Relating to the regulation of residential solar retail transactions; requiring an occupational registration; authorizing fees; providing civil and administrative penalties.

89(R) SB 1036 - Enrolled version - Bill Text

S.B. No. 1036

AN ACT

relating to the regulation of residential solar retail

transactions; requiring an occupational registration; authorizing

fees; providing civil and administrative penalties.

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

SECTION 1. Title 11, Occupations Code, is amended by adding

Chapter 1806 to read as follows:

CHAPTER 1806.

RESIDENTIAL SOLAR RETAILERS

SUBCHAPTER A.

GENERAL PROVISIONS

Sec.

1806.001.

SHORT TITLE. This chapter may be cited as

the Residential Solar Retailer Regulatory Act.

Sec. 1806.002. GENERAL DEFINITIONS. In this chapter:

(1)

"Commission" means the Texas Commission of

Licensing and Regulation.

(2)

"Department" means the Texas Department of

Licensing and Regulation.

(3)

"Electric cooperative" has the meaning assigned by

Section 11.003, Utilities Code.

(4)

"Electrical contractor" means a person licensed as

an electrical contractor under Chapter 1305.

(5)

"Executive director" means the executive director

of the department.

(6)

"Municipally owned utility"

has the meaning

assigned by Section 11.003, Utilities Code.

(7)

"Residential solar energy system" means a solar

energy system intended or designed primarily for family, personal,

or household use.

(8) "Residential solar retail" means:

(A)

the sale or lease of, or an offer to sell or

lease, a residential solar energy system; or

(B)

a transaction involving any combination of

the acts described by Paragraph (A).

(9)

"Solar energy system" means a system or

configuration of solar energy devices that collects and uses solar

energy to generate electricity.

(10)

"Solar retailer" means a person who is registered

under this chapter as a solar retailer.

(11)

"Solar salesperson" means an individual who is

registered under this chapter as a solar salesperson.

Sec.

1806.003.

DEFINITION OF CONTROLLING PERSON. (a) In

this section, "business entity" means a corporation, business

trust, estate, trust, partnership, including a limited

partnership, association, or any other legal entity, regardless of

whether the entity is incorporated in this state.

(b)

In this chapter, "controlling person" means an

individual who:

(1)

has direct or indirect control of at least 25

percent of the voting securities of a business entity;

(2)

has the authority to set policy and direct the

management of a business entity;

(3)

is the president, the secretary, or a director of a

business entity; or

(4)

is a general partner of a partnership, including a

limited partnership.

Sec.

1806.004.

LIMITED APPLICABILITY TO ELECTRICAL

CONTRACTORS. (a) If an electrical contractor employs an individual

to engage in residential solar retail on behalf of the electrical

contractor, the electrical contractor is exempt from the

registration and insurance requirements of this chapter applicable

to a solar retailer, except that an agreement in which the

electrical contractor is the seller or lessor is subject to

Sections 1806.155 and 1806.156.

(b)

If an individual is employed by an electrical contractor

to engage in residential solar retail on behalf of the electrical

contractor, the individual is exempt from the registration

requirements of this chapter.

Sec.

1806.005.

APPLICABILITY. (a) This chapter does not

apply to:

(1)

except as provided by Subsection (b), a written

agreement:

(A)

entered into in this state for the sale or

lease of a residential solar energy system; and

(B)

pertaining to a residential property located

outside this state; or

(2) a solar energy system:

(A) intended:

(i) for temporary or emergency use; or

(ii)

to provide power to a single

appliance;

(B) that:

(i)

if combined with other systems that

produce electricity, produces in combination with the other systems

a total peak output power of less than one kilowatt; or

(ii)

if not combined with other systems

that produce electricity, is designed to produce a peak output

power of less than one kilowatt; or

(C) sold or leased:

(i)

for commercial purposes, including a

solar energy system installed on the premises of a nonresidential

property;

(ii)

to provide power to a multifamily

dwelling that exceeds four dwelling units or stories;

(iii) before September 1, 2025; or

(iv)

in connection with new residential

construction.

(b)

This chapter applies to any residential solar retail

occurring in this state in connection with an agreement described

by Subsection (a)(1).

Sec.

1806.006.

PREEMPTION. To the extent of any conflict

between this chapter and any of the following laws, this chapter

prevails over:

(1)

a municipal ordinance regulating the same conduct

as this chapter; or

(2) Chapter 115 or 601, Business & Commerce Code.

SUBCHAPTER B.

POWERS AND DUTIES

Sec.

1806.051.

GENERAL POWERS AND DUTIES. (a) The

department shall administer and enforce this chapter.

