• A Department of Energy employee took the federal government's "fork in the road" offer.
• He said the resignation process was rushed and he's doubtful he'll be paid through September.
• Some 75,000 federal workers have accepted the deferred resignation program, the administration said.

When a program manager at the Department of Energy received the Trump administration's "fork in the road" resignation offer, his first reaction was defiance.

"My initial thought process was 'I am not going to do this because I don't want to let them win. They can fire me, but I'm not leaving,'" the program manager told Business Insider, adding that he wanted to stay and protect a clean-energy program he oversaw. "But it became pretty demoralizing and clear that wasn't a realistic option."

The DOE employee said he decided to take the buyout offer — known as deferred resignation — in February after his eight-person team was "decimated." He said it seemed unlikely that the department's career leadership could shield employees from President Donald Trump and Elon Musk's efforts to slash the federal workforce and eliminate climate- and DEI-related programs.

The DOE employee requested anonymity for fear of retaliation. BI verified the DOE employee's identity and viewed his signed deferred resignation agreement.

According to the Office of Management and Budget, about 75,000 federal workers had accepted the offer as of February 13. That's about 3.75% of the federal workforce, shy of the White House's goal of 5% to 10%. Agencies have additionally fired thousands of workers, mainly probationary employees who were hired or promoted in the past two years — moves that have attracted legal challenges.

The DOE employee said he was impressed by how many federal workers wanted to stay in their jobs because they care about public service. He worried that the Trump administration's gutting of federal agencies would fuel its narrative that the government is inefficient and ineffective, a view he disagreed with.

"Trump and Musk are creating those conditions by removing staff and pausing grants and requiring them to remove all the DEI efforts," the DOE employee said. "Before, things were functioning decently well."

3 strikes and he's out

The beginning of the Trump administration brought three events that tipped the scales for this DOE employee.

First, right after the inauguration, Trump signed executive orders that paused his team's work, as it paused funding authorized by Congress under the Inflation Reduction Act and the Infrastructure Investment and Jobs Act, former President Joe Biden's landmark climate accomplishments.

Second was what he saw as mistreatment of his colleagues. The DOE fired probationary employees on his team who'd been on the job less than a year. The DOE employee said that even if their work resumed in the coming months, he wasn't sure there would be enough staffers to implement it. The DOE employee also disagreed with directives to remove pronouns from federal email signatures.

"I wasn't willing to do that because it created a hostile work environment for the people who worked for me," he said.

Finally, the DOE employee is remote and thought he would eventually be fired if he refused to return to the office as directed by Trump's executive order.

'I am almost positive that I will not get paid through September'

The DOE employee described the deferred resignation process as rushed and lacking clear guidance.

He submitted his request to the Office of Personnel Management and then signed a four-page agreement with the DOE. The agreement said he would be placed on administrative leave until September 30 and be paid his current salary "subject to the availability of appropriations."

The DOE employee said he didn't know he had to request administrative leave until he had already been locked out of federal computer systems. His last day was Friday, and his pay is biweekly. His first paycheck for administrative leave should arrive in the coming weeks.

"I'm questioning whether the administration will fulfill the agreement," the DOE employee said. "I am almost positive that I will not get paid through September."

'It's a tough job market'

The DOE employee said he planned to start applying for jobs in case the Trump administration doesn't hold up the agreement.

But that presents other risks. The deferred resignation agreement requires federal workers who take another job to get approval from the ethics counsel regarding "outside activity," and the DOE employee said it was unclear whether those requests would be approved.

Ideally, he could find a position in clean energy that pays a similar amount as his federal job so he could leave the deferred resignation program altogether. The DOE employee falls on a pay scale ranging from $123,000 to nearly $160,000.

"I think it's a tough job market," the DOE employee said, adding that clean-energy companies and organizations might not be hiring given the Trump administration's attacks and the uncertainty about grant funding.

"The prospects of working in clean energy — the thing I care about — seem terrible at the moment," he said.

The DOE employee said many companies and nonprofits were also still waiting for their federal grant funding to be unfrozen.

"It's an anxious time," he said. "Where can I go that takes advantage of my skills but also has some sort of longevity?"

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• Billions of dollars in subsidies for more efficient appliances and rooftop solar remain frozen.
• Some states said they can't access rebates and grants that were set to be doled out to homeowners.
• Proponents say energy-efficient appliances and rooftop solar align with Trump's agenda to cut costs.

Many states still can't access hundreds of millions of dollars awarded for federal energy rebates and rooftop solar programs.

The freeze means some contractors in Arizona who have installed home rooftop solar and energy-efficient appliances are waiting to get paid for their work. In Colorado, state officials are delaying hiring more employees to implement the programs.

The confusion seems to be over President Donald Trump's executive orders to pause and revise climate programs as well as his short-lived federal spending freeze. Some $8 billion in rebates for energy-efficient appliances and retrofits, and another $7 billion for rooftop solar — set to be rolled out this year and authorized by the Inflation Reduction Act — are on the line.

Advocacy and trade groups said some states have been able to tap the money, but there is no clear pattern or communication from the Trump administration.

"There is absolutely no blue-red pattern, no geographical pattern. It is completely random," David Terry, president of the National Association of State Energy Officials, said. "We're awaiting that clarification from the administration so states can plan and move forward."

Proponents of the subsidies — including state officials and consumer advocacy groups — said they align with Trump's promise on the campaign trail to lower Americans' energy bills. Retrofitting homes with energy-efficient heating and cooling systems or rooftop solar is expensive up front but can save people money in the long run, they said. And lower-income homeowners and landlords who otherwise couldn't afford the upgrades were the target recipients.

Trump's energy policy has focused on boosting oil and gas drilling to drive down energy costs. Oil executives and economists say that won't happen anytime soon. In addition, potential tariffs on Canada and Mexico could hike gas prices across the country.

"These energy rebates will have real household impacts, not to mention the jobs they will create for contractors and electricians who have to do the work," Xavier Boatright, the Sierra Club's deputy legislative director for clean energy and electrification, told Business Insider. "Many red states like my home state of South Carolina have energy costs at an all-time high."

DOE didn't respond to a request for comment. In a court filing on February 9, attorneys for the Trump administration said that the department expects to resume issuing payments for home energy rebates. The filing doesn't mention the rooftop solar program.

The filing is part of a lawsuit that nearly two dozen states, including Arizona and Colorado, brought against the Trump administration's spending freeze. US District Judge John J. McConnell Jr. ordered the administration to immediately restore and resume funding on February 10.

Frozen accounts for energy rebates and rooftop solar

DOE's Home Energy Rebates are divided into two categories. One offers point-of-sale discounts on heat pumps, electric stoves, insulation, and new breaker boxes and wiring — capped at $14,000 per household.

They are targeted at low- and moderate-income homeowners. Landlords who rent to people in those income brackets are also eligible. The other category helps cut the costs of larger energy efficiency projects that slash home energy use by at least 20%.

EPA's Solar for All program similarly funds rooftop solar in low- to moderate-income communities across states.

Shayla Powell, a spokesperson for the agency, didn't comment on the specific status of Solar for All.<

Powell said that as of February 7, the EPA had worked to ensure all accounts with IRA funding were accessible in accordance with court orders.

But, several states told Business Insider they still can't access the funds. Arizona and Colorado are among the 11 states and the District of Columbia that launched their energy rebate and rooftop solar programs before Trump's inauguration.

Arizona was awarded more than $300 million in total. Adrianna Amato, a spokesperson for Arizona's Office of Resiliency, said in an email that the energy rebates are being processed and a vendor is building a list of qualified contractors completing work in homes that need to be paid.

"We have more than 1,000 applications in review for eligibility," Amato said on February 12. "When we go into the payment system, we are able to submit for reimbursement to draw down funds that have been spent, but we have not received our reimbursements for about two weeks. We only see a status statement that says it's pending agency review."

Will Tool, executive director of Colorado's Energy Office, said the state was similarly awarded nearly $300 million for energy rebates and rooftop solar projects.

Colorado had planned to roll out the rebates to the public early this year and was about to hire some employees to implement the solar program. The efforts are currently on hold.

"Our low- and moderate-income Coloradans would benefit from reduced energy costs, increased comfort, and reductions in pollution," Tool said. "We really do not understand why the Trump administration would want to freeze these programs in Colorado and across the country."

• California's insurer of last resort will get a $1 billion bailout to cover LA wildfire damages.
• The bailout will likely lead to higher insurance premiums for California homeowners.
• This situation could escalate the state's insurance crisis and convince more insurers to leave.

Property owners across California will likely pay higher insurance premiums to help cover the damages of the Los Angeles wildfires after the state's insurance plan of last resort said it doesn't have enough funds to pay out its claims.

State regulators on Tuesday approved a $1 billion bailout of California's insurer of last resort, the FAIR Plan, which covers those who can't find insurance on the private market. The bailout will be funded by private insurers licensed to operate in the state — and under a new rule enacted last year, they can pass up to half of the cost on to their customers.

The FAIR Plan said it was set to run out of money by the end of March as losses piled up from the Palisades and Eaton fires. It would be the first time in 30 years that it had been unable to pay its claims.

The bailout comes after California's largest home insurer, State Farm, this month asked state regulators for emergency permission to raise homeowners' rates by an average of 22%, starting May 1, to avert a "dire situation" for the company's finances. As of February 3, State Farm had paid out $1 billion and said it expected to spend far more.

It's all part of a worsening home insurance crisis in California that was already underway before the LA blazes destroyed more than 12,000 buildings. Back-to-back fires in 2017 and 2018 decimated insurers' profits, prompting companies including State Farm, Allstate, and Farmers Insurance to either stop writing new policies, pull back coverage, or, in some cases, drop tens of thousands of property owners in the state. Insurers cited growing losses from wildfires and other disasters coupled with inflation and more expensive home repairs.

Most recently, beginning in July, State Farm dropped nearly 70% of its policyholders in the affluent Pacific Palisades neighborhood.

All of this has forced hundreds of thousands of homeowners into the FAIR plan, designed to be a backstop for those who can't find insurance on the traditional market. Participation more than doubled between 2020 and 2024 to nearly half a million homes — many of which were in areas devastated by the Palisades and Eaton fires.

Measures to keep home insurers from fleeing California

The bill for the bailout will be divided among private insurers based on their market share in the state. As of 2023, State Farm, Farmers Insurance, and CSAA Insurance held the largest percentage of policies in California, according to S&P Global data. They have 30 days to pay the FAIR plan and — under a rule change made by California Insurance Commissioner Ricardo Lara last year — insurers can request approval to pass up to half those costs onto residential and commercial policyholders.

The change was part of Lara's broader strategy to lure private insurers back to California to help stabilize the market. The rules also should make it easier for companies to raise premiums and factor in the costs of reinsurance and risks of future disasters. In exchange, insurers will have to expand coverage in communities most at risk of wildfires.

Lara said he approved the FAIR Plan bailout to protect consumers and blamed 30 years of stagnant regulations for putting more people at risk.

"The FAIR Plan must pay claims just like any other insurance company," he said in a statement. "I reject those who are hoping for the failure of our insurance market by spreading fear and doubt. Wildfire survivors can't cash 'what ifs' to pay for food and rent, but they can cash FAIR Plan checks."

Some consumer advocates on Tuesday threatened legal action to stop private insurers from surcharging customers.

"This gift to insurance companies rewards bad behavior and will only incentivize insurers to drop even more homeowners and force them onto the FAIR Plan in the future because there's no consequence for abandoning these families," said Carmen Balber, executive director of Consumer Watchdog in Los Angeles.

Are you a homeowner with a story to share? Reach out to these reporters at [email protected] and [email protected].

• A federal pause on climate funding is delaying renewable energy projects and hiring.
• Recipients of grants, loans, and tax credits said they don't know if they'll be paid.
• The uncertainty is roiling solar, electric vehicle, and energy efficiency companies.

States and businesses deploying renewable energy projects are scrambling to raise capital, delaying hiring, and, in some cases, furloughing staff.

That's because the funds they were awarded months ago aren't available as President Donald Trump races to squash his predecessor's marquee climate law.

Maren Mahoney, director of Arizona's Office of Resiliency, was preparing to hire four employees to help manage a $156 million grant awarded under the Inflation Reduction Act to fund rooftop solar in low- to moderate-income communities across the state. The project could benefit an estimated 11,200 households by providing cheaper energy, she said. But as of February 7, a federal payment system was inaccessible.

"We are really hesitant to go ahead and hire anybody because we're unable to get into the system, which is how we eventually get reimbursed for our payroll expenses," Mahoney said. "These projects are about affordability and adding energy capacity to the system. So I think solar is actually in line with some of President Trump's priorities."

State officials, solar and electric vehicle businesses, and government workers told Business Insider that their funding remains frozen following Trump's executive order pausing hundreds of billions of dollars in loans, grants, and tax credits for renewable energy projects under the IRA. And even though several federal judges have temporarily blocked a more sweeping spending pause, uncertainty persists among financial grantees.

Jillian Blanchard, vice president of climate change and environmental justice at Lawyers for Good Government, said her team has fielded more than 100 inquiries from groups awarded grants from the Environmental Protection Agency, the Energy Department, and the Agriculture Department.

"Many are waiting on legally obligated funds," Blanchard said. "Some are being are waiting for invoices to be paid. Several have pulled back job offerings that are needed to meet the terms of their grants. Some are having to let people go, and some can't make payroll."

A spokesperson for the EPA said it couldn't comment on the funding freeze, citing pending litigation, and that the agency is working to implement Trump's executive orders. The Agriculture Department and Energy Department didn't return requests for comment.

