Solar stocks plunge after Trump's tax plan advances in US House
The shares of U.S. Solar companies dropped sharply on Thursday in premarket trading after the House of Representatives passed President Donald Trump's tax and spending plan, which could end many green-energy subsides that supported the renewable energy industry.
Sunrun was the worst hit, with a share price drop of up to 33%. Complete Solaria dropped by nearly 22%, while Enphase Energy and Maxeon Solar, as well as SolarEdge Technologies, fell between 10% and 15%.
First Solar, Canadian Solar, and JinkoSolar all saw their shares fall by 6.5%, 10% and 2.3% respectively.
Trump's budget plan, which he calls a "big beautiful bill", would eliminate funding under the Biden Administration Inflation Reduction Act as well as grants to reduce air pollution or greenhouse gas emissions.
The bill would eliminate the 30% federal credit for taxpayers installing solar rooftop systems. This would be a major challenge to the industry.
Raymond James analyst Pavel Molchanov said that while the industry had anticipated a gradual phase-out, the new bill speeds up this timeline.
According to the proposed new timeline, solar and wind projects will have to begin construction within 60 calendar days after the bill is enacted. They must also finish construction before the end of 2028. If they do not, then the tax credit will be revoked.
The clean energy industry now turns its attention to the Senate where the bill will be sent next before being sent to the President, in hopes that it will reverse some of the proposed changes to the IRA.
Molchanov said that the solar and wind industries would lobby hard to have the changes reversed while the bill was in the Senate. Reporting by Vallari Shrivastava, Bengaluru. Editing by Tasim Zaid
(source: Reuters)
