Wells says excise tax removal positive for Solar, negative for First Solar

Wells Fargo notes that around midday, the Senate released a new version of the tax bill. Politico notes that the new version may not be the final version. The firm notes that the Senate has passed the tax bill. Latest version of the Senate bill removes the one-time excise tax of 30%-50% on foreign content exceeding allowed limits, which was widely criticized by the industry and many GOP Senators. Removal of the excise tax is a positive for Wells’ entire solar coverage, but negative for First Solar (FSLR). Solar projects that begin construction within a year of the bill’s enactment are exempted from the year-end 2027 placed in service requirement. Presumably, solar projects that begin construction in the near 12 months will carry a 4-year safe harbor keeping the credit active until mid-2030. The change is a positive for Array Technologies (ARRY), Nextracker (NXT), Shoals Technologies (SHLS), Sunrun (RUN), Enphase (ENPH), SolarEdge (SEDG).