“There is absolutely no way the utility would be sold,” stated Calgary Mayor Jeromy Farkas, addressing concerns about the future of Enmax and its recent acquisition of Versant Power. This declaration comes amid discussions about expanding Enmax’s responsibilities to include the city’s water utility, a move that has sparked considerable debate among city councillors.
Enmax, which acquired Versant Power for a total of $1.8 billion, including $1.29 billion in cash and $500 million in debt, has been a focal point of municipal utility discussions. The acquisition was aimed at enhancing the utility’s portfolio, but it has also raised questions about the management of diverse assets across different regulatory environments.
The Bearspaw independent review panel’s recommendations are central to the mayor’s proposal for water management. Farkas has committed to adopting these recommendations in full, which include establishing independent oversight and expert management of the water system. He suggested restructuring the water utility into a wholly owned subsidiary to better manage its operations.
As discussions unfold, councillors are engaging in private sessions to explore options for the city’s utility holdings. Farkas expressed concern about “scope creep” when balancing different rate bases and regulatory regimes, emphasizing the complexities involved in managing multiple utilities under one umbrella.
While Farkas is not actively pushing for a sale of Enmax, he has indicated a desire for valuation work to be conducted. The potential value of the Versant unit is estimated at as much as $2 billion, which could be significant in future financial planning for the city.
In addition to its utility management challenges, Enmax has also been involved in external campaigns, providing $15 million to support a non-profit initiative opposing a consumer-owned utility in Maine. This involvement highlights the competitive landscape in which Enmax operates, as it seeks to solidify its position in the market.
What observers say
City councillor Alexandra Frison remarked, “There has been no discussion at the Board level regarding divesting Versant,” reinforcing the mayor’s stance on maintaining ownership of the utility. Meanwhile, fellow councillor Andre Chabot noted, “The regulated U.S. assets are a highly profitable portion of the utility’s holdings,” indicating that the focus may remain on maximizing the current assets rather than pursuing a sale.
As council deliberations continue, the focus is expected to center on whether a partial asset review could unlock funds for water capital work, a critical need for the city. Details remain unconfirmed, but the outcome of these discussions could shape the future direction of Enmax and its role in Calgary’s utility landscape.
