Steve Snyder

Activist shareholders from the U.S. have been pushing TransAlta to leverage up and buy back shares. How difficult is it to keep an eye on long-term strategy when shareholders think short-term?

I believe that you have to deliver both in the short term and in the long term. But I think the responsibility falls on management specifically, to be able to communicate to shareholders the benefits they'll get from a long-term perspective.

I've often thought that the easiest way to run a company for the long term would be to go private. How do you feel about that?

For a long-cycle, capital-intensive, quasi-essential service like electricity, there's a strong case to be made that a private investor with a long-term view would be the best source of capital. It's a very strong cash-flow business, but it does have inherent lumpiness in terms of short-term earnings, and it's often easier for long-term financial people to have the patience to wait for the payoff.

In Western Canada, you have a lot of coal-fired plants that are old and depreciated. How do you deal with lessening returns from older plants while also dealing with carbon dioxide emissions?

Coal is at the centre of a storm. It remains relatively inexpensive, but is obviously environmentally problematic. Our challenge is to find a way to capture and sequester carbon emissions and do it economically. If we can do that, there's a tremendous benefit to the environment as well as to shareholders, because the ability to extend the life of an old plant is one of the best returns we can provide to shareholders.

You had a significant investment in Mexico with coal-fired gas plants. What do you think the gas supply situation looks like?

Natural gas is another challenge. If you make an assumption of long-term availability and stable gas prices, you would ship production into natural gas-fired plants. But a lot of people are very uncomfortable with those two assumptions. The challenge we had in Mexico was about scale. With only two plants there, it wasn't enough scale to justify the overhead structure. So we had to make a decision: Either we had to find a way to grow those facilities or we needed to redeploy that capital elsewhere.

What do you think shareholders should consider when it comes to the growth of the company?

There's tremendous opportunity because of the growing shortage in power supply. The key is to really focus on the capital mix and how we look at dividends, share buyback and growth allocation of the capital. For shareholders, there's tremendous potential if we get that mix right, and so that's our focus--to get that capital mix right in the sweet spot.