Coal-fired power generation to be sold to PSE

TransAlta and Puget Sound Energy (PSE) said they have entered into a power purchase agreement for coal-generated power from the 1,340 MW Centralia generating station, Washington’s only coal-fired power plant. If approved by Washington utility regulators, the contract will help advance a TransAlta agreement with state government and the environmental community to phase out coal-fired power generation in Washington by 2025.

Under its power purchase agreement with TransAlta, PSE will buy 180 MW of base-load coal transition power from TransAlta starting in December 2014. In the following 12 months the contract increases to 280 MW. From December 2016 to December 2024 the contract is for 380 MW, and in the last year the contract volume drops to 300 MW.

PSE selected the TransAlta offer through a competitive Request for Proposal (RFP) process, evaluating the Centralia resource against more than 30 competing power supply alternatives.

The state Legislature in 2011 passed a bill codifying a collaborative agreement between TransAlta, lawmakers, environmentalists, and labor representatives. The timelines agreed to by the parties enable the state to make the transition to cleaner fuels, while preserving the family-wage jobs and economic benefits associated with the low-cost, reliable power provided by the Centralia plant. The legislation allows long-term contracts, through 2025, for sales of coal transition power associated with the Centralia facility.

TransAlta has invested more than $300 million in pollution control technology at the Centralia Plant, including scrubbers and low nitrogen dioxide burners.

The proposed TransAlta-PSE power transaction now awaits review by the Washington Utilities and Transportation Commission.

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