Solar stocks slipped on Monday after reports said that conservative Republican lawmakers have secured commitments from senior leadership to phase out clean energy credits sooner than before.
First Solar (FSLR) fell 7.3% — the top decliner in the S&P 500 index — while Enphase Energy (ENPH) and Sunrun (RUN) slipped by 3.2% and 7.8%, respectively. Power producer AES also fell by over 4%.
Bloomberg reported South Carolina Representative Ralph Norman saying that House leadership has agreed to a proposal to end Inflation Reduction Act tax credits earlier than Republicans’ original proposal of phasing them out from 2029 and ending completely by 2032
Norman is among a small group of Republicans pushing for further cuts to the proposed tax and spending bill, which would raise the U.S. debt.
The report added that House Republican leadership staff told reporters Monday that a phase-out date has yet to be decided, and it remains to be seen if it will cover projects where construction could start soon.
Monday’s decline stopped a rally in solar stocks in recent weeks as the earlier GOP proposal was viewed as much more favorable than expected.
The present bill must pass a vote in the House before progressing to the Senate. Some Republican lawmakers have already expressed concerns about widespread cuts to clean energy funding.
Separately, a Solar Energy Industries Association report said that nearly 300 U.S. factories, mainly in Republican-majority states, could shut or never open if the present proposal becomes law.
One retail trader said about First Solar, “We are not recovering at all this week, given what Trump did, and the price is clearly showing no buyers.”
While some traders were surprised, as many green energy manufacturing facilities are in so-called Red states.
Separately, Sunnova stock was also pressured by the threat of the cancellation of a federal loan program for installing rooftop solar.
First Solar and Enphase stocks have fallen 7.3% and 30.5%, respectively, year to date (YTD), while Sunrun is up 19%.
For updates and corrections, email newsroom[at]stocktwits[dot]com.