Under the current ownership structure, all Enmax employees, directors, and officers (“Enmaxians”) are owned by a municipality and not immediately accountable for capital and other related costs to the open market. They cannot benchmark themselves quickly and easily against competing utilities. Neither can they be rewarded with participation in the equity of the utility, such as is the case with private enterprise opportunities.
The Board of Directors has no guidance as to the markets assessment of the cost of capital for Enmax, and this key pricing variable is therefore left out of the equation. This will no doubt result in an increased possibility of bad decisions.
The fact that Enmax is owned by a political entity necessarily introduces politicization into the process and appointments of employees. This cannot be avoided. For example, the tumult raised around the President’s spending habits some years ago can be directly attributed to a political issue rather than a financial or operational metric issue.
Enmaxians therefore would, should, and will welcome a privatization of Enmax. It reintroduces them to the real world of commerce and finance. It can price their cost of capital much more effectively and perform their tasks in a much more meaningful manner. Enmaxians, like Calgary taxpayers, would celebrate the privatization of this enormous utility.
Images: Enmax Media
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