Key points
- The Invesco Solar ETF (TAN) fell again Friday and now sits about 31% below its May 29 record close of $73.93.
- Enphase and SolarEdge have each lost close to half their value since June 2. First Solar is down about 36% over the same stretch.
- The July 4 deadline to start construction under the older federal tax credit rules has passed, and the 30% homeowner credit expired at the end of 2025.
- A Section 232 decision on polysilicon imports is expected in early August. Enphase reports July 28, First Solar July 30, SolarEdge August 5.
Solar stocks fell again Friday. The Invesco Solar ETF (TAN) closed at $51.32, down 2.9 percent. The S&P 500 finished the session close to flat.
Losses ran deeper in the individual names. T1 Energy (TE), the Texas module maker that was FREYR Battery until a 2025 rebrand, fell 12.0 percent to $5.00. Canadian Solar (CSIQ) fell 9.0 percent. SolarEdge Technologies (SEDG) and Enphase Energy (ENPH) each fell 5.6 percent.
The selling was not limited to solar. Oklo (OKLO) fell 8.5 percent. Vistra (VST) was down 3.3 percent and GE Vernova (GEV) lost 1.6 percent. No single headline drove the group on Friday.
The group topped out in the first week of June. TAN set its record close of $73.93 on May 29 and has fallen about 31 percent since. T1 Energy is down 58 percent from its June 2 close of $12.04, the steepest fall in the group. First Solar (FSLR) is down about 36 percent from its own June 3 high.
The drawdown, stock by stock
| Stock | Peak close | Friday close | From peak |
|---|---|---|---|
| T1 Energy (TE) | $12.04 (Jun 2) | $5.00 | -58% |
| Fluence Energy (FLNC) | $27.91 (Jun 2) | $13.45 | -52% |
| Enphase Energy (ENPH) | $72.33 (Jun 2) | $36.72 | -49% |
| SolarEdge (SEDG) | $78.51 (Jun 2) | $42.61 | -46% |
| Array Technologies (ARRY) | $9.26 (May 28) | $5.32 | -43% |
| Sunrun (RUN) | $16.72 (May 29) | $9.96 | -40% |
| JinkoSolar (JKS) | $23.31 (May 29) | $14.81 | -36% |
| First Solar (FSLR) | $318.25 (Jun 3) | $202.84 | -36% |
| Nextracker (NXT) | $156.40 (May 29) | $100.10 | -36% |
| Canadian Solar (CSIQ) | $20.57 (Jun 2) | $13.37 | -35% |
| Invesco Solar ETF (TAN) | $73.93 (May 29) | $51.32 | -31% |
| Shoals Technologies (SHLS) | $12.77 (Jun 4) | $9.39 | -26% |
TAN rose 124 percent in the year through June 2 and set multiple record highs, according to MarketWise.
The July 4 construction deadline has passed
The tax law passed in 2025 set a hard date. Wind and solar projects that began construction on or before July 4, 2026 keep the standard four-year continuity safe harbor. That leaves them eligible for the Section 45Y production credit or the Section 48E investment credit into 2030. Projects that begin construction after July 4, 2026 have to be placed in service before December 31, 2027 to claim either one.
Developers moved to start construction ahead of that date. Safe harboring generally requires spending more than 5 percent of a project's total cost before the deadline, which pulled equipment orders into the first and second quarters.
Enphase's second-quarter revenue guidance of $280 million to $310 million includes about $85 million in safe harbor shipments. Safe harbor revenue at the company rose from $20.3 million to $34.5 million between the fourth quarter of 2025 and the first quarter of 2026.
Residential solar was hit first
The Section 25D residential clean energy credit gave homeowners a 30 percent credit on a home solar system. It expired at the end of 2025 and has not been replaced.
Enphase reported first-quarter revenue of $282.9 million, down from $356.1 million a year earlier. US sales made up 83 percent of the total and fell 23 percent from the prior quarter. CEO Badri Kothandaraman attributed the decline to "lower demand from the US residential solar and energy storage market following the Section 25D residential clean energy tax credit expiring at the end of 2025, as well as typical seasonality."
Sunrun added 17,665 subscribers in the first quarter, down 25 percent from a year earlier. Storage installed came to 282 megawatt hours, down 15 percent. The company held its full-year cash generation guidance of $250 million to $450 million.
Market research firm Ohm Analytics projects second-quarter residential interconnections down more than 25 percent year over year, with full-year installations down 22 percent.
A tariff decision is pending
The Commerce Department opened a Section 232 national security investigation into imported polysilicon on July 1, 2025. Polysilicon is the raw material in silicon solar cells. Commerce submitted its report in mid-May 2026, which started a 90-day window for the White House to act. A proclamation was initially expected by late June. Policy watchers now point to early August.
