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Sunnova: Autopsy of a ‘Green’ Failure

By Robert Bradley Jr. -- November 18, 2025

“Subsidies like the DOE’s guarantees can incentivize firms to prioritize short-term gains over long-term compliance. Sunnova’s aggressive sales tactics, which targeted vulnerable consumers, were enabled by its belief that federal backing insulated it from accountability.” (Issac Lane, below)

MasterResource has chronicled the rise and fall of the large, government-enabled rooftop solar company, Sunnova Energy International, Inc. Led by the toothy Enron-ex John Berger (who made millions of dollars at the expense of just about everyone else, including taxpayers), Sunnova is yet another case study of business failure under political capitalism (versus free-market capitalism).

Previous posts have been:

Sunnova’s demise is part of an overall shakeout in the government-enabled rooftop solar business (SunPower, Mosaic Solar, etc.). A political boom-political bust industry.

Bankruptcy Plan Approval

With Sunnova’s bankruptcy plan approved last week in federal court, lessons remain to be learned by the (slow motion) Solyndra repeat. Issac Lane wrote in “The Sunnova Debacle: Why Green Energy Subsidies Demand Corporate Integrity Over Political Patronage“:

The cancellation of Sunnova Energy’s $3 billion Department of Energy (DOE) loan guarantee in 2025 marks a watershed moment for investors in the clean energy sector. What began as a high-profile federal backing for solar infrastructure has unraveled into a cautionary tale of corporate governance failures, regulatory overreach, and the perils of betting on firms reliant on politically opaque subsidy processes. For investors, the Sunnova saga underscores a critical lesson: in the green energy race, transparency, ethical compliance, and financial rigor matter far more than government connections.

Lane identified three key factors: “predatory business practices, financial mismanagement, and shifting political winds.”

Regarding predation:

Sunnova’s history of targeting elderly and low-income homeowners with aggressive sales tactics—such as隐瞒 fees and exaggerating savings—triggered lawsuits and congressional investigations. A Minnesota Attorney General lawsuit, for instance, alleged that Sunnova concealed $35 million in hidden costs across nearly 5,000 loans. These practices, which violated the Truth in Lending Act (TILA), eroded public trust and made the company a political liability.

Regarding Financial Fragility:

Sunnova entered 2025 with $8.46 billion in debt and negative cash flow, prompting auditors to label it a “going concern.” High-interest loans (e.g., a $185 million term loan at 15% APR) and a shift in customer demand from loans to leases/PPAs further strained liquidity. By April 2025, the company filed for bankruptcy, rendering its DOE-backed Project Hestia—a residential solar and virtual power plant initiative—unviable.

Regarding Politics:

The Trump administration’s pivot to nuclear energy and rollback of Biden-era green subsidies sealed Sunnova’s fate. The DOE, now led by Energy Secretary Chris Wright, prioritized “proven” technologies and tightened scrutiny on conditional loan guarantees. Sunnova’s $3 billion guarantee, tied to consumer loans rather than direct corporate funding, became a casualty of this shift.

Lane usefully censored the government’s “green energy” loans:

The DOE’s Loan Programs Office (LPO), which approved Project Hestia in 2023, faces accusations of favoring politically connected firms over merit. Sunnova’s loan guarantee, finalized amid congressional probes into its sales practices, raises questions about due diligence. As Jigar Shah, a former DOE official, noted, such subsidies risk becoming tools of “regulatory capture” rather than engines of clean energy progress.

And “moral hazard” in this regard:

Subsidies like the DOE’s guarantees can incentivize firms to prioritize short-term gains over long-term compliance. Sunnova’s aggressive sales tactics, which targeted vulnerable consumers, were enabled by its belief that federal backing insulated it from accountability.

Issac Lane longs for “ethical green energy investing.” Good luck with that; the romantic view of government and private-sector political dealings, calling for “rigorous governance safeguards” involving “transparency,” “sustainable business models,” and “financial resilience.” But he fails to understand how the problem is political in the first place. The adage “The market picks winners, leaving losers for government” applies.