Furloughs and funding limbo

David Funk, president of Zero Emissions Northwest in Washington state, said on LinkedIn that he furloughed his staff due to Trump's executive orders. The company helps secure grants for rural farmers and small businesses to save on their energy costs by installing solar panels and energy-efficient appliances, among other projects.

He said his clients have $1.9 million in projects under construction but over $250,000 in delayed reimbursements from the Agriculture Department's Rural Energy for American Program, which is funded by the IRA.

"These farmers, laundromat owners, and rural grocery stores took on debt and dipped into their savings, trusting that the grants they were awarded would be paid," Funk said. "Due to Trump's recent executive order, we've advised all clients to pause all future investments as we no longer have confidence that signed contracts will be honored."

EV charging startup SWTCH was awarded over $1 million in federal funding to deploy electric vehicle chargers at multifamily properties in Puerto Rico. Josh Cohen, SWTCH's head of policy, told Business Insider last week that the company received an email from the Energy Department three days after Trump's inauguration saying leadership had "placed a hold" on the project until further notice.

Uncertainty around the future of funding

Cohen said he expects the project to eventually move forward, but the White House orders are creating a lot of uncertainty for small businesses that need government reliability and predictability.

Democrats in Congress also lack clarity about the status of programs at the EPA— one of the main federal agencies implementing the IRA.

On February 6, Sen. Ed Markey, a Democrat from Massachusetts, and a handful of other lawmakers protested the spending freeze outside EPA headquarters but were blocked by security from entering the agency.

"We need evidence provided to us that the EPA is complying with the court orders," Markey said.

They demanded a meeting with Administrator Lee Zeldin and any employees with Elon Musk's Department of Government Efficiency, which has been fanning out across the federal government. Zeldin was in Los Angeles as part of the EPA's response to the wildfires.

Since the IRA was enacted in 2022, companies have announced plans to invest more than $167 billion in factories to build and recycle technologies like solar panels and EV batteries, according to the research firm Atlas Public Policy. Many companies are awarded both federal tax credits and loans and grants.

"There's nothing that hurts our economy more than uncertainty," Bob Keefe, the executive director of E2, a business group that advocates for renewable energy policy, told Business Insider. "And right now, the uncertainty of tax credits and the spending freeze is roiling the economy. It's not making it attractive for companies to invest and expand and hire new workers."

• State Farm wants to hike insurance premiums in California to help pay for LA wildfire damage.
• Insurance affordability has deteriorated with intensifying disasters and home-repair inflation.
• This hurts housing affordability and long-term property values.

The aftermath of the Los Angeles wildfires could exacerbate a mounting challenge for California homeowners: ever-higher insurance costs.

California's largest home insurance provider, State Farm, has asked state regulators for emergency permission to raise homeowners' rates by an average of 22%, starting May 1, to avert a "dire situation" for the company's finances following the fires, according to a Monday letter to the state's insurance commissioner. The company also asked to raise premiums for renters and condo owners by 15% and by 38% for landlords.

State Farm said it had fielded more than 8,700 claims related to the LA wildfires and paid out about $1 billion as of Saturday but expected to spend far more. The fires destroyed some of the city's priciest real estate, including in the Pacific Palisades, as well as Malibu's. They're set to be the costliest in US history. The company says wildfire payouts are placing "very significant pressure" on its ability to pay claims.

Some analysts estimate the damage could total between $250 and $275 billion, a bill that will be split among local and federal governments, insurers, and residents. But the full cost won't be clear for years.

State Farm said its finances were already strained from previous years' losses, leading one rating agency to downgrade it.

"Insurance will cost more for customers in California going forward because the risk is greater in California," the company said in the letter, adding that an emergency rate hike is "essential to more closely align costs and risk" and allow the company to rebuild capital.

A spokesperson for State Farm pointed Business Insider to its letter when asked for comment.

Intensifying home insurance market instability

California has long faced home insurance issues spurred by surging costs from more frequent and intense disasters coupled with rising home-repair costs and inflation. Since 2022, major insurance companies — including State Farm, Allstate, and Farmers Insurance — have either stopped writing new policies in the state, pulled back coverage, or in some cases, dropped tens of thousands of property owners.

State Farm in May 2023 stopped writing new homeowners policies in California. The following March, the company dropped about 29,000 homeowners in the state — including nearly 70% of policies in Pacific Palisades, where January's blazes caused some of the worst losses. That nonrenewal process is ongoing but was recently paused in Los Angeles County due to the wildfires. As of February 1, State Farm said it has more than one million homeowners policies in California.

State Farm said its finances had taken a hit over the nine-year period ending in 2024. During that period, the company paid out $1.26 in claims and expenses for every $1 collected in premiums. Its after-tax net losses totaled $2.8 billion. State Farm said its financial position will be further weakened by the LA wildfires.

State regulators last August approved Allstate's request to hike home insurance premiums by an average of 34%. State Farm said it filed for a 30% rate increase for homeowners policies last June, which is still pending. That would be on top of rate increases State Farm got approved in 2023, including a 6.9% bump in January and a 20% bump that took effect in March.

Ripple effects on housing across the country

The rising cost of insurance and the growing cancellations of private insurance policies are compounding housing affordability issues across the country.

A Senate Budget Committee investigation found that private insurers' nonrenewals spiked threefold in more than 200 counties between 2018 and 2023. Homeowners who are denied private insurance can often opt for their state's insurer of last resort, though these policies tend to offer more restricted coverage and higher premiums.

Rising insurance costs hurt homeowners and potential homebuyers alike, as well as renters who face increased costs passed along by their landlords. Some retired homeowners and others on fixed incomes are already struggling to deal with rising premiums, which, combined with rising property taxes, add up to more than mortgage payments for a growing number of homeowners.

Rising insurance costs are also expected to hurt property values in the longer term. A recent study from the research firm First Street found that a combination of rising home insurance premiums and falling demand, particularly in areas hardest hit by climate change, will erase almost $1.5 trillion in US real estate values by 2055. The report found that 40% of property-value losses will occur in communities it calls "climate abandonment areas," which are the most at risk of out-migration and insurance premium spikes.

This trend is particuarly alarming given that Americans are increasingly moving into parts of the country most vulnerable to extreme weather. In 2023, tens of thousands more people moved into the most flood—and fire-prone areas of the US rather than out of them, the real estate company Redfin reported.

Have you been impacted by rising insurance premiums or lost your coverage? Reach out to these reporters at [email protected] and [email protected].

• Four nuclear startups plan to build power plants at Texas A&M University.
• Texas officials see nuclear as a way to meet skyrocketing electricity demand from AI data centers.
• The university is seeking $200 million from state legislators to help finance the nuclear projects.

Texas' largest university plans to be a test bed for small nuclear reactors that could help meet the state's skyrocketing electricity demand from data centers, population growth, and extreme weather.

The Texas A&M University System on Tuesday said it's leasing land to four nuclear startups that specialize in small modular reactors, or SMRs, which are about one-third of the size of traditional nuclear power plants. The startups aim to build commercial reactors that can provide power for the university and the Texas power grid, officials said.

To date, no commercial SMR has been built in the US and only a few exist in Russia and China. Development is picking up speed, especially as tech giants search for low-carbon, around-the-clock electricity for data centers with the computing power for artificial intelligence. But it's unclear when the first SMR might come online in the US, with forecasts ranging from five to 15 years.

"Hopefully we're the first of many places that have a proving ground for new energy technologies," Joe Elabd, vice chancellor for research at Texas A&M, told Business Insider. "Energy demand, not just in the state of Texas, but across the nation and globally, is rising at a very fast pace, particularly as companies construct data centers."

Texas' main grid operator forecast that power demand will nearly double by 2030, driven mainly by requests to plug into the grid from data centers and crypto-mining facilities. A similar trend is playing out in states like Virginia, Arizona, and Nebraska.

The arrival of the Chinese artificial intelligence company DeepSeek — which promised to be a cheaper and more energy-efficient model — cast some doubt about AI-driven electricity demand and sent nuclear stocks plunging on January 27. They've since recovered, buoyed by President Donald Trump's formation of Stargate, a joint venture between Oracle, OpenAI, and SoftBank to build AI data centers, including in Texas.

Even before the announcement of Stargate, Texas was already dealing with a stressed power grid. Its vulnerabilities were exposed during a 2021 winter storm that froze gas production, power plants, and wind turbines and left millions of people without heat and power for days. At least 200 people died.

The promise of small nuclear

Since then, Texas officials have been trying to shore up the grid — including by making the state a leader in advanced nuclear power. Texas Gov. Greg Abbott in November outlined a strategy with seven recommendations, including a new state office and energy fund dedicated to supporting advanced nuclear projects.

Proponents of SMRs argue that they could be a source of 24/7 power without producing greenhouse gas emissions, unlike gas plants that — at least in the short term — are going to be built to power data centers. Smaller reactors could be deployed faster and cheaper than traditional nuclear power plants, which have been plagued by cost overruns and delays. The country's most recent large nuclear plant, built by Georgia Power, arrived seven years late and $17 billion over budget.

However, some academic critics worry that SMRs will have a similar fate and leave taxpayers on the hook. In 2023, the startup Nuscale canceled what was set to be the first commercial SMR project in the US after utility customers backed away due to rising costs and delays. The project was backed by a $1.4 billion cost-share deal with the federal government. Environmental groups are also concerned about the radioactive waste that nuclear power produces and where it will be stored.

For its part, Texas A&M is partnering with four other nuclear startups: Kairos Power, Natura Resources, Terrestrial Energy, and Aalo Atomics. The university has asked Texas legislators for $200 million for its new energy proving ground.

The proposed site at Texas A&M is large enough to accommodate multiple SMRs with a combined output of more than one gigwatt, university officials said. That is enough to power about 200,000 homes. Until now, there hasn't been a suitable site for building clusters of nuclear reactors that can supply the power needed for AI innovation and other projects, officials said.

Mike Laufer, co-founder and CEO of Kairos Power, told Business Insider the company is still evaluating how many reactors it might build at the Texas A&M site. In October, Kairos also struck a deal with Google, which said it plans to buy power from multiple SMRs.

Douglass Robison, founder and President of Natura Resources, said the company plans to build one commercial reactor.

"We need to demonstrate that you can license an advance reactor," Robison said. "That's been one of the big concerns, particularly from the investment community."

Both Kairos and Natura have received construction permits from the Nuclear Regulatory Commission for demonstration SMRs, but not commercial-scale plants.

Correction: February 5, 2025 — An earlier version of this story misspelled the last name of Texas A&M's vice chancellor for research. It's Joe Elabd.

• Trump said he's planning tariffs on Canada and Mexico, which could risk higher gas prices.
• Most of US crude oil imports come from those two countries.
• Economists don't expect US drillers to boost production in order to keep prices down.

President Donald Trump's plan to slap tariffs on Canada and Mexico as soon as February 1 threatens to undercut one of his key campaign promises: lowering prices at the pump.

The US imports around 40% of the crude oil it refines into gas for your car and other vehicles. In 2024, about half of that came from Canada and 11% from Mexico. Economists told Business Insider that slapping those imports with tariffs could strain consumers' wallets at the gas station and have ripple effects across industries.

"Tariffs on crude oil is going to flow right through to the US consumer," Ed Hirs, a lecturer on energy economics at the University of Houston, said. "Canada may absorb some of the cost, but the US will absorb a lot of it, too."

Shortly after taking office, Trump said he could impose a 25% tariff on Mexico and Canada on February 1 as a way to push those countries to crack down on illegal immigration and drugs entering the US. White House spokesperson Karoline Leavitt on Tuesday said the plan "still holds."

Trump told reporters on Thursday in the Oval Office that he's still considering whether to include oil from Canada and Mexico in his tariffs.

Patrick De Haan, head of petroleum analysis at GasBuddy, told Fox Business on Thursday that consumers in the Great Lakes and Midwest regions would likely experience some of the largest impacts of tariffs. He said gas prices there could rise by more than 20 cents within days of the tariffs taking effect.

The US is producing record amounts of crude oil with domestic production amounting to about 60% of crude refined in the US, per the Energy Information Administration. But many refineries aren't equipped to process the light crude from US shale basins, Hirs said. Refineries in states like Michigan, Wisconsin, and Indiana rely on heavy crude from Canadian oil sands and it would be costly and time-consuming to convert the technology.

Hirs said it's difficult to predict how much prices will rise, in part because it depends on what OPEC+ does. The oil cartel has been postponing production increases to boost global prices. Trump has called on OPEC+ to slash prices, and ministers meet on February 3 to discuss his demands.

Even if crude prices rise, Hirs said the signal won't be strong enough for US drillers to boost production. US refineries that handle domestic crude already have more than enough supply.

"Tariffs that increase costs but lower revenue are going to be poisonous for the US oil industry right now," Hirs said.

The American Petroleum Institute, which lobbies on behalf of the US oil and gas industry, is opposed to additional tariffs. The group in December asked the Trump administration's top trade official to exempt crude oil and natural gas from levies because they would "directly undermine energy affordability and availability for consumers while eroding the U.S. oil and natural gas industry's competitiveness both domestically and globally."

Higher gas prices would have knock-on effects in other industries, too, such as fresh fruit and vegetables that are trucked into the US and construction projects that need fuel to power heavy equipment.

Trade war could cause long-term price slumps

While economists predict tariffs would cause a short-term spike in gas prices, they also said broader economic instability may lead to longer-term price drops.

Officials in Canada, Mexico, and China have warned that they will retaliate if Trump implements new tariffs. A trade war may slow down the global economy and depress prices, Hirs said.

