In recent weeks, the CSLB Enforcement division has received consumer complaints regarding the installation of residential solar systems. Allegations in these complaints include solar rebate program guidelines not being followed, and unlicensed contractors performing the installation work. Federal programs and utility companies follow strict guidelines about solar systems being installed by licensed professionals; Contractors State License Law requires that installation be performed by state–licensed contractors.

Additionally, CSLB is working on complaints about companies that fail to pull local building permits, misrepresent utility company or federal rebates—especially who needs to apply for them and whether the contractor or the customer should get them, the return on investment for solar power systems on residential and commercial buildings, demands for excessive down payments, and high-pressure sales whereby representatives tell a prospective customer that the "good deal" they're offering is only good for that day, failing to provide the legal three-day right to cancel the contract.

Since solar contracting work is a newly expanding construction segment, CSLB does not yet know whether there will be a significant increase in contracting problems. Unlicensed contracting, on the other hand, is a continual challenge because it is tied to the underground economy. In the past year, CSLB has strengthened its enforcement efforts and partnered with several state agencies to crack down on unlicensed and fraudulent contracting activity. Issues dealing with solar power systems now have CSLB strengthening its ties with California Building Officials and local building departments to watch for irregular solar contracting activity.

Follow Rebate Rules to Cash In on "Hot" Incentives

Licensees who work in the solar energy classifications must carefully adhere to all state and federal rebate and tax credit rules. Failure to follow solar incentive guidelines could prevent your client from qualifying for these price breaks.

Remember these guidelines when entering into contracts for solar energy work:

• Make sure the name style of your business and license number is in all contracts, bids, and advertisements exactly as it appears in CSLB's records. Contracts must be in the correct form and type as specified in Business and Professions (B&P) Code Section 7159.
• Double check with your clients' utility company to make sure they will honor government incentives for your particular license classification. Although CSLB authorizes several classifications to perform solar projects, a utility company may only allow certain contractor classifications to perform the work. Make sure you and/or your company hold(s) the appropriate license classification. The contract must include a licensee with the appropriate classification for the project.
• If a salesperson enters into a contract with a client on behalf of your business, that individual must be a registered Home Improvement Salesperson (HIS) with CSLB.
• Make sure you, your company's qualifying licensee, and your HIS can present the CSLB-issued pocket card to identify yourself and your business to your potential clients.

Solar the Hot Topic

CSLB executive, licensing, and enforcement staff met with solar industry representatives on June 16, 2010, to ensure solar classification and enforcement policies reflect the current and emerging solar energy marketplace. The group reached consensus on classification definitions and agreed to develop strategies to combat solar industry scams that are occurring statewide.

The evolution of the solar energy industry has led the Contractors State License Board (CSLB) to determine which of its licensing classifications are authorized to perform solar installation and repair work. In order to perform solar installation or repair jobs in California that are valued at $500 or more, a contractor must have a state license in at least one of the following classifications:

• "A" – General Engineering
• "B" – General Building
• C-4 – Boiler, Hot-Water Heating and Steam Fitting – Authorized to perform projects including solar heating equipment associated with systems authorized by this classification
• C-10 – Electrical – Authorized to perform any solar projects which generate, transmit, transform or utilize electrical energy in any form for any purpose.
• C-36 – Plumbing – Authorized to perform any project using solar equipment to heat water or fluids to a suitable temperature.
• C-46 – Solar – Authorized to install, modify, maintain, and repair thermal and photovoltaic solar energy systems. A licensee in this classification shall not undertake or perform building or construction trades, crafts or skills, except when required to install a thermal or photovoltaic solar energy system.
• C-53 – Swimming Pool – Authorized to include the installation of solar heating in swimming pool projects.

Solar "Soft Cap"

In an on-going effort to protect consumers from over-priced solar systems and prevent fraudulent federal tax claims, the California Public Utilities Commission (CPUC), which oversees the California Solar Initiative (CSI), has instituted a "soft cap" of $14.70 per watt for solar projects with applications for incentives.

Unlike a "hard cap," CSI's soft cap rules will allow administrators discretion to waive the price ceiling, provided that those seeking rebates furnish documentation justifying the higher costs if the project is priced two standard deviations above the average system costs listed in CSI's database. During the first quarter of 2010, the average system's cost ranged from $9.21 for those less than 10 kW and $7.66 for those larger than 10kW. Details regarding the new pricing policy are available in the June 2010 CSI Program Handbook.