North American investors expect a major uptick in energy mergers and acquisitions deals in the next 24 months, according to Dentons’ “Power Moves: Driving deals in the North American energy M&A market 2025” report.
This finding indicates that optimism is high despite a tumultuous market where volatile commodity prices, high interest rates, and the energy transition’s capital intensity are considered significant risks to energy transition M&A. Sixty percent of respondents expected dealmaking to increase in the next 24 months, and almost one in five anticipated a considerable boost.
Seventy-four percent of investors also expected storage to be a major transformative factor in energy infrastructure over the short term, given its importance in grid stability and renewable integration. North American financial sponsors (86 percent) were more confident than North American corporates (47 percent).
Ninety-one percent of investors anticipate that carbon capture, utilization, and storage and clean hydrogen will be key to North America’s decarbonization strategy over the next 24 months, with 90 percent looking at hydrogen adoption. Such technologies are considered indispensable despite high capital costs and infrastructure-related concerns.
The Canadian government’s support of energy transition M&A also fosters a positive outlook, with Canadian respondents reporting high confidence in policy support. Meanwhile, US policies are backtracking on IRA incentives.
Artificial intelligence has also impacted data center demand in the region. The aggregate transaction value for data center infrastructure activity in North America hit US$104.1 billion, which was more than three times the value recorded in 2023. Forty-seven percent of respondents said they had invested in data centers in the last 24 months, with 59 percent being financial sponsors.
“This new energy mix of the traditional and transitional makes for a challenging but undeniably opportunity-rich M&A environment. Understanding the opposing currents and crosscurrents shaping this primary sector, has never been more critical for industry leaders and dealmakers seeking to chart a path forward,” Dentons wrote in the report.
Dentons obtained feedback from 70 North American financial sponsors and 30 North American corporates that have invested US$5 million in renewable and/or conventional energy infrastructure M&A over the past 24 months for the “Power Moves: Driving deals in the North American energy M&A market 2025” report.