"It doesn't take much to throw the global economy into a recession," Hirs said. "That would help lower the price of gasoline and diesel for everybody because there would be less economic activity and less demand."

Bank of America strategist Francisco Blanch similarly told Business Insider in November that tariffs will likely curb global trade, driving down oil and gas prices.

• Trump threatened to eliminate FEMA, arguing its disaster response is too slow and costly.
• FEMA is responding to more climate-fueled disasters and often projects budget shortfalls.
• Former FEMA leaders have proposed that states take on more disaster preparedness and response.

After touring flood-ravaged areas of North Carolina and the wildfire devastation in Los Angeles, President Donald Trump is threatening the organization tasked with leading federal disaster recovery.

"I think we're going to recommend that FEMA go away," Trump said in a press conference in North Carolina on Friday.

Trump critisized the Federal Emergency Management Agency as "slow" and "bureaucratic," arguing it costs too much money and that states would do a better job handling disaster response. He's since issued an executive order directing a "full-scale review" of FEMA as a first step to either overhauling or eliminating the agency.

The president's threat comes as FEMA responds to an increasing number of catastrophic disasters across the country. Thousands of FEMA workers are spread out across places like LA, North Carolina, and Georgia and tasked with delivering financial aid to people displaced by wildfires, hurricanes, flooding, and tornadoes.

Both Republican and Democratic officials have warned the agency is stretched too thin and have also proposed states take on a greater share of preparedness and response. Already, state and local governments lead their own disaster recovery efforts and ask FEMA to step in when they lack enough resources to handle it themselves. After the president approves a disaster declaration request from a governor, FEMA mobilizes a national response that involves coordinating with other agencies.

"Think of FEMA as the quarterback for the federal government's response. But this is all in support of the state," Daniel Kaniewski, who served as the second-highest ranking official at FEMA during Trump's first term, said. FEMA helps fund both short-term emergency response and longer-term recovery for months — and in some cases years — after a disaster.

The president alone also can't eliminate FEMA, which would require Congress to change several laws. Trump's executive order established a FEMA review council co-chaired by the secretaries of Homeland Security and Defense. The council is tasked with evaluating the agency's disaster response during the past four years and comparing it to efforts by state and local governments.

The Senate has confirmed former South Dakota Gov. Kristi Noem to lead the Department of Homeland Security and Pete Hegseth to lead the Department of Defense. Trump hasn't nominated a FEMA administrator yet.

Here's a look at FEMA's budget and role during a natural disaster.

FEMA has three main assistance programs

The agency said it employs more than 20,000 people nationwide, including in Washington, DC, and across 10 regional offices, and has a $33 billion budget appropriated by Congress. The vast majority of that budget is for the Disaster Relief Fund, the primary account that pays for the government's response and recovery efforts.

Once the president approves a disaster declaration, FEMA has the authority to offer a range of financial aid to governments and individuals. These programs are known as public, hazard mitigation, and individual assistance.

FEMA typically reimburses state and local governments for 75% of the costs of handling a disaster and long-term recovery. These costs can include debris removal, search and rescue, emergency transportation, distributing food and first aid, and rebuilding public infrastructure. FEMA also issues billions of dollars in grants to state and local governments for projects that harden communities against future disasters, such as enforcing stronger building codes, building sea walls, and upgrading stormwater systems.

Disaster survivors can apply for individual assistance, which is largely targeted at the uninsured or underinsured. FEMA grants can cover temporary housing, rental assistance, home repairs, unemployment benefits, and in some cases legal services.

"FEMA doesn't allow for duplication of benefits, so if your insurance paid for something, then you can't get reimbursed by the federal government," Kaniewski, now a managing director at Marsh McLennan, a consulting firm, said.

FEMA said it has provided more than $316 million in grants to Hurricane Helene survivors in North Carolina alone, including more than $6.2 million in rental assistance.

In 2024, FEMA also started offering "serious needs assistance." The $750 grant helps cover disaster survivors's emergency expenses such as evacuation, food, and shelter. The new grant was part of a broader set of changes aimed at streamlining individual assistance after long-standing complaints from disaster survivors that the process took too long.

FEMA leaders say it's strapped for resources and that states could take on more responsibility

Congress is unlikely to eliminate FEMA altogether. However, several former FEMA leaders have raised concerns that the agency is stretched too thin and proposed that states do more to prepare and respond to disasters.

Since October 2022, FEMA has regularly projected shortfalls in the Disaster Relief Fund, in part because the agency is responding to a rising number of hurricanes, floods, wildfires, and other disasters. Scientists warn are becoming more frequent and destructive due to the climate crisis. Between fiscal years 1988 and 1997, there were an average of 39 major disaster declarations. In the most recent decade, there were an average of 63, an increase of 61%, the Congressional Research Service found.

Presidents have also expanded FEMA's mandate beyond responding to weather-related disasters — further taxing its resources. The agency in recent years has helped local governments respond to the Covid-19 pandemic and an increasing number of unaccompanied children crossing the southern border.

The Trump administration may look to Project 2025, a policy agenda published by the conservative think tank Heritage Foundation, for ideas to shift more costs to the states.

The section on FEMA calls on Congress to change the cost-share arrangement so that the federal government covers 25% of the costs for small disasters. But for "truly catastrophic" disasters, the threshold should be capped at 75%

Project 2025 also proposed that FEMA raise its "per capita indicator," which the agency uses to measure the financial impact of a disaster and whether the federal government steps in. The indicator is adjusted annually based on the Consumer Price Index, but Project 2025 said it hasn't kept pace with inflation. That's lowered the threshold for public assistance and "caused FEMA's resources to be stretched perilously thin."

• Universal basic income in the UK is politically controversial.
• The prime minister has previously said he "isn't attracted" to UBI and prefers retraining workers.
• Wales launched a small basic-income pilot in 2022 that ends this year.

Governments around the world are testing programs that give people money with no strings attached.

That includes the Welsh government in the UK, which in 2022 launched the first guaranteed-basic-income pilot in the country. The program, called Basic Income for Care Leavers, gave 638 young adults leaving the foster-care or local authority-care system a monthly payment of about £1,280, or $1,580, after taxes that they could spend on whatever they wanted.

The pilot is set to wrap up this year, and its results could inform a controversial debate in the UK over basic income. Guaranteed basic income offers recurring cash payments for a set period of time to a specific group of people, like mothers or artists. Universal basic income provides recurring cash payments to all people in a population, regardless of their socioeconomic status.

Countries testing basic income include the US, Canada, and Kenya. Supporters of basic income argue that it can address growing inequality and insulate workers from economic recessions and technological advances like artificial intelligence, while opponents are concerned that basic income disincentives work and that programs are too expensive to implement.

"There is experimentation going on, and there is a familiarity within policy circles, but it's still quite a controversial idea," said Jack Kellam, a spokesperson for the Autonomy Institute, a UK think tank that studies how to reshape work to address modern crises. "That's why people are cautious about touching it within mainstream politics."

Nearly half the 2,233 Britons in a July YouGov survey said they supported the idea of introducing UBI in the UK, while one-third opposed it.

Hurdles for basic income in the UK

One of the arguments against basic income is the price tag. Estimates of the cost in the UK are wide-ranging. A Georgetown University study published in 2023 found that implementing UBI in the country would cost about £45 billion a year, or 2% of its GDP. A working paper by the Institute for Policy Research in 2017 estimated it would cost more than £427 billion annually.

Smaller guaranteed-basic-income programs can be easier to implement. For example, the Welsh government allocated about £20 million over three years for its pilot.

The pilot hasn't been without controversy. The UK government, which in 2022 was controlled by the Conservative Party, opposed the Wales pilot and said UBI would discourage work and require significant tax increases to fund. Britain's Labour Party swept to power in July, and Prime Minister Keir Starmer has previously said he "isn't attracted" to UBI in response to advances in AI. He said the focus should be on retraining workers.

The Labour Party also controls the Welsh Parliament, but Kellam said that in Wales the party tends to be more progressive than its national counterpart.

The Autonomy Institute in 2023 proposed its own basic-income micropilot in the UK for 15 people, but Kellam said it hadn't attracted a funder yet. He hopes the results of the pilot in Wales, as well as emerging research in the US indicating the success of similar pilots, will create some momentum.

An analysis of 30 basic-income pilots in the US by the Guaranteed Income Pilots Dashboard — a research group that visualizes data from the programs — involving nearly 8,500 participants found more than half the cash grants went toward food and groceries, transportation, housing, utilities, healthcare, and education. Smaller basic-income studies and experiments found that cash payments helped participants earn higher wages, boosted job satisfaction, and improved productivity.

Kellam said another obstacle to implementing basic income in the UK is the government's centralized structure, which thwarts local leaders' ability to launch their own basic income pilots, like in the US.

"In the US, a lot of these trials are taking place at the town and city level," Kellam said. "We lack a lot of that infrastructure in the UK. We're involved in some of the discussions at local councils. But it's seen as less politically contagious."

• As LA looks to rebuild, it remains vulnerable to future wildfires.
• Solutions include fire-resistant building materials and designs, higher-density housing, and relocating residents.
• But rebuilding communities will have to contend with a housing shortage and political pressure.

LA's wildfires have displaced thousands of residents, and the city's leaders will have to decide how to rebuild in places where blazes are becoming more frequent and intense.

Experts in fire mitigation and climate science say LA should use this as an opportunity to design more resilient communities, given the growing risks of urban sprawl at the foothills of mountains and homes tucked into steep canyons that are vulnerable to fire.

They suggest relocating people out of areas most likely to burn, using more fire-resistant materials, establishing bigger buffer zones around homes and neighborhoods free of flammable vegetation and materials, and building more densely in safer areas.

But as the rebuilding effort begins to take shape, orders from city and state officials suggest they may not be taking that advice. LA Mayor Karen Bass issued an executive order on January 13 clearing the way to "rebuild homes as they were."

The order states that to be eligible for an expedited permitting process, a home must be rebuilt at the same location as it was before burning down and can't be converted from single-family to multi-family. A home also can't expand its footprint by more than 10%. The directives could leave those rebuilt homes just as vulnerable to the next fire.

Detailed below are some of the approaches experts said could help LA rebuild more safely.

Moving people to safer places

For decades, Americans have been moving into communities nestled next to and within forests and hills. A 2022 study published in Nature found that 45% of California's homes lie in those areas, more than in any other state.

Michael Wara, director of the climate and energy policy program at the Stanford Woods Institute for the Environment, said incentivizing people to move out of those risky areas and into safer zones — or managed retreat — is one of the most aggressive policies to mitigate the risk of wildfires and other disasters. The idea is "largely theoretical" in places like Pacific Palisades and Aldatena, he added, in part because they had vibrant economies.

To date, managed retreat programs have mostly focused on residents in a few flood-prone areas, including on Staten Island following Hurricane Sandy. In Alaska and on the Gulf Coast, communities disappearing due to melting permafrost and erosion and rising sea levels, respectively, were relocated.

A California program last year offered up to $350,000 in forgivable loans to people who were displaced by fires in 2018 and 2020 to move out of high-hazard areas, and the funds were quickly depleted.

Managed retreat is often "politically toxic," Stephen Smith, executive director of the Center for Building in North America, said. Asking longtime residents and homeowners to leave their properties and communities — or even just redesign them — is challenging and expensive. Some researchers also warned that buyouts in wildfire-prone areas could make the problem worse if abandoned lots become piles of kindling.

An alternative strategy is building more housing in safer parts of the city. Most of the greater LA area is dominated by very low-density, single-family detached houses. Restrictive zoning that prohibited multifamily buildings helped encourage residential sprawl.

But in recent years, California has passed a slew of laws designed to make it easier to build more dense housing. A new state law legalizing duplexes and lot-splitting in single-family neighborhoods across California could help boost density in single-family neighborhoods in LA further from the most fire-prone wilderness areas.

Making homes and neighborhoods more fire-resistant

LA officials should be considering community-wide plans for hardening homes and managing vegetation in yards and surrounding hillsides, said Erica Fischer, an associate professor at Oregon State University College of Engineering who studies fire resilience.

That's because fires can easily jump from one house to the next, both from embers carried by high-speed winds or radiant heat that ignites materials — two factors that caused the Palisades and Eaton fires to spread so fast.

"A lot of this comes down to not rebuilding quickly, taking the time to really make a community-wide plan, and then enforcing and enacting that plan," she said. "But that costs money and is daunting."

In 2008, California passed some of the strictest building codes in the country for homes in moderate-to-high-risk wildfire zones. They mandate fire-resistant materials for roofs, siding, and windows. Vents must have screens that shield embers from entering the home. So-called "defensible space" rules require homeowners to remove flammable materials like trees and shrubs starting 30 feet from the edge of buildings. The state fire agency, CalFire, also has the authority to fine homeowners who don't follow the rules.

However, older homes account for a large portion of those in LA County and weren't built to those strict codes, which added to the devastation.

Zach Seidl, a spokesperson for Bass, said in an email that the mayor wants to rebuild the Palisades to be more resilient but didn't say what measures she was considering. Seidl noted that current building codes are safer than decades ago and pointed to Bass' strategy to tackle LA's affordable housing crisis, which the mayor said has spurred more than 400,000 new housing units across the city.

A spokesperson for CalFire told Business Insider that since 2020, the agency has funded nearly $20 million in wildfire prevention grants to neighborhoods and homeowners and reduced fuels on more than 1,300 acres in LA County.

Smith said much of the risk stems from the combustible materials — namely wood framing — most American single-family homes are built with. "An urban fire is fueled by the actual structures, and we build our structures out of fuel in America," Smith said.

