Outgoing TransAlta boss Steve Snyder: CEO of the year
Under his leadership, a greener international power generator is born
There’s something Starbucks-like about the office of TransAlta Corp.’s outgoing president and CEO Steve Snyder. Spacious and bright, there are a half dozen small paintings lining one wall: slightly abstract motifs of leaves and flora in muted mocha and espresso colors. A couple of multi-stemmed cactuses loom taller than Snyder’s six-foot-one, straight-backed, 62-year-old frame.
There’s also the requisite large wooden desk with a leather chair. But it seems almost an anachronistic C-Suite relic that visitors breeze by as Snyder urges them to a low, less imposing round coffee table surrounded by four chairs so plump they incline you to “chill,” a word that Snyder uses several times over the course of an interview.
“Let me tell you a story about this office,” says Snyder, Alberta Oil’s 2011 CMA’s Chief Executive Officer of the Year, and a man about to embark on the biggest chill, retiring after 16 years as the head of Canada’s largest publicly traded electricity generation and marketing company. “When I came to TransAlta in 1996, the CEO’s office was up on the top floor in the corner, the 10th floor, the usual place. Very few people went there and when they did, it was with trepidation.”
Two years later, when the downtown Calgary office needed renovations, Snyder moved his office adjacent to the second-floor walkway connecting the two buildings comprising TransAlta’s headquarters. It’s on the same floor as a café and it allows Snyder to rub shoulders with some of the company’s 2,500 employees. “On the 10th floor you never ran into anyone. You just became this little papal chamber.”
Wearing a charcoal-colored suit and a patternless green tie, Snyder looks relaxed, even though in November, the Market Surveillance Administrator (MSA), Alberta’s electricity market watchdog, found TransAlta guilty of anti-competitive behavior.
For a 31-hour period in November 2010, TransAlta blocked electricity trades from British Columbia by booking transmission line capacity at the very end of 20-minute booking windows. The moves temporarily spiked electricity costs in Alberta. TransAlta, while stating its actions were unintentional, and the applicable rules vague, conceded it had nevertheless acted inappropriately and offered to disgorge the extra $245,000 profit it made, and pay, uncontested, a $125,000 fine.
The episode was not well received by Albertans and it is undoubtedly a ding on Snyder’s resumé. Yet the bigger picture is that since signing on with TransAlta – after helming GE Canada in Toronto and, before that, Noma – he’s transformed what was a regional, coal-belching electrical business into a greener international power generation behemoth. The trading gaffe, while spawning public ire and a wrist slap from the MSA, was merely nettlesome.
Snyder, who never set out to be a CEO, is humble about his tenure at TransAlta. But there’s no disputing that under his leadership, the company has become a bigger entity with a much wider reach. It has 70 power plants, $3 billion in annual revenue, $9 billion in assets, and power plants in Canada, the U.S. and Australia. He regularly works from 6 a.m. to 7 p.m., plus three or four nights a week attending functions on behalf of the company. Knowing nothing about the power generation industry when he came to TransAlta, his penchant for long hours helped him as he faced a steep learning curve.
“It’s a much more complex business than people get from looking from the outside in. It’s a real-time business because supply instantly equals demand, and that is unusual. Also you don’t have the same motivators you have in most companies. Take Colgate. (Snyder once worked there as a young engineer.) Well, we could go beat up Procter and Gamble. That’s a goal. That’s something that can get people motivated. I can make my product better by making it more effective, taste better, cheaper, package it better, advertise it better.”
“You come to the power business,” he continues, “and we have a product you can’t make better. You don’t have customers or competitors in the classic senses. You can’t touch your product. So the visceral part of motivating people is missing from this industry. You have to find other motivators.”
And he did. He took the now 100-year-old company international, building or buying electricity plants in Mexico, Argentina, New Zealand (those assets have since been sold off), the U.S. and Australia. Snyder made TransAlta a technological leader in gas plant technologies and clean coal generation. And building on TransAlta’s prior sorties into greener operations, Snyder instituted the company’s sustainable business practices, making its first large wind investments in the 1990s.
When Snyder took over TransAlta, nearly 90 per cent of its generating plants were coal-fired. Now, with new gas generating plants, hydro and geothermal power, and, at over 1,000 megawatts, the most wind generation of any company in Canada, coal now accounts for 50 per cent of TransAlta’s power production mix. “In our business, moving the needle that much is remarkable because it takes a lot of capital to do that,” he says.
Snyder purposely cultivated a certain amount of insecurity while at TransAlta to keep him on his corporate toes. “I always came to work paranoid that this could be my last day at the job. I always felt I had to come in and earn my job every single day.”
It’s unlikely he’ll ever be fired from his next position. January 2 was his last day at TransAlta (chief operating officer Dawn Farrell will succeed him), yet Snyder professes he’s barely given thought to post-retirement, save that, after spending the last 20 of his 40-year career as a CEO, he’s done with that. “I need to do something in the business world, but different from what I’ve been doing. Simply put, that means I don’t want to work for a salary,” he says. “I don’t want to do board work necessarily, or work for another company. I don’t want to consult – I am a learner, not a teacher.”
So he’s thinking of something in the equity world, or creating his own product or business. “That leaves a pretty broad field, but I’ll sort that out.”