At a glance

Keep the system running and keep paying any loan or lease. Then collect your paperwork, look up the company's license and bond on the Contractors State License Board's website, and send warranty claims for the equipment to the makers. If the company owes you for bad or unfinished work, its $25,000 license bond is the main pool of money California sets aside for homeowners, and the deadline to claim runs about two years from when the license would have expired.

It happens often enough to plan for. Of the 1,051 contractor licenses that connected at least 10 home systems in California in 2023, 213 connected none in the first eight months of 2026. Those contractors had installed 10,794 home systems in 2023 alone.

Who still covers what

PanelsThe panel maker

Product and performance warranties come from the manufacturer. REC, for one, says that if the original installer goes out of business, its ProTrust warranty still applies.

Inverter and batteryThe equipment maker

Same idea: the maker's warranty doesn't depend on the installer. The CPUC tells solar owners to keep the equipment warranties, "particularly for the inverter."

WorkmanshipThe installer

A labor or workmanship warranty is the company's own promise. If it closes, the license bond below may be the only money behind it.

Utility billingYour utility

Your permission to operate and billing plan stay with your account. The CPUC guarantees the net billing tariff for nine years to the customer who interconnects, not the installer.

A solar loanThe lender

The loan stays due. If your contract has the federal "Holder" notice, claims you had against the installer can be raised against the lender, up to what you've paid.

Lease or PPAThe system's owner

Your contract names the company that owns the panels; that may not be the company that installed them. Check who you pay and who your contract says handles repairs.

The CPUC's solar guide adds a reminder: unless you bought a maintenance plan or your system came with one, maintenance and repairs are your responsibility anyway, so the company closing changes less than it seems for a system that's working.

What to do, in order

  1. Gather your papers

    The contract, every payment record, the warranty documents for the panels, inverter and any battery, your utility's permission to operate letter, and any loan or lease contract. The CSLB's bond guide lists copies of the contract, payments, messages and proof of the problem.

  2. Look up the license

    Search the company's license number on the CSLB's website. The lookup shows the license status and the bond details, including the surety company that wrote it.

  3. Claim on the bond

    The CSLB's bond guide says to contact that surety company directly, describe the problem and send your evidence; the surety investigates and decides. If the contractor posted a cashier's check instead of a bond, the CSLB can only pay it out under a court order.

  4. File a CSLB complaint

    The board can investigate a licensed contractor if you file within the legal deadline, usually four years, according to the notice California requires in every home improvement contract.

  5. Warranty claims go to the makers

    Use the serial numbers on your equipment and the maker's warranty terms to file directly.

A kitchen table with an open accordion folder of household paperwork, a stack of stapled papers, reading glasses and a mug of coffee in soft morning light

The $25,000 license bond

$25,000bond every licensed contractor must keep with the CSLB, since January 1, 2023
  • Who it's for. A homeowner who hired the contractor for work on their own home and was damaged by a violation of the contractor license law can claim up to the full bond. Everyone else, such as people hurt by fraud or unpaid workers, shares at most $7,500 of it; the rest is reserved for those homeowners.
  • How it's split. One $25,000 bond covers every claim against that license. If claims add up to more, it's paid out in proportion to each claim.
  • The deadline. Two years after the end of the license period in which the problem happened. If the license was canceled, inactivated or revoked, two years from the date it would otherwise have expired.

The bond pays for violations of the license law, fraud, and unpaid wages or benefits, not every disappointment, and the surety company investigates before it pays. A license can't be renewed or reinstated while a judgment or admitted claim larger than the bond is unpaid.

If you have a solar loan

The lender usually isn't the installer, so the loan doesn't end when the company does. Look for this notice in your loan contract. When a seller arranges the financing, federal rules require it in bold type:

"ANY HOLDER OF THIS CONSUMER CREDIT CONTRACT IS SUBJECT TO ALL CLAIMS AND DEFENSES WHICH THE DEBTOR COULD ASSERT AGAINST THE SELLER OF GOODS OR SERVICES OBTAINED PURSUANT HERETO OR WITH THE PROCEEDS HEREOF. RECOVERY HEREUNDER BY THE DEBTOR SHALL NOT EXCEED AMOUNTS PAID BY THE DEBTOR HEREUNDER."

FTC Holder Rule, 16 CFR 433.2

If your contract has it, the claims you had against the installer, for example for work it never finished, can be raised against whoever holds the loan now, but what you can get back is capped at what you've paid on the loan. Keep paying while you sort it out, and put any dispute to the lender in writing. For how solar loans and PACE work in California, see paying for solar.

If the job isn't finished

Two rules in every California home improvement contract limit what you can lose. The down payment can't exceed $1,000 or 10% of the price, whichever is less, and the contract must say, in bold: "It is against the law for a contractor to collect payment for work not yet completed, or for materials not yet delivered." Collecting ahead of the work is, in the law's own words, against the law, which is the kind of violation a bond claim and a CSLB complaint address.

The bigger risk is liens. The same contracts carry a "Mechanics Lien Warning": "Even if you pay your contractor in full, unpaid subcontractors, suppliers, and laborers who helped to improve your property may record mechanics liens" on your home. Each subcontractor and supplier must first send you a "Preliminary Notice," so keep every one you've received. If a company closes owing its suppliers, those notices tell you who may have a claim on your home.

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Common questions

What happens if my solar company goes out of business in California?

Your system keeps working and your utility billing doesn't change. You lose the company's own promises, such as its workmanship warranty and service. Equipment warranties come from the makers, and the company's $25,000 license bond may cover damage from violations of the license law.

Is my solar panel warranty still good if the installer closed?

The panel and inverter warranties come from the manufacturers, not the installer. REC, for example, says its ProTrust warranty still applies if the original installer goes out of business. A workmanship warranty from the installer itself is only as good as the company.

How do I file a claim against a California contractor's bond?

Look up the license on the CSLB's website to find the surety company that wrote the bond, then contact that surety directly with your contract, payment records and evidence. The surety investigates and decides whether to pay.

How long do I have to claim on the contractor's bond?

Two years after the end of the license period in which the problem happened. If the license was canceled, inactivated or revoked, two years from the date it would otherwise have expired (Business and Professions Code 7071.11).

Do I still have to pay my solar loan if the company went out of business?

Yes, the loan stays due. If the contract includes the FTC Holder notice, claims you had against the installer can be raised against the lender, but recovery is capped at the amount you've paid on the loan.

Can my solar company's suppliers put a lien on my house?

They can if they weren't paid: California's required Mechanics Lien Warning says unpaid subcontractors, suppliers and laborers may record mechanics liens even if you paid your contractor in full. Subcontractors and suppliers must first send you a Preliminary Notice to keep that right.

This explains California law and published rules; it isn't legal advice. For a large loss, a bankruptcy filing or a lien, a lawyer can tell you what applies to your contract. Sources: Business and Professions Code 7071.5 · Business and Professions Code 7071.6 · Business and Professions Code 7071.11 · Business and Professions Code 7159 · CSLB: Fast Facts, a guide to contractor license bonds (PDF) · 16 CFR Part 433, FTC Holder Rule · REC: warranty and ProTrust · CPUC: Net energy metering and net billing · California DG Stats: Interconnected Applications Data Set. Reviewed October 2026.

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