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OLR Bill Analysis
SB 297
AN ACT CONCERNING CONSUMER PROTECTION FOR
CUSTOMERS OF SOLAR POWER COMPANIES.
SUMMARY
This bill establishes various requirements for sales and solicitations
of residential solar photovoltaic (PV) systems. Among other things, it
requires that:
1. third-party agents selling the systems for a residential solar PV
system provider be trained by the provider;
2. providers annually submit a list of their agents to the Public
Utilities Regulatory Authority (PURA); and
3. providers and their agents, among other things, (a) identify
themselves when making the sale or solicitation, (b) explain all
rates, fees, and charges for the system being sold, and (c)
generally limit their door-to-door sales to between 10:00 a.m. and
6:00 p.m.
The bill makes a violation of its provisions on residential solar PV
sales and solicitations an unfair or deceptive trade practice under the
Connecticut Unfair Trade Practices Act (CUTPA, see BACKGROUND).
Lastly, the bill creates a 16-member task force to study ways to
improve solar PV system sales for customers. The task force must report
its findings and recommendations to the Energy and Technology and
General Law committees by January 1, 2025.
EFFECTIVE DATE: October 1, 2024, except the task force provision
takes effect upon passage.
RESIDENTIAL SOLAR PV SYSTEM SALES AND SOLICITATIONS 2024SB-00297-R000356-BA.DOCX
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Application
By law, and under the bill, a “residential solar photovoltaic system”
is equipment and devices that:
1. are primarily meant to collect solar energy and generate
electricity by photovoltaic effect,
2. have a nameplate capacity rating of 12 kilowatts or less,
3. are installed on the roof of a single-family home, and
4. conform to the State Building Code.
A “residential solar PV systems provider” is any individual,
partnership, limited liability company, corporation, or other legal entity
that provides residential solar PV systems.
Third-Party Agents
The bill makes a third-party agent the legal agent of a residential solar
PV system provider if the agent contracts with, or is compensated by,
the provider to sell residential solar PV systems. It prohibits third-party
agents from selling the systems for these providers unless they (1) are
the provider’s employee or independent contractor and (2) have
received training directly from the provider.
The bill also requires the providers to annually file with PURA a list
of the names of any agents working on their behalf.
Sales and Solicitations Requirements
The bill requires each residential solar PV system provider to develop
and implement standards and qualifications for the employees and
third-party agents engaged in selling or soliciting the provider’s
residential solar PV systems. (It does not specify any additional criteria
for these standards and qualifications.)
It also establishes requirements for all sales and solicitations of
residential solar PV systems by the providers and their agents to a
customer. They apply to those conducted and completed entirely by
mail; door-to-door sale; telephone or other electronic means; during a 2024SB-00297-R000356-BA.DOCX
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scheduled appointment at the customer’s premises; or at a fair, trade or
business show, convention, or exposition. These require that the sale or
solicitation (1) identify the person making the sale or solicitation and the
provider he or she represents; (2) explain the purpose of the solicitation;
and (3) explain all rates, fees, variable charges, and terms and conditions
for the system.
For door-to-door sales, the bill also requires that the sale be done (1)
according to any municipal and local ordinances for door-to-door
solicitations; (2) between 10:00 a.m. and 6:00 p.m., unless the customer
schedules a different appointment; and (3) with written materials
available in both English and Spanish. In addition, the provider’s
representative or agent must prominently display or wear a photo
identification badge stating the name of his or her employer or the
provider that he or she represents.
The bill also requires that providers and their agents comply with the
Federal Trade Commission’s telemarketing sales rules, which, among
other things, restricts when and who they can call (16 C.F.R. § 310.1 et
seq.).
Enforcement
In addition to making violations of its provisions an unfair or
deceptive trade practice under CUTPA, the bill also makes a customer’s
waiver of any of its provisions void and unenforceable by the residential
solar PV systems provider.
