Reference
The plain-English solar glossary
Solar comes with its own vocabulary, and it is at its worst in the two moments it matters most: when your installer goes out of business, and when the house changes hands. A wrong assumption about a warranty, a lien, or a net-metering rate costs real money. Here is every term that matters, in plain English.
No term matches. Try a shorter word, or ask us.
When your installer closes
If the company that installed your panels has stopped answering, these are the words you will run into — on a court docket, in a letter from a company you have never heard of, or in a warranty clause someone quotes at you. Most of them decide whether a promise still exists.
Orphaned system
A solar system whose installer has gone out of business, so there is no longer anyone answering the phone about it. The phrase is industry shorthand; nothing about the system itself changes. What changes is who you can hold to a promise. Your panels, inverters and battery are still covered by their manufacturers. Only the promises the installer made in its own name are in question.
Chapter 7 bankruptcy
Liquidation. The company stops operating, a trustee sells whatever is left, and the proceeds are divided among creditors in a fixed order. A workmanship warranty is an unsecured promise, which puts it near the back of that line. When an installer files Chapter 7, the practical answer is that its own warranty is gone, even though your equipment warranties are untouched.
Chapter 11 bankruptcy
Reorganization. The company intends to keep operating and emerge under a court-approved plan. Chapter 11 can preserve warranty obligations if the plan assumes them, but plans routinely reject unprofitable contracts, and a Chapter 11 can convert to a Chapter 7 liquidation at any point. A Chapter 11 filing is a reason to act, not a reason to relax.
Discharge
A bankruptcy court wiping out a debt or obligation so it can never be collected. This is the mechanism that ends a workmanship warranty: the promise is not cancelled by the installer, it is extinguished by the court. Discharge is also why paying a successor company to honor a discharged warranty is a purchase, not a claim.
Proof of claim
The form a creditor files to be counted in a bankruptcy. Homeowners can file one for a broken warranty. Be clear-eyed about it: unsecured claims in a solar installer liquidation typically recover pennies on the dollar or nothing, and the deadline (the bar date) passes quickly. It costs little to file and should not be your plan.
Wind-down without bankruptcy
A company that simply stops answering, without ever filing anything in court. This is more common than bankruptcy and it is legally the opposite situation: no filing means no discharge, so the company still owes you the warranty. The obligation is unperformed, not void. The difficulty is enforcement, not entitlement, and the leverage is different because the entity still exists.
Successor
A company that has taken on another company’s obligations, usually by buying its assets. A true successor owes you what the original owed you. Asset purchases are frequently structured specifically to leave warranty liabilities behind, so the label on a press release is not proof. Ask what was actually assumed, in writing.
Servicer
A company that administers something it does not owe. A servicer answers your call, schedules a visit and sends an invoice, but it is not standing behind the original warranty. The distinction matters enormously: a servicer answering the phone can look identical to a successor honoring a warranty until the bill arrives. Paid service is a legitimate option; it is just not a claim.
Assignment
The transfer of a contract from one company to another. Your loan, your lease, your monitoring account and your warranty can each be assigned separately, to different companies, at different times. That is why the answer to “who do I call?” is often four different answers rather than one.
Manufacturer warranty
A warranty issued by whoever built the hardware — the panel maker, the inverter maker, the battery maker — not by whoever installed it. These survive an installer’s failure completely, because they were never the installer’s promise to break. They are the coverage most homeowners wrongly assume they lost, and they are usually the larger part of what a system is worth in warranty terms. Compare the workmanship warranty, which does depend on the installer.
Installer certification requirement
A clause in some manufacturer warranties requiring a licensed or certified installer to diagnose the fault, or to perform the replacement, before the claim is paid. It is the single most common objection raised against a homeowner whose installer is gone, and it is usually answerable: most manufacturers accept any qualified licensed installer, not specifically the original one. Address it in the claim letter rather than waiting to be asked.
Production guarantee
An installer’s promise that the system will generate a stated number of kilowatt-hours per year, with a cash make-good if it falls short. This is the installer’s own promise and it dies with the installer. Do not confuse it with the panel manufacturer’s performance warranty, which is a different promise, from a different company, and survives.
