Last Week in ConTech - 7 July 2025
Deregulation will impact the cost of construction
Deep Insight: Deregulation will impact the cost of construction
Last week, California rolled back one of the most impactful pieces of state regulation in an effort to reduce construction costs.
The target was the California Environmental Quality Act (CEQA), a law passed in 1970 shortly after the National Environmental Policy Act (NEPA) was signed at a federal level. While both laws were designed to protect the environment, CEQA goes much further.
As Brian Potter breaks it down:
“The National Environmental Policy Act (NEPA) is the law which requires involved and time-consuming environmental studies for any major federal government action (and which allows people to sue projects if they believe the environmental study was insufficiently thorough)”
The difference with CEQA is that:
“while most NEPA-like laws only require governments consider the effects on the environment of a given action, CEQA requires impacts to be mitigated.”
The challenge arose in 1972 when the California Supreme Court interpreted ‘public’ projects to include any private development that required governmental approvals (virtually every construction project).
And because CEQA is a self executing statute, it doesn’t rely on enforcement from a government agency. Anyone can anonymously file a CEQA lawsuit, delaying projects and increasing legal risk and cost.
Despite growing frustration, California Democrats have long resisted weakening the law. But with voters increasingly blaming them for housing shortages and rising costs, the political calculus is shifting.
The two new bills aim to streamline the process of construction:
AB 130 exempts certain housing developments from CEQA which meet specific criteria, such as compliance with local zoning, density, and environmental standards.
SB 131 creates a streamlined CEQA review process for housing projects that meet most, but not all, criteria for an exemption.
This marks a significant shift. If a progressive stronghold like California can ease environmental laws to make way for housing, it opens the door for similar reforms in other left-leaning states like New York, Massachusetts, and Minnesota.
It also follows a unanimous U.S. Supreme Court decision in May to limit the scope of NEPA reviews to only the immediate environmental impacts of major infrastructure projects.
The political winds are shifting. Cutting regulatory barriers to lower construction costs is becoming a bipartisan priority.
In this issue there are:
12 Startup Fundings
7 Policy and Regulatory Changes
7 New National Infrastructure Projects & Priorities
1 New investment funds
1 Acquisitions
6 News articles
79 new jobs posted - view here
Reading time: 11 mins
Startup Funding
Waste Management
Woodchuck, a Michigan startup, raised $3.75m in Seed funding. They have developed an AI platform which uses image recognition to identify, sort and process woodwaste from the construction and manufacturing industry to convert into high quality biomass which can be used as a clean energy source. More here.
Notes:
The construction industry generates over 41 million tons of wood waste annually and the majority ends up in landfills.
Woodchuck is able to identify and divert wood waste helping construction and manufacturing companies reduce their waste hauling costs.
Additionally they are able to track every step of the process informing on materials diverted and CO2 avoided helping companies meet sustainability requirements.
It’s valuable as they connect the entire wood waste supply chain, making it easier for contractors to divert an existing waste stream into a circular system.
Estimating
Bild AI, a Californian startup, raised $3.1m in Seed funding. They have developed an AI solution which reads blueprints and can create detailed material and cost estimates. More here.
Robots
Q-Bot, a London startup, raised £350k in funding. They have developed a robot which sprays underfloor insulation to reduce energy. More here.
Notes:
In a typical home 20% of all heat escapes through a suspended timber floor.
Their solution involves dropping a robot under the floor which is able to spray the insulation.
Instead of selling their robots to contractors, they operate a robot as a service model directly selling to the end consumer.
SR Robotics, a Polish startup, raised €8.4m in funding. They develop remotely operated and autonomous underwater robots for the defence and civil sectors being able to complete tasks such as seabed mapping and the safeguarding of critical underwater infrastructure and strategic ports. More here.
AssetCool, a London startup, raised $13.6m in Series A funding from investors including Taronga Group. They have developed a robotic system which applies special coatings directly onto overhead power lines to boost their capacity and extend their lifespan. More here.
Green Materials
Supersede, an Arizona startup, raised $10m in Seed funding (debt round). They produce high performance structural panels made from recycled plastic which are rot-proof and waterproof alternatives to plywood. More here.
Solarix, a Dutch startup, raised €5.5m in funding. They develop solar facade panels. More here.
Construction Management
ColabTools, a Mumbai startup, raised ₹2 Cr (~$234k USD) in funding. They're building a cloud based construction management and monitoring tool with features to support tasks such as site progress monitoring, attendance monitoring, quality inspections and work order control. More here.
Green Materials
Terra CO2, a Colorado startup, raised $124.5m in Series B funding. They develop low carbon building materials with the goal of creating a net zero cement and are first making and selling low carbon supplementary cementitious material that can be blended with traditional cement. More here.
Notes:
In February 2025, they announced they raised $82m in Series B funding.
This round includes additional capital that has been raised (e.g CEMEX completed an undisclosed investment in May 2025).