That makes the US an outlier, he added. Many countries have evolved to rely mainly on concrete, which is less likely to catch fire. The abundance of wood construction in the US is a result of both tradition and the lower cost of wood.

But the need to quickly rebuild might mean taking the path of least resistance

If the rebuilding efforts after other recent fires in California are any indication, homes in the Pacific Palisades, Altadena, and elsewhere in LA will be rebuilt in more fire-resistant ways, but communities won't be designed is a drastically different manner.

LA's booming economy and acute housing shortage intensify the need for a quick recovery. Rebuilding what previously existed is often the path of least resistance after disasters, as it's easier to obtain the necessary permits and homeowners may be cost-limited by inadequate insurance payouts and rising construction costs.

"This is no time for urban planning exercising. That'll delay it by 15 years. We need people back in their houses," Steve Soboroff, a real estate developer and former police commissioner tasked with managing the city's rebuilding efforts, said at a news conference.

Wara said LA officials' plans are setting people up for another disaster. He noted that Pacific Palisades and Altadena — which saw some of the worst damage — were laid out decades ago without wildfires in mind. Winding roads head toward the coast and in the direction of the powerful Santa Ana winds that blow flames from east to west into densely populated towns.

Climate change is only making catastrophic wildfires more likely, Wara added."

In 2023, LA saw record rainfall and abundant vegetation. Then last year, during a scorching hot summer, it quickly dried up, setting the stage for the current wildfires. A recent study by UCLA found that rising global temperatures are making this kind of "whiplash" between rain and drought more common.

After a disaster like the fires in LA, there's enormous pressure on political leaders to rebuild affected communities as quickly as possible. And that crunch — and the elevated costs that come with surging demand for construction resources — might not leave time for rethinking how the rebuilding happens to better protect communities going forward.

"You would think this would be an opportunity to harden the properties, to maybe not build on some lots that were immediately in the wildland interface. But what we see time and time again is the political realities going in exactly the opposite direction," Ben Metcalf, a housing policy researcher at the University of California, Berkeley, told Business Insider.

Ultimately, the affected communities will likely be built back to look much as they did before the fires. "We're left with the same strategy we've got, just a little beefier," Smith said.

• Trump said Monday that the US is in an energy emergency, pushing his agenda of higher output.
• He signed executive orders that would make it easier to produce oil and gas in the United States.
• The US is already producing and exporting record amounts of oil and gas.

President Donald Trump on Monday started to fulfill his promise to "drill, baby, drill" to boost US oil and gas production.

On his first day in office, Trump signed a declaration of a national energy emergency, an executive order that will allow the returning president to accelerate permitting for energy projects including pipelines and power plants. One of the Trump administration's priorities is to "use all necessary resources" to build energy infrastructure.

Another part of Trump's energy plan is to open up Alaska — which is rich in natural resources — for energy exploration and extraction. On Monday night, the president signed an executive order reversing Biden's restrictions on oil and gas exploration in the state.

"We will be a rich nation again, and it is that liquid gold under our feet that will help to do it," he said in his inaugural address.

The US, Trump said Monday, is home to "the largest amount of oil and gas of any country on Earth, and we are going to use it," promising to lower prices and "export American energy all over the world."

Trump said on the campaign trail that "unleashing American energy" — specifically oil and gas — and reversing the Biden administration's climate rules would lower prices at the pump and be an economic boon. For many Americans concerned about inflation, the message resonated.

On Monday, flanked by CEOs of the country's largest tech companies, Trump said he would end the Green New Deal and cancel the electric vehicles mandate.

In a statement, the White House said Trump would end leases to wind farms and withdraw once again from the Paris Climate Accord.

Still, delivering on those promises may prove difficult. Economists and energy analysts told Business Insider that oil and gas prices are largely dictated by global factors outside a president's control. Proponents of President Joe Biden's signature climate law also warned that unraveling it would undercut a manufacturing boom, predominantly in Republican states, where new factories are churning out solar panels, electric vehicles, and batteries that can reduce planet-warming emissions from fossil fuels.

In addition to fossil fuel production, administration officials said in a statement the orders will aim to boost supplies of non-fuel minerals and that the actions will increase consumer choice for a range of manufactured products.

In the US, about 24% of oil and 11% of natural gas are produced on federal lands and waters, per industry estimates. The vast majority comes from private land owned by individuals and companies. The Biden administration has limited drilling in federal areas like the Gulf of Mexico and Alaska and paused new permits for terminals to export gas overseas.

Groups representing the fossil fuel industry, including the American Petroleum Institute, said those moves cost jobs at home and threaten global energy security. The industry also argues the US needs more oil and gas to meet AI's skyrocketing demand for around-the-clock power.

US oil and gas production are already at record levels

ExxonMobil CEO Darren Woods suggested in November press interviews that the Trump administration would have little effect on production. The industry is already producing plenty of oil and gas, and there isn't an opportunity to unleash a lot of production in the near term, he said.

"Certainly we wouldn't see a change based on a political change but more on an economic environment," Woods told CNBC.

Trump's nominees to two key Cabinet positions said they would restore America's "energy dominance" during Senate confirmation hearings last week."

Chris Wright, Trump's nominee to lead the Energy Department, said he would back all forms of energy, including fossil fuels, nuclear power, and renewables. He said he believed climate change is a "global challenge" that needed to be solved — a shift from some of his past comments denying there was a crisis and criticizing renewables as "unreliable and costly." Doug Burgum, Trump's pick to lead the Interior Department, promised to expand oil and gas drilling on federal lands and waters.

Energy analysts told BI that oil majors have been more focused on returning money to shareholders than investing in new projects to boost production, in part because China is experiencing an economic downturn. For decades, China has driven global oil demand as it built new factories and real estate and the country's wealthier population bought cars. However, the housing market is now in disarray due to millions of unsold apartments and consumers are driving more EVs, crimping demand for oil.

Biden's climate law is creating jobs

China has managed to rapidly become a leader in renewable energy technology and controls the vast majority of the critical minerals needed for it. The Biden administration sought to catch up, in part by enacting the Inflation Reduction Act. University of Pennsylvania researchers estimated that the law would invest about $1 trillion over the next decade in developing and manufacturing technology like solar panels, wind turbines, electric cars, batteries, and nuclear power.

Since the IRA was enacted in 2022, more than 1,000 manufacturing facilities and 350,000 jobs have been announced. Millions of Americans have also claimed more than $8 billion in tax breaks for solar panels, EVs, and heat pumps, which could lower their energy costs over the long term.

Trump has called the law the "green new scam" and promised to terminate it.

• Trump is planning executive orders aligned with his "energy dominance" agenda.
• His top priorities are expanding fossil fuel exports and drilling on federal lands and waters.
• Trump may hit roadblocks in Congress and the courts in trying to roll back climate rules.

President-elect Donald Trump is expected to make a big push for fossil fuels on January 20 through a series of executive orders aimed at boosting US oil and gas production and rolling back the Biden administration's climate rules.

On the first day of his second term, Trump could direct federal agencies to approve new terminals to export liquified natural gas (LNG) and start unwinding restrictions on oil and gas leasing on federal lands and waters, several fossil fuel industry lobbying groups helping shape Trump's energy agenda said.

"On day one, we're excited about them lifting the LNG pause, which has been so damaging to the American LNG industry and our reliable trade partners overseas," Mike Sommers, president of the American Petroleum Institute, told reporters at an event in Washington, DC on January 14. He added that many executive orders will instruct federal agencies to restore America's focus on "energy dominance."

Other targets include Biden-era regulations that encourage the shift to electric vehicles, including curbs on tailpipe pollution and a federal waiver allowing California to ban the sale of new gas-powered cars by 2035. Trump may also toss out Biden's executive order from 2021 directing federal agencies to reduce greenhouse gas emissions across their buildings, vehicles, and supply chains.

Trump campaigned on a promise to "drill, baby, drill" and "unleash Americans' energy production," even with the US already producing a record amount of oil and gas and being the world's largest exporter. Industry executives, employees, and corporate political action committees donated more than $32 million to Trump's campaign, data tracked by Open Secrets shows.

But many of the industry's priorities can't be accomplished with an executive order alone, either because Congress has to change laws or federal agencies have to undertake lengthy rulemaking processes. Attempts to roll back Biden's climate rules will likely be challenged in court, as well.

"When he takes office, President Trump will make America energy dominant again, protect our energy jobs, and bring down the cost of living for working families," Karoline Leavitt, spokesperson for the Trump transition team, said.

Here's what fossil fuel groups said could happen quickly in the new administration.

Greenlighting new gas terminals

Trump can direct the Energy Department to start approving new permits for LNG terminals immediately via executive order, said Kenny Stein, vice president for policy at the American Energy Alliance, a conservative group advising Trump's energy agenda.

The move would end a temporary pause the Biden administration instituted in January 2024 so the Energy Department could study the impacts of more LNG exports on the economy, national security, and the climate crisis.

The API argued that the pause threatens global energy security and US competitiveness overseas and will cost jobs at home. In December, the Energy Department found that the US is already on track to double LNG exports to 2028 under approved projects, and continuing to approve new projects will increase greenhouse gas emissions fueling the climate crisis.

Environmental groups are expected to challenge new LNG permits in court and could cite the Energy Department's study.

Oil and gas leases on federal land and water

Trump has repeatedly promised to unwind limits that the Biden administration's Interior Department placed on oil and gas drilling in areas like the Gulf of Mexico and Alaska.

Trump is expected to direct the Interior Department to revise a five-year offshore leasing plan finalized by the Biden administration. The plan scheduled three auctions between 2024 and 2029 — a record low compared to the 47 sales proposed during Trump's first term.

In Alaska, the president-elect also wants to further open up the Arctic National Wildlife Refuge and the National Petroleum Reserve to fossil fuel development.

Biden in 2023 approved ConocoPhillips' massive Willow oil drilling project in the National Petroleum Reserve, but then made tens of millions of acres of the reserve off-limits to drilling to protect wildlife habitat.

During Trump's first term, Congress also directed the Interior Department to open Alaska's Arctic National Wildlife Refuge to oil and gas drilling for the first time. The Biden administration auctioned off 400,000 acres in January, the smallest amount allowed under the law, but it didn't attract a bidder. An auction in the final weeks of the Trump administration also didn't attract interest from any oil majors.

The state of Alaska sued the Biden administration over the sale, arguing that the area's size and additional restrictions made oil drilling economically unviable. The Trump administration could potentially expand the sale.

Targeting EVs

Trump is also expected to direct the EPA and Transportation Department to start reviewing and rewriting regulations that encourage the shift to electric vehicles.

"I will end the electric vehicle mandate on day one," Trump said during a speech at the Republican National Convention in July. "Thereby saving the US auto industry from complete obliteration, which is happening right now, and saving US customers thousands and thousands of dollars per car."

There are no federal EV mandates, however. In March, the EPA finalized tailpipe pollution limits for cars, SUVs, and trucks sold between 2027 and 2032, which are the strictest to date. The Biden administration said this could boost electric vehicles to up to 56% of new car sales, while hybrids could account for about 13% of sales as automakers adjust production to meet the new standards.

Trump is likely to go after California's recent move to ban the sale of new gas-powered cars by 2035. Under the Clean Air Act, the state can set more stringent limits on tailpipe pollution than the federal government as long as it's granted a waiver from the EPA. The agency in December greenlighted California's plan to ban the sale of new gas-powered cars by 2035, which the Trump administration is expected to revoke — similar to a fight with California over the waiver in his first term.

That would likely set up a legal fight with California Gov. Gavin Newsom, who has moved to "Trump-proof" the state and vowed to defend the state's EV and climate policies.

• Some fire hydrants ran dry in LA due to enormous water demand and infrastructure problems.
• President-elect Trump wrongly blamed a separate debate over water from northern California.
• Here's what you need to know about the water supply problems in Los Angeles.

Some fire hydrants in the Pacific Palisades area of Los Angeles ran dry this week after the wildfires overwhelmed the local water system.

The problem unleashed a flurry of criticism, including from President-elect Donald Trump. He accused California Gov. Gavin Newsom of refusing to sign a "water restoration declaration" that would have allowed water from northern California to flow into the areas burning in Los Angeles.

"He wanted to protect an essentially worthless fish called a smelt, by giving it less water (it didn't work!), but didn't care about the people of California," Trump wrote on January 8 on his social media platform.

But the reasons the water ran out were about local infrastructure, California officials and water policy experts told Business Insider. They also refuted the existence of a "water restoration declaration" and said Trump used the delta smelt as a scapegoat for a separate — and much more complex — debate over water allocations from a watershed in northern California.

A spokesperson for Newsom called Trump's claims "pure fiction," and accused Trump of politicizing the disaster. A spokesperson for Trump's transition team pointed to a plan his administration developed in 2019 directing water to the Central Valley and Southern California. But a Newsom spokesperson and California water policy experts said that plan is unrelated to water in fire hydrants in Los Angeles.

Newsom on Friday ordered an investigation into the cause of lost water supply and pressure in municipal systems. The order followed a report by the Los Angeles Times that a large reservoir in Pacific Palisades was empty and out of service as flames engulfed entire neighborhoods. The Los Angeles Department of Water and Power said it took the Santa Ynez Reservoir offline in February for repairs to meet safe drinking water regulations.

How water from the reservoir might have helped firefighters tame the blazes remains unclear.

Fire hydrants ran dry because of infrastructure

Janisse Quiñones, head of the Los Angeles Department of Water and Power, said urban water systems aren't designed to supply enough water to fight wildfires.

"We had crews trying to mitigate this, and they had to evacuate," Quiñones said during a January 8 press conference. "We're fighting a wildfire with urban water systems, and that is really challenging."

