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Solar stocks jump in Tuesday’s trading after the U.S. Senate passed the latest version of President Trump’s tax and spending legislation following days of tense negotiations, as Republicans removed a last-minute excise tax on wind and solar projects that contributed to big declines in several solar stocks on Monday.
The proposed tax was supported by some U.S. manufacturers who said the country needs to wean clean energy supply chains away from China. but it caused alarm from renewable developers who said it could raise costs for solar and wind farms that still rely on some foreign components and supply chains dominated by China.
Among relevant names: Shoals Technologies (NASDAQ:SHLS) +18.4%, Array Technologies (NASDAQ:ARRY) +10.7%, Sunrun (NASDAQ:RUN) +8.5%, Solaredge Technologies (NASDAQ:SEDG) +7.9%, Fluence Energy (FLNC) +4.7%, Nextracker (NXT) +4.2%, Enphase Energy (ENPH) +3.5%, Maxeon Solar Technologies (MAXN) +3.2%, NextEra Energy (NEE) +2.7%, Canadian Solar (CSIQ) +2.7%, JinkoSolar (JKS) +2.6%, AES Corp. (AES) +1.8%, First Solar (FSLR) -0.1%.
The bill still phases out solar and wind tax credits beginning in 2026, to be completely phased out by 2028, and will require solar or wind projects to be in service by the end of 2027 to qualify for tax credits; nuclear power credits will last until 2036, and hydrogen tax credits will be phased out in 2028.
“Despite limited improvements, this legislation undermines the very foundation of America’s manufacturing comeback and global energy leadership. If this bill becomes law, families will face higher electric bills, factories will shut down, Americans will lose their jobs, and our electric grid will grow weaker,” Solar Energy Industries Association President Abigail Ross Hopper said in a statement.
The House, which barely passed its own version of the bill, now must vote on the Senate’s substantial changes to the package, which promises to be a difficult task given that some Republican lawmakers have expressed continued concerns over the bill’s impact on the federal deficit.
With a very narrow majority, House Speaker Mike Johnson can afford to lose just three votes in the chamber to pass the legislation in a party-line vote.