While the risk of a U.S. debt default appears low, and the overall impact is likely to be modest if a deal is reached, Barclays believes the sector most in focus is likely clean energy.
Analysts told investors in a note Monday that clean energy was a material beneficiary of the Inflation Reduction Act (IRA) subsidies and is now caught in the crosshairs of the GOP's proposal.
However, they said the "risk is low because it is unlikely IRA's subsidies would be repealed in any bipartisan deal."
"Solar panel manufacturers and installers would be negatively impacted from a resulting reduction in US utility-scale solar demand that would likely materialize were the IRA is to be rolled back," analysts wrote.
"The GOP's proposed rollback of subsidies contained in irA would have a direct material impact on the solar sector and just about all of the solar names that we cover, including FSLR, ARRY, NXT, ENPH, SEDG, NOVA, RUN, and SPWR."