sells, negotiates, procures, or executes agreements for

solar energy systems.

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Subd. 17.

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Solar energy system.

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"Solar energy system" has the meaning given in section

216C.06, subdivision 17, and, if applicable, includes an on-site energy storage system

interconnected with the solar energy system. A solar energy system must be installed at a

natural person's residence.

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Subd. 18.

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Solicit.

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"Solicit" means to contact a consumer to sell, lease, or install a solar

energy system.

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Sec. 4.

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[81B.04] REGISTRATION REQUIRED; SOLAR ENERGY COMPANIES

AND SALESPERSONS.

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Subdivision 1.

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Registration required.

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A person is prohibited from engaging in the

activities of a solar energy company or salesperson without first registering with the

commissioner under this chapter.

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Subd. 2.

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Application and renewal.

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When determining whether to issue or renew a

registration, the commissioner must consider the application and renewal forms. As

applicable, the application and renewal forms must include:

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(1) the solar energy company's name, assumed names, doing business as names, including

caller identification names, and business addresses; the name of each solar energy company

owner and officer; and the name and primary work location of each solar energy salesperson;

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(2) if a solar energy company is doing business under a name other than the solar energy

company's legal name, documentation that the assumed name has been properly filed with

the secretary of state or appropriate government office;

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(3) the solar energy company's primary telephone number, email address, and website

address used or intended to be used by the solar energy company and the company's solar

energy salespersons to buy, sell, solicit, market, or deliver solar energy systems, energy

storage systems, or a power purchase agreement;

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(4) for the solar energy company and each solar energy company owner, officer, and

salesperson, a disclosure of all criminal convictions by a court, including military courts,

within the last ten years, except convictions for juvenile offenses and convictions relating

to misdemeanor traffic citations and misdemeanor convictions involving driving under the

influence, driving while intoxicated, driving without a license, reckless driving, or driving

with a suspended or revoked license;

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(5) a disclosure of civil judgments in favor of a government entity, and government

entity orders entered, filed, or issued, against the solar energy company, the company's

officers and owners, or the company's solar energy salespersons within the last ten years

for violation of consumer protection or unfair trade practice laws;

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(6) a disclosure of a settlement or other agreement with a government entity within the

last ten years resolving concerns that the solar energy company, the company's officers and

owners, or the company's solar energy salespersons violated consumer protection or unfair

trade practice laws;

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(7) a disclosure of any instance in which the solar energy company, the company's

officers and owners, or the company's solar energy salespersons were at any time permanently

or temporarily prohibited by a court of competent jurisdiction or ordered to cease and desist

as the result of a government agency action from engaging in the actions of a solar energy

company or salesperson;

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(8) evidence of each salesperson's registration with Recheck, or an equivalent public

registry identified by the commissioner; and

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(9) copies of all advertising materials, marketing materials, agreements, and forms.

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Subd. 3.

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Notice of change in registration information.

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A registered solar energy

company must provide the commissioner written notice of a change in the solar energy

company's name; assumed names; doing business as names; business addresses, including

all business addresses at which the company or the company's solar energy salespersons

conduct business; owners; email addresses; website domain names; or primary telephone

number used by the company or the company's solar energy salespersons no later than 30

days after the date the change occurs.

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Subd. 4.

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Records.

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A solar energy company must retain records of (1) all salespersons

the company employs or contracts with, (2) all sales proposals provided to a consumer, (3)

executed disclosures, and (4) stipulations upon which the terms of an agreement executed

under section 81B.06 are based. Records under this subdivision must be retained for a period

of not less than six years.

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Subd. 5.

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Registration fee.

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(a) The fee for a registration under this chapter is:

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(1) $....... for solar energy salespersons; and

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(2) $....... for solar energy companies.

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(b) The commissioner may adjust the registration fee on an annual basis as needed based

on the cost to process registrations.

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Sec. 5.

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[81B.05] REGISTRATION DENIAL, NONRENEWAL, REVOCATION,

AND SUSPENSION.

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Subdivision 1.

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Authority.

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The commissioner may by order suspend, revoke, or refuse

to issue or renew a solar energy company salesperson registration for:

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(1) providing incorrect, false, misleading, or incomplete information to the commissioner

or refusing to allow a reasonable inspection of (i) information and documents in the

possession of the solar energy company, the company's salesperson, or a third party, or (ii)

the company's, the company's salesperson's, or the third party's premises;

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(2) obtaining or attempting to obtain a registration through misrepresentation or fraud;

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(3) failing to meet any of the requirements of section 81B.06;

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(4) making misrepresentations regarding government programs, utility relationships, or

regulatory requirements;

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(5) engaging in high-pressure sales tactics or preventing consumers from consulting

with advisors; or

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(6) violating this chapter or section 45.027, 325F.67, 325F.69, or 325F.694.

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Subd. 2.