Monitoring account and owner rights
Monitoring platforms such as Enphase Enlighten and the SolarEdge portal outlive the installer that set them up — but the installer usually holds the administrative rights on the account, and often the homeowner has never been given more than a view. The practical result is that faults stop being noticed. A system can underproduce for years without anyone looking, which is quiet money and the most recoverable loss on this page.
FTC Holder Rule
A Federal Trade Commission rule that puts a specific notice in consumer credit contracts arranged by a seller. Where it applies, the finance company that holds your solar loan is subject to the same claims and defenses you would have had against the installer — which matters when the installer no longer exists but the monthly payment does. It is a live avenue for a homeowner still paying for a system that does not work, and one worth raising with a consumer attorney.
Each sample kit works these terms through one installer’s actual situation — what was discharged, what survived, and who to write to.
Financing & ownership
Third-Party Ownership (TPO)
Any arrangement where a company — not the homeowner — owns the solar equipment. Leases and PPAs are the two forms. TPO grew to more than half of the U.S. residential solar market in 2024, and it is the financing type that most complicates a home sale, because the buyer must assume the agreement or the seller must buy it out.
Solar lease
A fixed monthly payment to use solar equipment a third party owns. You pay for the panels regardless of how much power they produce. At a sale, the buyer must qualify to assume the lease or the seller pays it off. See our solar leases at closing guide.
Power Purchase Agreement (PPA)
Like a lease, but you pay per kilowatt-hour the system produces rather than a flat amount, usually with an annual price escalator. Also third-party owned and subject to transfer or buyout at sale.
Solar loan
A loan used to purchase the system, which the homeowner then owns. The loan is almost always held by a finance company (GoodLeap, Mosaic, Sunlight, Dividend), not the installer — so an installer bankruptcy usually doesn't affect it. Most solar loans file a UCC-1 lien on the equipment.
Escalator
A clause that raises your lease or PPA payment every year, commonly 1.9–2.9%. Over a 20–25 year term it can push payments well above the original rate, so buyers assuming an agreement should read it carefully.
Buyout / payoff
The amount required to purchase a leased or PPA system outright, or to pay off a solar loan. At a sale this figure — and who holds it — must be confirmed in writing, especially if the original financier has gone bankrupt.
Costs & incentives
Federal solar tax credit (ITC / Section 25D)
The residential clean energy credit, also called the solar ITC or Section 25D, let homeowners who bought their system claim 30% of the cost against federal taxes. It applied to owned systems bought with cash or a loan, not to leases or PPAs, where the third-party owner claimed a separate business credit instead.
25D expiration (One Big Beautiful Bill, 2025)
The 2025 federal budget law (H.R.1, the One Big Beautiful Bill Act) ended the 30% residential clean energy credit for systems installed after December 31, 2025. The rush to beat that deadline and the sharp drop in demand afterward are a major reason several large installers filed for bankruptcy in 2025 and 2026.
Liens & title
UCC-1 fixture filing
A financing statement a lender files (often with the county and/or Secretary of State) to secure its interest in the solar equipment. It's routine, but title and escrow must locate and address it before a home can sell or refinance cleanly. See our UCC lien guide.
PACE lien
Property Assessed Clean Energy financing repaid through the property tax bill. Unlike a UCC filing, a PACE obligation attaches to the property itself and typically must be paid off at sale because it can take priority over the mortgage. See our PACE lien guide.
Secured party
The company named on a UCC-1 filing as holding the security interest — i.e., who must be paid or must release the lien. After a bankruptcy, the secured party of record may have changed to a successor servicer.
Utility & net metering
Net metering (NEM)
A billing arrangement that credits you for excess power your system exports to the grid. Older, more generous "grandfathered" rates can be worth thousands per year — and in many states they do not automatically transfer to a buyer. See how net metering transfers at resale.
Net billing (NEM 3.0)
A successor to traditional net metering (notably California's 2023 change) that pays a lower, market-based rate for exported power, lengthening payback periods and making batteries more attractive.
Permission to Operate (PTO)
The utility's formal sign-off allowing a newly installed system to turn on and export. A system without PTO isn't legally operating, and a missing PTO can surface as a problem at sale.
Interconnection agreement
The contract with the utility that connects your system to the grid. It lists your equipment and your net-metering terms, which makes it one of the most useful documents to have when identifying a system.
