Clean energy investors weren't exactly celebrating Christmas in July when President Donald Trump signed the One Big Beautiful Bill Act (OBBBA) into law over the 4th of July holiday weekend.

The bill's primary focus was the extension of his 2017 tax cuts, but it also rolled back several clean energy initiatives that former President Joe Biden had included in the Inflation Reduction Act (IRA) of 2021.

While the official Senate version is more lenient to clean energy than the original House of Representatives’ version, the OBBBA strikes down a number of tax credits and incentives for renewable energy in both residential and commercial spaces.

Some clean energy sources fared better than others. Geothermal, hydroelectric and nuclear energy companies will feel less of a sting, but solar and wind stocks are looking at some serious headwinds coming in 2026.

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Some of the key provisions of the new law affecting the renewables sector include:

The renewable energy industry is expected to face reduced demand, higher prices, job losses and increased regulatory burdens as a result of these new provisions. Today, we'll look at three stocks that investors may want to avoid as U.S. energy policy turns against wind and solar.

Sunrun Inc.

However, despite a few profitable quarters, it has yet to post positive net income for a full year and has lost nearly $3 billion in the last 12 months alone. It's also one of the more heavily-shorted stocks on Wall Street, with more than 31% of the float sold short as of this writing. And, despite the recent upgrade from ‘Hold' to ‘Underperform' from Jeffries, the fundamental and technical outlook for Sunrun looks bleak.

Any hope Sunrun shares had of breaking out of their long-term downtrend likely fizzled with the passage of Trump’s bill. The stock has been fading for nearly 12 months now, with the downtrend line tested but yet to be broken. Two previous attempts to break the downward momentum resulted in quick reversals back to the lows, and now that OBBBA is law and projections indicate continued unprofitability, this cycle of sellers’ momentum is likely to persist.

SolarEdge Technologies Inc. 

SolarEdge narrowed its losses in Q1 2025, with EPS figures coming in at -$1.14 per share (beating -$1.26 consensus), and the $219 million in revenue represented 7.4% year-over-year (YoY) growth. However, analysts remain unimpressed: the stock has only one Buy rating from the 26 analysts with coverage, along with 15 Hold and 10 Sell ratings. The average price target is just $18.56, which implies a downside of more than 25% from the current market price.

The daily stock chart also provides some hints about the next price move, as the Relative Strength Index (RSI) has triggered an Overbought signal once again. In the previous two instances, the RSI hitting 70 resulted in the stock gapping down hard, and there's plenty of evidence to suggest this scenario will play out once again.

Enphase Energy Inc. 

Enphase Energy aims to be a one-stop shop for solar energy generation and storage, while also offering software solutions for energy management and communication. While this business model has proven profitable, the elimination of the residential solar credit and battery storage credit could reduce the company's margins and hinder future profit growth.

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