Solar Stocks Plunge As Trump Reportedly Pulls Out Of Paris Climate Deal

The clean energy industry was rocked on Wednesday morning after a new report suggested that President Trump has made his decision to withdraw from the Paris climate agreement. Shares of some major solar players—including SunPower (NASDAQ:SPWR) , Canadian Solar (NASDAQ:CSIQ) , and First Solar (NASDAQ:FSLR) —dipped suddenly following the news.

Word of the decision was first scooped by Axios, which cited two sources with “direct knowledge of the decision.” According to these sources, the administration is finalizing the details of the withdrawal through a small team that includes EPA chief Scott Pruitt.

Apparently the pullout will come down to one of two options. The first would be the initiation of a formal withdrawal, which could take up to three years, while the other option would see the U.S. exit the underlying United Nations climate change treaty—a decision that would be “faster but more extreme,” according to Axios.

The Paris accord was inked in late 2015, and climate change activists hailed the agreement as a major win for their cause. Nearly 200 governments agreed to limit greenhouse gas emissions and move towards clean energy; the deal promised new investments and worldwide support of renewables like solar.

Trump has been mulling a withdrawal from the deal for some time now, but his recent trip abroad was met by several world leaders urging the U.S. to remain in the deal.

Nevertheless, a letter from 22 Senate Republicans, including Majority Leader Mitch McConnell, calling for a clean exit from the agreement apparently cemented Trump’s decision. The U.S. will join Nicaragua and Syria as the only countries not supporting the deal (yes, even the likes of North Korea are signed on).

Shares of several popular solar stocks were down on the news. SunPower dipped more than 4%, Canadian Solar was down more than 6%, and First Solar dropped nearly 4.5%. Additionally, JinkoSolar (NYSE:JKS) fell about 5.5%, while JA Solar (NASDAQ:JASO) was down nearly 3%. Sunrun (NASDAQ:RUN) also slipped marginally.

Overall, the Guggenheim Solar ETF (LON:TAN) dipped as much as 1% to an intraday low of $18.37 in morning trading Wednesday. This ETF corresponds to the MAC Global Solar Energy Index, which tracks companies in various business segments throughout the global solar power industry.

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