Spring 2025

Notes from North America

Welcome to the first edition of the North America quarterly update. Each quarter, we'll send you the latest reporting from the team, provide insight into our work beyond the charts and graphs, and highlight what's going on in the energy world in the United States, Canada, and Mexico. Thanks for signing up.

The beginning of 2025 was filled with changes and new opportunities for the North America team. Our co-founders, Tom Sanzillo and David Schlissel, retired. Their work ethic, values, and wisdom continue to guide our team, who have enthusiastically picked up the mantle. 

2025 started with the exciting news that Mitsubishi was terminating its proposal to build a new methyl methacrylate monomer plant in Geismar, La. Many of the reasons the company cited for doing so were first detailed in IEEFA’s July 2024 report about the risks of the plant, which had already been delayed at the time of the report. The announcement is a huge win for communities in Louisiana.

The North America team held three webinars to promote three reports. You can watch the webinar about the Enbridge pipeline here, the webinar for the Pathways Alliance carbon capture report here, and the data centers and energy usage in the Southeast here. Each webinar had excellent engagement, with participants asking insightful questions that let our analysts dive even deeper into the work.

We also recently created a page dedicated to North America on LinkedIn. Give us a follow to stay up to date.

In the coming year, we look forward to bringing you even more insightful analysis, new ways to present our work, and more opportunities to work together. Let us know what you'd like to see in the newsletter. I hope you enjoy it.

-Todd Leahy

North America Regional Director

Catch up Quick

Enbridge should consider closing its old, troubled Line 5 pipeline

The company's plan to bore a tunnel under the Straits of Mackinac between Lake Michigan and Lake Huron to replace an underwater segment of Line 5 is costly and ill-advised. This report explores how a plan to close the pipeline would not only relieve the company of debt burdens and litigation battles, but would also allow the company to chart a more flexible energy transition course.

Financial risks of carbon capture and storage in Canada: Concerns about the Pathways Project and Public Energy Policy

Cost challenges threaten the ability of a large, planned carbon capture project in Alberta to achieve financial sustainability. The report shows that the Pathways Alliance plans to capture carbon dioxide (CO2) generated at 13 oil sand processing facilities, compress the gas and send it by pipeline to a storage hub near the Cold Lake region in Alberta, faces multiple financial challenges.

Another bad year - and decade - for fossil fuel stocks 

Oil and gas stocks continued to fall behind the broader stock market in 2024. The S&P 500's fossil fuel components saw a 5.72% return in 2024, compared to the full index's 25.02%. These results are becoming a familiar story. The fossil fuel sector has underperformed the S&P 500 in seven of the last 10 years, delivering the lowest performance and highest volatility of any S&P sector. Oil, gas, and coal have been unreliable and inconsistent contributors to long-term investment portfolios.

Data centers drive buildout of gas power plants and pipelines in the Southeast

Southeast utilities and pipeline companies are planning a major buildout of natural gas infrastructure over the next 15 years, largely driven by forecasted demand for data centers, but there is a real threat of overbuilding power plants and pipelines. This report shows that ratepayers are subsidizing the costs of proposed electrical infrastructure that will only worsen if it is overbuilt.

Blue hydrogen's carbon capture boondoggle

Producing blue hydrogen is a lose-lose proposition that would cost billions of dollars in subsidies for essentially zero environmental benefit. This report focuses on Air Products’ planned Louisiana Clean Energy Complex (LCEC), one of the largest blue hydrogen projects in development in the U.S. IEEFA’s analysis shows that the project would be a potential money-making bonanza for Air Products but would have little if any environmental benefit, while costing taxpayers billions of dollars.

Chart of the Quarter

The latest By the Numbers edition shows that the energy transition in the United States is happening faster than many realize. This is perhaps the most prevalent in Texas, where solar continues to gain ground on fossil fuels.

Quotable

“Doubling down on new LNG terminals without taking into account demand trends raises the risk of overinvestment and infrastructure being underutilised as the energy transition accelerates.”

Ana Maria Jaller-Makarewicz, IEEFA lead energy analyst, Europe

“As the hydrogen landscape becomes more pragmatic, choosing the right ‘colour’ of hydrogen becomes crucial to maximising its impact on decarbonisation. Any investment in fossil fuel-based hydrogen production risks trapping investors, as they may find themselves committed to a long-standing technology likely to become obsolete in the coming years.”

Soroush Basirat, IEEFA energy finance analyst, global steel Australia

Media Highlights

New York Times: Why coal has been so hard to quit in the U.S.

Radio Canada: Country's largest carbon capture project may not be viable 

Louisiana Illuminator: Mitsubishi walks away from $1.3 billion chemical plant planned for Louisiana

Sustainable Views Opinion: Fossil fuels' problems run deeper than politics

Válgame PR: ¿Más gas natural y menos energía renovable?, pronósticos para Puerto Rico tras cambios de gobierno?

Gasworld Podcast: Hydrogen does not belong in your home

Connect with IEEFA

Sign up for our newsletters:

By the Numbers

Updates from around the globe.