ENMAX to Focus on Regulated Business and Invest Less in the Competitive Market
By: Nick Clark
To Calgary’s Next Mayor and City Council,
As you may or may not be aware, the City of Calgary is the sole shareholder of ENMAX, and as such, has a role to play in ENMAX’s governance, policies, and strategic direction. As Calgary’s future City Council, you should be informed about the direction ENMAX has chosen to take and how it will impact Calgarians.
The following text illustrates the direction ENMAX intends to take going forward. We encourage you to become engaged and familiar with the industry, as you will be present at future AGMs and will be expected by your constituents to represent the interests of Calgarians.
Alberta’s deregulated market is changing under the AESO’s Restructured Energy Market (REM) Design, at the behest of the Government of Alberta. Fundamental market changes are coming with tightened guardrails. Over the last couple of years, power pool prices have fallen (in September alone, 102 hours were priced at $0/MWh). How has this impacted the utilities, retailers, and consumers? Perhaps unpacking comments made at the ENMAX AGM with Calgary City Councillors might help shed some light on what the future holds.
ENMAX CEO Mark Poweska outlined the strategic focus for 2025 and beyond at the AGM, focusing on the business' regulated components. The renewed strategic focus will put less emphasis on the competitive side of the business and more on the wires infrastructure. In a CBC Article, Poweska is quoted as saying, “The competitive business — it's a volatile business. You have up years and you have down years. Over the last couple of years, the commodity prices have been high and that part of business has been doing well." He elaborated, “We expect our regulated earnings to become a large part of our portfolio as these businesses grow. At the same time, our competitive earnings will stay flat or decline due to market competition and rising carbon costs.”
Included in the regulated business is Versant Power, a utility that ENMAX purchased in Maine, USA at a cost of $1.8 billion in 2020. ENMAX invested $702 million in infrastructure across Alberta and Maine in 2024.
What does this mean? ENMAX will not renew existing commercial contracts and will no longer serve new commercial clients that consume more than 250,000 kWh of electricity or 2,500 GJ of natural gas, annually. While ENMAX will honour existing contracts until their expiration dates, no renewal options will be offered, and adding new sites will no longer be possible.
With the local civic election just weeks away, we wonder how the next Mayor and City Councillors will view this significant shift in ENMAX’s strategy. The question that should be asked by those vying for elected office: How is investing a significant amount of money in the United States going to help reduce regulated wire costs for consumers here in Calgary? Affordability should be top of mind, and increased wires costs to consumers (when they already make up a significant portion of a consumer’s bill) should be balanced against the city’s dividends. The CBC article linked above also makes mention of $20 million from the dividend spent on “community amenity upgrades.” Are these community amenity upgrades making life more affordable?
Moving away from the competitive market is a bold move and a significant shift within Alberta’s energy landscape as ENMAX exits from the commercial and industrial electricity and natural gas market. This development, which impacts a wide range of customers, from small businesses to large industrial operations, marks a pivotal moment in the province’s energy sector.
Election day is Monday, October 20th, and advance voting is from October 6th to 11th. For more information on Calgary’s municipal election, please visit Elections Calgary.