SREC (Solar Renewable Energy Certificate)
A tradable credit earned for the clean energy your system generates, sold in certain state markets (PA, NJ, MD, MA, DC, OH, VA and others). Who owns the SRECs after a sale depends on the contract — the homeowner may have signed them away to the installer or financier. See our SREC transfer guide.
True-up
The annual reconciliation of a net-metering account, when the utility totals a year of credits and charges and bills or refunds the difference. Your true-up month and running balance matter when a solar home changes hands mid-cycle.
Equipment & warranties
Inverter
The device that converts panel DC output into usable AC power. String inverters serve a whole array; microinverters sit under each panel. Inverters carry their own manufacturer warranty (10–25 years) and are the most common component to need replacement.
Workmanship warranty
The installer's warranty covering installation labor, racking, wiring, and roof penetrations (typically 10–25 years). It is the only warranty tied directly to the installer's survival — and the one at risk when an installer goes bankrupt.
Degradation
The gradual decline in a panel's output, roughly 0.4–0.5% per year. A healthy 10-year-old system should still produce about 95% of its first-year output; well below that suggests a fault worth investigating.
Performance (power) warranty
A panel manufacturer's guarantee that output won't fall below a specified percentage over 25–30 years. Distinct from the product warranty, which covers physical defects.
Rapid shutdown / SnapRS
A required rooftop safety feature that quickly de-energizes panels so first responders can work safely. Some systems (notably Generac PWRcell installs sold by companies such as the former Pink Energy) used a SnapRS device whose failures could take a system offline; the manufacturer, not the bankrupt installer, runs the replacement program.
At the transaction
Lease assumption
The process by which a buyer takes over a seller's solar lease or PPA, subject to the servicer's credit approval. Starting it early is the difference between a smooth closing and a delayed one.
Estoppel certificate
A signed statement from the lease or PPA servicer confirming the current terms, balance, and status of the agreement. Buyers, lenders, and title companies request one during a sale so everyone works from the same numbers, which is harder to obtain once the original company has failed.
Finaled permit
A solar permit the local jurisdiction has inspected and closed out. An open or unfinaled permit can block a sale or trigger lender conditions. See open solar permits at closing.
Solar disclosure report
An independent document that consolidates a system's ownership, financing, liens, permit status, warranties, installer standing, and net-metering into one place for a real estate transaction — what SolarDisclosure™ produces.
Reading a solar proposal
kW vs kWh
Kilowatts (kW) measure power, the size of the system; kilowatt-hours (kWh) measure energy, what it produces and what you are billed for. A proposal lists the system in kW DC and its estimated production in kWh per year. Your utility bill is in kWh. The whole deal should be sized from your annual kWh.
DC vs AC rating
Panels are rated in DC watts; the inverter converts to AC, losing 10 to 20 percent to heat, wiring and clipping. A 8 kW DC system is roughly a 6.5 to 7.2 kW AC system. Price per watt is usually quoted on DC; production comes out in AC.
Production estimate
The proposal's kWh-per-year figure. It should come from a modeling tool (PVWatts, Aurora, Helioscope) using your roof's orientation, tilt and shade. Divide it by the system's kW: above about 1,700 kWh per kW per year is rare outside the desert Southwest; 1,200 to 1,500 is typical for most of the country.
PVWatts
A free calculator from the National Renewable Energy Laboratory that estimates annual production for a system of a given size at your address. Run it yourself before you accept a proposal's production number.
Offset
The share of your annual electricity use the system is designed to produce, expressed as a percentage. Under full net metering, 100 percent offset makes sense; under net billing, every kWh exported is credited at a discount, so a system sized above your usage mostly benefits the seller.
Self-consumption
The share of your solar production you use in your own home at the moment it is produced, instead of exporting it. Typically 30 to 45 percent for a household that is out during the day, 60 to 80 percent with a battery. It is the number that decides how much net billing hurts.
Specific yield
Annual kWh produced per kW of system size. The quickest sanity check on a proposal: compare it to PVWatts for your location.
Microinverter
A small inverter mounted under each panel, converting DC to AC at the panel. Panels operate independently, so shade on one does not drag down the others, and most carry 25-year warranties. Enphase is the dominant brand.
String inverter
One inverter for the whole array, usually on a wall near the meter. Cheaper up front, typically a 10- to 12-year warranty, which means a replacement bill around year 12. Often paired with optimizers (SolarEdge) to reduce the shade penalty.
