Solar companies Sunrun (RUN) - Get Report and SolarCity are being investigated by the SEC to determine if they are masking how many customers have canceled contracts after they sign up for home solar energy systems, sources told the Wall Street Journal.
The cancellation metric is a way for investors to determine a company's health. Typically solar companies will give a customer some time after a contract is signed, or until installation to terminate the deal.
"In the residential solar industry, integrity and word of mouth recommendations are paramount. Our investigation of state public records suggests that the number of complaints represents a very small fraction of the number of successful solar installations nationwide," trade group Solar Energy Industries Association told the Journal.