A solar panel is displayed on a wall near the signage at the entrance to Tesla Inc.’s new showroom in New York.
Mark Kauzlarich | Bloomberg | Getty Images
As evidence, a US federal agency is examining a complaint from a former Tesla employee about how the company managed and communicated fire risks and defects in its solar systems. CNBC learned this from documents received at the request of the Freedom of Information Act.
The US Consumer Product Safety Commission (CPSC) is conducting an investigation and has also interviewed the former Tesla employee who filed the complaint in spring 2019, Steven Henkes, who was then Tesla Solar Field Quality Manager.
CNBC found out about the investigation by asking the CPSC for a full copy of the whistleblower complaint. The agency declined to file the full complaint, but revealed: “The records we are holding are of an open investigation and consist of internal and external reports.” The exact scope and focus of the investigation is currently unknown.
Henkes is also suing Tesla for retaliation.
In a lawsuit filed in Alameda County in November 2020, Henkes said he was fired from his job at Tesla on August 3, 2020 after raising security concerns internally and filing formal complaints with government agencies when Tesla failed to act, To fix the problem Communicate closely with customers about unacceptable fire risks in the company’s solar systems.
Henkes believes that “due to serial errors in the Tesla installations, there is still a real fire hazard,” according to a statement emailed by his attorney Robert Wallace. “Consumers were not adequately informed about the risks,” the statement said.
Tesla got into the solar business in late 2016 when it acquired SolarCity for $ 2.6 billion. Tesla Energy (formerly SolarCity) installs photovoltaic, ground and carport solar systems on the roof.
While Tesla does not break down solar energy revenues itself, “power generation and storage” accounted for only 6% of the company’s total revenue in 2020, but up 30% year-over-year at the end of 2020, according to the financial report. On a January 27 earnings call, Musk said to analysts, “We care deeply about solar and it’s growing rapidly. I think it won’t be long before Tesla is by far the leader in solar.”
Tesla’s systems have been installed in homes including military housing units at Fort Bliss and other bases, schools in the LA unified school district, and commercial facilities such as Walmart stores and Amazon warehouses.
As CNBC previously reported, Tesla solar systems previously caught fire. In August 2019, Walmart sued Tesla for negligence after solar roof systems installed by Tesla Energy were ignited at multiple Walmart locations.
In court records, Walmart said Tesla did not properly monitor, repair, and maintain these systems, even after the fires. The fires caused significant damage and faulty systems posed serious risks to employees, customers and companies, according to Walmart’s complaint at the time.
On November 5, 2019, the companies issued a joint statement looking forward to a “safe revitalization of our sustainable energy systems”. The exact terms of billing the companies – and the cost of Tesla – were never disclosed. A Walmart spokesperson pointed to a subsequent statement in January 2020 that said, “Some of this work may involve replacing certain solar panels.”
Tesla did not immediately return a request for comment.
Greg Sellers, CEO of a solar maintenance and repair company in Morgan Hill, Calif., Says the fire hazard in solar photovoltaics, whether at home or in larger facilities, is still very low. Research by the Fraunhofer Institute for Solar Energy Systems supports his observations from practice.
Without commenting specifically on Tesla, Sellers said, “For those of us who work on the repair and safety side, every incident is too numerous. Fires are still very rare. That’s why they get so much publicity when they happen.” He says it is generally more likely that a fire is caused by a failed installation practice than a component failure. And he notes that as these systems become more widespread, solar installers keep getting better.
Public Safety Concerns
CNBC asked the CPSC – a federal agency whose job it is to “protect consumers from products that pose a fire, electrical, chemical, or mechanical hazard” – for a copy of Henkes’ full complaint after its fourth quarter lawsuit referred to in 2020.
Abioye Ella Mosheim, chief officer of the CPSC’s Freedom of Information Act, declined, citing an exception for records related to an open investigation. She wrote, “The records you requested are from the files of the CPSC Office of Compliance and Field Investigation.
Henkes declined to speak to CNBC directly, but answered some questions via email through his attorney, Robert Wallace.
He confirmed that the CPSC interviewed Henkes and asked the former Tesla employee to provide the agency with additional material. Some of the items Henkes made in a “CP-15” complaint to the government included:
· Error analysis reports from an external engineering company
· Internal meeting minutes, reports and emails
· Examples of customer notifications
· Photos of thermal events related to client houses
· Meeting minutes and presentations from a supplier named Amphenol and Tesla
Henkes wants Tesla to “reconsider its clarity with the customer,” said his lawyer on his behalf. The former employee was working to implement a “permanent countermeasure” for the issues he encountered prior to his release, the lawyer added. However, Henkes claims that at the end of his tenure at Tesla he was “constantly thwarted and then fired for continuing to work for public safety.”
Another former Tesla Solar employee, who asked not to be named because he is still in the solar industry, upheld many of Henkes’ allegations in the public lawsuit.
In particular, that person said that many of Tesla’s solar systems, especially those that contain certain roof rack components and Amphenol H4 connectors, pose a significant fire risk and that Tesla’s remediation or change efforts have not been transparent or effective. They also said the company has not yet repaired or removed all systems with known fire risks.
Tesla used to outsource refurbishment efforts and maintenance of its aging solar fleet, but is now canceling at least some of those contracts and bringing the process back up and running, according to this former employee.