As we enter the second quarter of 2026, the PVF sector faces increased uncertainty. The U.S. Supreme Court’s (SCOTUS) 6-to-3 ruling struck down President Donald Trump’s use of a 1970 era law justifying his broad tariff program. The Trump administration has replaced the tariffs struck down by SCOTUS with a new 10% across-the-board global tariff that relies on Section 122 of the Trade Act of 1974.
President Trump later stated he would raise tariffs to 15%, though it has not been made official as of this writing.
In addition, Judge Richard Eaton of the U.S. Court of International Trade stated all importers affected by the tariffs are entitled to a refund.
The judge has mandated that U.S. Customs and Border Protection (CBP) update its procedures for calculating refunds, which should be processed with interest. The CBP stated that it would need about 45 days to set up an electronic system to process the refunds.
The government may appeal the ruling, and there are concerns about the logistical challenges involved in processing refunds, given the more than 70 million entries that need review.
The Iran conflict is also fueling uncertainties as energy prices have escalated by more than 50%, with crude as of this writing at $102.05/barrel (WTI) and $104.62/barrel (Brent).
The duration of the conflict, along with the extent of damage to the region’s production infrastructure, will affect oil prices. The opening of the Strait of Hormuz will free the movement of oil tankers, as 20% of global petroleum consumption and 25% to 27% of all seaborne oil trade flow through the Strait, which will have a significant impact on pricing.
Pricing and the availability of carbon steel butt-welding pipe fittings and forged steel flanges remain stable. However, electricity, natural gas and now petroleum-related energy prices are increasing substantially, combined with labor and tariff-related cost escalation that remain uncertain as of this writing.
Shortages are being reported due to demand from the data center construction sector and increased maintenance in the energy sector.
The availability of large-diameter fittings and flanges, in particular, required in the tens-of-thousands for data center construction, are subject to raw material supply chain disruptions, transportation cost escalation and disruptions, and tariff-related uncertainties.
Close contact with your suppliers and manufacturers is critical in today’s environment, and working closely with your contractor customers to maintain a reliable supply chain is essential to meet their construction schedules.
Construction news
• Basin Electric Power Cooperative selected Denver-based PCL Construction to build a $4 billion natural gas-fired facility called Bison Generation Station in Williams County, North Dakota.
The Bison Generation Station consists of two roughly 745 MW combined-cycle units, set to produce approximately 1.49 GW. The first unit of the plant is scheduled to go online in early 2029, followed by the second unit in 2030.
Basin Electric is working with PCL and Burns & McDonnell to align construction packages with project schedules. Construction is expected to begin this quarter.
• Enbridge launches construction of a $450 million Line 5 relocated in northwestern Wisconsin. With permits in hand, crews have already begun clearing the site and mobilizing for the construction of the 41-mile-long oil and gas liquids pipeline, while legal actions continue to hamper progress.
• West Virginia local distribution cooperative Hope Gas announced plans for a new natural gas pipeline project in Mason County, which borders the Ohio River northwest of Charleston. Total investment value (TIV) is estimated at $250 million, and the investment is privately funded.
The project aims to enhance long-term delivery and economic development as the area seeks to capitalize on its natural gas resources. Construction on the initial 30-mile segment of the 24-inch-diameter pipeline will begin this month, with a completion date targeted for late 2026.
The new infrastructure is designed to support the development of American Intelligence & Power Corp.’s Monarch Compute Campus, which will eventually supply up to 8 GW of power to support hyperscale and enterprise data centers.
• U.S. Secretary of Energy Chris Wright announced that the Energy Department’s Office of Energy Dominance Financing has closed a $26.5 billion loan package to deliver more than $7 billion in electricity cost-savings to millions of customers in Georgia and Alabama.
The two loans will build, or upgrade, more than 16 GW of firm, reliable power to the electrical grid. This includes 5 GW of new gas-fired generation, and 6 GW of nuclear improvements through upgrades and license renewals, hydropower modernization, battery storage systems and more than 1,300 miles of transmission and grid enhancement projects.
• Sempra Energy is boosting its capital spending plans in order to build out infrastructure to support large load clients such as data centers. Sempra said that its five-year capital plans had significantly increased, rising from a 2025-2029 spending plan of $56 billion to $65 billion from 2026-2030.
• Center Point Energy also raised its capital expenditures for 2026-2035 spending by $500 million, which is being tacked on to plans of $65 billion in capital expenditures during a 10-year period.
Center Point’s service region is primarily in the Gulf Coast area that includes Houston and Beaumont. Center Point predicted a 50% rise in the Houston area’s peak load to 2029, two years earlier than its previous forecast. Driving this is 7.5 GW of predicted load growth from data centers.
Labor and costs
The U.S. Labor Department is considering the repeal of the Biden administration’s Independent Contractor Classification Act.
Industry groups praise the recent proposal to rescind a 2024 final regulation that makes it harder for businesses to classify workers as independent contractors under the Fair Labor Standards Act, which governs when minimum wage and overtime are required.
The proposal would replace the Biden rule with the employee classification analysis that was in effect in 2021. The agency also proposes applying that analysis to the Family and Medical Leave Act and the Migrant and Seasonal Agricultural Worker Protection Act.
The Associated General Contractors of America supports the proposal and has long called for federal clarification of the independent contractor status and preservation of legitimate independent contractor relationships that have historically existed in the construction industry.
A 60-day public comment period on the measures is in effect until the end of this month.
Networking at the PVF Roundtable
The PVF Roundtable (PVFRT) recognizes the need for developing a skilled labor force and is actively funding PVF-oriented trade school scholarships through its PVFRT Charitable Foundation.
The foundation has awarded more than $2 million; it is growing to help meet the need for a young, skilled PVF workforce.
The primary funding for the PVFRT Charitable Foundation comes from the PVFRT Annual Golf Tournament and the annual TroutBlast.
The golf tournament will be held May 11; venue and details will follow and will be posted on the website (www.pvf.org). The Weldbend Corp., Ferguson Industrial and MRC Global are key sponsors of the event.
The next networking meeting of the PVF Roundtable will be held May 12, opening at 4:30 p.m. Please bring your clients and associates for the opportunity to meet industry peers up close and personal.
The meeting will be held at Houston’s Bayou City Event Center, 9401 Knight Rd., 281-501-6720. This venue will provide additional space and convenience for exchanging information and meeting new clleagues.
The PVF Roundtable continues to serve as a vital hub for industry networking, education and advocacy. Recent and upcoming events reflect the sector’s commitment to collaboration and innovation.
Networking Meetings are now, more than ever, essential for you, your associates and clients to share information, discuss pertinent issues, meet new contacts, develop new long-lasting friendships and pursue new opportunities in the industry.