Power optimizer
A device under each panel that conditions its output before it reaches a string inverter, reducing shade and mismatch losses. Not a microinverter: the string inverter is still a single point of failure.
Panel wattage
The DC rating of one panel under standard test conditions, commonly 400 to 450 watts in 2026. System size is panel count times wattage. A proposal that lists panel count but not wattage or model is incomplete.
Tier 1 panels
A bankability ranking of manufacturers used by financiers, not a quality grade. A salesperson saying 'Tier 1' has not told you the make, the model, or the warranty terms. Ask for all three.
Battery capacity and power
Capacity (kWh) is how much energy the battery stores; power (kW) is how fast it can deliver it. A 13.5 kWh, 5 kW battery (the most common residential size) runs essentials overnight but cannot start a central air conditioner and an oven at once. Backup needs are about kW; bill savings are about kWh.
Critical loads panel / backup panel
A sub-panel wired to the battery that carries the circuits you want to keep on in an outage. Whole-home backup needs a larger battery and often a service upgrade; a critical-loads panel is the affordable version.
Time-of-use (TOU) rates
A utility rate that charges more during peak hours (typically late afternoon and evening) and less overnight. On TOU, a battery earns by storing cheap or solar power and discharging at the peak price. On a flat rate it saves almost nothing on the bill.
Grid-tied, hybrid, and off-grid
Grid-tied systems export surplus and import shortfall and shut down in an outage unless a battery is present. Hybrid systems add a battery and an inverter that can island the house. Off-grid systems have no utility connection at all and need far more battery and generator capacity than most people expect.
The sale and the money
Price per watt
The cash price divided by the system's DC watts. The only number worth comparing across quotes, because monthly payments hide the fee and the term. Ask every seller for the cash price in writing.
Redline
The floor price per watt an installer gives its sales organization; everything the rep sells above it is commission. Knowing it exists is leverage: your competing cash quote is the closest thing to the redline you will get.
Dealer fee
A fee the solar lender charges the installer in exchange for offering a low advertised APR, routinely 15 to 35 percent of the loan, which the installer folds into your price. It is why the amount financed on a 'low APR' solar loan is often a quarter above the same system's cash price. Three state attorneys general sued over undisclosed dealer fees in 2026.
APR
The annual percentage rate on a loan, including interest. On solar loans the APR looks low because the dealer fee is paid separately, by you, through the price. Compare total cost over the term, not the APR.
Re-amortization / month-18 payment jump
A solar-loan structure that assumes you will pay the tax credit amount (often 26 to 30 percent of the loan) into the loan by month 16 to 18. If you do not, the payment resets upward. With the 25D credit gone for 2026 installs, this structure has no credit to fund it.
Installment account
How a solar loan appears on your credit report: a fixed-payment debt like a car loan, reported monthly to Equifax, TransUnion and Experian. It counts in your debt-to-income ratio and a missed payment is reported regardless of whether the panels work.
Hard inquiry
A credit check that appears on your report when you apply for a loan. Signing a solar loan generates one; 'just checking if you qualify' at the door often does too.
Debt-to-income ratio (DTI)
Your monthly debt payments divided by gross monthly income, the number mortgage lenders use to approve a loan. A $250 solar payment on $8,000 of income adds about 3 points. Run it past your lender before signing if a purchase or refinance is in your plans.
Prepayment terms
Whether, and how, you can pay a solar loan off early. Most allow it without penalty, but a dealer fee financed up front is sunk either way; paying off early does not recover it.
FTC Cooling-Off Rule / three-day cancellation
A federal rule (16 C.F.R. Part 429) giving you three business days to cancel a sale of $25 or more made at your home or anywhere other than the seller's permanent place of business. The seller must give you a cancellation form and tell you about the right. Many states extend it. Cancel in writing to the installer and the lender.
Home solicitation sale
The legal term for a sale made at your home, which triggers the cancellation rights above and, in most states, a state home-solicitation statute. Ohio, Michigan and Kansas all sued solar sellers in 2026 under those statutes.
Arbitration clause
A contract term requiring disputes to go to private arbitration instead of court, usually waiving class actions. Most solar contracts and loans have one. It is why consumer attorneys often pursue the lender under the Holder Rule or route complaints through a state attorney general, whose suits are not bound by your arbitration clause.