Tech-enabled Contractors
Flipspaces, a Mumbai startup, raised $35m in funding. They have developed a technology enabled design and build solution for commercial interiors which uses virtual reality to provide a photo realistic interior design experience for the consumer and connects to their contracting arm consisting of an integrated supply chain network with curated vendors (200k+ products) supporting end to end delivery. More here.
Drones
Wingcopter, a German startup, raised funding (undisclosed). They develop, manufacture, sell and operate all electric drones used for activities such as surveying of pipelines, power lines, roads, railways and terrain with LiDAR for infrastructure management purposes. More here.
Notes:
Funding for drone startups appears to increasingly concentrate on drone companies which design and manufacture hardware in house.
A reason is the Ukraine war, which has highlighted the need for localized, secure manufacturing (away from China).
In the U.S., this trend has been further supported by a recent executive order from Trump for ‘Unleashing American Drone Dominance.’
These drone companies are playing a growing role in military operations, and the pace of technology development is creating spillover benefits for the construction industry.
For example, access to high-grade LiDAR at lower costs enables more affordable surveying and infrastructure management, especially for assets spread across long distances like power grids, pipelines, and railways.
Other
FieldFactors, a Dutch startup, raised €1.65m in funding. They are building systems for rainwater reuse which captures rainwater where it falls, purifies it through natural biofiltration and stores it underground for local reuse. More here.
Notes:
While not a strictly construction tech solution, this can be very beneficial for civil and landscape design.
In university one of the core subjects was water sensitive urban design.
Due to water resource challenges, increasing focus was placed on circularity and water reuse where we seek to mimic natural water cycles, reduce stormwater runoff and utilize stormwater more efficiently.
This solution is valuable in supporting this design methodology.
Policy and Regulatory Changes
US
Comparing How the House and Senate Bills Deliver on Trump’s Agenda
The US Senate has passed its version of Trump’s sprawling domestic policy package.
It now must win final approval in the House to clear Congress.
From the perspective of construction:
Wind and solar tax credits for businesses
Projects must begin construction within one year after the bill’s enactment to claim the full tax credit.
Otherwise, projects that start after that can only claim the credit if they are operational by the end of 2027.
Residential energy tax credits
Ends tax credits for rooftop solar, electric heat pumps and other energy-efficient home devices at the end of 2025.
Tax credits for companies that produce clean hydrogen fuel
Companies must begin construction by the end of 2027 to claim credits.
Tax breaks for factories that make clean energy components like electric cars or solar panels
Excludes most companies from claiming the credit if their supply chains are connected to “foreign entities of concern,” which include China.
Terminate credit for wind power components after 2027.
Rescinding IRA funds
Rescind an estimated $5 billion in unobligated funds from certain programs included in the IRA.
California rolls back environmental law to expedite housing
The California Environmental Quality Act (CEQA) allows individuals and groups to file lawsuits to challenge projects.
This can delay building by years and increase litigation costs.
A new law exempts urban "infill" housing projects, which are built in and around existing development, from CEQA if they are less than 20 acres and located outside hazardous zones.
Certain infrastructure projects, such as water system improvements, day care centers and advanced manufacturing facilities will also be excluded from CEQA.
Environmental permitting review narrowed in wake of Supreme Court decision
Federal agencies began rolling out updates to the National Environmental Policy Act (NEPA) procedures.
This included the Department of Agriculture, the Department of Energy, the Department of Interior, the Department of Transportation and FERC.
The changes mean fewer projects will need environmental reviews and regulators will have less time to identify potentially significant environmental consequences of major infrastructure projects.
ICE crackdown rattles Houston’s construction industry as contractors warn of labor shortage
In Texas, immigrant workers make up about 38% of all construction workers.
Nearly a quarter of Texas construction workers are undocumented, according to estimates from the American Immigration Council.
It suggests there could be more than 53,000 undocumented construction workers in the Houston region.
The Trump administration has set a target of 3,000 ICE arrests per day, though as of May, the daily average was 760.
The European Commission has released a package of documents aimed at supporting EU Member States in the implementation of the Energy Performance of Buildings Directive (EPBD).
The EPBD aims for all new buildings to be zero-emission by 2030 and the entire building stock to be zero-emission by 2050.
It provides a practical roadmap to help Member States transpose the directive into national legislation by the May 2026 deadline.
It includes:
Delegated regulation offering a framework for setting national energy performance requirements that are cost-effective for building owners.
Implementing regulation which creates templates for the transfer of national information to the EU building stock observatory supporting data comparison.
Guidance documentation providing clarification on provisions.
Germany
Germany plans to cut funding for the use of green hydrogen in industry by two thirds by 2030
The German government plans to reduce funding to support the use of green hydrogen for industrial decarbonisation.
They would cut the €3.7bn ($4.3bn) of funding allocated to German businesses for this purpose up to 2030 to €1.2bn.
This funding had been used to provide more than €1bn of direct grants, known as “climate protection contracts” to five companies in October 2024.
Notes:
This is an interesting development as Germany is constructing a nationwide hydrogen pipeline network.
