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Tesla cars are parked outside a home with a Tesla solar roof on Weems Street in Boca Chica Village, Texas, June 21, 2021.
Veronica G. Cardenas | bloomberg | Getty Images
Tesla They agreed to pay just over $6 million to settle a class action lawsuit brought by customers who faced solar roof price hikes in 2021 after agreeing to install the systems in their homes.
The Tesla solar roof was previously known as the Tesla “solar glass”. CEO Elon Musk first promoted the system in 2016 as an architecturally attractive roofing product that would generate energy and look just as good as shingles in a home without the solar panels. The solar glass roof tiles he carried in a shareholder presentation, while promoting Tesla’s then-planned acquisition of SolarCity, were later revealed to be a prop rather than a working prototype.
As previously reported by CNBC, Tesla Solar Roof customers had signed contracts with the company and were preparing to install the systems in their homes, when they were caught off guard by sudden price increases in 2021 that required higher payments to move forward with their facilities.
The price hike was not a simple change. The lead plaintiff in the class action lawsuit, Matthew Amans, saw the price of his solar roof rise from about $72,000 in his original contract to about $146,000 per court filing.
Tesla raised the prices of its solar installations at least twice that year, and made it a requirement for customers who order solar panels or roof tiles to also order a home energy storage Powerwall system.
According to the Amended Class Action Settlement Agreement, filed in U.S. District Court in San Francisco on July 10, 2023, as of the end of June this year, approximately 8,636 Tesla customers were part of the group affected by the price hike, and the resulting surprise costs and terms. Changing customers Just over 6,300 canceled solar power contracts with Tesla Energy.
Tesla has completed 1,656 Solar Roof contracts at the original price offered to customers, according to the filing, with 57 other customers for Solar Roof installations at the original price as of the end of June. As for the rest of the customers who did not cancel or book the installations at the original price, they amounted to 616 people.
Wood Mackenzie has estimated that as of the beginning of 2023, Tesla has installed only 3,000 solar roof systems in the United States since promoting the technology seven years ago.
In the energy sector, Tesla’s total solar deployments (including conventional solar panels and roof tiles) fell nearly in half to 48 megawatts in the first quarter of 2022 versus the same time in 2021.
Tesla said the declines in solar deployment at the time were caused by delays in importing certain components that were beyond the company’s control.
By the first quarter of 2023, Tesla solar deployments totaled 67 megawatts, representing a 40% year-over-year growth. At the same time, Tesla’s growth in energy storage systems rose 360% in the first quarter of 2023 from a year earlier, showing that its home and utility-level backup batteries, much more than solar installations, drive revenue for Tesla’s energy division.
The national average cost of installing 10-kilowatt solar panels in 2022 was about $20,000 after factoring in federal solar tax credits, according to Energy Sagea marketplace that connects energy companies and customers.
Read the full settlement terms from the class action lawsuit (Amans v. Tesla, Inc. 3:21-cv-03577) here:
Correction: This story has been updated to reflect the correct totals for Tesla’s solar deployment in the first quarter of 2022 and 2023, respectively.
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