SunPower, a solar icon once valued in the billions, files for bankruptcy

SunPower, a Silicon Valley solar pioneer, filed for bankruptcy in Delaware yesterday, marking the collapse of a onetime icon of American solar.

The company will sell some of its assets to the recently formed residential installer Complete Solaria, whose investors include veteran cleantech players John Doerr and T.J. Rodgers. SunPower identified assets and liabilities of somewhere between $1 billion and $10 billion in its Chapter 11 petition.

SunPower was once one of the larger domestic solar manufacturers, and a rare survivor of the infamous cleantech bust of the early 2010s. But now, even as solar installations smash records in the U.S. and the federal government pours money into onshoring solar panel production, the firm has been undone by China’s industrial policy strength and its own strategic boardroom missteps.

The company’s fall did not come without warning signs: In recent years, SunPower has been plagued by accounting controversies, including the need to restate several quarters of its financial results; investor lawsuits; a breach of a credit agreement; and ​“going concern” warnings. In late April, the firm announced plans to cut just about one-quarter of its 3,800 roles.

On July 17, SunPower sent out a note to its dealer network that it would no longer support new leases or power-purchase agreements — meaning it was not acquiring any new customers. The company also said that it would not support installation of solar panels that had been delivered but not yet installed. That note ultimately signaled the beginning of the end of SunPower.

SunPower has lived many lives over the decades.

The firm has been a vertically integrated solar module manufacturer with a high-performance (and higher-cost) crystalline-silicon solar cell technology, a supplier to a downstream dealer network for residential and commercial rooftops, and a project developer of utility-scale solar power plants. SunPower has also raised funding to act as a third-party financier of residential solar rooftops and battery systems.

But after the shuttering of its last U.S. factory in 2021, SunPower’s most recent iteration saw the company reduced to a distributor with an independent dealer network, whose main advantage was a strong relationship with Maxeon, the spinout of SunPower’s once-flagship manufacturing business.

SunPower’s colossal collapse will have painful consequences for independent dealers left hanging with unpaid installations, suppliers such as Enphase, residential customers with interrupted financial deals, and its thousands of remaining employees.

The history of a homegrown solar giant

Founded by Richard Swanson in Silicon Valley in 1985, SunPower first distinguished itself with world-record solar cell performance — a technical edge that Maxeon maintains today.

When the firm faced financial problems in 2001, Rodgers, a Silicon Valley semiconductor legend and former classmate of Swanson’s, rescued the company with a check for $750,000. It turned out to be one of the better investments in venture capital history; SunPower went public in 2005 and soon reached a multibillion-dollar market capitalization.

In 2006, the firm acquired PowerLight, a Berkeley, California–based solar system designer and installer, for $332 million in cash and stock. The acquisition, finalized in 2007, essentially set off the first wave of large-scale solar installations in the nation. SunPower, along with First Solar, was one of the first solar panel manufacturers to pursue utility-scale projects and develop its own solar farms.

Years later, the financial woes returned, driven by China’s race to lower costs and the difficulty of building SunPower’s higher-end solar panels. In 2011, French oil and gas major Total bought a majority ownership stake in SunPower and sought to provide some measure of financial stability in the perennially bumpy industry, which had come to be nicknamed the ​“solar coaster.”

But that financial stability never quite materialized. Throughout the 2010s, as solar plummeted in price and began to gain steam in the U.S., the firm floundered. Its technology costs weren’t falling as fast as those of the conventional solar panels mass-produced in China, and competitors such as Sunrun and Sunnova were elbowing it out of the residential rooftop market.

By the start of this decade, when interest rates soared and California, the biggest rooftop solar market in the U.S., slashed its rooftop solar incentives, the firm was in no position to weather the storm. It lost $227 million last year.

The dust is still settling after SunPower’s fall, and much remains unclear. Perhaps Rodgers, alongside Doerr, will be able to yet again breathe new life into the firm’s assets via Complete Solaria. But what’s clear at this point is that the company’s legacy will live on in the people, companies, and technologies it has influenced — and in the ongoing clean energy transition it helped spawn.