Can you cancel a solar contract in Texas? The 5-day rule

How the Texas five-day cancellation works

Chapter 1806 of the Texas Occupations Code, added by Senate Bill 1036 ^[2], lets a buyer or lessee cancel by written notice on or before the fifth business day after signing the agreement ^[1]. The clock starts when you sign, not when the system is installed ^[1].

Your contract must list the last calendar date you can cancel and a mailing or email address for your notice. If no address is listed, you can send written notice by any reasonable method ^[1].

If the sale or lease involves a lender affiliated with or referred by the solar company, the agreement must require that lender to cancel any accompanying loan when you cancel ^[1].

Texas also has an older home solicitation law that gives three business days to cancel many sales made at your home ^[3]. If the two laws conflict, the solar law controls ^[1].

What Texas solar companies can't do

Under Chapter 1806, anyone selling residential solar may not make false, misleading or deceptive statements. They also may not falsely state or imply a connection to a utility or government agency ^[1]. The state licensing agency, TDLR, says these prohibited acts became enforceable on September 1, 2026 ^[4].

When installation is part of the deal, the contract must say a licensed electrical contractor will do the work and name that contractor ^[1].

Registration and enforcement by TDLR

Starting September 1, 2026, solar retailers and salespeople in Texas must be registered with the Texas Department of Licensing and Regulation ^[4].

After notice, a hearing and a finding that the law was broken, TDLR can order a solar sale or lease cancelled and the money paid under it refunded ^[1]. Civil penalties are capped at $2,500 per violation or $50,000 in total for similar violations. Those caps rise to $10,000 and $100,000 when a court finds someone over 65 was harmed ^[1].

Attorney General actions in Texas

In April 2026, the Texas Attorney General announced civil investigative demands to Freedom Forever, Sunrun, Lone Star Solar Services and CAM Solar over claims about bill savings, system performance and installation. This is an investigation, not a finding against any company ^[5].

In May 2026, the Attorney General sued CAM Solar, alleging deceptive sales of solar systems. These are allegations in a lawsuit ^[6].

Buyback rates and the savings you were promised

Texas has no single statewide rate for the extra power your system sends to the grid. The Public Utility Commission says buyback terms are part of your electricity provider contract and are usually lower than the retail price you pay. City utilities and co-ops set their own ^[7].

If your savings estimate assumed you'd get credit at the full retail rate, check what your provider actually pays.

If the five days have passed

Most homeowners we talk to are past the first week. That doesn't end the question. Many consumer loan contracts include a federal notice required by the FTC Holder Rule. It makes whoever holds your loan subject to the claims you have against the seller, with recovery capped at what you've paid ^[8]. Whether it applies depends on your loan papers.

Keep making your payments while you sort it out. Start with the cheapest fixes, like calling your loan servicer or making a warranty claim, and bring your contract to a free consultation.

Where to complain or check a license in Texas

This is general information, not legal advice.

Laws change, and whether a rule applies depends on your contract and the facts. Solar Resolution Advocates is not a law firm. For advice on your situation, talk to a licensed Texas attorney.

Can you cancel a solar contract in Texas?