Far from satisfied with the relatively meager returns in the gas pipeline business, TransCanada PipeLines CEO Hal Kvisle said his company plans to spend about $10 billion over the next five years on power generation projects.

TransCanada hopes to become a “really significant player in power generation to the point that you might see power as an equal 50-50 element of our overall asset portfolio,” said Kvisle during a FirstEnergy Capital Corp. energy conference in New York on Wednesday.

“If you look at it from a book value basis, we have approximately $15 billion of assets invested in the pipeline business and about $2.5 billion invested in the power business,” he added. To reach an equilibrium, “you could see us investing a number approaching $10 billion in power over the next five or six years.”

Kvisle said TransCanada is eagerly awaiting an inevitable asset sell-off by other companies. Currently, he said, companies seem to be trying to avoid selling, but low prices will lead to a generation buyer’s market relatively soon, he said. Kvisle’s remarks dovetailed with those of an FPL Group executive at another conference Tuesday, who estimated about $10 billion in generation assets already are on the market, with more expected to come (see Power Market Today, March 7).

“Deal flow in power is a little bit slow right now because a lot of people are still resisting the inevitable outcome of a downturn in power prices that reminds me of my years in the E&P sector when the downturn in prices come inevitably and in due course deal opportunities will follow. We are very much looking for where power acquisition opportunities might come from. We see many of them out there, [it’s] just the sellers aren’t quite ready to sell yet.”

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