Solar Energy Stocks Drop As House Approves Major Rollback Of Climate Incentives

Shares of solar companies, including Sunrun, Inc. RUN, SolarEdge Technologies, Inc. SEDG, Enphase Energy, Inc. ENPH and Array Technologies, Inc. ARRY tumbled in early trading as investors digested the consequences of President Donald Trump's sweeping budget and tax package dubbed “One Big, Beautiful Bill."

What To Know: Republican representatives advanced a bill that included dramatic rollbacks of clean energy tax credits and incentives that had previously driven growth in the green energy sector. 

The bill would end the 30% federal tax credit for residential solar installations and accelerate the phaseout of investment and production tax credits for utility-scale solar projects. 

A new analysis released by the Solar Energy Industries Association warns that the budget bill could trigger an immediate decline in solar and storage investments, potentially resulting in up to $220 billion in investment loss by 2030. 

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BMO Capital analyst Ameet Thakkar downgraded Sunrun stock on Thursday from Market Perform to Underperform and slashed the price target from $9 to $4 as the outlook for the solar industry dimmed. 

Companies with a strong U.S. manufacturing base, like First Solar, Inc. FSLR, were less affected by the bill, which leaves manufacturing tax credits largely intact. 

Why It Matters: The so-called “One Big Beautiful Bill” threatens the solar industry with both the loss of direct incentives and the anticipated drop in demand for rooftop and utility-scale solar projects. 

The bill now moves to the Senate, where lawmakers could propose changes. As the legislative process unfolds, the solar industry faces uncertainty and elevated risk. 

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