According to the documents, Smith said Alberta lacked the transmission lines needed to export the power to the United States.
"But at least for now there is limited capacity to move this west and then south through British Columbia and on to our Pacific Northwest," the cable notes.
"There is almost no capacity to move it south into the U.S. Rocky Mountain states and markets further afield."
Opposition parties say a proposed multi-billion dollar north-south transmission line will be used to export that power even though the Stelmach government has denied it.
"There's nothing necessarily wrong with exporting surplus power to the United States," NDP Leader Brian Mason said.
"But by hiding it, they're proceeding with a policy that will require Albertans through their electricity bill to pay for this transmission infrastructure which is worth billions and billions of dollars."