The chief executive of Capital Power Corp. said a key focus in the months ahead will be digesting two soon-to-be purchased U.S. natural gas power plants.
The Edmonton-based power generator announced a $3-billion deal earlier this month to buy the Hummel power station in Pennsylvania and the Rolling Hills station in Ohio. Both are owned by subsidiaries of LS Power Equity Advisers LLC and the purchase is expected to close in the third quarter.
On a conference call Wednesday to discuss Capital Power's first-quarter results, an analyst asked CEO Avik Dey whether more acquisitions are on the horizon.
"We will continue looking at opportunities," Dey replied. "But make no mistake — the priority for this year will be to, one, close the transaction and to integrate these two assets in particular because we're in a new market."
The acquisition gets Capital Power a foothold in what's known as the Pennsylvania-New Jersey-Maryland Interconnection market, which it says is the largest and most attractive market in North America.
On the call, Dey said natural gas generation has been growing in the United States for the past 25 years — through three recessions and despite a surge in renewable power. For a decade, it has been the top source of U.S. power generation, he added.
"Amid considerable market turmoil, we have continued to invest in natural gas. Why? The answer is simple," Dey told investors.
"The demand growth potential we see is insensitive to economic and other forms of disruption."
A significant driver of natural gas power demand has been data centres used in the burgeoning artificial intelligence space. The massive operations require an immense amount of electricity to run and cool off computer servers.
Alberta's technology minister has said the province hopes to see $100 billion worth of artificial intelligence data centres under construction in the next five years.
Capital Power said earlier this year that its recently retooled Genesee Generating Station southwest of Edmonton is well positioned to power such an operation. It now runs entirely on natural gas instead of coal after a $1.6-billion multi-year project, allowing it to boost capacity by around 60 per cent while cutting greenhouse gas emissions by 40 per cent.
On Wednesday, Dey said work continues to find a potential data centre partner for the Genesee site and it has done detailed engineering to understand what may be needed.
Earlier in the day, Capital Power said its profit and revenue fell during the first three months of 2025.
Net income attributable to shareholders was $151 million during the quarter ended March 31, or $1.03 per diluted share.
That compared with a profit of $205 million or $1.57 per diluted share during the same period a year ago.
Revenues and other income for the quarter decreased to $988 million from $1.12 billion during the first quarter of 2024.
This report by The Canadian Press was first published April 30, 2025.
Companies in this story: (TSX: CPX)
Lauren Krugel, The Canadian Press
