Five minutes into lunch, Dawn Farrell makes a startling admission: She isn't sure yet whether she enjoys her big new job atop Canada's largest publicly traded power company.
It is rare for chief executive officers, even rookies, to express anything less than total satisfaction with their mandates. But after about two months running TransAlta Corp. of Calgary, Ms. Farrell concedes she is feeling her way into the staggeringly intricate job, having stepped up from the chief operating role in January.
"You feel a heavier weight – it all rests on you now," says the daughter of a Calgary beekeeper and a self-professed "lousy leader" during the early years of her career.
Ms. Farrell is an island of disarming candour in an executive world rife with bombast and ego. In the serious business of global electricity, she refuses to take herself seriously – which might just be her biggest advantage.
She claims no hobbies – no gruelling triathlons, not even the odd golf outing – but focuses her energies on two consuming passions: her family and TransAlta, where she worked for more than two decades before replacing long-time CEO Steve Snyder on his retirement.
Both enterprises have a lot of moving parts. Married for 30 years to a carpenter, she is mother of two adult daughters and, at 52, recently became a grandmother for the third time. At century-old TransAlta, she oversees the country's largest operator of coal-fired power plants, a player in natural-gas generation and hydro-electricity, and producer of a third of Canada's wind power. And it is active in Canada, the western United States and Western Australia.
With that array of assets, TransAlta faces both market opportunities and operating risks.
Ms. Farrell was rudely welcomed to the CEO's job by lower U.S. power prices and fallout from unplanned Alberta shutdowns, slashing profit 74 per cent in Mr. Snyder's last quarter as CEO.
But she says the mix of technologies and geographies reflects careful positioning by Mr. Snyder and his predecessors. "The table has been set and my job now is to take advantage of what's been set," she says. As the new CEO, she will be driving "a growth agenda," she maintains.
That means pushing ahead aggressively with renewable energy. TransAlta is building a new wind farm in Quebec's Gaspé region and sees potential for growth in Ontario. Thus, it is important for Ms. Farrell to make Eastern Canadian connections in her new capacity as CEO, which explains the working lunch of salads and sandwiches in a meeting room at the Fairmont Royal York in Toronto.
And while wind is the sexy clean technology, Ms. Farrell is not quite ready to abandon coal, the biggest and dirtiest weapon in TransAlta's arsenal, providing 50 per cent of its power capacity, with the bulk of it generated in Alberta.
"Sometimes, when you are advocating for coal, you feel like you are advocating for tobacco," Ms. Farrell says. "People make you feel that way." But anyone who has watched her give a speech knows she can be forceful in making the case for coal as a continuing option in a power-hungry world.
Coal's proportion of TransAlta's power mix will decline, as coal-fired plants are shuttered at the end of their natural lives – as mandated under evolving government policy – and natural gas and renewables come on strong. But the option of updating and thus extending the lives of some coal plants – thus, reducing the massive capital cost outlay – should not be ruled out, she says, because economics and technology can change in a whisker.
She is pinning her hopes on carbon capture and storage, the still infant science of capturing emissions and storing them underground. Ms. Farrell argues it is good public policy to support carbon storage, because the world is awash in coal and somebody, somewhere, will burn it, whether in Canada, China or the developing world.
And it is particularly critical for Alberta, which will need a lot more power to meet demands from the oil sands and other future projects.
To those who dismiss carbon capture as uneconomic, she points to TransAlta's experience with wind. In 1999, when the company bought its first wind farms, producing power from wind was two to three times more expensive than today. As a result of subsidies and larger-scale production, the cost has plummeted to the extent that "wind has just entered the realm of being economic. It no longer needs to be subsidized – and it shouldn't be."
In regions where wind blows hard, such as Southern Alberta and Saskatchewan, TransAlta is producing power at a cost competitive with natural gas and coal, she says. Carbon storage will follow that same arc, she insists, as companies climb the learning curve and economies of scale click in.
"We should be looking hard at it because 50 per cent of the world's electricity is supplied by coal and they are building a [coal]plant in China every week. There is going to be a lot of coal burned on this planet over the next 50 years, whether Canada does anything about it or not."
There is no single technology that will meet the world's power needs, she argues – not wind, not geothermal (another TransAlta technology), not natural gas, and coal has to be in the mix. The economics of gas-fired plants look good now, because the price is low and it is half as dirty as coal. But emissions may still exceed future standards, and carbon capture from gas plants is more costly than from coal.
So if coal is a tough sell, so are most of the things TransAlta does – which means the new CEO must be a patient communicator who can function in regulated and deregulated jurisdictions and across diverse public policy frameworks.
She sees her biggest challenges in the paradox of modern-day life – that people want low-cost reliable energy delivered to their doors, but with the least possible environmental impact. What's more, the not-in-my-backyard mentality is rampant, she says, particularly in the heated debate over new transmissions systems for Alberta.
"We live in a big country, we figured out how to build a railway, we figured out how to build roads. We often have decisions where the public interest has to overcome private rights," she observes.
Ms. Farrell approaches these issues as a child of entrepreneurs, the first in her family to pursue a corporate career. With a commerce degree and a masters of economics, she moved into power-load and rate-setting jobs with TransAlta, which often put her on the front line with customers.
She left in 2003 to join British Columbia Hydro and Power Authority (BC Hydro) to gain some operating experience, becoming executive vice-president for generation. But after 4½ years, she wanted to return to Calgary for family reasons, and went to Mr. Snyder for advice. He invited her back in the company.
It has not been a straight line to the CEO's office. At one point in her career, she concluded she was a poor leader, who contributed ideas to her team but did not listen well to others. Burned out on the job, she sought a leave of absence. Instead, her boss suggested she take the summer off with her family – but keep running the department at a distance.
"The trick was you had to delegate," she says, and that experience changed her style. "I said, 'Okay, I have to really think about how I work with people.'" Today, she admits that "I am not the world's best leader, but I have worked hard to become better."
It helps to have an inquiring mind, and Ms. Farrell is as comfortable discussing magic realism in literature, as the economics of power rates. She and her husband are voracious readers, and she particularly admires author Rohinton Mistry and his epic work A Fine Balance for capturing the tension between tradition and modernity in Indian society.
She feels the same push-pull in companies like TransAlta that are built on long traditions, but must be alert to revolutionary ideas. This means constantly facing the question: "How do you dump what is not working and keep what is working?"
It is the kind of riddle that fascinates Ms. Farrell as she begins to guide TransAlta through the thicket of strategic options in the power business of the 21st century. Even after some opening-night jitters, it's a role she could learn to love.
-Born: Feb. 2, 1960, in Calgary
-Bachelor of commerce; masters of economics, both from the University of Calgary
-Twenty-seven years in the power industry, joining TransAlta after university.
-Left TransAlta in 2003 to work for BC Hydro for 4½ years.
-Rejoined TransAlta in 2008, became CEO in January, 2012.
-Married for 30 years to a hardwood-floor contractor in
-Describes her husband as "TransAlta's No. 1 shareholder advocate."
-The couple have two daughters, aged 23 and 24, and three grandchildren.
"My daughters would attest I am not supermom. It takes a lot of juggling to make it all work."
-Favourite pastime is reading widely – about religion, neuroscience, psychology and economics, as well as fiction.
-Favourite author now is the late Jose Saramago, Portuguese Nobel laureate; her pick among his works is Death With Interruptions.