IEEFA North America May Update

May 2026

Notes from North America

Happy May from the North America team! A constantly changing global energy landscape seems to be our new normal, but I remain impressed by how our team—and the teams around the globe—have been able to keep up and take a hard look at what events in Iran mean for the global energy transition.

Since I last wrote to you in March, we've published insightful deep dives into the LNG industry. As events in Iran have shown, LNG is not the reliable or cheap fuel it's been touted to be. There has never been a better time to break free of volatile fossil fuels and invest heavily in local, reliable renewable energy we know is deployable.

We're seeing the implications of this volatility across the United States. As we wrote about in our foundational report, global events are affecting consumer prices, making the fast buildout of gas-fired power generation a risky financial investment. The same holds true of the ammonia market, which is banking on an unproven market to meet demand in the electricity sector. You can watch the team discussing the financial and health risks of building out ammonia facilities here.

As the global energy economy continues to overlap, we hope you will find our analysis helpful in making sense of it all. Thanks for staying with us, all the best.

-Todd Leahy

North America Regional Director

Catch up Quick

Ammonia build-out: Recipe for risks

Federal, state, and local agencies awarding financial incentives for the construction of ammonia plants may not deliver the robust economic benefits promised to local communities taking on these facilities. This report shows that ammonia production is not a significant job engine; energy markets for ammonia are not likely to be robust; rising construction costs and operational expenses pose financial risks; and ammonia production and transport pose safety issues.

What does New Fortress Energy’s bankruptcy mean for Puerto Rico?

In March New Fortress Energy announced it was unable to pay its debts and has entered into a restructuring agreement with some of its creditors. The bankruptcy may provide Puerto Rico with an opportunity to cancel a contract with a New Fortress subsidiary. An IEEFA analysis casts doubt on the ability of New Fortress to quintuple natural gas sales to Puerto Rico. Spanish version.

Four hidden stories in the New Fortress Energy bankruptcy

In addition to the implications for Puerto Rico, the March 17 debt restructuring plan announced by New Fortress Energy revealed systemic mismanagement and operational failures. The plan for New Fortress, which had lost almost $1.3 billion over the previous 12 months, would slash its debt from $5.7 billion to $527 million. Financial filings show New Fortress made pervasive financial misstatements and steered more than $1 billion in dividends to shareholders and company insiders. New Fortress also suffered poor operational performance at Mexico’s only liquefied natural gas plant and likely will abandon a second Mexican LNG plant. Spanish version.

Amigo LNG: An export project that’s running out of gas

The proposed Amigo LNG offshore export facility would shortchange four gas-fired power plants serving northwestern Mexico. The four plants need up to 357 million cubic feet of gas per day from the Sásabe-Guaymas pipeline. The export facility would need another 745 million MMcf/d, but the pipeline can only carry 812 MMcf/d. Besides leaving little or no gas for these electricity stations, Amigo LNG would jeopardize gas supplies to a proposed 400MMcf/d connector to the Sásabe-Guaymas pipeline that would serve other power plants and industries. The gas supply issue poses a serious challenge to the project’s ability to obtain government permits and attract investors. Spanish version.

Court ruling on Texas anti-ESG law may save state from self-inflicted economic wound

A federal court ruling striking down a Texas “anti-ESG” law, designed to prevent public pension managers from divesting from fossil fuel assets, may save the state from a self-inflicted economic wound. Although the decision affects only the first of a wave of proposals aimed at promoting fossil fuel investments while suppressing support for renewable energy, it casts significant doubt on the legality of similar state efforts. The implications may have far-reaching effects for investors, policymakers, and fiduciaries across the country. Spanish version.

Upcoming Webinar

Following the release of IEEFA's report and case studies on the rush to gas, join the author for a discussion on the findings and alternatives to meet electricity demand. IEEFA is excited to partner with the Alliance for Affordable Energy on this webinar, with Jackson Voss providing a local look at the impacts of Entergy Corporation's commitment to gas-fired generation on consumer pricing and the impacts to local communities. The webinar will be recorded. Register here.

Featured Chart

The California State Teachers’ Retirement System is reducing its exposure to fossil fuels. The fund has moved $30 billion into a low-carbon public equity portfolio, highlighting the maturity of such investment strategies. This move is in line with growing evidence of the financial risk facing the most carbon-intensive investments and occurs alongside other steps to protect the fund from climate risk. A more ambitious approach is needed to mitigate future risks caused by climate change. As seen in this edition's featured chart, the weight of the traditional energy sector in the California State Teachers' Retirement System (CalSTRS) public equity portfolio has fallen by one-third, from 4.7% in 2022 to about 3% in 2025.

Quotable

“Heat pump installations have strengthened Germany’s energy security and reduced its vulnerability to high and volatile LNG prices. The Middle East crisis is Germany’s biggest wake-up call to electrify since Russia’s 2022 invasion of Ukraine. There is significant potential for Germany to accelerate heat pump deployment and curb its reliance on gas imports even further.”

Ana Maria Jaller-Makarewicz, lead energy analyst, Europe

“While Australia only buys a small percentage of its crude oil from the Middle East, it is highly exposed through the Asian refineries we import refined products from. Countries are already starting to put restrictions on exports to prioritise their domestic markets.”

Kevin Morrison, Energy Finance Analyst, Australian Gas

Media Highlights

The Energy Mix: High Hopes, Few Details as Major Projects Office Hits Six-Month Mark

The Columbus Dispatch: Trump promised a $33 billion Pike County power plant. Is that a reality?

WCHSTV: No W.Va. substations in proposed MARL routes; June public comment sessions set

Poynter: Will Americans really pay $500 more for gas this year? It depends.

El Cronista de Negocios: Litigio contra México por litio, frío de Florida calienta agronegocios mexicanos, y crisis por gas en Altamira

San Juan Daily Star: New Fortress restructuring could impact Genera PR’s contract.

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