It is to span 9,040 kilometers and connect key hydrogen hubs across the country at a cost of 19b euros.
India
5L fine on construction sites emitting dust
Construction sites in Chennai emitting dust into public places will soon face a fine of up to 5 lakh (~$5,8k USD), including a work stoppage notice.
This is to regulate dust pollution from construction activities.
National Infrastructure Projects & Priorities
Europe
The Fight to Revive Europe’s Militaries Is Just Beginning
NATO members pledged to spend 3.5% of gross domestic product on military capabilities and 1.5% on defense infrastructure.
This is as Russia’s war in Ukraine has exposed shortfalls in Europe’s defenses at a time when US support has become less certain.
Notes:
This will impact construction spending and the development of EU wide supply chains.
The EU currently has a duplication in weapons systems and will require a focus in interoperability.
They will also need to determine where domestic production makes sense and where it doesn’t including which region.
It may result in centralized procurement mechanisms and EU wide tenders for the development of defense infrastructure.
Big Tech
Google inks its first fusion power deal with Commonwealth Fusion Systems
Commonwealth Fusion Systems (CFS) will send Google 200 megawatts of electricity from its Arc power plant.
This is expected to come online in the early 2030s.
Google thinks of its energy investments in phases.
In the short term, Google has prioritized solar, wind, and batteries.
Further out, it’s betting on geothermal and small modular nuclear reactors and this investment (fusion) is in the long term category.
UAE
UAE Overtakes Saudi Arabia in Project Awards as Kingdom Eases Up
The UAE has awarded an estimated $31 billion in projects so far in 2025, outpacing Saudi Arabia’s $20.6 billion.
If the UAE maintains its lead through year-end, it will be the first time it comes out ahead since 2018.
The shift comes as the kingdom eases up on projects as it faces funding pressures and also adjusts to market demand and rising costs.
UK
Britain shuns $34 billion Morocco-UK subsea power project
Britain has rejected a 25 billion pound ($34.39 billion) Moroccan renewable energy project.
It would have used solar and wind power from the Sahara to supply up to seven million UK homes.
The plan involved building 3,800 kilometres (2,361 miles) of high-voltage direct current subsea cables from Morocco to southwest England.
The government said it believed domestic projects could offer better economic benefits.
Notes:
This shift shows a growing concern for domestic energy sovereignty at the expense of international collaboration.
Hungary
Hungary Says US Lifts Sanctions on Its Nuclear Expansion Project
The US government has lifted sanctions that had held up Hungary’s planned expansion of its Paks nuclear plant.
Trump’s administration withdrew the penalties imposed during Biden’s presidency, which means construction of the planned expansion of its Paks nuclear plant can accelerate.
India
South Goa highway project to use AI-driven construction technology
The Union ministry of road transport and highways (MoRTH) has chosen 16 pilot projects across the country where AI-driven technology will be implemented.
One is for the four-laning of 22km of the highway from BendorDem to Canacona.
The ministry will use Automated and Intelligent Machine-aided Construction (AIMC) for this project.
This was successfully tested in the construction of the Lucknow-Kanpur expressway project.
Thailand
Bangkok Building Collapse Tied to Construction and Design Flaws
Thai investigators concluded that flaws in the design and construction methods caused the collapse of a partially built Bangkok building.
This killed at least 89 people during the March 28 earthquake.
It was the only structure in the capital to collapse.
The elevator and stairwell walls (key structures meant to absorb shear force) were improperly designed and built.
Notes:
There are currently arrest warrants and criminal charges being placed against the company and key individuals.
This will impact the development of new regulation and its enforcement in the coming years.
Acquisitions
Home Depot goes after pro market with $4.3B acquisition
Home Depot has struck a deal for its subsidiary SRS Distribution to acquire specialty building products distributor GMS Inc.
Including debt, the transaction is valued at about $5.5 billion.
GMS’ business focuses on specialty building materials, including drywall, ceilings, steel frames and other products for residential and commercial construction and remodeling projects.
This is to further target the ‘pro’ market and is expected to accelerate SRS’s goals of becoming a multi-category building distributor.
Notes:
Home Depot acquired SRS last year for $18.25b.
With this SRS’s acquisition, the home improvement retailer said its total addressable market grew by $50 billion to about $1 trillion.
News
New York State may seek federal loan for ambitious nuclear plan
Philippine Construction-To-Mining Tycoon Isidro Consunji Takes On Concrete Challenge
Last December, the DMCI Holdings (a $1.8 billion revenue company) completed its biggest acquisition to date.
It paid $660 million (including debt) for Mexican giant Cemex’s loss-making cement unit in the Philippines.
How Small Apartments in Big Buildings Became the US Norm
Cost for Repairs to U.S. Transit Assets Estimated at $140.2 Billion
Construction on Mars Takes a Leap Forward
How generative AI could help make construction sites safer (MIT Technology Review)
If I missed anything this week, please reply and let me know! I’ll make sure to include it next week.