After months of litigation, Telsa agreed to pay slightly more than $6 million to settle a class-action lawsuit brought by customers who faced sudden Solar Roof price hikes in 2021 after agreeing to have the systems installed at their homes.
The class action lawsuit, brought on behalf of more than 6,300 customers who initially signed up for the company’s Solar Roof system, alleged that the price they were quoted increased substantially once it came time to install the sleek photovoltaic glass roof shingle system.
These unforeseen expenses led many to reconsider their decision and ultimately cancel their contracts, causing what has been described as “immense frustration” and “inconvenience.”
The lead plaintiff in the case, Matthew Amans, experienced what many other members of the class said happened, which was an exponential increase in the price charged. In Aman’s case, his solar roof install more than doubled over the quoted bid, as CNBC reported, from around $72,000 in the original contract to somewhere around $146,000, per court filings.
CNBC previously reported on how Tesla Solar Roof customers signed contracts with the company and, preparing to have the systems installed at their homes, were surprised by sudden price increases in 2021 requiring higher payments to move ahead with their installations.Tesla Solar Roof, formerly known as Tesla “solarglass,” raised prices for its solar installations at least twice that year and made ordering a Powerwall home energy storage system a requirement before installation could proceed, according to the complaint.
According to the amended class-action settlement agreement, filed with a U.S. District Court in San Francisco on July 10, at the end of June 2023, approximately 8,636 Tesla customers were part of the group affected by the price hikes. The fallout was significant for the company; changes to the terms and conditions led to more than 6,300 homeowners canceling their contracts with Tesla Energy, CNBC reported.
Tesla completed 1,656 Solar Roof contracts at the original price quoted to customers, according to the filing, with another 57 customers slated for Solar Roof installations at the original price as of the end of June. The remaining customers who have not yet canceled or booked installations at the original price amounted to 616 people.
An analysis by the research firm Wood Mackenzie last April estimated that, as of the start of 2023, Tesla had only installed 3,000 of its Solar Roof systems in the U.S. since touting the technology seven years prior.
Tesla’s overall solar deployments (including traditional solar panels and glass roof tiles) dropped by nearly half to 48 MW in the first quarter of 2022 versus the same time in 2021. The company said, at that time, the declines were attributed to delays of certain components that were beyond the company’s control.
By the first quarter of 2023, Tesla reported that overall solar deployments amounted to 67 MW, representing 40% year-over-year growth. At the same time, Tesla’s growth in energy storage systems soared 360% in the first quarter of 2023 from a year earlier. That huge jump is demonstrative of how important its home- and utility-scale backup batteries are in juicing Tesla’s Energy division revenue, far outpacing money made through solar installations.
EnergySage, a marketplace exchange connecting energy companies and customers, said the national average cost for a 10-kilowatt solar panel install in 2022 was around $20,000 after figuring in federal solar tax credits.