(b)

The commission shall adopt rules necessary to

administer and enforce this chapter, including:

(1)

in addition to any practice prohibited or

restricted by this chapter, prohibiting or restricting any specific

unfair, deceptive, or misleading practices related to residential

solar retail and specifying those practices;

(2)

requiring a solar retailer or solar salesperson to

provide disclosures or educational materials when selling or

leasing, or offering to sell or lease, a residential solar energy

system and specifying the form and format of those disclosures;

(3)

regulating the form and format of an agreement for

the sale or lease of a residential solar energy system;

(4)

establishing insurance requirements for solar

retailers; and

(5)

establishing continuing education requirements as

a prerequisite to renew a solar salesperson registration under this

chapter.

(c)

The commission shall consult the Office of Consumer

Credit Commissioner in adopting rules described by Subsections

(b)(2) and (3) to ensure compliance with federal and state law

governing financial transactions, including the Truth in Lending

Act (15 U.S.C. Section 1601 et seq.).

Sec.

1806.052.

FEES. The commission shall establish and

collect reasonable and necessary fees in amounts sufficient to

cover the costs of:

(1) administering this chapter; and

(2)

any other activity or function necessary for

effective regulation under this chapter.

Sec.

1806.053.

EDUCATIONAL MATERIALS. (a) The Public

Utility Commission of Texas shall develop, in consultation with the

department and the office of the attorney general, educational

materials that inform consumers of the consumers' rights and

remedies related to the purchase or lease of residential solar

energy systems under this chapter and other applicable laws.

(b)

The commission by rule may require solar retailers and

solar salespersons when engaging in residential solar retail to

provide solicited persons with the educational materials developed

under this section.

SUBCHAPTER C.

REGISTRATION

Sec.

1806.101.

REGISTRATION REQUIRED: SOLAR SALESPERSON.

A

person may not engage in residential solar retail for compensation

unless the person:

(1)

engages in residential solar retail on behalf of a

solar retailer; and

(2)

is registered as a solar salesperson under this

chapter.

Sec.

1806.102.

REGISTRATION REQUIRED: SOLAR RETAILER.

A

person may not employ or otherwise contract for the services of an

individual to engage in residential solar retail on behalf of the

person unless the person is registered as a solar retailer.

Sec.

1806.103.

ELIGIBILITY FOR REGISTRATION. (a) To be

eligible for a registration under this chapter, a person must:

(1) submit an application to the department;

(2) pay any required fees; and

(3)

meet the eligibility requirements of this chapter

and of rules adopted under this chapter.

(b)

To be eligible to register as a solar salesperson, the

applicant must be an individual.

Sec.

1806.104.

SOLAR RETAILER APPLICATION. An application

to register as a solar retailer must include:

(1)

if the solar retailer is an entity, a list of each

controlling person of the solar retailer;

(2)

the name and registration number of each solar

salesperson who engages in residential solar retail on behalf of

the solar retailer; and

(3)

evidence satisfactory to the department that the

applicant has insurance meeting the requirements established by

commission rule.

Sec.

1806.105.

CRIMINAL HISTORY RECORD INFORMATION CHECK.

The department may conduct a criminal history record information

check of each applicant or, if applicable, any controlling person

of an applicant for a registration under this chapter using

information:

(1) provided by the applicant; and

(2)

made available to the department by the Department

of Public Safety and any other criminal justice agency under

Chapter 411, Government Code.

Sec.

1806.106.

EXEMPTION FROM CONTINUING EDUCATION.

Notwithstanding Section 51.405 or any other provision of this

chapter, a solar retailer may not be required to complete

continuing education to renew the solar retailer's registration

under this chapter.

SUBCHAPTER D.

PRACTICE BY REGISTRANTS

Sec.

1806.151.

NOTICE TO DEPARTMENT OF SOLAR SALESPERSONS

AUTHORIZED TO ENGAGE IN RESIDENTIAL SOLAR RETAIL. A solar retailer

shall promptly notify the department in a manner prescribed by the

department of:

(1)

each solar salesperson authorized to engage in

residential solar retail on behalf of the solar retailer; and

(2)

any change in an authorization described by

Subdivision (1).

Sec.

1806.152.

SUPERVISION REQUIRED. (a) A solar retailer

shall provide reasonable supervision to each solar salesperson

authorized to engage in residential solar retail on behalf of the

solar retailer, including making reasonable efforts to correct any

violation of this chapter or a rule adopted under this chapter that

the solar retailer is aware of or of which a reasonable person under

the same circumstances would be aware.

(b)

A solar retailer is responsible for any violation

described by Subsection (a) committed by a solar salesperson

authorized to engage in residential solar retail on behalf of the

solar retailer.

Sec.

1806.153.

CODE OF CONDUCT; COMPLIANCE WITH OTHER LAW.