Class action
A lawsuit brought by a group of people with the same claim. In solar, class actions have targeted equipment defects (the Generac SnapRS settlement) and lenders. An attorney general lawsuit is not a class action; it is the state enforcing consumer law, and any restitution usually goes to consumers who filed complaints.
Attorney general complaint
A consumer complaint filed with your state attorney general's office. Free, online, and the list that restitution in an enforcement case is built from. If you were misled, file it even if nobody has sued yet; complaint volume is what starts the cases.
Deceptive trade practices act
The state consumer-protection statute (names vary: UDAP, DTPA, Consumer Sales Practices Act) under which attorneys general and private plaintiffs sue over false savings claims, hidden fees and misrepresented tax credits. Every 2026 state solar suit cited one.
Consumer Financial Protection Act
The federal law that lets state attorneys general sue lenders for unfair, deceptive or abusive practices. Virginia and Michigan used it in 2026 to reach the national lenders behind failed solar installers.
Solar sales commission
What the rep earns above the redline, commonly $0.20 to $1.00 per watt, split with managers and the dealer, higher on financed deals. Negotiable precisely because it sits above the installer's own floor price.
Owning and maintaining the system
Roof penetration and flashing
Every mounting foot goes through the roof; flashing is what keeps water out. Leaks at penetrations are the most common workmanship failure and the one a dead installer cannot fix. Ask who honors the roof warranty and for how long, and get it from the roofer if the installer's answer is weak.
Removal and reinstall (R&R)
Taking the panels off and putting them back for a roof replacement, typically $1,500 to $6,000. If the roof has under 10 years left, replace it before the panels go on.
Annual production audit
Comparing a year of actual production (from the monitoring app) with the proposal's estimate. A 10 percent shortfall is normal variation; 25 percent is a fault. Doing this once a year is the cheapest insurance an owner has, and the most skipped.
Homeowner's insurance and solar
Most carriers cover rooftop solar under the dwelling policy; some require a rider, some raise premiums, and a growing number non-renew. Ask your carrier before installing and again before selling.
Property tax exemption for solar
Many states exclude the added value of a solar system from property-tax assessment, some permanently and some with a sunset. Check your state; a reassessment after installation is a real cost where no exemption exists.
Transfer fee
A charge by a lease, PPA or loan company to move the agreement to a new homeowner at sale, on top of the credit qualification. Ask for the amount in writing before listing.
System documentation
Invoice, equipment list with serial numbers, warranty registrations, permit final, PTO letter, interconnection agreement, and production history. The packet an appraiser, a buyer, a title company and a manufacturer will each ask for. Assemble it the week the system is turned on.
Going green and going off-grid
Community solar
A subscription to a share of a solar farm elsewhere in your utility territory, credited on your bill. No roof, no loan, no lien, usually cancellable. For renters, shaded roofs, and anyone whose goal is emissions rather than ownership, it is often the better answer.
Renewable energy certificate (REC)
A tradable certificate representing the environmental attribute of one MWh of renewable generation. Whoever owns the REC gets to claim the 'green' power. In many leases and PPAs, and in some loans, the company keeps the RECs, so the homeowner's system is legally not green for the homeowner. SRECs are the state-market version.
Carbon payback
The time it takes a solar system to offset the emissions from making it, typically one to three years. After that the system is net-positive for the remainder of a 25-plus-year life. It is a reason to buy; it is not a reason to buy a badly priced system.
Off-grid sizing
Designing for the worst week of the year rather than the annual average: three to five days of battery autonomy, a generator for winter, and a system two to three times larger than a grid-tied home would need. Off-grid is a lifestyle and a site decision, not a savings decision; a grid-tied hybrid system delivers most of the independence at a fraction of the cost.
Islanding
Running your home on solar and battery while disconnected from the grid. Standard grid-tied systems cannot do it (they shut down in an outage for line-worker safety); a hybrid inverter with a transfer switch can. If backup is why you want solar, ask specifically whether the proposed system islands.
Turn the jargon into a clear answer
A SolarDisclosure™ report identifies exactly which of these apply to a specific home — the lien, the lease, the servicer, the warranties, and the net-metering — before you buy, sell, or list.
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