SunPower equipment technicians install P-Series solar panel technology at their Hillsborough, Oregon plant on November 7, 2018.
Steve Dipaola Reuters
Solar stocks rose in pre-market trading on Monday after a report that the Biden administration will suspend tariffs on solar panels in four countries.
President Joe Biden will announce a 24-month exemption from solar panel tariffs, Reuters reported, and will use the Defense Manufacturing Act to encourage local production. The move comes as an investigation by the Commerce Department in Cambodia, Malaysia, Thailand and Vietnam added more barriers to equipment imports.
Shares of Sunrun jumped more than 13%, while SunPower and Enphase Energy jumped nearly 9%. SolarEdge Technology won more than 5%. Array Technologies jumped about 20%.
“If confirmed, we believe the announcement will be clearly positive for our coverage, especially in the context of the solar utility market, which is facing uncertainty following the launch of the US Department of Commerce’s AD / CVD investigation at the end of March, ”JPMorgan analyst Mark Strauss said in a note to customers.
Tariffs have come under increasing criticism in recent months as the war in Europe has boosted world energy prices. The tariffs were originally imposed by the Trump administration, with Biden announcing a four-year extension in February.
Solar stocks have been declining since last November, when market sentiment for unprofitable growing companies deteriorated. However, the sector has held a good rally in recent weeks. The Invesco Solar ETF (TAN) rose more than 27% from its lowest levels in May.
The increase in solar reserves in 2020 and 2021 is due in part to optimism that the democratic administration will strengthen federal support for the industry. However, the Build Back Better bill, which will include additional costs for clean energy, came to a halt in Congress last year.
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