A solar retailer and a solar salesperson shall comply with:

(1)

any code of conduct adopted by commission rule

governing solar retailers or solar salespersons, as applicable;

(2)

Subchapter E, Chapter 17, Business & Commerce

Code;

(3)

Chapter 115, Business & Commerce Code, as if the

solar retailer or solar salesperson, as applicable, were a seller

or lessor under that chapter; and

(4)

the Truth in Lending Act (15 U.S.C. Section 1601 et

seq.) and applicable state laws governing financial transactions by

providing any disclosure required by those laws.

Sec.

1806.154.

REGISTRATION INFORMATION. (a) On request by

the department or a person to whom a solar retailer or solar

salesperson has offered to sell or lease, or has sold or leased, a

residential solar energy system, the solar retailer or solar

salesperson, as applicable, shall provide the department or person

with the retailer's or salesperson's name and registration number.

(b)

A solar retailer shall ensure that each agreement for

the sale or lease of a residential solar energy system by the

retailer includes the name and registration number of the retailer

and the solar salesperson involved in the transaction.

(c)

An electrical contractor or individual acting on behalf

of an electrical contractor shall provide the electrical

contractor's name and license number under the same circumstances

as a solar retailer or solar salesperson is required to provide the

retailer's or salesperson's name and number under this section.

Sec.

1806.155.

REQUIRED CONTRACT PROVISIONS. (a) If the

sale or lease of a residential solar energy system involves the

installation of the system at a person's residence, the sale or

lease agreement must:

(1)

provide that the installation of the residential

solar energy system will be performed by an electrical contractor;

(2)

conspicuously state the name and license number of

the electrical contractor who will perform the installation

described by Subdivision (1); and

(3)

provide that the solar retailer or electrical

contractor, as applicable, will obtain:

(A)

any permit required by a government entity

for the installation described by Subdivision (1);

(B)

if Section 39.554 or 39.916, Utilities Code,

applies, the approval by the electric utility serving the person's

residence of the interconnection of the residential solar energy

system; and

(C)

if the person is a customer of an electric

cooperative or a municipally owned utility, the cooperative's or

utility's approval of the interconnection of the residential solar

energy system.

(b)

The requirement under Subsection (a)(2) may be

satisfied by providing a list of electrical contractors in the

agreement from which one must be selected to perform the

installation described by Subsection (a)(1).

(c)

If the sale or lease of a residential solar energy

system involves a third-party lender that is affiliated with or

referred by the solar retailer, the sale or lease agreement must

include a provision requiring the third-party lender to cancel any

accompanying loan made by the third-party lender to the buyer or

lessee on the buyer's or lessee's cancellation of the agreement

under Section 1806.156.

Sec.

1806.156.

RIGHT TO CANCEL AGREEMENT. (a) In this

section, "business day" means a calendar day excluding Saturday,

Sunday, or any legal holiday, as that term is defined by Section

662.021, Government Code.

(b)

Notwithstanding any other law, a solar retailer shall

allow a buyer or lessee who enters into an agreement to purchase or

lease a residential solar energy system to cancel the agreement

without penalty or further obligation by providing written notice

of the cancellation on or before the fifth business day after the

date on which the agreement was executed by the buyer or lessee.

(c)

A solar retailer shall include in an agreement for the

sale or lease of a residential solar energy system the last calendar

date of the cancellation period prescribed by Subsection (b) and

the mailing address or e-mail address for providing the notice of

cancellation.

(d)

If the agreement does not contain the address for

cancellation required by Subsection (c), the buyer or lessee may

cancel the agreement during the period described by Subsection (b)

by providing written notice of cancellation to the solar retailer

by any reasonable method.

SUBCHAPTER E.

ENFORCEMENT

Sec. 1806.201. PROHIBITED ACTS. A person may not:

(1)

intentionally, knowingly, or recklessly make a

false, misleading, or deceptive oral or written statement to

another person when engaging in residential solar retail;

(2)

falsely state or imply an affiliation with a

public utility or government agency when engaging in residential

solar retail;

(3)

fail to provide the disclosure statements or any

educational materials as required by this chapter, by Chapter 115,

Business & Commerce Code, or by commission rule when engaging in

residential solar retail;

(4)

engage in residential solar retail at a residence

in violation of posted signage indicating that soliciting is

prohibited, unless otherwise directed by an occupant of the

residence;

(5)

allow the installation of a residential solar

energy system to be performed by a person who is not an electrical

contractor;

(6)

make a material misrepresentation in an

application submitted to the department under this chapter or in

any other document submitted to the department under this chapter;

or

(7)

violate, attempt to violate, or conspire to

violate this chapter or a rule adopted under this chapter.

Sec.

1806.202.