Quiñones said water demand was four times higher than usual for 15 hours straight as firefighters rushed to put out the flames. That depleted three 1 million gallon water tanks in Pacific Palisades between the afternoon of January 7 and early morning of January 8.

"Those tanks help with the pressure on the fire hydrants and the hills of Palisades," Quiñones said during a press conference. She explained that without enough pressure in the system, more water couldn't be pumped uphill into the tanks from a network of underground pipes and aqueducts, leaving hydrants dry. Officials couldn't refill the tanks fast enough as flames engulfed entire neighborhoods.

Jeffrey Mount, a senior fellow at the Public Policy Institute of California Water Policy Center, a nonpartisan think tank that tracks water use and storage data in California, characterized the water supply problems as an "infrastructure bottleneck."

"Water flows from the reservoirs into this very complicated network of pipes, pumps, and tanks that stretch all over LA. It's really like an electrical grid," Mount said. "Before the fire, the system was full, but then was drained."

However, the Santa Ynez Reservoir — which holds 117 million gallons of water — was empty. Had the reservoir been operable, water pressure in the Palisades would have lasted longer, Martin Adams, the former general manager of the Los Angeles Department of Water and Power, told the Los Angeles Times. He added that while it would have helped, it wouldn't have saved the day.

Newsom on January 8 said up to 140 additional water tender truckers were deployed to assist in fighting the Eaton and Palisades fires.

At a January 9 briefing, LA Mayor Karen Bass said fire hydrants aren't constructed to handle such massive devastation. The water shortage was compounded by the fact that planes couldn't perform water drops from the air because of the high-speed Santa Ana winds.

"That was the reason that the devastation was so bad," Bass said. "The unprecedented wind, the strength of the wind, and the fact that the air support could not go."

There isn't a water shortage in southern California

Trump accused Newsom of causing a water shortage around LA. But southern California has plenty of water, despite the issues with fire hydrants, sources told BI.

Most reservoirs in southern California are full, Mount said. As of January 10 the Castaic Lake reservoir — the largest State Water Project reservoir in Southern California — was at 77% of its total capacity, per the California Department of Water Resources.

Mount said this was due to two years of record rainfall and snowpack in the northern Sierra Nevada mountain range, which feeds many reservoirs that serve southern Californians.

Mike McNutt, a spokesman for the Las Virgenes Municipal Water District that serves 75,000 people in northwest LA — including in Palisades — told CalMatters on January 8 that the water supply was "looking pretty solid."

What does the delta smelt have to do with this?

A spokesperson for Newsom said Trump "conflated two entirely unrelated things: the conveyance of water to Southern California and supply from local storage." The spokesperson added that there was no "water restoration declaration."

Mount agreed, as did Mark Gold, the Natural Resources Defense Council's water scarcity director and a board member of the Metropolitan Water District of Southern California.

"There is no connection between the delta smelt and the water challenges of fighting a fire in Southern California," Mount said.

Mount said Trump may have been referring to a separate debate over how to allocate water exported from the Sacramento-San Joaquin Delta — where water in northern California flows into the San Francisco Bay — to both agriculture and urban areas in the southern half of the state, including Los Angeles.

In December, the Biden administration and California officials finalized a plan that aimed to strike a balance among farmers, urban residents, and depleted fish populations including the delta smelt, CalMatters reported. The new regulations replaced those finalized during Trump's first term, which were litigated by Newsom's administration over concerns that the delta smelt, salmon, and steelhead trout would be pushed to extinction.

While Los Angeles does import water from the Bay Delta through the State Water Project, Gold reiterated there are no shortages in southern California.

The region also gets water from the eastern Sierra Nevada through the Los Angeles Aqueduct, the Colorado River, and groundwater.

"The scapegoat for Trump has been the delta smelt because it's not exactly charismatic megafauna," Gold said, noting that endangered and threatened salmon, trout, and other fish are at risk.

January 12, 2024: This story has been updated to reflect the news that the Santa Ynez Reservoir has been offline since February last year, though it's unclear what effect that had on firefighting efforts.

Were you impacted by the Los Angeles fires and want to share your story? Email this reporter: Catherine Boudreau [email protected]

• Many Americans may experience sticker shock when buying a mocktail or glass of NA wine.
• Restaurants and bars said high-quality ingredients and labor-intensive prep adds to the price.
• Americans, especially those under 25, are spending less on alcohol and looking for NA options.

As Americans spend less on booze and browse menus for non-alcoholic alternatives like mocktails and wine, sticker shock can be a common reaction.

At Binge Bar in Washington, DC, the city's first fully non-alcoholic bar, "spirit-free" cocktails cost between $11 and $14. A glass of NA wine is $15, while a can of NA beer is $5. Prices are similar at other hot spots in Washington, DC. Moon Rabbit, an upscale Vietnamese restaurant, sells several "spirit-free" cocktails for $13 to $14 compared to about $19 for regular cocktails.

On social media, mocktails have been criticized as "glorified" or "sexy" juice that shouldn't be priced similarly to alcohol.

Restaurant owners and bar managers told Business Insider that alcohol alone doesn't drive the price. Mocktails are often made with high-quality ingredients such as botanicals, herbs, and spices, and can take longer to make. That way, customers still feel like they're getting the cocktail experience. Plus, NA whisky, gin, or wine can cost just as much — if not more — than traditional booze in part because removing alcohol is an additional step for manufacturers.

Ingredients account for about 18% of a drink's menu price, according to restaurant industry standards. The rest covers operating costs like labor, rent, and utilities, bar managers said.

This comes at a time when many participate in Dry January or reflect on their drinking after the US Surgeon General released its recent report linking alcohol to cancer.

Gigi Arandid, owner of Binge Bar, said NA cocktails are just as complex as those with alcohol. She spends a lot of time educating customers about special ingredients in Binge Bar's drinks and the health benefits of avoiding alcohol. Sales are up 45% between 2023 and 2024, Arandid said.

She created the most popular drink on the menu, a Cucumber Mangorita, with fresh cucumber juice, mango puree, lime juice, herbs, spices, and tonic. It costs $11 or $14, depending on whether you add a non-alcoholic tequila. The prices reflect the fresh ingredients, labor-intensive prep, and Reposado Tequila, she said.

Do you plan to change your drinking habits in response to the Surgeon General's recommendation? Tell us why in this survey

Unique syrups, herbs, and spices can up prices

At Moon Rabbit, bartenders infuse NA whiskey with five spice, a spice blend commonly used in Vietnamese and Chinese cooking, for 24 hours. The whiskey is made by Lyres, one of the most popular brands in the sector, and at $26 a bottle, it is more expensive than some traditional spirits, said Thi Nguyen, bar director at Moon Rabbit.

"We're not just putting a bunch of juice together," Nguyen said, adding that ingredients like purple shiso and soursop are expensive and challenging to source. "We are really intentional and want to highlight Vietnamese culture."

At Bresca, a Michelin-starred bistro in DC, spirit-free drinks are $12, while regular cocktails are in the $18 to $20 range.

Bresca's Cintronnade al la Menthe, a play on the mint lemonade you might find in France, is a three-day process. While the ingredients are simple — mostly lemon, cardamom, mint lemongrass, and sugar — bartenders make a citrusy syrup known as oleo from scratch, then lightly ferment and carbonate it, said Will Patton, beverage director for Hive Hospitality, which operates Bresca.

Non-alcoholic beer is more accessible

For those not interested in cocktails, NA wine is slowly gaining popularity as manufacturers improve the taste. But don't expect it to be cheap, because winemakers and brewers have to take an additional step to remove the alcohol.

"As a winery, you've already invested in making great quality wine, and then it's more work to run it through an industrial process to remove the alcohol," Sarah Kate, founder of non-alcoholic drinks magazine Some Good Clean Fun, said. "When you do that, you're also removing some of the characteristics of the wine."

Patton said mid-range NA wines cost between $17 and $25 a bottle, comparable to traditional bottles.

The beer industry is further along, with more than 150 brands, such as Athletic Brewing, Heineken, and Budweiser, making NA products. Athletic cofounder Bill Shufelt said in an email that the company's "off-premise" sales — or those at supermarkets and convenience stores — grew by more than 50% between 2023 and 2024. Athletic is now the most popular brand in the category, holding more than 19% market share, Shufelt said.

He added that the company has worked hard to match the price of widely distributed craft beer. Six-packs of Athletic are typically priced between $9.99 and $10.99 on retail shelves. The price is budget-friendly, even after Athletic re-engineered nearly every step of the brewing process to make its products free of alcohol.

"While some may assume that the absence of alcohol should make NA beer less expensive, the reality is that it can cost just as much — or even more — to produce," Shufelt said.

• A fire devasted one of the world's largest secondhand clothing markets in Accra, Ghana.
• Kantamanto Market receives 15 million garments weekly and employs some 30,000 people.
• An advocacy group urged the global fashion industry to provide relief.

A fire devastated one of the world's largest secondhand clothes markets in Accra, Ghana.

The blaze started Thursday and destroyed as much as two-thirds of Kantamanto Market, which employs about 30,000 clothing traders and receives some 15 million garments weekly from wealthy countries like the US, the UK, and China.

Thousands of people lost their stalls. Ghana National Fire Service said the fire was fully extinguished, and no injuries or fatalities were reported. They are still investigating the cause of the fire.

Now, clean-up efforts are underway, and advocacy groups are calling on the global fashion industry to help provide relief.

"This is a critical moment for the global fashion ecosystem to show solidarity, not just by recognizing the value of secondhand markets, but by providing tangible help to rebuild and sustain them," Daniel Mawuli Quist, creative director of The Or Foundation, said in a statement.

The fire calls attention to the global fashion industry's lack of alternatives for waste handling.

Workers in Kantamanto Market resell and remanufacture millions of garments. But the rise of fast fashion has overwhelmed Accra with textile waste piling up in gutters, landfills, and beaches. An estimated 40% of garments go unsold, The Or Foundation found. The nonprofit in Ghana conducts research and offers grants and job training to workers in Kantamanto Market.

The Or Foundation pledged $1 million to relief efforts and set up a fund to raise money for rebuilding the market and providing financial assistance to vendors.

Kantamanto Market before the fire

Up to two-thirds of the market was destroyed

The fire was extinguished on Thursday

The aisles of Kantamanto Market before the fire

Thousands of people have lost their stalls

Metal scrap dealers are going through the rubble now that cleanup efforts are underway

• Real-estate tech startups aim to make tasks from property management to homebuying more efficient.
• We surveyed 10 venture capitalists to identify the hottest proptech companies of the year.
• Some of the firms are modernizing real estate by digitizing analog processes, sometimes using AI.

The frozen housing market meant tough times for the proptech — or property technology — industry.

As the market starts to thaw, however, things are looking up for firms that seek to use technology to digitize, automate, or otherwise improve legacy processes in the worlds of residential and commercial real estate.

Business Insider asked 10 venture-capital investors who focus on real-estate and construction technology to nominate the most exciting, promising, and talked-about proptech startups in 2024.

The 20 companies on the final list reveal the breadth of the proptech universe.

Take Steadily, a firm trying to digitize insurance underwriting for real-estate investors, a process that has historically taken a lot of paperwork and time — only to result in policies with steep premiums. Another startup, Arcol, aims to make producing 3D architectural drawings faster and easier. A third, Conservation Labs, uses an AI-powered sensor to detect if water is leaking or being wasted in a building to prevent damage and protect the environment.

In the first half of 2024, venture funding for proptech companies dropped 14.3% from the same period a year prior. Funding totaled $4.37 billion, down from $5.1 billion during the same period in 2023 and dramatically less than the $13.13 billion invested in the first six months of 2022, according to the Center for Real Estate Technology & Innovation (CRETI), which surveyed 1,088 proptech startups.

Certain niches, however, hold promise. In 2024, VC investments in AI-powered proptech companies reached a record $3.2 billion, CRETI reported earlier this month.

Here are 20 of the buzziest proptech companies in 2024, presented alphabetically. The companies' fundraising numbers are from PitchBook to ensure a consistent data source.

Did we miss a company you think is disrupting the industry? Send reporter Jordan Pandy an email at [email protected].

Agora

City: New York City and Tel Aviv

Year founded: 2019

Total funding: $64.31 million

What it does: Agora is a financial software firm that helps real-estate investors process payments, keep track of tax records, raise money, and generally organize data.

Why it's hot: The firm, which raised a $34 million Series B round in May, said it helps landlords and developers with much-needed modernization.

"Real estate is the largest asset class in the world. However, the market still relies on legacy software providers, inefficient workflows, outdated, fragmented systems, and manual, tedious work," Asaf Raz, Agora's head of marketing, told Business Insider.

"Investors expect a digital-first experience — they're tech-savvy and need access to information quickly. Firms can't work without it, and clients need a platform like Agora more than ever," Raz said.

A challenge it faces: Real-estate investors are still grappling with relatively high interest rates, which makes it harder to borrow money and scale up, and the relatively high price of materials, which makes it tougher to renovate or upgrade properties. Those market forces could make customers more reluctant to spend money on new software.

Agora CEO Bar Mor told business news site Pulse 2.0 earlier this month, however, that Agora might still appeal to customers because its suite of products could help them "enhance efficiency and save costs."

Arcol

City: New York

Year founded: 2021

Total funding: $5.1 million

What it does: Arcol is a web browser-based design tool predominantly used by architects to create and collaborate on 3D models of buildings and explore their feasibility.

Why it's hot: Architects — Arcol's target audience — have traditionally relied on software design tools like AutoCAD and Revit, which require paid licenses and aren't as collaborative. Arcol has set out to solve that issue with a browser-based format easily shared and edited by anyone involved in a building project.

