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The president is on his way to Los Angeles next.
On his fifth day back in office, President Trump is making the rounds to recent disaster zones —- North Carolina, which is recovering from Hurricane Helene, and later Los Angeles, where fires are still burning. In the immediate aftermath of both catastrophes, Trump was quick to blame Democrats for their response. Touching down in North Carolina earlier today, he sounded the same tune as he proposed overhauling or even eliminating the Federal Emergency Management Agency, which is responsible for disaster preparation and recovery nationwide.
On the tarmac, Trump told the press that his administration was “looking at the whole concept of FEMA,” saying he would rather states be solely responsible for disaster recovery. Later, at a hurricane recovery briefing, Trump said that he planned to sign an executive order that would “begin the process of fundamentally reforming and overhauling FEMA — or maybe getting rid of FEMA.” Trump dodged questions on details of the order or a timeline for implementation.
While speaking to a group of North Carolina families at a separate event, Trump told them, “Unfortunately, our government failed you, but it wasn’t the Trump government. It was a government run by Biden.” False claims about the hurricane response, stoked by Trump during the final month of his campaign against Kamala Harris, led FEMA to put up a “myth and fact” response page on its website to debunk swirling rumors.
It is true, however, that earlier this month, FEMA informed thousands of displaced North Carolina residents that their vouchers for temporary housing were about to expire for one of three reasons: their homes had been deemed “habitable,” the residents had not approved a FEMA inspection, or the agency couldn’t get in contact with them. Speaking to the families, Trump said this was unjustifiable given that “your government provided shelter and housing for illegal aliens from all over the world.” He claimed he would “surge housing solutions” to the state that went beyond FEMA’s temporary measures, but did not provide more details as to how.
After arriving in Los Angeles, where large swaths of the city have been devastated by still-active wildfires, President Trump met with Governor Gavin Newsom on the tarmac, striking a conciliatory tone as he said he wanted to “work together” to help L.A. recover. This disaster also prompted a flurry of misinformation when fire hydrants in the city temporarily ran dry. While the city’s water infrastructure simply wasn’t equipped to put out numerous simultaneous historic blazes, Trump put the blame squarely on Newsom and his previous opposition to a policy that would have redirected water from a river delta in Northern California to farms in the Central Valley and cities in Southern California, endangering a fish species called the Delta smelt.
Experts say this has nothing to do with the fires or the ability to put them out, as all water storage tanks were full and the blazes were due to a combination of drought and extreme winds. Yet Trump has continued to hold up the protection of the smelt fish as all that’s wrong with California’s fire response, even making it a feature of his recent executive order “Putting People Over Fish: Stopping Radical Environmentalism To Provide Water Solutions To Southern California.”
After a tour of the Pacific Palisades neighborhood and a photoshoot with L.A. firefighters, Trump met with city and state leaders and pledged to declare a national emergency that would allow him to waive all federal permits for rebuilding. “The federal permit can take 10 years. We’re not going to do that. We don’t want to take 10 days,” Trump said to applause. “I’d ask that the local permitting process be the same.”
L.A. Mayor Karen Bass agreed that she wanted to expedite the process but reiterated that before rebuilding efforts could begin in earnest, all the fire debris needed to be cleared. That’s an arduous process that the Army Corp of Engineers estimated could take 18 months to complete. While Bass vowed to speed up this timeline, Trump claimed that “the people are willing to clean out their own debris.”
Trump also repeated his promise to “open up the pumps and valves in the North,” though again, there’s no evidence that more piped water would have done anything to prevent these fires. “We want to get that water pouring down as quickly as possible. Let hundreds of millions of gallons of water flow down into Southern California, and that’ll be a big benefit to you.”
And he didn’t miss an opportunity to mention the smelt once more, telling the assembled leaders “it’s in numerous other areas. So it doesn’t have to be protected. The people of California have to be protected.”
Editor‘s note: This story has been updated to reflect Trump’s visit to Los Angeles.
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Meta and Microsoft both confirmed plans to invest heavily in AI infrastructure.
Big Tech said this week that it’s going full steam ahead with building out data centers, and the power industry loves it. Since Microsoft and Meta reported their earnings for the beginning of the year on Wednesday, including announcements either reaffirming their guidance on capital expenditures or even increasing it, power sector stocks have jumped.
Shares of Vistra, which has a fleet of power plants including nuclear, natural gas, coal, and renewables, are up almost 7% in early afternoon trading. Constellation, one of the largest nuclear producers in the country, is up 8%. GE Vernova, which makes in-demand gas turbines, is up 4%. Chip designer Nvidia’s shares are up 4%.
