Solar stocks nosedive following surprise White House move | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

Following months of bankruptcies, policy shocks, and stubborn rate headwinds, solar stocks finally got a breather when Congress eased off part of its tax clampdown.

However, when things looked like turning around for clean energy, another twist landed, halting the recent rally in solar stocks.

💵💰Don’t miss the move: Subscribe to TheStreet’s free daily newsletter💰💵

Fresh moves out of Washington have flipped the script yet again, knocking investor hopes in the process. Now, the whole sector is bracing for what comes ahead.

Solar stocks face fresh uncertainty as policy twists keep rattling investors.

Image source&colon; Raze Solar via Unsplash

Solar stocks have been on a topsy-turvy run this year

It’s been less about the underlying technology shifts than the shifting positions in Washington.

Without that crucial 30% federal Investment Tax Credit and Production Tax Credits, rooftop solar names like Enphase (ENPH) and Sunrun (RUN) were staring down big hits to demand and quickly shrinking margins.

Also, key utility players like First Solar (FSLR) lost out on bids as financing dried up.

By June 17, the Invesco Solar ETF (TAN) tanked over 10% on renewed Senate proposals to phase out all credits by 2028, sparking massive sell-offs across the board.

In a surprise turn of events, on July 1, lawmakers scrapped a looming excise tax on foreign-made panels. Many experts, though, called it a temporary reprieve, resulting in a snapback for most beaten-down names in the solar sector.

Yet the broader threat remained alive, with long-term credits expected to be phased out over the next three years.

More Tech Stock News:

Moreover, solar projects stand to struggle without fresh incentives or lower borrowing costs. In short, solar’s fate has been mostly linked to policy tweaks and a make-or-break catalyst for this once-sunny sector.

President Trump’s new order rattles clean energy stocks

Solar stocks just got another gut punch, and this one’s come straight from the top.

On Tuesday, President Trump signed an executive order tightening the screws on solar and wind tax credits while doubling down on the One Big Beautiful Bill Act passed July 4.

The order tells the Treasury Department to solidify the repeal of these credits and crack down even harder on what Trump deems “unreliable” wind and solar energy.

The White House’s statement makes clear that green subsidies are out, and U.S. energy “dominance” comes first.

Naturally, Wall Street didn’t take it well.

Enphase Energy and AES Corp. led the S&P 500 losers early Tuesday, sinking 5.1% and 4.1%, respectively.

NextEra Energy shed 3.8%, First Solar dropped 3.4%, and NRG Energy slipped 3.2%.

Residential solar names, in particular, had it even worse.

Sunrun tanked nearly 10%, Shoals Technologies fell 8%, and Array Technologies lost over 4%. Solaredge, another major solar inverter player, slid 3.8%.

The new order is in line with a fresh deal President Trump’s team has worked with the House Freedom Caucus, which effectively pushes for closer oversight of green energy perks.

In exchange, the goal is to secure stronger backing for the broader spending plan.

The numbers show the crippling impact.

Under the previous law, developers could claim a 30% federal tax credit for solar through 2032. That window slams shut after 2026 unless projects have already broken ground or are complete by 2027.

Without these subsidies, the capital will likely flee to other sectors with more predictable support, putting the clean energy space on thin ice.