JinkoSolar (JKS) shares plummeted 5.28% in pre-market trading on Tuesday, as investors reacted to a potentially devastating blow to the solar industry. The sharp decline came after news broke that a U.S. Senate panel has proposed a full phase-out of solar and wind energy tax credits by 2028, as part of changes to President Donald Trump's sweeping tax-cut and spending bill.

The draft bill, circulated by a U.S. Senate committee, suggests phasing out subsidies established by the Biden-era 2022 Inflation Reduction Act. Under the proposal, solar and wind incentives would be reduced to 60% of their current value in 2026 and eliminated entirely by 2028. This is a significant acceleration compared to the current law, which wouldn't begin phasing out these credits until 2032.

The news has sent shockwaves through the solar industry, with many U.S. solar stocks experiencing double-digit losses. JinkoSolar, as a major player in the global solar market, is not immune to these concerns. The proposed changes threaten to make solar energy less competitive and could potentially slow down the adoption of renewable energy technologies. This comes at a time when the solar industry is already grappling with challenges such as high interest rates and recent net metering reforms in California, which have dampened U.S. residential demand for solar installations.