SunPower equipment technicians install P-Series solar panel manufacturing technology at their manufacturing facility in Hillsboro, Oregon, on November 7, 2018.
Steve Dipaola | Reuters
Solar energy stocks soared in pre-market negotiations on Monday following a report that the Biden administration is suspending tariffs on solar panels in four countries.
President Joe Biden will declare a 24-month tariff exemption for solar panels, Reuters reported, and will use the Defense Production Act to promote domestic production. The move comes as a Commerce Department investigation into Cambodia, Malaysia, Thailand and Vietnam has added more barriers to equipment imports.
Shares of Sunrun rose more than 13%, while SunPower and Enphase Energy rose nearly 9%. SolarEdge technology gained more than 5%. Array Technologies appeared around 20%.
“If confirmed, we believe the announcement will be a clear positive for our coverage, especially within the utility-scale solar market, which has faced uncertainty since the Department of Commerce’s AD / CVD investigation of the United States began in late March, “JPMorgan analyst. Mark Strouse said in a note to customers.
Tariffs had received more criticism in recent months, as the war in Europe has pushed up energy prices around the world. Tariffs were originally set by the Trump administration, and Biden announced a four-year extension in February.
Solar stocks have been falling since last November, when market sentiment towards unprofitable growth companies plummeted. However, the sector has seen a good concentration in recent weeks. The Invesco Solar ETF (TAN) has gained more than 27% since the May lows.
The increase in solar stocks in 2020 and 2021 was due in part to optimism that a Democratic administration would increase federal support for industry. However, the Build Back Better bill, which would include additional spending on clean energy, stalled in Congress last year.