The final shape is not known. The Coalition for a Prosperous America has proposed a schedule of duties, along with tariff-rate quotas:
- Polysilicon: $10 per kilogram
- Wafers: $0.07 per watt
- Cells: $0.10 per watt
- Modules: $0.20 per watt
Roth Capital Partners has estimated the cost. An import-only minimum import price would add about $0.10 per watt to module costs. A minimum import price combined with ad valorem tariffs could reach $0.49 per watt in a worst case. Roth calculates that every $0.10 per watt of added module cost translates to $4.00 to $5.50 per megawatt hour on power purchase agreement prices.
Any tariff would apply across the silicon chain, covering polysilicon, wafers, cells and modules. First Solar builds cadmium telluride thin-film panels and does not use polysilicon.
Long-term rates rose
Solar projects are financed, and the cost of that financing tracks the long end of the curve. The 10-year Treasury constant maturity yield closed at 4.67 percent on July 22, up from 4.63 percent the day before, per the Federal Reserve's H.15 release. The effective federal funds rate sat at 3.63 percent.
The Federal Open Market Committee left its target range at 3.50 to 3.75 percent in June and meets again July 28 and 29. No Summary of Economic Projections is scheduled for that meeting.
Panel prices and import supply
China produces more than 80 percent of the world's solar panels. Oversupply has pushed panel prices down and squeezed manufacturer margins globally. US tariffs of 35 to 55 percent on imported Southeast Asian panels and components sit on top of that, per MarketWise. Wood Mackenzie counts trade duties on cells and modules from India, Indonesia, Laos, Malaysia, Thailand and Vietnam, which together supply 78 percent of US cell imports.
The installation numbers are mixed
US solar installations came to 7.8 GWdc in the first quarter. That is down 27 percent from the first quarter of 2025 and down 42 percent from the fourth quarter, according to the SEIA and Wood Mackenzie US Solar Market Insight report. Utility-scale accounted for 5.9 GWdc of the total, a 34 percent decline year over year. Residential came in at 1,179 MWdc, up 6 percent. The report attributes that increase to an overflow of jobs started at the end of 2025 so customer-owned systems could qualify for the expiring 25D credit.
Solar still made up 60 percent of all new US electricity capacity in the quarter. Solar and battery storage together were 91 percent.
The two main forecasts for the year count different things. The Energy Information Administration expects 43.4 GW of new utility-scale solar capacity in 2026, a 60 percent increase over 2025 and more than 12 GW above the record set in 2024. That would be 51 percent of the 86 GW of total generating capacity scheduled to come online. Wood Mackenzie's base case covers all segments and has annual additions flattening near 43 GWdc a year through 2031. It has residential contracting 21 percent this year before a 2027 recovery, and commercial declining into 2028 on California's NEM 2.0 transition.
The buildout pipeline itself is large. Wood Mackenzie estimates 216 to 240 GWdc of utility-scale solar is safe harbored, most of it before year-end 2025 and ahead of the Foreign Entity of Concern rules. It names interconnection queues and permitting bottlenecks as the constraints on turning that pipeline into installed capacity, along with FEOC uncertainty.
First Solar posted first-quarter net sales just above $1 billion, up 24 percent year over year, with net income of $347 million, up 65 percent. Its contracted backlog stood at 47.9 GW.
We laid out the bull case for this group on June 25, when solar and storage looked like the fast lane for AI power, three weeks after the peak. We have covered the other side of the AI power trade too, in our explainer on AI's power problem and this week when Oklo and X-Energy rallied on a Trump nuclear-for-AI report. T1 Energy has company-specific problems on top of the sector ones, covered in our July 9 piece on its short interest.
What's on the calendar
- July 28: Enphase Energy reports second-quarter results after the close. Guidance includes about $85 million in safe harbor shipments.
- July 28 and 29: FOMC meeting.
- July 30: First Solar reports after the close. Analysts expect $2.83 a share.
- Early August: Section 232 polysilicon proclamation expected.
- August 5: SolarEdge reports before the open.
Roth Capital Partners says a draft bill extending the Section 45X manufacturing credit is now unlikely to surface until after the midterm elections, and that a split Congress afterward is the realistic window for a multi-year extension to pass.
Sources
- Federal Reserve, H.15 Selected Interest Rates, July 23, 2026
- PV Tech, EIA: US to add record 43.4GW of new utility-scale solar PV capacity in 2026
- PV Tech, Lower residential demand after 25D tax credit ends impacts Enphase's Q1 2026 revenue
- Sunrun, First Quarter 2026 Financial Results
- pv magazine USA, US polysilicon 232 decision delayed to August while 45X extension draft pushes past midterms
- SEIA, Solar Market Insight Report Q2 2026
- Wood Mackenzie, The US solar industry has a robust pipeline. So why is 2026 looking flat?, June 10, 2026
- pv magazine, US Q1 solar installations decline 27% year over year, June 11, 2026
- MarketWise, Why solar stocks are falling despite strong earnings, July 17, 2026
Prices are Friday, July 24, 2026 closes. Nothing here is investment advice.
