Early termination of tax exemptions? U.S. solar stocks plummet across the board, with Sunrun falling 40%
Overnight, solar inverter manufacturer Enphase Energy and solar panel manufacturer First Solar fell by 27.2% and 19.3%, respectively, while solar panel sellers Sunrun and SolarEdge Technologies plummeted by 43% and 39.4%, respectively, leading the S&P
According to media reports, as part of Trump's "Big Beautiful" tax reform plan, the U.S. Senate has proposed a plan to gradually eliminate federal tax credits for the solar industry by 2028.
The draft bill shows that tax credits for solar and wind projects will be cut by 60% in 2026 and completely eliminated by 2028, while under current law, tax incentives will not begin to phase out until 2032.
Following the announcement, photovoltaic-related stocks plummeted overnight. Solar inverter manufacturer Enphase Energy and solar panel manufacturer First Solar fell by 27.2% and 19.3%, respectively, while solar panel sellers Sunrun and SolarEdge Technologies crashed by 43% and 39.4%, leading the S&P.
Industry analysts pointed out that many solar projects rely on the cash flow advantages brought by tax credits, and once this support disappears, project returns may significantly decline, leading to capital withdrawal. Especially for small and medium-sized developers, they may face the dual dilemma of rising financing costs and project delays.
Whether the bill can pass remains uncertain
In fact, the 2028 timeline set by the Senate proposal gives the solar industry a relatively clear policy exit timetable.
However, analysts pointed out that for companies that heavily rely on tax incentives to maintain competitiveness, three years may not be enough to fundamentally adjust their business models.
Currently, it remains unknown whether policymakers will pass the bill in its current form before the July 4 deadline.
Raymond James analyst Pavel Molchanov stated:
"Republicans in the House and Senate will need time—possibly months—to bridge these differences. During this time, lobbyists from the solar and wind industries will have the opportunity to express their views."
Citigroup strategists stated that they "remain optimistic about residential solar" and noted that the proposal is "slightly improved" compared to the House version, but "more restrictive than the original bill."