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Appendix: Schweizer on Sunnova

Peter Schweizer provided this autopsy in his article, “Sunnova bankruptcy shows government failures” (September 4, 2025). Excerpts follow:

  • Government support in the form of loan guarantees or subsidies has a history of finding companies like Solyndra and others that go out of business or declare bankruptcy despite infusions of government financial help. The latest example is a solar panel company called Sunnova, Inc…. 
  • Sunnova was a commercial and residential solar company that sold and leased clean energy technology, performed solar panel installations, and even offered financing plans such as loans. The company did business all over the country, especially in California, Puerto Rico, and New Jersey. 
  • Back in September 2023 … the US Department of Energy closed the deal on a $3.3 billion loan guarantee to Sunnova in support of the company’s “Project Hestia” program, … with the stated goal of making “distributed energy resources” more available to homeowners.
  • The project used a “virtual power plant model” … to offer government-backed loans to customers that would otherwise not be able to afford rooftop solar. 
  • Yet what Sunnova also had was a parade of red flags that should have raised concerns within the LPO. As the loan guarantee was being awarded, the Better Business Bureau (BBB) had flagged the company for a “pattern of complaints” about its sales practices and customer service. The Better Business Bureau last accredited the company in 2019, and despite Sunnova’s claim that it was “working closely” to reacquire accreditation, the bureau noted that “…the BBB is not able to work with Sunnova Energy Corporation at this time to have accreditation reinstated as the business currently does not meet the BBB’s Standards for Accreditation.” 
  • Sunnova also had problems in Puerto Rico, where the island’s Energy Bureau required it to change business practices after getting complaints from customers about its contracts and billing procedures. Customers alleged that their signatures had been transplanted onto restrictive contracts, and that Sunnova salespersons made false representations as to the value of the product…. Even worse, the only recourse Sunnova allowed customers was an in-house arbitration process, sometimes taking place thousands of miles away in Texas – a requirement that the Energy Bureau determined was illegal….
  • Six months after the award, in December 2023, a group of congressmen asked that very question, citing the company’s history of shady business practices and comparing it to Solyndra Inc., a notorious solar cell manufacturer that went bankrupt in 2011 despite receiving more than $500 million in stimulus funds during the Obama administration.  
  • The congressional inquiry also focused on the [DOE Loan Program Office] director, Jigar Shah. Shah is linked indirectly to Sunnova through an industry group called the Cleantech Leaders Roundtable. Cleantech, which Shah cofounded in 2019, shared a board member (Anne Slaughter Andrews) with Sunnova. A solar industry veteran, Shah left the LPO in January in front of the incoming Trump administration, though he has remained active in clean energy spaces. 
  • Furthermore, Shah has been accused of using his role as the director of the LPO to benefit Cleantech, operating a “pay-to-play” scheme with his former organization as a beneficiary. Shah continued to be listed on the Cleantech website until 2023, years after he joined the Department of Energy in March 2021. During this time, he also continued to appear at Cleantech events for loan-seeking companies, including a “Deploy23” conference that Cleantech invited the LPO to cohost in 2023….
  • In February 2025, Sunnova held its annual meeting for its retail dealers. Despite being months in arrears on payments to these dealers and struggling to handle its mounting debt, the company urged its dealers to keep marketing and selling its solar panels, encouraging their patience and promising them payment…. Some dealers feared having their accounts shut down if they did not agree to the change….
  • The struggling company reported nearly $9 billion in funded debt…. Sunnova has since announced the sale of its business operations and assets to a group controlled by GoodFinch Management for $25 million. Meanwhile, all those subsidiary dealers are saddled with about $347 million in unpaid funds, with no clear path or timeline for getting the money they are owed. 
  • While they wait, Sunnova’s executives won’t. On July 15, Sunnova asked the bankruptcy court for permission to offer a $7 million incentive plan to seven members of its top leadership, including its CEO. This, the company told the court, would ensure that these officers are “properly incentivized” during the bankruptcy process. 

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