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Solar energy company responsibility for actions of salespersons.

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The

commissioner may take action against a solar energy company for a violation of this chapter

by the company's salespersons acting on behalf of or at the direction of the company. The

commissioner may also take action against the salesperson.

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[81B.06] SOLAR ENERGY SYSTEMS CONSUMER PROTECTIONS.

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Subdivision 1.

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Disclosure form; content; amendment.

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(a) The commissioner must

develop a written disclosure form that a solar energy company must provide to a consumer

before an agreement is signed. The disclosure form must be in at least ten-point font and

must contain, at a minimum:

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(1) the name of the consumer;

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(2) the name of the solar energy salesperson;

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(3) the name, street address, telephone number, email address, and license or registration

number of the solar energy company that is party to the agreement;

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(4) the name, street address, telephone number, email address, and license or registration

number of the company installing the solar energy system at a consumer's residence, if

different from the solar energy company;

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(5) a description of the project, including: (i) the capacity of the solar energy system in

kilowatts-DC and, if applicable, the capacity of the energy storage system in kilowatt-hours;

(ii) the brand and type of solar module, inverter, and monitoring device installed; and (iii)

a statement that the solar energy system does not provide backup power without being

interconnected with an energy storage system or other specified equipment that the consumer

may decide to deploy;

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(6) a solar energy system's technical specifications, including but not limited to:

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(i) estimates of the first year's production, corrected for estimated production losses

resulting from shade, snow, and soiling; and

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(ii) the annual rate of decline in the amount of electricity generated by the solar energy

system as a result of system degradation;

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(7) a statement that the consumer continues to receive an electric utility bill and that the

solar energy company or lender does not control the consumer's electricity rates;

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(8) the estimated price of the solar energy system;

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(9) an advisement suggesting that homeowners consult the homeowner's current mortgage

loan servicer, originating lender, and insurance company regarding any potential impacts

of installing a solar energy system;

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(10) any performance or production guarantees or warranties made by the manufacturer

or installer of the solar energy system and the transferability of the guarantees or warranties;

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(11) information regarding how to file a complaint with the agency responsible for

regulating the agreement, including:

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(i) the name and contact information of the regulating agency;

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(ii) a brief description of the agency's role in regulating solar energy system transactions;

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(iii) a link to the agency's website or telephone number for filing complaints or requesting

assistance;

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(iv) information regarding how a consumer's personal data contained in an agreement

is collected, used, stored, and shared; and

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(v) information regarding a consumer's rights under sections 325M.10 to 325M.21 to

understand and control the use of the consumer's personal data, including the ability to:

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(A) access data collected about the consumer;

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(B) request data corrections or deletions;

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(C) opt out of data sharing or targeted advertising; and

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(D) file a complaint with the appropriate agency if the consumer believes the consumer's

rights have been violated;

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(12) a description of requirements that must be met before an installed solar energy

system is activated;

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(13) a description of equipment a consumer may deploy in order to provide backup

power to a solar energy system;

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(14) assumptions and methodologies used to estimate postinstallation electric bill savings

provided to the purchaser, including at a minimum estimated utility rates, rate increases,

solar energy system production over time, and the rate of utility compensation for excess

energy generated by the system at the time the agreement becomes effective;

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(15) financial incentives from the utility, state, and federal government the consumer is

eligible for and that have been incorporated into calculations of the total cost of the solar

energy system made by the solar energy salesperson or solar energy company, including

tax credits, and necessary steps a consumer must take in order to receive the incentives;

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(16) a disclaimer stating that the solar energy company and solar energy salesperson are

not tax advisors and are not qualified to give tax advice;

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(17) the following statement: "THE SOLAR ENERGY SYSTEM DOES NOT PROVIDE

ANY ELECTRICITY TO THE CUSTOMER DURING A POWER OUTAGE, and

automatically disconnects from the utility grid in order to protect utility repair personnel

from the risk of electric shock from electricity that could otherwise flow into the utility

distribution system."; and

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(18) the following statement: "A consumer may, subject to section 325G.08, withdraw

from the proposed sale without penalty."

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(b) A solar energy company or the installer of a solar energy system, immediately after

determining that a material change in equipment, pricing, financing, production estimates,

project timetables, or any other significant aspect of the proposed sale or operation of a

solar energy system has occurred after the disclosure form has been provided to a consumer,

must communicate the change to the consumer in writing and must provide the consumer

an amended disclosure form incorporating the change.

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Subd. 2.

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Solar energy system purchase agreement; content.

