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Renewable electricity stocks were whipped Monday as new revisions to Donald Trump’s spending plans have produced things that don’t and don’t have in the future of clean energy in the United States.
The amendment will raise the costs for wind farm developers and solar developers who source parts from China, but will create exemptions for solar companies in some homes and prefer American manufacturing, reflecting the administration’s anti-renewable energy response. While companies building industrial-scale wind and solar will be hit hardest, companies that leased solar systems to homeowners will likely extend their access to tax credits.
Utilities company Nextera fell 4%, while energy construction company Primoris lost 2%. Enphase Energy, a solar and battery technology manufacturer, lost 3%.
Meanwhile, First Solar stocks rose 9%, while Sunrun rose 11%.
Clean energy companies were surprised by the weekend’s revision, including new taxes on solar and wind projects, when China’s components are too high.
Additionally, the new text will require solar and wind projects to be operated by the end of 2027 to qualify for tax credits. This is a potential hurdle that requires time-consuming permissions and grid connections before the deadline. The language was added to the draft after being removed from previous versions.
“This is a complete legislative attack on wind and solar,” said John Miller, energy transition analyst at TD Securities.
Residential solar stocks were supported by last-minute grace periods that extended the time frame for companies such as Sunrun to continue investing tax credits on clean power projects such as solar, wind and battery storage.
American manufacturers such as First Solar benefited from bill penalties for purchasing Chinese-made products.
Analysts at Jefferies said the change was “gradually positive” for residential solar providers in the country.
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The US Senate will begin voting for amendments later Monday, following a narrow vote to begin debating the law that is wrapped up over the weekend.
Since the bill’s text was first released, the clean energy industry has embarked on a lobbying blitz to convince Republican lawmakers who benefited from investments spurred by the Biden-era Inflation Reduction Act.
“The Clean Energy Investor community is very concerned about what Congress is doing,” said Frank Macchiarola, chief advocacy officer for the American Clean Power Association. “We have seen significant investment and development in clean energy over the past three years, which has meant incredible job creation in Republican states and districts.”