Microsoft, which has been dogged byanalyst and media reports that it’s canceling some data center builds or slowing down its overall pace of deployment, reaffirmed its previousguidance that it would spend around $80 billion on data centers for its fiscal year. The affirmed guidance, Dan Ives of Wedbush Securities wrote in a note to clients, came “put to rest” the earlier chatter.
Meta, meanwhile, raised its guidance for capital expenditures from a range of $60 billion to $65 billion to at least $64 billion and as much as $72 billion.
Looking at these hyperscalers, as well as the data center company CoreWeave, Morgan Stanley estimates 38% annual growth in capital expenditures for cloud computing in 2025, to $392 billion — a $29 billion or 7 percentage point jump from its estimate a month ago. This increased spending will be a “boost to AI capex/power enablers.”
These companies, which make up the larger artificial intelligence supplier complex, were some of the most affected by Donald Trump’s Liberation Day tariffs announcements, as energy production ishighly sensitive to the global macroeconomy. (Not to mention power plants and power plant suppliers are themselvesoften major purchasers of foreign goods and commodities.) GE Vernova, for example, told investors last month that it would take a several hundred million hit thanks to tariffs.
But in the topsy turvy world of post “Liberation Day” markets, these companies’ investors are optimistic about the future again.
Microsoft chief executive Satya Nadella told analysts on the company’s earnings call that “we will be short power” when it comes to building out data centers, and that “I need power in specific places so that we can either lease or build at the pace at which we want.”
How that power will be provided is one of the key questions of the energy transition.
Big tech companies tend to have some kind of commitment to using renewable or low-carbon power, and are among the country’s largest voluntary purchasers of non-carbon-emitting power. Microsoft, for example,is helping pay for the planned restart of one unit of the Three Mile Island nuclear plant by agreeing to buy its power output.
There is a tight market for all sorts of power equipment right now, especially gas turbines, which will remain in short supply well into the back end of this decade based on current production plans. Renewable developers such as NextEra argue that solar, wind, and batteries make the most sense to quickly meet the needs of power-hungry data center developers and utilities because of how quickly and cheaply they can be built.“We should be thinking about renewables and battery storage as a critical bridge to when other technology is ready at scale, like new gas-fired plants,” NextEra chief executive John Ketchum said on an earnings call late last month, reversing the typical line that natural gas can serve as a “bridge fuel” to a low carbon future. “Gas turbines are in short supply and in high demand.”
In the meantime, load growth from data centers could push up power prices across the board. So even if you can’t build a new gas plant anytime soon, the one you’re operating that’s powering a data center right now is as good as gold.
The AI-powered startup aims to provide home-level monitoring and data to utilities.
In theory at least, an electrified household could play a key role in helping stabilize the grid of the future, alleviating times of peak electricity demand by providing power back to the grid and giving utilities timely warnings about hardware that may be failing. But devices used to measure and monitor power demand today, such as smart meters, aren’t advanced enough to do this type of orchestrated power management and fault detection at a granular level — thus leaving both financial and grid efficiency savings on the table.
Enter Utilidata, which just raised a $60 million Series C funding round to get its artificial intelligence-powered software module into smart meters and other pieces of grid infrastructure. This module acts as the brains of a device, and can provide utilities with localized insights into things like electricity usage levels, the operations of distributed energy resources such as home solar and batteries, anomalies in voltage data, and hardware faults. By forecasting surges or lulls in electricity demand, Utilidata can optimize power flow, and by predicting when and where faults are likely to occur, it empowers utilities to strategically upgrade their grid infrastructure, or at least come up with contingency plans before things fail.
The company’s AI system enables all of this analysis to happen at the grid edge — the point at which the electricity system enters a customer’s home — as opposed to in a centralized cloud, which reduces bandwidth needs and allows for immediate responses.
“There's enough capability at that node to optimize multiple complex decisions and create a better holistic outcome for the customer on the grid,” Utilidata CEO Josh Brumberger told me. The company did a trial recently with the Electricity Power Research Institute that showed promising cost savings and reduced grid strain. “We were able to reduce the customer’s bill by 12.5% and shave peak [usage] by 25%,” he told me.
Utilidata’s series C was led by the clean energy investor Renown Capital Partners, with support from strategic investors such as the electricity infrastructure company Quanta and Nvidia, which Utilidata partnered with to create its AI platform.
It will still be a while before Utilidata-powered smart meters allow for automated load management down to the household level, Brumberger told me, calling this the “Holy Grail” of grid operations. That’s because making load adjustments across interconnected systems is a complex task that needs to be perfectly coordinated, often with strict regulatory oversight and opt-in from participating customers. Utilities are famously cautious about adopting new technologies such as this one, as a mishap leading to a blackout can have catastrophic consequences.
