Able Energy's unfinished solar projects spark legislation, state fraud suit

After hearing from dozens of unhappy customers of Able Energy Co., state officials are moving forward on two fronts to help Minnesotans recover thousands of dollars in down-payment money as well as provide protection for others who may be victimized by solar contractors in the future.

State regulators moved to revoke Able Energy's license in March after discovering that the company collected more than $1 million in advance payments but failed to finish about 200 jobs in Minnesota and Wisconsin.

State Sen. Tony Lourey, DFL-Kerrick, said Thursday he believes there will be bipartisan support for two bills he is proposing that would help protect consumers from unscrupulous solar contractors. Lourey said he will try to get those bills passed when the next session begins in January.

"I think the case for fixing this is very strong," said Lourey, who attended a meeting convened by angry Able Energy customers last week. "This is a pretty egregious situation."

In a lawsuit filed last week, the state Department of Labor and Industry accused Able Energy and its owner, Michael J. Harvey, of defrauding customers by making "numerous misrepresentations" about its capacity and willingness to install solar panels on homes throughout the state.

The department is seeking restitution on behalf of the company's customers, as well as an order barring Harvey from doing solar work for any other companies.

Though Able Energy hasn't held a valid electrical contractor's license in Minnesota since February, Able and its agents tricked a Rochester doctor into handing over $11,070 in April by promising his solar project would be completed by September, according to the lawsuit. The company has not responded to "any of his numerous phone calls" since collecting the money.

State officials said the doctor's experience fits a pattern in which Able Energy representatives would make promises that the company couldn't fulfill in order to obtain the largest down payments possible from its customers. In some cases, customers were promised a quicker start date if they made a larger down payment, while others were strung along for months with false promises that work was going to begin soon.

Harvey declined an interview request, but he previously said he intends to challenge the revocation of his license, saying he did nothing wrong. He has blamed the company's problems on his workers.

In a brief written response to the Star Tribune, Harvey said the Labor Department "took a manageable situation and made it next to impossible."

In its lawsuit, the Labor Department said Able Energy's customers were fooled into thinking they were making progress by being told their place in line, even though "Harvey conceded that Able's job queue did not even really exist," according to the lawsuit. "Able was merely keeping an informal list of customers on a white board in its office."

State officials said some customers have been devastated by their losses, which range as high as $150,000.

"Some of those customers took out bank loans, emptied out retirement accounts or borrowed money from friends and family to pay for projects that have either never been started or remain incomplete," according to the lawsuit.

Harvey said he has provided credits to some customers whose projects started late, even though he was not contractually required to offer such help. "We are doing our job to be fair to each and every customer," his statement said.

Jeff Hall, who won a court judgment of $13,350 against Able Energy in April for his unfinished project in northern Minnesota, said he's glad legislators are moving to help the company's customers.

"I'm pretty happy with Sen. Lourey," said Hall, who organized last week's meeting between state officials and Able Energy's customers. "He heard about our situation and he's moving on it. That is kind of what you ask of a state senator."

Lourey said his legislation would require solar contractors to belong to a state recovery fund that was created to help people who have been victimized by licensed contractors who fail or commit fraud. In the past five years, 461 people have applied to get relief from the fund, an industry-supported effort that provides up to $75,000 per affected homeowner, according to the Labor Department.

Lourey said a separate bill would allow Able Energy's customers to access the current fund.

"That might engender a little more pushback than the prospective bill, so I'll be working on both very hard," he said.