The Senate’s proposal to phase out tax credits for solar energy by 2028 has sent shockwaves through the renewable energy sector. Solar stocks plummeted following the announcement, with major companies like Enphase Energy Inc.

U.S. solar stocks tumbled on Tuesday after a Senate panel proposed phasing out solar and wind tax credits by 2028, as part of changes to President Donald Trump's sweeping tax-and-spending bill. Solar inverter maker Enphase Energy and solar panel manufacturer First Solar slid 27.

While the Senate proposal would eventually remove credits provided by the Biden administration’s Inflation Reduction Act, analysts at J.P. Morgan and Mizuho said the Senate version is better for shares of solar and other renewables companies than the version passed by the House of Representatives in late May.