Solar stocks gain premarket as Meta secures more solar power for data centers; Enphase Energy and Sunrun up over 4%.

Solar stocks gain premarket as Meta secures more solar power for data centers; Enphase Energy and Sunrun up over 4%.

In a positive development for the solar energy sector, shares of Enphase Energy and Sunrun have surged in premarket trading, following Meta's announcement of a significant solar power deal for its data centers. The news comes as the industry faces regulatory challenges from the U.S. Senate's proposed tax bill, which aims to terminate clean electricity tax credits for wind and solar in 2028.

Meta Platforms, the parent company of Facebook, Instagram, and WhatsApp, has secured a deal with utility AES Corp to supply 650 megawatts of solar energy in Texas and Kansas. This deal, announced on June 19, 2025, is expected to further boost demand for solar energy, particularly in the utility-scale market.

Enphase Energy, a leading supplier of microinverters for solar systems, saw its shares rise by over 4% in premarket trading. The company has been the subject of increased institutional investment, with several major funds, including QRG Capital Management Inc. and Worldquant Millennium Advisors LLC, boosting their stakes in the company [2]. Enphase Energy's CEO, Badrinarayanan Kothandaraman, also increased his personal holdings in the company, purchasing 4,000 shares in April 2025 [2].

Sunrun, a major residential solar installer, also experienced a significant premarket gain, with its shares rising by over 4%. The company has been facing regulatory headwinds due to the proposed Senate bill, which aims to terminate Section 25D, a key tax credit for residential solar installations [1]. Despite these challenges, Sunrun's stock performance indicates that investors are optimistic about the company's long-term prospects.

The utility-scale solar market, which builds large solar farms for data centers, factories, and entire communities, appears to be somewhat insulated from the impact of subsidy withdrawal. This market is shielded from regulatory changes due to its customer base, which includes large corporations like Meta and Amazon, for whom energy is a relatively small part of their overall budgets [1].

Investment banks have downgraded residential solar stocks, citing regulatory overhangs and potential challenges to their business models. However, the utility-scale market remains resilient, with analysts suggesting that solar remains highly cost-competitive with other fossil fuel generation technologies [1].

The solar energy sector is poised for continued growth, driven by increasing demand for renewable energy and the resilience of the utility-scale market. Despite regulatory challenges, companies like Enphase Energy and Sunrun are well-positioned to benefit from the sector's long-term prospects.

References:
[1] https://www.cnbc.com/2025/06/20/rooftop-solar-stocks-face-wipe-out-but-first-solar-shares-could-double-says-clean-energy-investor.html
[2] https://www.marketbeat.com/instant-alerts/filing-qrg-capital-management-inc-buys-shares-of-8247-enphase-energy-inc-nasdaqenph-2025-06-23/