Solar manufacturers fell sharply on reports Wednesday that President Donald Trump is leaning toward withdrawing the U.S. from the landmark 2015 Paris climate accord.
JinkoSolar Holding Co., the biggest solar manufacturer, dropped 3.2 percent to $18.23 at 11:01 a.m. in New York, after sliding as much as 8 percent. Canadian Solar Inc., the largest North American panel producer, slid as much as 6.5 percent, while First Solar Inc., the top U.S. company, fell as much as 4.4 percent and rival SunPower Corp. was down as much as 4.2 percent.
Trump said in a tweet Wednesday that he will announce “over the next few days” whether he will pull the U.S out of the global climate pact, and according to reports from publications including Axios, he’s already decided to do so.
“The stocks are reacting to headlines, and the U.S. potentially pulling out of Paris is a big headline,” Gordon Johnson, a New York-based analyst at Axiom Capital Management, said in an interview Wednesday. “With Trump in office, the pressure for utilities and others to do solar is going to decline. That will negatively affect demand.”
It’s not just solar manufacturers that were affected. Sunrun Inc., the biggest independent U.S. rooftop solar company, was down as much as 3 percent. NRG Energy Inc., the largest U.S. independent power producer and the owner of almost 5 gigawatts of renewable energy, fell as much as 1.5 percent.
While solar isn’t driven primarily by a carbon price, “it does suggest that the U.S. may subsidize coal, which would be bad for U.S. manufacturers like First Solar and SunPower,” said Jenny Chase, a Zurich-based solar analyst at Bloomberg New Energy Finance.