DENIAL OR REFUSAL TO RENEW. The executive

director may deny an application to register or refuse to renew a

registration under this chapter if the applicant or, if applicable,

a controlling person of the applicant has:

(1)

violated this chapter or a rule or order of the

commission or executive director; or

(2)

had suspended or revoked, or has been otherwise

formally disciplined in connection with, any authorization to

practice an occupation or engage in a business that was issued by a

licensing authority in this state or another state.

Sec.

1806.203.

ADMINISTRATIVE PENALTY. In imposing an

administrative penalty under Subchapter F, Chapter 51, for a

violation of Section 1806.201, the commission in determining the

appropriate amount of the penalty may consider whether any

individual over the age of 65 at the time of the prohibited conduct

was harmed by the conduct.

Sec.

1806.204.

WARNING LETTER. (a) Before imposing an

administrative penalty or sanction against a person under Chapter

51, the executive director may issue a warning letter directing a

person to take corrective action regarding the violation that is

the basis of the penalty or sanction.

(b)

In determining whether to issue a warning letter under

Subsection (a), the executive director may consider any history of

violations by the person, including whether the person complied

with previous warning letters, and the person's efforts to correct

the violation and prevent future violations.

(c)

A determination to issue a warning letter under this

section is not a contested case under Chapter 2001, Government

Code.

Sec.

1806.205.

CEASE AND DESIST ORDER. The executive

director may issue a cease and desist order under Section 51.3513 to

protect public health and safety.

Sec.

1806.206.

AMOUNT OF CIVIL PENALTY. (a)

Notwithstanding Section 51.352 and except as provided by Subsection

(b), the amount of a civil penalty imposed under Chapter 51 for a

violation of this chapter or a rule adopted under this chapter may

not exceed:

(1) $2,500 for each violation; or

(2)

$50,000 in the aggregate for all violations of a

similar nature.

(b)

In a proceeding imposing a civil penalty under Section

51.352 for a violation of this chapter or a rule adopted under this

chapter, if the court finds that an individual over the age of 65 at

the time of the violation was harmed by the violation, the amount of

the civil penalty may not exceed:

(1) $10,000 for each violation; or

(2)

$100,000 in the aggregate for all violations of a

similar nature.

Sec.

1806.207.

AGREEMENT CANCELLATION AND REFUND. (a)

Subject to Subsection (b), the commission or executive director

may, after notice and a hearing and after finding that a violation

of this chapter or a rule adopted under this chapter has occurred,

order the cancellation of an agreement for the sale or lease of a

residential solar energy system and the refund of any amount paid

under the agreement.

(b)

The amount of a refund ordered under this section may

not exceed the amounts paid under the agreement.

(c)

This section does not authorize the executive director

or commission to impose or collect penalties, fines, or other

damages, except that a proceeding under this section may be

combined with a proceeding to impose an administrative penalty or

sanction by the department.

(d)

A proceeding under this section is a contested case

under Chapter 2001, Government Code.

(e)

This section does not prohibit an injured party who was

refunded money under this section from bringing an action in a court

with jurisdiction to collect damages, other than the refunded

money, or obtain equitable relief under other applicable law.

Sec.

1806.208.

VIOLATION BY ELECTRICAL CONTRACTOR. An

electrical contractor who violates this chapter or a rule adopted

under this chapter is subject to an administrative penalty or

sanction or any other enforcement provision under Chapter 1305,

Chapter 51, and this chapter.

SECTION 2. Chapter 1806, Occupations Code, as added by this

Act, applies only to a contract entered into on or after the

effective date of this Act. A contract entered into before the

effective date of this Act is governed by the law in effect on the

date the contract was entered into, and that law is continued in

effect for that purpose.

SECTION 3. Not later than June 1, 2026, the Texas Commission

of Licensing and Regulation shall adopt rules necessary to

implement Chapter 1806, Occupations Code, as added by this Act.

SECTION 4. As soon as practicable after the effective date

of this Act, the Texas Department of Licensing and Regulation shall

establish and lead a stakeholder work group to provide advice and

recommendations to the department on regulating activities

governed by Chapter 1806, Occupations Code, as added by this Act.

The department shall establish the size, composition, and scope of

the stakeholder work group.

SECTION 5. (a) Except as otherwise provided by this Act,

this Act takes effect September 1, 2025.

(b) Sections 1806.101 and 1806.102 and Subchapter E,

Chapter 1806, Occupations Code, as added by this Act, take effect

September 1, 2026.

______________________________

______________________________

President of the Senate

Speaker of the House

I hereby certify that S.B. No. 1036 passed the Senate on

April 7, 2025, by the following vote: Yeas 22, Nays 8.

______________________________

Secretary of the Senate

I hereby certify that S.B. No. 1036 passed the House on

May 23, 2025, by the following vote: Yeas 94, Nays 37, two

present not voting.

______________________________

Chief Clerk of the House

Approved:

______________________________

Date

______________________________

Governor