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An agreement must be

in at least ten-point font and must contain, at a minimum:

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(1) the information required in subdivision 1, clauses (1) to (8) and (10);

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(2) the estimated date of completion of design and engineering of the solar energy system,

and statements in close proximity that read:

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(i) "The solar energy company must complete all work necessary to meet the timelines

required by the Minnesota Distributed Energy Resource Interconnection Process."; and

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(ii) "After receiving notice of all required permitting, interconnection, and other required

approvals for installation of the solar energy system, the solar energy company must give

the consumer written notice of the estimated installation start and completion dates.";

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(3) an explanation of warranties and guarantees with respect to equipment or performance,

including the transferability of the obligations;

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(4) the total purchase price for the solar energy system, including all fees;

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(5) if applicable, the payment schedule for the solar energy system;

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(6) a description of the responsibilities of each party to maintain and repair the solar

energy system;

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(7) a disclosure of each party's responsibility to file the interconnection application with

the consumer's utility and obtain necessary permits;

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(8) if applicable, a description of a security interest filed against the solar energy system,

including Uniform Commercial Code filings under chapter 336; and

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(9) the documents that a seller for a home solicitation sale under section 325G.08 must

provide to a consumer regarding a consumer's right to cancel the agreement within three

business days after entering the agreement.

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Subd. 3.

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Solar energy system lease agreement; content.

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In addition to the content

required under subdivision 4, an agreement to lease a solar energy system must include, at

a minimum:

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(1) the total number and amount of payments required under the lease;

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(2) the payment schedule for the leased system, including the number, amount, and due

dates or periods of payments;

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(3) the interest rate of the loan;

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(4) a statement regarding the right of a consumer to purchase the solar energy system

during or at the termination of the lease, including how the purchase price is calculated;

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(5) a description of options available to the lender to transfer the lease to a third party

and the conditions under which a transfer may be made;

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(6) disclosure of fees received by the lender from the solar energy company; and

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(7) disclosure of a fixed filing or other security interest a lender intends to file with

respect to the solar energy system.

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Subd. 4.

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Solar energy system power purchase agreement; content of consumer

agreement.

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In addition to the content required under subdivision 3, a consumer's agreement

with respect to a solar energy system power purchase agreement must include, at a minimum:

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(1) the length of the power purchase agreement and the total number, amounts, and due

dates of required payments;

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(2) the monthly payment amounts during the first year of the power purchase agreement;

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(3) the rate of payment increases and the date of the first increase, if applicable;

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(4) the trigger event, amount, and timing of any onetime or recurring fees, including but

not limited to system removal fees, Uniform Commercial Code notice removal and refiling

fees, Internet connection fees, and automated clearinghouse fees;

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(5) the manner in which a consumer receives invoices;

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(6) a statement regarding the right of a consumer to purchase the solar energy system

during or at the termination of the power purchase agreement, including how the purchase

price is calculated;

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(7) notice to a consumer that the owner of the system is filing a fixture filing on the solar

energy system; and

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(8) information regarding the transferability of the power purchase agreement if a

consumer sells the residence where the solar energy system is installed.

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Subd. 5.

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Other provisions.

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(a) A consumer is not required to make a payment on a loan

or under a power purchase agreement before the consumer's utility has given the consumer

permission to operate the solar energy system.

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(b) A lender must withhold at least ten percent of the total amount owed to a solar energy

company until the consumer's utility provides the consumer permission to operate the solar

energy system.

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(c) The sale of a solar energy system under this chapter is subject to section 325G.08

governing home solicitation sales. A solar energy company and a consumer have all the

corresponding rights and responsibilities under section 325G.08 regarding a consumer's

right to cancel an agreement without penalty.

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(d) Subject to paragraph (b), a consumer has the right to cancel a sale subject to this

chapter at any time without penalty.

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(e) The solar energy company must ensure that a durable sticker or plaque containing

the current contact information for all warranty and service work is permanently affixed in

a conspicuous location adjacent to the main electrical service panel or the primary disconnect

switch of the solar energy system.

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(f) The provisions in this section must be included in the disclosure form and an

agreement subject to this section.

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Subd. 6.

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Agreement review meeting.

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(a) An agreement review meeting must be held

between the consumer and the solar energy company or the company's designee at least ...

days before an agreement is signed. During the meeting, the solar energy company or the

solar energy company's designee must disclose the terms of the final agreement to the

consumer, answer the consumer's questions, and obtain the consumer's affirmative

acknowledgment and understanding of the agreement's terms.

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(b) Notwithstanding any other law, both audio and video of the agreement review meeting

must be recorded by the solar energy company or the company's designee, and must be

made available to the consumer upon request. The solar energy company must maintain a

copy of the recording for at least two years after the date the agreement review meeting

occurs.

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(c) The agreement review meeting must be conducted in the same language used in the

disclosure form.

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Subd. 7.

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Enforcement.

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(a) The commissioner must enforce this chapter.

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(b) A solar energy company that contracts with a solar energy salesperson that violates

this chapter is subject to the remedies under section 8.31 as if the solar energy company

had committed the violation. This paragraph does not reduce or eliminate the liability of a

solar energy salesperson who violates this section.

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