SunPower Files for Bankruptcy to Sell Some Assets to Complete Solaria Deal

SunPower, once one of the premier solar companies, has filed to exit bankruptcy through Chapter 11. Citing assets and liabilities between $1

billion and $10 billion in its filing late Monday at the United States Bankruptcy Court for the District of Delaware, SunPower intends to sell off some assets and exit bankruptcy in this move. Complete Solaria, a residential solar installer, agreed to act as the “stalking horse” buyer for Blue Raven Solar’s business, new homes business, and non-installing dealer network. SunPower, one of the companies filing bankruptcy, nominated an initial bidder as its stalking horse buyer to set an initial benchmark bid for their assets and create an initial bidding benchmark that other potential buyers can follow. This deal is expected to close sometime between mid-September and late September; SunPower plans to continue selling off remaining assets.

SunPower began experiencing difficulties last year after breaching its credit agreements due to an inventory reporting error at one of its subsidiaries. SunPower later received a waiver from lenders to avoid technical default and provide $75 million funding; however, substantial doubt remained as to its ability to continue operations and SunPower ultimately suspended new leases and power purchase agreements causing its share price to dip below $1 per share.

SunPower made an unexpected announcement last month: they would stop product shipments and deactivate existing leases and power purchase agreements, leaving their thousands of customers hanging in limbo. A letter was then sent out informing both customers and dealers of SunPower’s decision and stated it no longer supported installations of its previous generation of products. “These steps are intended to preserve the value of investments we already hold while simultaneously providing long-term solutions,” according to CEO Thomas Werner’s letter.

At California Solar Company, its challenges stemmed from numerous sources; however, policy changes had a devastating impact on its profitability. California’s net metering tariff forced many solar manufacturers out of business or into bankruptcy as its cost shift from producers to customers for renewable energy production.

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SunPower’s filing marks yet another blow to an already struggling solar industry, which has struggled to compete with fossil fuel prices. SunPower marks one of the biggest casualties this year amid fierce price wars between utilities and clean energy producers regarding how best to subsidize clean-energy production. As soon as its assets can be liquidated quickly before closing its shop in September, California Solar Energy Association offers customer assistance hotlines here.