Shares in renewable energy companies surged following the U.S. Senate’s decision to eliminate a controversial excise tax from its comprehensive GOP tax legislation. This move brought much-needed relief to the renewable sector, which had faced concerns about potential setbacks under the Trump administration.
European companies led the rally, with Vestas (USOTC:VWDRY) climbing more than 10%, SMA Solar jumping 12%, and Orsted (USOTC:D2GA) up 3%. In the U.S. market, renewable stocks also saw strong gains on Tuesday, including Sunrun (NASDAQ:RUN) surging over 10%, Enphase Energy (NASDAQ:ENPH) rising 3%, and SolarEdge Technologies (NASDAQ:SEDG) increasing 7%.
The positive trend continued into Wednesday’s premarket trading, with Enphase adding another 1.8%, First Solar gaining 0.6%, and Sunrun up 1.3%.
Although the Senate bill removed the excise tax that many industry participants feared could severely impact clean energy growth, it still features accelerated phaseouts for certain clean electricity tax credits. On the upside, the legislation introduces a four-year safe harbor for projects starting construction within one year of enactment, allowing those projects to qualify for incentives through 2030.
The bill now moves to the House of Representatives, where debate over remaining clean energy incentives is expected to influence the final version of the legislation.