PosiGen Bankruptcy: Double-Pledged Solar Leases & Customer Rights [Legal Guide]

Disclaimer This article is for informational, consumer education, and public-record reporting purposes only and does not constitute formal legal advice. For specific guidance on bankruptcy claims or lease termination, consult a consumer protection or bankruptcy attorney.

Overview

On November 24, 2025, PosiGen, PBC—the New Orleans-based Public Benefit Corporation and clean energy provider marketed heavily to over 40,000 low-to-moderate-income (LMI) households across Louisiana, Connecticut, New Jersey, and Mississippi—filed for Chapter 11 bankruptcy. On February 24, 2026, the bankruptcy court confirmed a liquidating Chapter 11 plan (effective February 26, 2026), cementing that PosiGen is undergoing an orderly corporate wind-down rather than continuing as an independent operational provider.

       POSIGEN COLLAPSE & THE ASSET-PLEDGING WEB
       
 [PosiGen Chapter 11 Filing]  ──>  [Confirmed Liquidating Plan]
      (Nov 24, 2025)                     (Feb 24, 2026 Wind-Down)
            │                                       │
            ▼                                       ▼
 [Creditor Fraud Allegations]  ──>  [40,000+ LMI Homeowners Trapped]
  • Double-pledged solar assets      • Broken systems & dead monitoring
  • Diverted bridge loans            • Clouds on real estate title (UCC-1)
  • CT Green Bank $22M lawsuit       • Disputed automatic ACH lease drafts

The bankruptcy was accompanied by explosive allegations from creditors and lenders who accused former management of double-pledging rooftop solar assets, commingling corporate cash, diverting bridge-loan proceeds, and fraudulently obtaining a $25 million loan. In parallel, the Connecticut Green Bank filed litigation against PosiGen over $22 million in defaulted financing, while non-debtor affiliates challenged an alleged "illicit, unauthorized centralized cash collection system."

For tens of thousands of working families with PosiGen 20-year leases or Power Purchase Agreements (PPAs) on their roofs, the collapse has triggered urgent questions: Who actually owns your rooftop panels? Can a liquidating trustee demand lease payments for dark equipment? And how do you remove PosiGen's UCC-1 fixture filing if you need to sell or refinance your home? (Review our comprehensive guide on solar lease transfer and escalator problems).

Key Takeaways

• Chapter 11 Liquidation PosiGen is not emerging as a reorganized solar installer; its confirmed Chapter 11 liquidating plan (effective February 26, 2026) governs the orderly sale and transfer of its leased solar portfolio.
• Double-Pledged Asset Scandals Multiple institutional creditors allege that PosiGen pledged the exact same customer solar contracts and hardware as collateral to different lenders, creating competing security claims over customer systems.
• The $22 Million Connecticut Green Bank Suit Connecticut Green Bank—one of PosiGen’s principal institutional partners—sued PosiGen over $22 million in unpaid debt, highlighting the breakdown of its subsidized clean energy programs.
• Lessor Breach & Lease Rescission If PosiGen’s liquidating servicer fails to maintain panels, ignores inverter outages, or violates contractually promised energy savings, consumers possess statutory grounds under state UDAP laws to rescind the agreement and demand removal of UCC-1 fixture liens or explore the top ways to cancel a solar contract.

The Allegations: Double-Pledging and Commingled Cash

Unlike typical solar contractor failures caused merely by rising interest rates, PosiGen’s insolvency was precipitated by intense inter-creditor warfare and allegations of financial misconduct.

1. Double-Pledging of Customer Solar Portfolios

In bankruptcy court filings, senior secured lenders and bridge creditors asserted that PosiGen management repeatedly pledged the same pools of residential solar leases as collateral to multiple financial institutions.

When a solar lessor "double-pledges" contracts, two separate creditors may claim conflicting security interests in your rooftop system. This title confusion directly impacts homeowners because neither creditor can unilaterally demonstrate clear, unencumbered ownership of the underlying contract.

2. The $22 Million Connecticut Green Bank Lawsuit

Connecticut Green Bank provided millions in state-backed capital to facilitate PosiGen's expansion into Connecticut to serve underserved communities. The Green Bank's $22 million lawsuit alleged substantial defaults, misallocated funds, and failures to satisfy project development benchmarks, severely undermining PosiGen's operational footprint in the Northeast.

3. Centralized Cash Collection Disputes

Non-debtor project entities and lenders filed objections alleging that PosiGen instituted an unauthorized centralized cash-sweep mechanism that diverted customer lease revenues away from project-specific accounts into general corporate coffers, leaving local maintenance operations completely unfunded.

What the Liquidating Plan Means for Homeowners

When PosiGen’s Chapter 11 liquidating plan took effect in late February 2026, the company’s customer portfolio was placed into a wind-down trust or slated for auction to third-party secondary servicers.

Here is what customers must understand.

1. The panels are generally owned by the lessor, not you

Under standard PosiGen contracts, you entered into a lease or PPA. PosiGen or its financing vehicle retained legal title to the panels and recorded a UCC-1 Financing Statement against your real estate in county land records.

