Solar stocks experienced a dramatic selloff on Tuesday, June 17, 2025, as the U.S. Senate’s version of President Donald Trump’s tax bill maintained provisions to fully phase out renewable energy incentives by 2028.
Major solar companies saw double-digit losses in premarket trading, with some stocks plummeting over 27% as investors fled the sector.
The Senate bill specifically targets solar and wind power tax incentives while preserving support for nuclear, hydropower, and geothermal energy sources, marking a significant shift in federal energy policy that threatens the renewable energy sector’s growth trajectory.
Trump’s Tax Bill Devastates Solar Stocks
The Senate version of Trump’s tax bill includes a provision that would completely eliminate both solar and wind power tax incentives by 2028, dealing a crushing blow to the renewable energy sector.
Unlike previous versions, this legislation maintains support for nuclear, hydropower, and geothermal energy sources, creating a clear preference for traditional and alternative energy technologies over solar and wind.
The renewable energy incentives were cornerstone policies of former President Joe Biden’s Inflation Reduction Act, and their removal represents a fundamental reversal of federal clean energy support.
Senate Republicans are pushing aggressively to pass the legislation before the Fourth of July holiday, with the bill also raising the federal debt limit from $4 trillion to $5 trillion. The elimination of these tax credits could severely impact project financing and development timelines across the solar industry.
The legislation’s implications extend beyond solar to other clean energy sectors, particularly electric vehicles, which are also facing policy headwinds.
Senate Republicans have separately proposed ending the $7,500 tax credit for new electric vehicle sales within 180 days of the measure becoming law, and immediately terminating credits for leased EVs manufactured outside North America.
This broader assault on clean energy incentives signals a comprehensive shift away from renewable technology support under the Trump administration.
Panic Among Solar Stocks Following Shift in Policy Outlook
The market reaction to the Senate bill was swift and severe, with leading solar companies experiencing catastrophic losses during Tuesday’s trading session.
Enphase Energy (NASDAQ:) led the decline, plummeting over 24% to $34.63 in premarket trading, while Sunrun (NASDAQ:) crashed more than 27% and SolarEdge Technologies (NASDAQ:) dropped 22%. First Solar (NASDAQ:) fell approximately 12%, demonstrating that even the largest players in the sector were not immune to the selloff.
The broader solar sector performance data reveals the magnitude of the industry’s struggles throughout 2025. Year-to-date returns show the solar industry down 13.99% compared to the S&P 500’s positive 1.95% gain, highlighting the sector’s underperformance even before this latest policy shock.
The one-year returns paint an even more dire picture, with the solar industry declining 44.91% while the broader market gained 10.87%, indicating sustained pressure on renewable energy investments.
Individual company performance data underscores the sector’s vulnerability to policy changes. Among the largest solar companies, First Solar trades at $145.52 with a market cap of $15.579 billion but shows negative returns across multiple timeframes, including a -17.43% year-to-date decline. Enphase Energy, despite its recent 24% drop, still maintains a significant market presence but faces analyst downgrades and earnings disappointments that compound the policy-related headwinds facing the entire renewable energy sector.
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Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.
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