A Tesla solar panel customer accused the company of a ‘bait and switch’ tactic that hurt his credit score with a loan he never applied for

(Business Insider) – When Olivier Chaine bought solar panels from Tesla in 2017, he didn’t expect the investment to hurt his credit score.

But that’s exactly what happened, he said in a lawsuit filed against the company earlier this month, after Tesla started reporting his agreement to buy the electricity produced by the panels on a kilowatt-hour basis as a 20-year, $74,226 loan. That deal, known as a Power Purchase Agreement or PPA, is standard practice for any solar installation, and sets a constant rate for the homeowner’s electricity from the system.

Because it was reported as a loan, though, the agreement caused Chaine financial harm when it came time to refinance an investment property, according to the lawsuit. Chaine also says it resulted in Chase reducing his credit card limit.

After disputing the loan with Equifax, which is also named in court documents, the credit reporting agency said its investigation had found the reported loan was correctly listed as an account on Chaine’s credit report, according to the lawsuit. A letter to Tesla went unreturned, Chaine said in the documents.

Tesla did not respond to a request for comment. The company’s response to a subpoena is due later this month.

Chaine’s attorney told Bloomberg News, which first reported on the lawsuit , that the move by Tesla was a “bait and switch.” He’s seeking financial damages for his client Chaine.

Tesla has struggled to grow its solar business following the acquisition of Solar City in 2016. In the first half of 2020 , solar installation income totaled less than 5% of overall revenue.