2. You do not owe full lease payments for a system that does not produce

PosiGen marketed its contracts around guaranteed clean energy savings. If your inverter has failed, your monitoring app is dark, or your panels produce zero kilowatt-hours, paying the full monthly lease fee results in unjust enrichment for the liquidating trust. Under general contract principles and state consumer protection statutes, a total failure of consideration gives the homeowner the right to withhold disputed payments and demand contract cancellation.

3. Liquidating trustees must still honor consumer protection laws

A bankruptcy liquidating plan does not exempt a loan servicer from state consumer fraud laws or the Fair Debt Collection Practices Act (15 U.S.C. § 1692e). If a collection agency demands payment on a broken PosiGen system or makes false threats of foreclosure, they violate federal debt collection standards.

Action Plan for PosiGen Customers

If you have a PosiGen solar lease on your home, follow these steps to protect your property and finances.

  STEP 1: Verify System Performance & Meter Output
    └── Log into your inverter and utility net-metering portal to verify kWh output.
         │
  STEP 2: Pull County UCC-1 Fixture Filing Records
    └── Search county deed records for all active PosiGen liens or assignments.
         │
  STEP 3: Serve Written Notice of Material Breach & Dispute
    └── Send certified dispute demanding service or lease termination within 30 days.
         │
  STEP 4: Challenge Competing Lender Claims
    └── Demand proof of who holds clear, unencumbered title to your lease contract.
         │
  STEP 5: Demand Statutory UCC § 9-513 Lien Termination
    └── Issue formal 20-day termination demand if the lease is terminated or broken.

Step 1: Document Equipment Output and Utility Bills

Check your electric utility statements and physical inverter:

• Is your system generating power, or are you paying both your regular electric bill and a PosiGen lease bill?
• Take high-resolution photos of your utility meter and inverter screen (note any fault lights or error codes).

Step 2: Search County Deed Records for Conflicting Liens

Visit your local county recorder or registrar of deeds website. Search your property address for UCC-1 fixture filings. Note whether PosiGen, Connecticut Green Bank, or an unfamiliar institutional trust is listed as the Secured Party. If multiple lenders have recorded overlapping filings against your property, document this immediately.

Step 3: Issue a Formal Notice of Default to the Servicer

Send a certified letter to PosiGen’s court-designated servicing address:

• Notify them of non-functioning equipment, unperformed maintenance, or unfulfilled energy guarantees.
• Cite the confirmed Chapter 11 liquidating plan (Case No. 25-11532).
• Give the servicer 30 days to repair the system at zero cost or deem the lease breached and rescinded.

Step 4: Demand UCC-3 Lien Release for Stalled Real Estate Closings

If you are selling or refinancing your home and PosiGen's bankruptcy is holding your transaction hostage, issue an authenticated demand under Uniform Commercial Code § 9-513. If the lessor has materially breached the lease, they must file a UCC-3 termination statement within 20 days.

Sources and Official References

• U.S. Bankruptcy Court: In re PosiGen, PBC, et al. (Chapter 11 Liquidating Plan Docket)
• Connecticut Green Bank: Public Notices and Financial Disclosures
• Cornell Law LII: 15 U.S. Code § 1692e (False or Misleading Representations under FDCPA)
• Cornell Law LII: Uniform Commercial Code § 9-502 (Contents of Financing Statement)
• Cornell Law LII: Uniform Commercial Code § 9-513 (Termination Statement)
• Consumer Financial Protection Bureau: Submit a Solar Financing Complaint

FAQ

Did PosiGen file for bankruptcy?

Yes. PosiGen, PBC filed for Chapter 11 bankruptcy on November 24, 2025. On February 24, 2026, the court confirmed a Chapter 11 liquidating plan (effective February 26, 2026), transitioning PosiGen from an active solar installer into an orderly corporate wind-down under liquidating trustees.

What are the "double-pledged asset" allegations against PosiGen?

Creditors and lenders filed formal court objections alleging that PosiGen's management pledged the same customer solar contracts and equipment portfolios to multiple financial institutions as security for competing loans. This has created conflicting legal claims between senior lenders and bridge financiers over who actually owns the underlying leases.

Do I still have to pay my PosiGen lease if the system is broken?

If PosiGen or its successor servicer fails to maintain the system, and your panels generate zero or severely degraded power, you have a strong legal argument for material breach of contract and total failure of consideration. Homeowners should not simply cancel ACH payments without sending a formal written dispute letter citing the breach, the bankruptcy docket, and their intent to terminate the contract under state consumer protection statutes.

Why did Connecticut Green Bank sue PosiGen?

Connecticut Green Bank, which partnered with PosiGen to offer solar leases to low-to-moderate-income families in Connecticut, filed litigation against PosiGen over approximately $22 million in defaulted project financing and failure to comply with program covenants.

How do I get PosiGen’s UCC-1 lien off my house so I can sell or refinance?

Under Uniform Commercial Code § 9-513, if the secured party has breached the contract, or if the debt obligation has been resolved, you can send an authenticated demand letter requiring the secured party to record a UCC-3 termination statement within 20 days. If the liquidating servicer fails to comply, you can pursue an escrow holdback with your title company or petition the county court for judicial expungement.