Utah customers are still paying for solar panels that don’t work, lawsuit claims

A state agency has ordered Elan Solar to halt all business, and is taking the company to court.

(Trent Nelson | The Salt Lake Tribune) An Elan Solar employee installs solar panels on a Santaquin home on Friday, Nov. 6, 2020. A 2024 lawsuit claims Elan Solar and its owner, Kevin Colarusso, has repeated deceived and misled customers.

One customer took money from his 401(k) to finance a home solar panel system that took more than a year to work. Another stopped paying the loan they used to finance solar panels that still don’t work after nearly three years. Another is still paying for panels that have sat “dormant for over two years, unconnected and not producing electricity.”

They are among the roughly 140 customers the Utah Division of Consumer Protections claims were deceived by Orem-based Elan Solar and its owner, Kevin Colarusso, in a lawsuit filed last week in Salt Lake City’s Third District Court.

The lawsuit seeks damages for numerous alleged violations of the Utah Consumer Sales Practice Act (CSPA), claiming Elan Solar has repeatedly misled customers and the public about its business practices, and installed solar panels without a license to do so.

The division also filed an emergency cease-and-desist order at the beginning of March “due to Elan Solar’s continued deceptive conduct and, most importantly, the unlawful practice of representing themselves as a full-service solar installation company without the appropriate State of Utah license,” according to a news release.

Colarusso said it is too soon for him or his attorney to respond to the allegations — he and the company has until early April to file a formal response — but, he said, they “believe many of the allegations will prove to be false.” He said the company is in “complete compliance” with the cease-and-desist order.

At the center of the division’s lawsuit is the claim that more than 140 Elan Solar customers paid for solar panels that do not work, because Elan never finished installing them.

According to the complaint, customers frequently took out loans, at Elan’s direction, to finance the cost of the solar systems, which cost between $25,000 and $75,000. Lenders paid Elan Solar the full amount due “once a consumer’s system was ‘substantially complete,’” according to the complaint — but “substantially complete” did not mean “functional.”

The DCP claims Elan failed to connect customers’ solar panels to their houses’ electrical panels, leaving them effectively useless — but still leaving customers to pay back the loans.

“Some consumers have been making loan payments for over 18 months, with nothing to show for it,” the complaint claims.

The lawsuit was spurred by more than 30 complaints the division says it has received about Elan Solar over the past 18 months. Elan also admitted that “at least 140 customers” do not have functional systems, according to the complaint.

Solar power, cast in shadows

The lawsuit alleges Elan Solar misled customers at nearly every level of interaction — from fabricating Google reviews and making false claims on its own website to making direct sales pitches that misrepresented how much each system would cost.

In fact, any solar installations done in Utah since August 30, 2023, were done illegally, the lawsuit claims. The state’s Division of Professional Licensing revoked Elan’s contractor license last summer for failing to perform services and failing to pay subcontractors. But Elan Solar still claimed on its website until at least March 1 that it is a “licensed contractor in each state in which we operate,” according to the suit.

“For months, Elan Solar continued to engage in business activities that require a contractor license in Utah despite its revoked state license,” the lawsuit claims.

The Division of Consumer Protection analyzed 373 Google reviews last December, according to the complaint, and flagged 89 as “highly suspicious,” written by the same person or “clearly written by family members and Elan Solar’s employees.” One review included in court documents “appears to have been copied and pasted verbatim for a review left for a different solar company.”

Elan, the complaint alleges, falsely claimed on its website that it was certified by the Better Business Bureau. In sales pitches with potential customers, sales reps used a software tool that made it appear as if dozens of neighbors already had functioning Elan systems installed, though that was not the case, court documents claim.

Sales representatives also misled customers about how much the systems would cost and how much money customers would eventually save on electricity, the lawsuit claims.

Some customers claim Elan failed to secure the necessary permits before installing their solar panels, despite representations to the contrary. One customer, identified by his initials in the complaint, claimed his utility company notified him shortly after his system was installed that it was not in compliance and “needed to be turned off.” The customer is still paying for the system, even though it sits dormant, the lawsuit says.

Another customer paid for the requisite permits herself after realizing Elan never obtained them, according to the complaint. Elan told the customer it would reimburse her for the application fee but has yet to do so. Her installation remains incomplete and her system “remains unconnected and inoperable,” the complaint says.

Repeat offender

Elan Solar has already settled with the Division of Consumer Protections in two prior cases, according to the division. In January and July of 2022, the division found Elan failed to provide customers with “required disclosure statement[s] prior to entering contracts, violating the Residential Solar Energy Disclosure Act (RSEDA).”

The lawsuit seeks damages on behalf of Elan customers who have filed a complaint with the Division of Consumer Protections, plus at least $300,000 in punitive fines.

“The mission at the Division of Consumer Protection is to strengthen trust in Utah’s commercial activities through enforcement and education,” Katie Hass, the division’s director, said in a news release. “Deceptive conduct like that exhibited by Elan Solar does the exact opposite — it harms consumers and erodes trust in the solar industry, and our economy overall. It is imperative that we hold companies responsible for deceptive behavior and the resulting harm to consumers so that trust may be restored, and good actors may thrive.”

Shannon Sollitt is a Report for America corps member covering business accountability and sustainability for The Salt Lake Tribune. Your donation to match our RFA grant helps keep her writing stories like this one; please consider making a tax-deductible gift of any amount today by clicking here.