The bill further specifies that any contract for residential solar PV
systems is void and unenforceable if PURA finds it to be the product of
unfair or deceptive marketing practices or in material violation of the
bill’s provisions. (PURA’s authority to determine whether a contract is
an unfair or deceptive marketing practice is unclear, as this authority
generally lies with the consumer protection commissioner under
CUTPA. In addition, to the extent this provision applies to existing
contracts, it may implicate the Contract Clause of the U.S. Constitution
(see BACKGROUND).) 2024SB-00297-R000356-BA.DOCX
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SOLAR PV SYSTEM TASK FORCE
The bill requires the task force to study policy, regulations, and
legislation to improve disclosure requirements and consumer
protection for consumers who purchase, lease, or enter into power
purchase agreements for solar PV systems. The study must also examine
whether special protections are needed for consumers who are low-
income or senior citizens.
The task force must report its findings and recommendations to the
Energy and Technology and General Law committees by January 1,
2025. The task force terminates when it submits the report, or January 1,
2025, whichever is later.
Membership
Under the bill, the task force has 16 members: five ex-officio
members, one gubernatorial appointee, and ten legislative appointees.
The ex-officio members are the environmental protection commissioner,
PURA chairperson, consumer counsel, consumer protection
commissioner, and Connecticut Green Bank president, or their
respective designees. The appointees are as follows:
1. one appointed by the governor, who must be a member of an
association that represents retailers of solar PV systems in
Connecticut;
2. two appointed by the House speaker, one of whom must have
experience representing senior citizens in matters related to
consumer protection or utilities;
3. two appointed by the Senate president pro tempore, one of
whom must have experience representing consumer groups,
especially in underserved communities;
4. one appointed by the House majority leader;
5. one appointed by the Senate majority leader;
6. two appointed by the House minority leader; and 2024SB-00297-R000356-BA.DOCX
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7. two appointed by the Senate minority leader.
All initial appointments to the task force must be made within 30
days after the bill’s passage. The appointing authority must fill any
vacancies.
Meetings and Administration
Under the bill, the House speaker and Senate president pro tempore
must select the chairperson from among the task force’s members. The
chairperson must schedule the task force’s first meeting, which must be
held within 60 days after the bill’s passage. The Energy and Technology
Committee’s administrative staff must serve as the task force’s
administrative staff.
BACKGROUND
CUTPA
CUTPA prohibits businesses from engaging in unfair and deceptive
acts or practices. It allows the consumer protection commissioner to
issue regulations defining what constitutes an unfair trade practice,
investigate complaints, issue cease and desist orders, order restitution
in cases involving less than $10,000, enter into consent agreements, ask
the attorney general to seek injunctive relief, and accept voluntary
statements of compliance. It also allows individuals to sue. Courts may
issue restraining orders; award actual and punitive damages, costs, and
reasonable attorney’s fees; and impose civil penalties of up to $5,000 for
willful violations and $25,000 for violation of a restraining order (CGS §
42-110a et seq.).
Contract Clause
The U.S. Constitution’s Contract Clause (art. I, § 10) prohibits states
from passing laws that impair the obligation of contracts. In a 2017
opinion (2017-06), Connecticut’s attorney general noted that when a
litigant raises a Contract Clause challenge against a legislative act,
courts ask three questions to determine whether the act violates the
clause: (1) is the impairment substantial; (2) if so, does the law serve a
legitimate public purpose; and (3) if so, are the means of accomplishing
this purpose reasonable and necessary (Buffalo Teachers Fed’n v. Tobe, 464 2024SB-00297-R000356-BA.DOCX
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F.3d 362 (2d Cir. 2006)).
Related Bill
sHB 5236 (File 103), § 25, favorably reported by the General Law
Committee, among other things, allows DCP to impose a civil penalty
of up to $5,000 for CUTPA violations, after an administrative hearing.
COMMITTEE ACTION
Energy and Technology Committee
Joint Favorable
Yea 14 Nay 4 (03/21/2024)