New Trump Order Adds to Pressure on Sunrun and Other Renewable-Energy Stocks

 Renewable-energy stocks fell, after President Trump issued an executive order calling for tight application of the eligibility rules for clean-energy tax credits.

Shares in solar-equipment maker First Solar fell about 5% in morning trading Tuesday, while Sunrun dropped 11%.

Stocks in energy-project developers such as NextEra and AES logged smaller declines.

The tax-and-spending bill passed by Republicans last week made good on Trump's promise to withdraw President Joe Biden’s green tax credits. The final law requires wind and solar farms to be in service by 2027 to get tax credits, and allows them to claim credits if construction starts in the next 12 months.

That means a lot is riding on what counts as “under construction.” Trump's executive order, issued Monday, said a “substantial portion” of a facility must be built to claim credits and told the Treasury to write new guidance within 45 days.

The order looks designed to mollify Republican fiscal hawks. The House Freedom Caucus was unhappy about the 12-month runway for clean-energy projects, which was more lenient than some previous drafts of the legislation.

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