"These people are core to our society; they're literally building the built world, yet they hate using their tools," said Paul O'Carroll, the son of an architect and founder of Arcol. "The design tool we use to design buildings, we want to rethink for the browser to be collaborative and to be performant."

So far, demand is high. Arcol, run by a team of six, has a waitlist of over 18,000 users, O'Carroll said.

A challenge it faces: There are several other startups in the BIM, or Business Information Modeling, space. Competing with established players like Revit could take a lot of time and money, according to AEC Magazine. (AEC stands for architecture, engineering, and construction.)

Also, Arcol is currently only useful to architects during the conceptual modeling phase, and the company hopes to expand the tool to help with other stages of construction.

Branch Furniture

City: New York City

Year founded: 2018

Total funding: $11.76 million

What it does: Branch Furniture sells office products, like chairs and desks, to businesses and directly to consumers.

Why it's hot: The company's first iteration sold office furniture the old way: B2B, catering to employers outfitting a huge space who would often purchase items in bulk. After the pandemic changed how (and how often) workers occupied offices, Branch pivoted to sell to regular people — wherever they work.

"We launched our D2C business to cater to the future of work, which was definitively hybrid, both during COVID and after — and that's where we sit today," Sib Mahapatra, cofounder of Branch Furniture, told Business Insider.

Branch's ergonomic chair is a bestseller with a 4.6 rating out of five with over 6,000 reviews — it's rated among the best in its category by Business Insider, Architectural Digest, and Wired for its adjustability and sleek design.

In addition to desk chairs — in colors that range from a standard black to salmon-y orange hue called "poppy," the company also sells desks and lamps to outfit a home office. Its inventory includes meeting tables and even phone booths ($6,395) for more commercial office spaces.

A challenge it faces: Branch's products are physical, so it's been plagued by supply-chain delays. Branch is also up against competitors in the good-looking-furniture-that-is-also-comfortable arena, including Herman Miller and Steelcase — though Branch's offerings are often cheaper.

The company is also gaining ground regarding velocity, or the speed at which new products are developed and released.

"We're learning a lot about the pace of iteration in our product category," Mahapatra said. "It's definitely not software, but the benefit is that you get more time to really get things right and to iterate with purpose, and you end up being a little bit more deliberate about how you iterate the product — it just takes longer."

BuildCasa

City: Oakland, California

Year founded: 2022

Total funding: $6.67 million

What it does: BuildCasa helps California homeowners subdivide their lots — thanks to new state laws — and then connects them with local builders who pay the homeowners for a portion of their land and then build new housing on it.

Why it's hot: The national housing crisis is particularly acute in California, which recently passed a series of laws to encourage more building. While others look to transform construction to make cheaper housing, BuildCasa uses technology instead to find more buildable lots in desirable locations like San Francisco and San Jose.

Most massive home-building companies focus on large, master-planned communities, often far from city centers. BuildCasa's vision, said its founders Ben Bear, CEO, and Paul Stiedl, CPO, is to become a large homebuilder focused instead on finding land in already desirable cities and suburbs.

The company works with homeowners to subdivide their land, creating a new, buildable lot. Those lots can then be sold to a local real-estate developer to build on, or BuildCasa can work in partnership with a local builder to erect and then sell a completed home.

A challenge it faces: New laws have simplified the process of subdividing lots, but building in infill areas still requires technical expertise and good relationships with local officials. Building on these smaller lots may be becoming easier, but it still isn't easy.

Conservation Labs

City: Pittsburgh, Pennsylvania

Year founded: 2018

Total funding: $14.68 million

What it does: Conservation Labs developed a smart water sensor that can identify leaks and wasteful water use. The H2know sensor uses machine learning to decode sounds in water pipes and translate them into insights for commercial property owners, including restaurants and hotels.

Why it's hot: The startup is at the intersection of two buzzy topics: AI and sustainability. H2know trains on thousands of hours of water pipe acoustics so that, over time, it becomes more accurate in detecting leaks and inefficient water use in buildings. Customers use that information to fix problems and conserve water, saving them money on utility bills while lowering their overall carbon footprint. Some 20% of home energy use goes to heating water.

"There's a very strong relationship between net-zero carbon emissions and water consumption," said Mark Kovscek, founder and CEO of Conservation Labs.

He added that H2know has detected leaky toilets in nearly every building in which it's installed. Some large properties are wasting 1 million gallons of water a year, he said.

A challenge it faces: H2know starts at $129, and it could be hard to convince cash-strapped commercial real estate owners to spend money to install sensors when the office market is struggling in many parts of the US.

Kovscek said the goal is to scale up to 100,000 sensors installed as soon as possible, or five times what Conservation Labs is currently on track to sell this year. To support that growth, the company needs to hire some of the "best and brightest" data scientists and engineers to further develop the machine-learning platform that underpins H2know, Kovscek said.

Constrafor

City: New York

Year founded: 2019

Total funding: Almost $380 million

What it does: Large general contractors use Constrafor's software to onboard and pay their subcontractors on time — sometimes before the contractors themselves get paid by the clients. Contractors can also use the software to help purchase the supplies and services needed to complete a construction project on time and within budget.

Why it's hot: There's the money raised. In November, Constrafor announced that it raised $14 million in Series A funding as well as a $250 million credit facility.

The issues the firm is trying to address are also key. Construction is booming across the US, thanks in part to President Joe Biden's $1.2 trillion infrastructure bill. The rise of AI is also leading to a corresponding increase in the construction of data centers.

The actual process of construction, however, can often be long and complicated. That's why Constrafor's role as a one-stop shop appeals to large general contractors.

"So far, everyone has been focused on just building a very, very small point solution," said Anwar Ghauche, Constrafor's founder. "We're combining multiple different workflows, multiple different departments, all on the same platform."

The main challenges it faces: Next up: Constrafor must try to convince subcontractors to subscribe and pay for its software, too.

Gauch added that Constrafor's contractor clients can face cash-flow crunches. Those can lead to delays on important projects.

After Hurricanes Helene and Milton severely damaged parts of Florida, North Carolina, and other parts of the Southeast, Constrafor launched a disaster relief effort that would allow local contractors who are part of rebuilding efforts "to overcome delays, purchase materials, and ensure timely payment for their teams."

Ease Capital

City: New York

Year founded: 2022

Total funding: $13.95 million

What it does: Ease Capital helps private equity firms and large investors lend to smaller apartment landlords. It uses data and technology that allow the biggest players to lend $5 million to $50 million in deals that would typically be too small for them.

Why it's hot: Sophisticated private lenders usually focus on the largest apartment complexes, meaning that most apartment-building owners have to turn to banks and agencies to borrow money to purchase or refinance properties. However, current high rates have dramatically slowed bank and agency lending and the large private lenders usually won't lend for small—and medium-sized projects.

Ease uses data and technology to make it easier and more efficient for these large lenders to lend on smaller deals when the need is the highest. In 2023, the company announced a $450 million partnership with major real estate owner and asset manager Taconic Capital Partners, and has already announced multiple successfully originated loans.

CEO Charlie Oshamn told Business Insider earlier this year that the company is often seeing up to $1 billion in loan requests a month. Unlike other firms, which provide an estimated rate upfront that could potentially change over months of negotiation, Ease Capital sticks to its initial offering, eliminating the guessing game for potential clients.

A challenge it faces: Though the founding team has successfully launched other major proptech businesses, like flexible office and event space provider Convene and real-estate data firm Reonomy, it still needs to prove itself as a lender.

Habi

City: Colombia and Mexico

Year founded: 2019

Total funding: $564 million

What it does: Habi has built Latin America's largest proprietary database and utilizes AI-based pricing algorithms to facilitate transactions and financing for homebuyers and sellers. Habi also buys and sells homes, offers mortgages, and posts and publicizes listings of properties for sale.

Why it's hot: The company operates in Colombia and Mexico without centralized MLS. MLS, or multiple listing services, are databases designed to help real estate brokers identify available homes for sale. These systems are abundant in the US, whereas they are scarce in Latin America. Without an MLS, it means homebuyers and sellers in Colombia and Mexico have difficulty knowing which properties are available for sale, their prices, and their listing and pricing history.

By gathering and sharing information on more than 20 million homes, Habi has addressed a critical need in these countries' real estate sector, establishing itself as an authority on housing in the region.

"We've become a household name for low and middle-income sellers and consumers and brokers in Mexico and Colombia," Brynne McNulty Rojas, CEO and cofounder of Habi, told Business Insider.

A challenge it faces: A combination of factors, including shifting economic and political conditions, has stalled the growth of Latin America's real-estate market. To achieve the same level of ubiquity as Zillow in the US, Habi must get real-estate brokers and sellers to list their properties on its platform and entice buyers to use it.

HoneyHomes

City: Lafayette, California

Year founded: 2021

Total funding: $21.35 million

What it does: Founder Vishwas Prabhakara envisions Honey Homes as a "primary care physician for your home." For a monthly fee, a dedicated handyman will come once or twice a month to knock off "lightweight" home improvement projects like fixing a leaky faucet, installing a new ceiling fan, or repainting a room.

Why it's hot: With a cooling housing market, Prabhakara believes many homeowners are staying in their homes longer and interested in investing resources in — and enjoying — the property they currently have.

The main challenge it faces: Homeowners who already hire their preferred handymen may not be willing to pay for a service that sends new people, and bigger projects might require more specialized repair professionals. Then there's the cost and current smaller scale of the company: Subscriptions start from $295 a month, or $3,940 a year, according to the company website. The service is only available in parts of San Francisco and the Bay Area, Los Angeles, Orange County, and Dallas, according to the site.

Impulse Labs

City: San Francisco

Year founded: 2021

Total funding: $25 million

What it does: Impulse Labs made a battery-powered induction cooktop that, unlike most of its competitors, which may require an electrical upgrade, can plug into a standard 120-volt outlet. The cooktop can boil water at lightning speeds, and sensors hold heat levels steady even at high temperatures.

Why it's hot: Impulse Labs founder Sam D'Amico said the cooktop offers a better cooking experience than gas burners while promoting more climate-friendly homes. Cooking with gas emits pollutants like methane, benzene, and carbon monoxide, which harm our health and the planet. But it can cost thousands of dollars to rewire a home for an electric induction stove. Impulse Labs' induction cooktop avoids those pollutants and the cost of home retrofits.

The battery in Impulse Labs' stove also stores enough power to make three meals if the power goes out, D'Amico said.

"One of the cheapest ways to deploy battery storage is in the appliances we have to buy anyways," he added.

The main challenge it faces: The cooktop costs $5,999. The price is high, D'Amico said, but similar to other premium appliances. The price is lower if buyers qualify for tax breaks and rebates from federal and state governments, as well as some utilities. It's also only a cooktop — not a full stove — but D'Amico said the company eventually wants to sell a suite of appliances that can be a whole-home battery solution. Impulse Labs is accepting pre-orders, with plans to ship in the first quarter of 2025, according to its website.

Keyway

City: New York City

Year founded: 2020

Total funding: $43 million

What it does: Keyway uses machine learning and AI to aid institutional investors in sourcing, underwriting, and managing portfolios of properties.

Why it's hot: Companies that use AI have become commonplace today, but Keyway believes it is ahead of the pack in adopting and applying AI technology to real-estate investing.

"We were very early on in the AI game in 2020, and I think we've built a really strong backend of data with lots of APIs that allows us to integrate very segregated data very fast," CEO and cofounder Matias Recchia told Business Insider. "The fact that we built our system in a modular way also allows us to customize our product to a lot of our customers — so it's really not one solution fits all."

The main challenge it faces: New technology like Keyway can be hard to push on seasoned real-estate investors as they're used to using old-school methods like manually sourcing, underwriting, and managing portfolios.

"We're merging two cultures that are very different," Recchia said. "The real-estate industry requires a lot of proof to show them that data can really help them make better decisions. So there's a little bit of a culture shift that we're bringing to real estate as we sell them these tools and we partner with them."

Latii

City: Brooklyn, New York

Year founded: 2023

Total funding: $8.82 million

What it does: Latii is a sourcing platform that uses AI-powered tools to help North American-based architects and contractors save up to 60% by connecting with Latin American, southern European, and northern African window and door fabricators.

Why it's hot: Architects often include custom windows and doors in their designs, but hiring contractors and craftspeople overseas can cost their property-owning clients thousands of dollars. The architects who work with Latii, however, can source materials faster and at lower costs, cofounder and CEO Santiago Bueno told Business Insider.

"We're able to produce either equal or higher quality products at a less expensive rate," Bueno said.

In October, Latti announced that it had raised $5 million in seed-round funding, which it will use to expand in the Pacific Northwest, Mountain states, and the New York tri-state area.

The main challenge it faces: When working with fabricators in Latin America, challenges can arise in managing certifications, enforcing warranties, and overcoming language barriers. The region's use of the metric system can also be difficult for North America-based architects to navigate.

Lessen

City: Scottsdale, Arizona

Year founded: 2020

Total funding: $713.8 million

What it does: Lessen's software allows commercial and residential landlords to track maintenance needs, connect with service providers, and buy products.

Why it's hot: In August, Inc. magazine named Lessen the fastest-growing private software company in the US, citing its $1.1 billion valuation.

The valuation preceded a major acquisition in 2023: Lessen spent $950 million to buy property maintenance management firm SMS Assist in what the Commercial Observer called the largest proptech acquisition in history.

