What happens if the solar company goes bankrupt or sells the project?
Short answer: for leases covered by Texas's 2021 solar law, the company must post removal security that stays in place even if the project is sold. The legal deadline is late, so negotiate for it sooner.
What Texas law requires for solar
Utilities Code Chapter 302 requires the lease to include financial assurance for removal, such as a parent-company guaranty, letter of credit, or bond. The amount is at least the estimated cost to remove the equipment and restore the land, minus salvage value, estimated by an independent Texas-licensed engineer and updated over time. The assurance must be delivered no later than the earlier of the lease ending or the 20th anniversary of commercial operation, and it stays in place until removal is done, including if the project is sold (Tex. Util. Code § 302.0005).
Battery storage
Chapter 303 (2025) sets similar rules for battery storage leases signed on or after September 1, 2025, adds recycling duties, and does not allow the financial assurance requirements to be waived by contract (Baker Botts; Tex. Util. Code ch. 303). Landowners can seek a court order to enforce these obligations (Baker Botts).
If the project is sold
Developers usually seek broad rights to assign the lease to another company without your consent (Sands Anderson). Ask how the lease handles a sale: who must notify you, and that the buyer takes on every obligation to you.
What to negotiate
- Removal security delivered earlier than the 20th year
- Notice to you of any sale or assignment
- Payment deadlines and the right to end the lease if payments stop
Related questions
General information from the sources linked above, not legal, tax, or financial advice.