A nearer term use case, Brumberger explained, would be detecting local power glitches more quickly, or forecasting when these failures might occur. For example, a new electric vehicle in the neighborhood could potentially overload local electrical distribution equipment. Utilidata could allow the utility to replace the equipment before anything goes wrong, thus enhancing grid resiliency. Insights such as this, Brumberger said, are “going to have value immediately.”
Already Utilidata has partnered with Aclara, a large manufacturer of smart meters, to install its AI module. One day, Brumberger told me, he wants to see the tech in other grid infrastructure such as transformers, EV chargers, or automatic circuit breakers known as reclosers.
Naturally, Brumberger is also excited about the potential of integrating Utilidata’s technology into data centers, telling me he sees opportunities to deploy the company’s AI modules “at the server level, at the rack level, and at the row level, all the way up to that interconnection point,” in order to help data centers run more efficiently. As the AI boom drives data center electricity demand through the roof, Utilidata is a classic example of AI helping to ameliorate the very problem it’s created.
“Every watt of energy that does not go towards compute because it's either lost or is going towards cooling is a wasted watt,” Brumberger told me. “And so the more granular and distributed your visibility and controls are, the more efficient and valuable a system you'll have.”
Three weeks after “Liberation Day,” Matador Resources says it’s adjusting its ambitions for the year.
America’s oil and gas industry is beginning to pull back on investments in the face of tariffs and immense oil price instability — or at least one oil and gas company is.
While oil and gas executives have been grousing about low prices and inconsistent policy to any reporter (or Federal Reserve Bank) who will listen, there’s been little actual data about how the industry is thinking about what investments to make or not make. That changed on Wednesday when the shale driller Matador Resources reported its first quarter earnings. The company said that it would drop one rig from its fleet of nine, cutting $100 million of capital costs.
“In response to recent commodity price volatility, Matador has decided to adjust its drilling and completion activity for 2025 to provide for more optionality,” the company said in its earnings release.
In February, Matador was projecting that its capital expenditures in 2025 would be between $1.4 and $1.65 billion.This week, it lowered that outlook to $1.3 to $1.55 billion. “We’re very open to and want to have reason to grow again,” Matador’s chief executive Joseph Foran said on the company’s earnings call Thursday. “This is primarily a timing matter. Is this a temporary thing on oil prices? Or is this a new world we live in?”
Mizuho Securities analyst William Janela wrote in a note to clients Thursday morning that, as the first oil exploration and production company to report its earnings this go-round, Matador would be “somewhat of a litmus test for the sector: we don't believe the market was expecting E&Ps to announce activity reductions this soon, but MTDR's update could signal more cuts to come from peers over the next few weeks.”
West Texas Intermediate crude oil prices are currently sitting at just below $63, up from around $60 in the wake of President Donald Trump’s “Liberation Day” tariff announcements. While the current price is off its lows, it’s still well short of the almost $84 a barrel crude prices were at around this time last year.
The price decline could be attributable to any number of factors — macroeconomic uncertainty due to the trade war, production hikes by foreign producers — but whatever the cause, it has made an awkward situation for the Trump administration’s energy strategy.
The iShares U.S. Oil & Gas Exploration & Production ETF, which tracks the American oil and gas exploration industry, is down 9% for the year and more than 13% since “Liberation Day,” while the rest of the market has almost recovered as the Trump administration has indicated it may ease up on some of his more drastic tariff policies.
If other drillers follow Matador’s investment slowdown, it could imperil Trump’s broader energy policy goals.
Trump has both encouraged other countries to produce more oil (and bragged about lower oil prices) while also exhorting American drillers to “drill, baby, drill,”with enticements ranging from kneecapping emissions standards to a reduced regulatory burden.
As Heatmap has written, these goals sit in conflict with each other. Energy executives told the Federal Reserve Bank of Dallas that they need oil prices ranging from $61 to $70 a barrelin order to profitably drill new wells. If prices fall further, “what would happen is ‘Delay, baby, delay,’”Wood Mackenzie analyst Fraser McKay wrote Wednesday. “We now expect global upstream development spend to fall year-on-year for the first time since 2020.”
A $65 per barrel price “dents” margins for drillers, meaning “growth capex and discretionary spend will be delayed,” McKay wrote.
Matador also announced that it had authorized $400 million worth of buybacks, and itsstock price rose some 4% on the earnings announcement, indicating that Wall Street will reward drillers who pull back on drilling and ramp up shareholder payouts.
“We’ve got the tools in the toolbox, including the share repurchase, to make Matador more value quarter by quarter,” Foran said. Rather than “blindly” pouring capital into growth, Matador would aim for a “measured pace,” he explained. “And if you mean what you say about a measured pace, that means when prices get a little lower, you take a few more moments to think about what you’re doing and don’t rush into things.”