Solar energy stocks dropped sharply on Tuesday as the market digested cuts to renewable power tax credits in the Senate's version of the budget bill.

Shares of US solar companies fell sharply after Senate Republicans released a bill that would end clean energy tax credits earlier than expected, dashing hopes that major cuts passed by the House wouldn’t stick.

The Senate Finance Committee’s language would take a sledgehammer to some parts of the renewable-friendly Inflation Reduction Act while sparing others.