Opinion: Is Enmax paying its fair share into City of Calgary coffers?

For Calgary’s economy, 2019 was a terrible year, marked by ongoing troubles in the energy sector and a downturn in construction. Not surprisingly, the city’s weak economic performance has had an impact at the municipal level as well.

The City of Calgary is struggling financially and city council, led by Mayor Naheed Nenshi, has been making tough decisions on what to cut and who will pay more. But whether you call it a higher mill rate or increased user fees, those monies come from the same source: you and I.

But the city does have another significant source of revenue under its control: dividends from its wholly-owned subsidiary, Enmax.

The city has approved changes where residential taxes will increase by 7.5 per cent and yet there is no planned increase in revenue from our $2.4-billion investment in Enmax. This begs the question: How is this fair to Calgarians?

In analyzing financial reports, statements and reviews from Enmax and comparing these to similar information from Epcor, the Edmonton-owned utility, it seems that Calgarians are getting a poor return on their investment. The data I collected indicates that if Calgary adopted a funding formula similar to Edmonton’s, city revenues from Enmax could double from $50 million to $100 million per year.

Again we wonder: How is this fair to Calgarians?

In late November, I joined more than 50 fellow citizens participating in city budget deliberations, during which I urged council to seek more money from the Enmax dividend. Doubling the dividend — not an unreasonable ask — would create a revenue stream that is more in line with what the City of Edmonton receives from Epcor.

The idea seemed to intrigue Nenshi, who said he’d like to follow up. As well, Coun. Jeff Davison expressed interest at the public hearing in bringing a motion to council on the Enmax dividend. The issue got further traction recently when Marcel Latouche, head of the Institute for Public Sector Accountability, advocated for an increase to the dividend with CHQR radio talk show host Danielle Smith.

Calgarians have expressed concerns to me as to whether the utility would download the impact back onto its ratepayers. Rate increases require approval and there are bodies and venues to which Calgarians could appeal or offer feedback. These include our city council, which also has a relationship with the Enmax board, itself an entity selected by the City of Calgary, and the Alberta Utility Commission. Finally, of course, there is the prerogative offered to all Albertans to choose another provider for their energy needs.

You may remember that in 2001 Calgary city council began the process of privatizing Enmax, garnering bids that went as high as $2 billion. Calgarians widely and loudly decried the move and, in the end, the sale of Enmax was revoked in a 13-2 vote by council.

The voices of Calgarians made a difference in 2001 and now, 19 years later, they can make a difference again. I urge you to reach out to the mayor and to your councillors and encourage them to make efforts to obtain a better return on our equity in Enmax.

An additional $40 million or $50 million per year in the city’s coffers could make a world of difference to Calgary’s citizens and taxpayers.

With a simple email or phone call, you could help change the story to make Calgary’s economic recovery fairer for all of us.

John Kehler is a Calgarian who worked 41 years in the electrical industry, for the Alberta Electrical System Operator and TransAlta Utilities, before his retirement in 2017.