TransAlta and EPCOR sign development agreement for Alberta power project

March 15, 2006 – TransAlta Corporation and EPCOR Utilities Inc. announced yesterday that they have signed a development agreement to jointly pursue TransAlta’s Keephills 3 power project. Keephills 3, formerly known as Centennial, is a proposed 450 MW unit adjacent to TransAlta’s existing Keephills facility, approximately 70 km west of Edmonton, Alberta.
“Development of the Keephills 3 plant is key to ensuring Alberta’s future power needs are met with reliable and cost-effective power,” said Tom Rainwater, TransAlta Executive Vice-President Corporate Development and Marketing. “Together TransAlta and EPCOR have almost 200 years of combined expertise in developing, building and operating power generation facilities.”
Using key elements of the successful model EPCOR and TransAlta used to develop and operate the Genesee 3 (G3) power facility, the companies will work together to develop the Keephills 3 facility. Development work in 2006 will include continuing stakeholder consultations, focusing on the regulatory process, defining commercial and financial details, completing preliminary engineering and design work, and establishing contractual arrangements for construction. Assuming that development work proceeds according to plan, required regulatory approvals are obtained and final project approvals are received from the boards of directors of both companies, the facility is expected to be online in 2011.
“The agreement leverages EPCOR’s recent success leading the construction of Genesee 3, and the excellent working relationship with TransAlta,” said EPCOR Executive Vice-President Brian Vaasjo. “Genesee 3 was completed on time, on budget, and with one of the best safety records in the industry. It also affirms our commitment to developments that feature the best available technology economically achievable.”
The Keephills 3 project will use either supercritical boiler technology, which is in operation at G3, or other technology that provides equivalent or superior environmental performance at a comparable cost. Supercritical technology is more efficient and has better environmental performance than conventional coal plants.
The development agreement contemplates that TransAlta and EPCOR would become equal partners in the construction and ownership of the Keephills 3 facility. EPCOR would manage construction and TransAlta would operate the facility. Both parties would independently dispatch and market their share of the unit’s electrical output.