Clean energy stocks plunge as Trump's Senate bill slaps new taxes on solar and wind, phases out key credits

Economic Times

4 hours ago

AP Clean energy stocks plunge as Trump's Senate bill slaps new taxes (AP Photo/John Locher)
Wall Street's clean energy sector was rocked Monday as President Donald Trump's signature 'big, beautiful bill' advanced in the Senate, sending solar and wind stocks tumbling in response to sweeping new taxes and a rapid phase-out of federal tax credits for renewable energy. The legislation, which is at the heart of Trump's second-term agenda, introduces a first-of-its-kind excise tax on wind and solar projects, especially those using components sourced from China, and accelerates the rollback of incentives that have fueled America's clean energy boom since 2005.
According to the American Clean Power Association, the new tax is expected to cost clean energy businesses an additional $4–$7 billion by 2036 and could drive up consumer electricity prices by 8% to 10%. The tax applies to all wind and solar projects that begin construction after June 16, 2025, and to any project placed into service after 2027, even those already under construction. The bill also requires projects to prove they are free from Chinese components to avoid the penalty—a near-impossible feat, say industry experts, given the global supply chain.
The Senate bill doesn't stop there. It hastens the end of tax credits for wind and solar that were set to run for years under the Inflation Reduction Act, effectively pulling the rug out from under hundreds of planned projects and billions in investment, especially in Republican-leaning states like Texas and Oklahoma. The rooftop solar sector, however, emerged as a rare bright spot: shares of Sunrun and SolarEdge jumped after it was revealed that credits for leased rooftop systems would remain in place until at least the end of 2027.Industry leaders and environmental groups were quick to condemn the move. 'This is how you kill an industry,' said Bob Keefe of E2, a nonpartisan business group, while Jason Grumet, CEO of the American Clean Power Association, called it 'punitive' and warned it would 'strand hundreds of billions of dollars in current investments, threaten energy security, and undermine growth in domestic manufacturing'. Analysts at the Rhodium Group estimate the new tax and loss of credits could increase wind and solar project costs by 10% to 20%, with the added burden likely to be passed on to consumers in the form of higher electricity bills.The bill's supporters argue the new provisions will boost domestic manufacturing and reduce reliance on Chinese supply chains. Still, clean energy advocates say the changes could push data centers and other energy-hungry industries to seek cheaper, dirtier power sources abroad, undermining both climate goals and U.S. competitiveness.
As the Senate races through a marathon 'vote-a-rama' on amendments, the future of America's clean energy transition—and the wallets of millions of consumers—hangs in the balance.