Lessen's software is widely used, handling 3 million work orders a year across 250,000 properties, according to Fifth Wall, an investor in the firm. Lessen also launched Lessen Advantage Marketplace, which allows its landlord customers to buy materials like glass, floors, and doors and find better insurance and loan rates.

The main challenge it faces: Like many real-estate firms, Lessen faces an overall slowdown in both the commercial and residential sectors, with mortgage rates remaining elevated. One big potential client base for Lessen is office building owners and property managers, but the office market right now is struggling, with vacancies around the US at record highs.

"We typically grow hand-in-hand with our clients, serving them in additional properties and markets as they expand. So, for example, interest rates can influence growth in some areas of our business," said Michael Tanner, senior vice president of marketing at Lessen.

A dearth of tradespeople is also a challenge for the company's platform that connects them to landlords, Tanner said.

Finally, the firm competes in a crowded market of competitors offering software for landlords, including Stessa, AppFolio, TenantCloud, and more.

Metropolis

City: Santa Monica

Year founded: 2017

Total funding raised by the company: $1.93 billion

What it does: Metropolis uses a computer vision platform powered by artificial intelligence to enable checkout-free payment at parking facilities. After registering their vehicles on the Metropolis app, customers can simply drive in and drive out without the hassle of paying with credit cards or ticket machines.

Why it's hot: Metropolis announced its acquisition of SP Plus, the largest parking network in North America, for $1.5 billion in October 2023 and closed the deal in May 2024. The move allowed Metropolis to rapidly scale its technology and reach 50 million customers across 4,000 locations.

"We've seen success and are continuing to scale and grow because Metropolis' checkout-free experiences give people the gift of time back, so they can spend it on the things that matter the most," cofounder and CEO Alex Israel told Business Insider.

The main challenge it faces: Israel said that most of the parking payments and transactions in the world are still analog.

"We envision a future where checkout-free payments travel with you, but scaling this technology across industries is complicated — it requires remarkable proprietary technology and boots on the ground," he said.

PredictAP

City: Boston

Year founded: 2020

Total funding: $13.17 million

What it does: PredictAP makes real estate invoice processing simple and easy. It uses AI to code invoices quickly.

"So the accounting rules can become very complicated in commercial real estate at big companies," said CEO and founder David Stifter, describing the journey of how an invoice is processed.

He said an invoice would come in first, and someone would need to determine which accounting rules to apply. Predict AP will be useful at this stage because the AI will understand and use the accounting rules correctly. Then, it will go through the rest of the accounts payable process, a department responsible for paying vendors for services or goods at the company. Then, someone will approve it and then pay for it.

Why it's hot: Predict AP serves every corner of the real estate sector. The company said its customers are publicly traded companies that own real estate, private companies that own and operate real estate, or customers who provide services for those big companies.

The company has been able to help AP specialists and property managers face difficulties entering invoices because it takes a lot of time and effort.

"We're able to help folks with that difficult task of coding invoices and it's particularly painful in real estate where there's a lot of complexity," said CEO and founder David Stifter. He added: "Nobody wants to be typing 15-digit invoice numbers; that's not fun."

Russell Franks, the president and cofounder of Predict AP, added to his comments and noted that Predict AP could process an invoice in 30 to 40 seconds faster than the normal processing time of five to 10 minutes.

The main challenge it faces: The company shared that it is hard to find funding in this tough economy, and it is not easy to grow and expand.

Propexo

City: Boston

Year Founded: 2022

Total funding: $7.97 million

What it does: Propexo's unified API, or application programming interface, helps other real-estate tech companies quickly and easily integrate with property-management systems.

Why it's hot: Real-estate tech companies use APIs to integrate with data from external sources, like lead generation systems or rent roll systems.

However, existing APIs and the technology around them are outdated.

That means companies lose time and money that could be used to develop their product while trying to integrate with these APIs, said COO Ben Keller.

Propexo's unified API improves the developer experience by making the integration process simpler, faster, and cheaper. "We're really the first engineering infrastructure product in the proptech ecosystem," said Keller.

The main challenge it faces: It's not easy to convince property managers and owner-operators to change how they've been running their businesses for many years.

In August, the Department of Justice filed an antitrust lawsuit against RealPage, alleging that the property-management software company allows landlords to coordinate and unfairly keep rents high. This is causing some landlords to rethink how they handle and process information, according to trade publication Multifamily Dive.

Rent Butter

City: Chicago

Year founded: 2020

Total funding: $4 million

What it does: Rent Butter has created an alternative tenant screening process that gives landlords a more comprehensive view of applicants' financial history.

Why it's hot: Landlords have historically relied on static credit reports and background checks when evaluating potential tenants. Doing so creates a barrier for applicants with financial difficulties early in their adult lives, as credit scores are a difficult metric to improve.

Rent Butter is trying to eliminate that barrier and change the narrative around who is a "good" candidate by providing landlords with additional information that can more accurately assess a person's financial reliability.

Their application connects to an applicant's bank account, credit history, and employment, criminal, and rent payment history to provide a detailed one-page report highlighting their financial behaviors and potential risks.

"Our whole approach is: How do we show who the person is today — not who they were seven or 10 years ago," cofounder and CTO Christopher Rankin told Business Insider.

The main challenge it faces: Rent Butter partners with landlords, rather than selling directly to consumers, which makes scaling a challenge. Most landlords already have a tenant-vetting process, so it could be hard to convince them to change to Rent Butter.

Shepherd

City: San Francisco

Year founded: 2021

Total funding: $22.27 million

What it does: Shepherd is a Managing General Underwriter (MGU) leveraging tech to make underwriting commercial construction insurance more efficient. It also wields data to create more informed risk selection and price recommendations, often leading to upfront and long-term savings for policyholders.

Why it's hot: Insurers partner with MGUs to provide clients with insurance, with the MGU underwriting policies for clients and selling to potential policyholders. Shepherd adapts the typical MGU model by cutting the underwriting process from weeks to hours and incorporating risk assessment tech into its platform, making it a one-stop shop for insurers and clients. By working faster and putting these services in one place, Shepherd can better serve construction companies and insurers while fostering more involved relationships.

The main challenges it faces: Both insurance brokers and potential clients have some healthy skepticism about a new model for commercial construction insurance, so it falls on Shepherd to earn their trust to gain their business.

Steadily

City: Austin

Year founded: 2020

Total funding: $60.1 million

What it does: Steadily is a digital insurance company for real-estate investors that promises a "faster, better, and cheaper" underwriting experience.

Why it's hot: Steadily founder Darren Nix first encountered the outdated nature of insurance underwriting, trying to find quotes for his own rental property in Chicago.

Terrible customer service and shockingly high quotes stopped him in his tracks.

"It was like rolling back the clock to the mid-1990s," he told Business Insider. Focusing on selling insurance to real-estate investors has helped Steadily grow to about 140 employees across Austin and Kansas City, Missouri.

In November, Steadily announced it had started to actively write new business on its own insurance carrier. "Nothing says 'we believe in the product we've built' more strongly than underwriting risk as the carrier," Nix said in a statement.

The main challenge it faces: Steadily has started selling insurance to short-term-rental investors, which presents different challenges than underwriting more traditional, longer-term rentals.

The market represents significant growth — accounting for nearly 20% of Steadily's current business — but the pricing is tricker.

"The people coming in and out of those properties don't take care of them at the same level of responsibility," Nix explained. "One of the things that a host can do to demonstrate that they are a good insurance risk is to point to their Airbnb or VRBO history and show that they're a super host, they take great care of their property, they don't host ragers."

Tour24

City: Medfield, Massachusetts

Year founded: 2020

Total funding: $20.35 million

What it does: Tour24 is an app that lets prospective tenants take self-guided apartment tours without a leasing agent present.

Why it's hot: In many cities, renting an apartment can be cutthroat, with open-house lines and bidding wars to nab a good unit at a reasonable price.

More than ever, people are deciding on places to live quickly — sometimes even committing before they've even seen the unit because they aren't able to schedule a walkthrough that jives with their working hours.

Tour24 allows users — who are ID- and credit card-verified — to tour apartments when leasing agents aren't available, such as on evenings and weekends.

"We are seeing that certainly millennials really prefer self-guided experience," Georgianna W. Oliver, the founder of Tour24, told Business Insider.

Oliver said many of their leasing-agency clients offer Tour24's self-guided tours as well as leasing agent-led tours and virtual tours — and have given feedback that the more options they give potential renters, the better.

"People have the options," she said. "And they really like having the options."

The main challenge it faces: Since the worst part of the COVID-19 pandemic, many individual leasing agencies have been offering some version of a self-guided tour on their own with their own video Tour24 also competes with other self-guided rental-tour apps like Rently and CareTaker.

Tour24 seems to be holding its own: The startup announced in October that it raised $5 million in a Series B round, noting that it had doubled in size in 2024 to reach 525,000 units across over 2,060 multifamily properties.

• Homeowners are increasingly being dropped by their private home insurers.
• Regions with the highest nonrenewal rates are most prone to wildfires, hurricanes, and other disasters.
• A new Senate report warns of economic risks as climate change destabilizes insurance markets.

Homeowners across the country are increasingly facing a stark new reality: they're losing their home insurance.

The share of home insurance policies from large insurers that weren't renewed increased last year in 46 states, a report released Wednesday by the Senate Budget Committee found. The increasing frequency and intensity of disasters like wildfires, hurricanes, and flooding and the rising cost of rebuilding have pushed many insurers to drop customers or hike premiums. This has left thousands of homeowners scrambling to find new insurance policies or joining the growing ranks of those going without insurance.

More than 200 counties saw their non-renewal rates spike threefold between 2018 and 2023. Counties in Northern California and South Florida saw among the highest rates of nonrenewals. Coastal counties in Massachusetts, Mississippi, and North Carolina also saw dropped policies soar. Manhattan ranks 20th, with rates of dropped policies rising from 1.25% in 2018 to 4.11% in 2023.

The national scale of home insurance nonrenewals was previously unknown because insurance companies are regulated at the state level. The National Association of Insurance Commissioners said not all states collect granular data about the availability and affordability of coverage in some areas. The association in March announced an effort with state insurance regulators to try to fill the gap.

Senate Budget Committee Chairman Sheldon Whitehouse launched his own investigation into the homeowners' insurance market last year. He received nonrenewal data from 23 companies accounting for about two-thirds of the market. In testimony on Wednesday, Whitehouse said he demanded nonrenewal data because experts suggested policies being dropped were an early warning sign of market destabilization. He also said they correlated with higher premiums.

The American Property Casualty Insurance Association, a lobbying group representing insurance companies, said nonrenewal data doesn't provide "relevant information" on climate risks. Many factors, including a state's litigation and regulatory environment, factor into nonrenewal decisions, the association said.

The association added that more costly weather disasters, combined with inflation and overbuilding in climate-risk regions, are making insurance less affordable for many Americans.

Home insurance premiums are rising in many regions across the country. The National Bureau of Economic Research recently reported that average home insurance premiums spiked by 13%, adjusted for inflation, between 2020 and 2023.

Most mortgage lenders require homeowners to purchase insurance, and some require additional insurance for specific disasters, including flooding. Insurers refusing to offer coverage can hurt home values because homes that can't be insured in the private market are less desirable to potential buyers.

The Senate Budget report warned that the insurance crisis will get worse as the climate crisis fuels more frequent and destructive disasters, including hurricanes, wildfires, and flooding. A destabilized insurance market could "trigger cascading economy-wide financial upheaval," the report said.

"The failure to deal with climate change isn't just driving up the cost of homeowners' insurance, it's making it harder for families to even find homeowners' insurance, and that makes it harder to get a mortgage," Whitehouse said in a statement to Business Insider. "When the pool of buyers is limited to only those who can pay cash, it cuts off pathways to homeownership—particularly for first-time homebuyers—and risks cascading into a crash in property values that trashes the entire economy."

Have you been dropped by your home insurance company or are you facing a steep premium increase? Email these reporters to share your story: [email protected] and [email protected].

• Private home insurers are dropping a growing number of customers in most states, a Senate report found.
• That leaves homeowners at risk, turning to more expensive last-resort options or going uninsured.
• While Florida has managed to reverse the trend somewhat, the risk to homeowners is set to intensify.

As Americans flock to places in the US vulnerable to natural disasters, private home insurance companies are running the other way.

The problem has left a rising number of homeowners with just one option to cover property damage: insurers of last resort.

The scale of homeowners losing their plans became clearer on Wednesday after a Senate Budget Committee investigation found that private insurers' nonrenewals spiked threefold in more than 200 counties between 2018 and 2023.

"What our new data reveal is that the failure to deal with climate change is also affecting whether families can even get homeowners insurance, which threatens their ability to get a mortgage, which spells trouble for property values in climate-exposed communities across the country," Senate Budget Chairman Sheldon Whitehouse said in releasing the report.

A recent study by Harvard University's Joint Center for Housing Studies found that between 2018 and 2023, the number of properties enrolled in California and Florida's insurers of last resort more than doubled. A similar trend is playing out in Louisiana. While Florida has reduced participation this year, it still has the highest enrollment in the country.

The problem isn't isolated to the most predictable states. The Senate Budget Committee found that the rate of homeowners losing their private insurance also rose in Hawaii, North Carolina, and Massachusetts.

Policymakers and insurers are trying to stabilize the private market, by enacting new laws and overhauling regulations. However, with scientists predicting that climate-fueled disasters will become more frequent and severe for the foreseeable future, the risk to America's homeowners is mounting.

Growing insurance risk has some states looking for solutions

In nearly three dozen states, insurers of last resort, known as Fair Access to Insurance Requirements, or FAIR, are available to homeowners and businesses who struggle to find insurance on the private market.

