Puerto Rico Senate to Probe Sunnova Subsidiary Bankruptcy
Investigation launched amid concerns over consumer impact and energy resilience.
The Puerto Rican Senate will investigate potential negative effects on consumers stemming from the bankruptcy filing of Sunnova Tep Developer LLC, a subsidiary of Sunnova Energy, INC. The move follows worries about local solar energy agreements and federal subsidies.
Senate Resolution 253
Senate Resolution 253, approved by the Senate, directs an inquiry into Sunnova Tep Developer LLC and its impact on Puerto Rican consumers. Introduced by Senator Héctor Joaquín Sánchez Álvarez, the measure will assess the bankruptcy’s repercussions on Sunnova’s alliances with local companies such as ISO Solar, Power Solar, Windmar, Pura Energía, and Melprio.
Furthermore, the resolution will examine the potential effects on federal subsidy programs designed to bolster energy resilience on the island.
“Solar energy is a key piece for the island’s energy resilience and thousands of families have trusted these companies to ensure their future. Given this bankruptcy, we have the responsibility to investigate and protect Puerto Rican consumers who could be affected”
—Héctor Joaquín Sánchez Álvarez, Senator
Sunnova’s Financial Situation
Sunnova Tep Developer LLC filed a voluntary request under Chapter 11 of the Federal Bankruptcy Law in the Southern District of Texas, reporting debts exceeding $100 million. According to the U.S. Energy Information Administration, solar energy accounted for about 5% of Puerto Rico’s electricity generation in 2022 (EIA.gov).
Sunnova Energy had considered restructuring involving its subsidiaries, and the parent company faces debt of approximately $8.5 billion. This instability has impacted agreements with local solar panel installation companies, which have developed their own financing divisions.
Impact on Consumers
Sunnova Energy has been present in Puerto Rico since 2013, providing financing for approximately 70% of solar systems on the island through loans, rentals, and energy purchase agreements (PPA). With over 50,000 users in Puerto Rico, the subsidiary’s bankruptcy has sparked concerns about the guarantees of installed systems.
“This is a situation that requires immediate attention. If the guarantees of the systems are at risk, we are talking about a direct threat to the pocket and the energy stability of tens of thousands of homes,”
—Héctor Joaquín Sánchez Álvarez, Senator
The Transportation, Telecommunications, Public Services and Affairs of the Consumer Commission has been tasked with delivering a report within 120 days, outlining findings, conclusions, and possible legislative actions.
License Renewal
As of early this month, Sunnova had not finalized the renewal of its license to offer financing in Puerto Rico with the Office of the Commissioner of Financial Institutions (OCIF), the subsidiary confirmed.