Shares of T1 Energy Inc (NYSE:TE) are falling sharply on Wednesday after short-seller Fuzzy Panda Research published a report alleging the solar manufacturer misled investors about its supply chain compliance.

The report is a follow-up to Fuzzy Panda’s May 19 findings, though TE shares are still up roughly 15% since that last publication as of Wednesday afternoon. Benzinga has reached out to T1 Energy for comment.

T1 Energy Invoices Allegedly Tie Solar Cells To Trina Solar

Fuzzy Panda, which holds a disclosed short position in TE, claims a whistleblower provided 26 invoices showing T1 purchased more than $65 million in solar cells from China’s Trina Solar during the first quarter of 2026, the same period in which multiple company executives publicly stated the firm had stopped buying from Trina and shifted to four non-Chinese, FEOC-compliant suppliers.

Why T1 Energy’s FEOC Compliance Status Could Erase Its Profits

The distinction matters enormously for T1’s bottom line. Under U.S. FEOC rules tied to the 45X tax credit program, solar manufacturers must source less than 50% of material costs from prohibited foreign entities. Because solar cells represent the bulk of T1’s bill of materials, Fuzzy Panda argues the company’s Material Assistance Cost Ratio sits at just 19%, well below the required 50% threshold.

Report Claims $41.4M in Tax Credits Should Be Reversed

The report contends that the $41.4 million in 45X tax credits T1 booked in Q1 2026 would need to be reversed, flipping adjusted EBITDA from a reported positive $9.1 million to a loss of $32.3 million. Trina Solar was also added to the U.S. Department of War’s list of Chinese military companies operating in the United States just two days before the report’s publication.

TE Shares Slide Wednesday Afternoon

TE Price Action: T1 Energy shares were down 6.50% at $7.91 at the time of publication on Wednesday, according to Benzinga Pro data.

Read Also: Anthropic's Growth Is Exploding. Palantir Says That's Exactly The Problem

Image: Shutterstock