The numbers are rising because private insurers are pulling back coverage and hiking premiums in areas at risk of wildfires, hurricanes, flooding, and other disasters often made worse by climate change.

While state-mandated FAIR plans are designed to be a backstop, insurance regulators and private insurance companies are alarmed by how many homeowners and businesses are enrolling, especially in California and Florida. The plans are often more expensive and provide less coverage. Plus, saddling one insurer with the riskiest policies increases the chances of one major disaster sinking the system and leaving taxpayers and insurance companies with the bill.

Florida and California are trying to reverse the trend, and Florida has seen some progress. The state's insurer of last resort, Citizens Property Insurance Corporation, said on December 4 that its policy count dropped below 1 million for the first time in two years.

Mark Friedlander, a spokesperson for the Insurance Information Institute, said the drop reflects a series of changes in recent years to stabilize the state's private insurance market after more than a dozen companies left the state or stopped writing new policies.

The Florida legislature passed laws to curb rampant litigation and claim fraud that drove up legal costs for private insurers. Friedlander said insurance lawsuits in the first three quarters of 2024 are down 56%, compared with the first three quarters of 2021 — the year before the new laws were enacted. Citizens also started a "depopulation" program that shifts customers to the private market. State regulators in October said they had approved at least nine new property companies to enter the market, and premiums weren't rising nearly as much as last year.

In California, many of the deadliest and most destructive wildfires have occurred within the last five years. As a result, some private insurers are hiking premiums and limiting coverage in risky areas, pushing more homeowners to the insurer of last resort. The Harvard study found that policies in the state's FAIR plan doubled between 2018 and 2023 to more than 300,000. As of September, the California Insurance Commission said policies totaled nearly 452,000.

The commission is working to overhaul regulations to slow the trend, including requiring private insurers to sell in risky areas. In exchange, it should be easier for companies to raise premiums that factor in reinsurance costs and the risks of future disasters. That should help stabilize rates, said Michael Sollen, a spokesman for the commission.

Sollen added that in the past, private insurers could seek approval for higher premiums but weren't required to offer coverage in wildfire-prone areas.

"In a year from now, what's happening with the FAIR plan will be a key measure for us," he said. "We expect to see those numbers start to stabilize and go down."

A mounting home insurance crisis

Still, a reduction in state-backed plans isn't necessarily a sign of progress, Steve Koller, a postdoctoral fellow in climate and housing and author of the Harvard report, told Business Insider.

A growing number of homeowners in places like Florida, Louisiana, and California are purchasing private insurance from nontraditional providers barely regulated by state governments. These so-called "non-admitted" insurers don't contribute to a state fund that guarantees homeowners will have their claims paid even if the insurance provider fails, leaving their customers without access to this backup coverage.

"Someone could be moving to a private insurer from Citizens, and that insurer might have higher insolvency risk," Koller said.

He added that more homeowners are opting out of insurance altogether. The number of US homeowners going without insurance has soared from 5% in 2019 to 12% in 2022, the Insurance Information Institute reported.

Plus, Americans are increasingly moving into parts of the country most vulnerable to extreme weather. Tens of thousands more people moved into the most flood—and fire-prone areas of the US last year rather than out of them, the real estate company Redfin reported earlier this year.

As insurers of last resort try to shift more risk to the private market, home insurance premiums are expected to keep rising. That's especially true in the areas hardest hit by climate-fueled disasters.

If private insurers exit hard-hit regions en masse in the future, Koller said states might need to become the predominant insurance provider in the same way the National Flood Insurance Program took over after the private market for flood insurance collapsed in the 1960s. Most flood insurance plans are still issued by the federal government.

"My guess is states are going to work very, very hard to avoid that and ensure the existence of a robust private market, but that's a parallel that I can't personally unthink about," he said.

Have you struggled to get home insurance, moved to an insurer of last resort, or gone uninsured? Contact these reporters at [email protected] or [email protected].

• The Biden administration on Wednesday approved California's ban on gas cars by 2035.
• Trump has promised to revoke California's authority to set strict limits on tailpipe pollution.
• It's a high-stakes fight over the future of electric vehicles and tackling the climate crisis.

The stage is set for another battle between President-elect Donald Trump and California over the state's aggressive push for electric vehicles that could affect the rest of the country.

The Environmental Protection Agency on Wednesday said California can go ahead with its ban on the sale of new gas-powered cars by 2035. The approval is an attempt to safeguard the state's strict limits on tailpipe pollution from Trump's promise to revoke them and roll back other federal incentives for electric vehicles.

The stakes are high for automakers because what happens in California can dictate companies' broader EV strategies and the pace of the country's shift away from fossil fuels. The state accounts for some 11% of the US auto market and is also the top EV market in the country. In the first half of 2024, EVs and hybrids accounted for nearly 40% of sales in California.

On top of that, 11 other states and Washington D.C. have adopted rules similar to California's as they seek to reduce the country's largest source of greenhouse gas emissions. The rules require automakers to sell a growing number of zero-emissions vehicles over time. In 2026, at least 35% of new cars, pickup trucks, and SUVs must be electric in California and five other states, while other states' targets kick in in 2027.

Automakers largely support easing emissions regulations

While Trump will face legal challenges in trying to roll back California's rules, he could find some automakers on his side.

The Alliance for Automotive Innovation, a lobbying group representing most new vehicle manufacturers in the US, has already asked Trump to ease emissions regulations but keep federal tax incentives that keep EVs affordable.

John Bozzella, president of the alliance, said Wednesday that the waiver was an expected development and the Trump administration will likely revoke it next year.

"We've said the country should have a single, national standard to reduce carbon in transportation," Bozzella said in a statement. "But the question about the general authority of California to establish a vehicle emissions program – and for other states to follow that program – is ultimately something for policymakers and the courts to sort out."

Trump, some Republican lawmakers, and groups linked to fossil fuel interests have repeatedly attacked EVs on the campaign trail, falsely claiming that Americans would be forced to abandon their gas-powered vehicles.

Those attacks come as the EV market deals with a marked slowdown in demand, forcing many companies to reasses their long-term plans for battery-powered cars and, in some cases, add more hybrids to the mix. A pullback in production has made it harder for many companies to meet long-term emissions requirements. Automakers including General Motors, Ford, and Stellantis have laid off thousands of workers.

Auto market analysts, environmental lawyers, and policy experts told Business Insider that they expect the shift to zero-emissions vehicles to continue regardless of who's in the White House — albeit at a slower pace if Trump and Congress overturn tax incentives to buy EVs and investments in charging infrastructure.

"Whatever the Trump administration does this time, automakers' concerns about stability will come up again because all of these manufacturers have said zero-emissions vehicles are the future," Sean Donahue, an attorney who's represented the Environmental Defense Fund in litigation over California's emissions waiver, said.

He added that there's pressure from regulators in other countries to address the climate crisis. US automakers also don't want to fall far behind competitors in countries like China, where affordable EVs have taken off.

California looks to 'Trump-proof' its regulations

Even if Trump does revoke California's emissions waiver, Gov. Gavin Newsom is already trying to "Trump-proof" the state, including its EV and climate policies.

Newsom said he would restore rebates for consumers who buy EVs if Trump ends the federal $7,500 tax credits enacted in the Inflation Reduction Act. This month, the state's energy commission approved a $1.4 billion investment in EV charging and hydrogen fuel stations over the next four years. The commission said the funding could help build nearly 17,000 new public chargers for passenger vehicles — on top of the 152,000 available now.

Newsom also convened a special legislative session to bolster California's defenses against Trump's attacks. Lawmakers could pass $25 million in new funding for the California Department of Justice so the state can file litigation against the Trump administration. That will likely happen if Trump revokes the state's tailpipe pollution waiver.

Karoline Leavitt, a spokeswoman for the Trump transition team, said that Trump plans to stop what he says are attacks on gas-powered cars.

"When he takes office, President Trump will support the auto industry, allowing space for both gas-powered cars AND electric vehicles," she said in an email.

Ann Carlson, a professor of environmental law at the University of California at Los Angeles, told Business Insider that she expects the Trump administration to face an uphill legal battle.

She said the EPA has approved California's authority to set strict rules for tailpipe pollution for decades because the state's air quality is so bad. Otherwise, areas including Los Angeles and the Central Valley wouldn't comply with federal air pollution laws and could be penalized.

"The sanction is the withholding of federal highway funds," Carlson — who recently served as chief counsel to the National Highway Traffic Safety Administration — said. "It's quite draconian. So California has a pretty good argument that it needs these waivers to meet federal law."

The Supreme Court last week agreed to consider a lawsuit that oil and gas producers filed against the EPA over its waivers allowing California to set stricter limits on tailpipe pollution than the federal government. However, SCOTUS will only decide whether fossil fuel makers have standing to sue over what they say is bureaucratic overreach and won't consider whether California's waiver is legal.

James Di Filippo, a principal policy analyst at the research firm Atlas Public Policy, said automakers will likely continue to walk back their EV investments while the legal battles play out. Companies could seek another compromise with California to restore more certainty as they plan new vehicle models for years to come.

"If they're uncertain about a regulatory outcome, they'll default to a less intense push," he said.

• Auto execs see an opportunity to roll back state EV mandates under President-elect Donald Trump.
• Nissan and Toyota say state rules requiring a rapid uptick in EV sales are unrealistic.
• Automakers are facing slowing EV demand, job cuts, and competition from China.

Some auto executives see an opportunity with the incoming Trump administration to roll back state rules requiring a rapid uptick in electric vehicle sales.

Executives at Nissan, Toyota, and the auto industry's largest US lobbying group say it will be impossible for the industry to meet aggressive timelines to phase out gas-powered cars and trucks by 2035 in a dozen states including California and New York, as well as Washington, DC. In six states, a target kicks in in 2026, when at least 35% of new car sales must be EVs.

"It will take a miracle to be achieved," Jérémie Papin, senior vice president of Nissan, said this week during an event in Washington, DC. "That's where others need to do a reality check on what's possible."

He noted that EVs accounted for about 9% of new car sales nationwide in the third quarter — a record, but still far short of what regulators are requiring by 2026.

Automakers, facing lower-than-expected demand for EVs this year, are pulling back on production, and some companies are cutting jobs to save costs. At the same time, they have poured billions of dollars into EVs and executives say they are committed to the transition, especially to stay competitive with China as it churns out more affordable EVs. That balancing act has put the industry in a delicate position with Trump who railed against EVs on the campaign trail, vowing to kill tax credits and other incentives encouraging Americans to buy them.

Now the industry is strategizing how to influence Trump, including on EV sales requirements they view as too ambitious. Trump will likely take their side.

At a campaign event in Michigan in October, he said no state would be allowed to ban gas-powered cars. Trump during his first term tried to revoke California's authority to set stricter limits on tailpipe pollution than the federal government. California is granted that authority under the Clean Air Act but must get waivers from the Environmental Protection Agency. Biden restored the states' authority — a move currently being litigated and could reach the Supreme Court.

To avoid uncertainty, a group of automakers, including BMW, Ford, Honda, and Volkswagen, struck an agreement with California in 2020 to follow the state's rules through 2026.

The rules are stricter than federal regulations issued earlier this year by the Biden administration's EPA. Those federal rules aren't an "EV mandate," as Trump falsely said on the campaign trail. Rather, automakers can choose how to curb greenhouse gas emissions from cars, trucks, SUVs, and vans sold between 2027 and 2032. The agency estimated the rules could boost EVs to up to 56% of new car sales, with the rest from a mix of hybrids and gas vehicles.

'Not ready to go electric'

Dealers, which were the first to sound the alarm on changes in the EV market last year, have argued that state and federal emissions requirements are out of step with demand. As companies push to meet these requirements, dealers complain they are stuck with unpopular EVs on their lots.

"A majority of customers are simply not ready to go electric right now," Dave Kelleher, a Chrysler-Dodge-Jeep-Ram dealer in Pennsylvania, told BI. "Maybe with a new administration, some of those fines will become a thing of the past, or even mitigated."

Karoline Leavitt, spokeswoman for Trump's transition effort, said Trump will stop attacks on gas-powered cars.

"When he takes office, President Trump will support the auto industry, allowing space for both gas-powered cars AND electric vehicles," she said in an email.

John Bozella, president of the Alliance for Automotive Innovation, which represents companies producing nearly all the new vehicles sold in the US, sent a letter to Trump in November asking that he ease emissions regulations but keep EV tax incentives fueling domestic investment in the supply chain.

An analysis commissioned by the Natural Resources Defense Council found that companies have announced $312 billion in planned investments in EVs and battery production since Biden took office in 2021, fueled partly by tax incentives in the Inflation Reduction Act.

One automaker, Toyota, supports doing away with EV mandates and subsidies altogether. In a recent op-ed in the Wall Street Journal, Toyota Chief Operating Officer Jack Hollins wrote that state mandates distort the market because companies funnel zero-emissions vehicles to those locations and ultimately limit choices for customers.

General Motors initially sided with Trump in his crusade against California's EV rules, but dropped its support of the legal battle after Biden won the 2020 election. It's unclear whether the automaker would once again side with Trump if he tries to roll back emissions requirements. Paul Jacobson, General Motors' executive vice president and chief financial officer, told reporters that ideally there'd be more consistency between federal and state rules. But the automaker will respect regulators' authority, he said.

"There's a lot at stake here," Jacobson said during the event in Washington. "That's why we talk about being nimble across the board, because sometimes it's the marketplace and sometimes it might be the regulatory environment. But we can't make excuses for poor performance. It's not just Washington. It's China, it's Europe. There's a lot of things going on all over the world and we have to be able to respond to that."