CALGARY, ALBERTA--(Marketwire - Nov. 23, 2012) - TransAlta Corporation (TransAlta) (TSX:TA)(NYSE:TAC) reported today an independent arbitration panel granted TransAlta force majeure relief for derates and outages in 2010 and 2011 related to mechanical failure of critical generator components on Sundance unit 3. This decision validates that the mechanical failure was beyond TransAlta's reasonable control.
"This decision further validates our good operating practices," said Dawn Farrell, TransAlta President and CEO. "The circumstances of the failure were unforeseen; we did what was necessary and prudent to return the unit to service, maintain safe operations, and support the reliability of the Alberta system."
TransAlta took unit 3 of the Sundance facility out of service in May 2010 due to the mechanical failure of critical generator components. Subsequently, TransAlta notified the Power Purchase Arrangement (PPA) Buyers and claimed force majeure relief under the PPA. The PPA Buyer rejected this claim, which was then referred to a binding arbitration process under the dispute resolution process set out in the PPA and in accordance with the Alberta Arbitration Act.
Sundance 3 comprises 353 megawatts (MW) of the 2,126 MW Sundance power plant, which has six individual units and serves as a baseload facility for the Alberta electricity system. TransAlta commissioned Unit 3 in 1976. Located about 70 kilometers west of Edmonton, Sundance is the largest power plant in Alberta, and the largest coal plant in Western Canada.
TransAlta is a power generation and wholesale marketing company focused on creating long-term shareholder value. TransAlta maintains a low-to-moderate risk profile by operating a highly contracted portfolio of assets in Canada, the United States and Australia. TransAlta's focus is to efficiently operate geothermal, wind, hydro, natural gas and coal facilities in order to provide customers with a reliable, low-cost source of power. For over 100 years, TransAlta has been a responsible operator and a proud contributor to the communities in which it works and lives. TransAlta has been selected by Jantzi-Sustainalytics as one of Canada's Top 50 Socially Responsible Companies since 2009 and is recognized globally for its leadership on sustainability and corporate responsibility standards by FTSE4Good. TransAlta is Canada's largest investor-owned renewable energy provider.
This news release may contain forward looking statements, including statements regarding the business and anticipated financial performance of TransAlta Corporation. These statements are based on TransAlta Corporation's belief and assumptions based on information available at the time the assumption was made. These statements are subject to a number of risks and uncertainties that may cause actual results to differ materially from those contemplated by the forward-looking statements. Some of the factors that could cause such differences include, pricing in the market place, our inability to enter into long term contracts due to prevailing market conditions, legislative or regulatory developments, competition, global capital markets activity, changes in interest rates, currency exchange rates, inflation levels and general economic conditions in geographic areas where TransAlta Corporation operates.
Note: All financial figures are in Canadian dollars unless noted otherwise.