Independent arbitration panel validates TransAlta's operating practices and grants claim of force majeure on Sundance unit 3
November 23 2012 - 7:45AM
Marketwired
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."
Background information:
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.
Contacts: Investor inquiries: Jess Nieukerk Director, Investor
Relations Phone: 1-800-387-3598 in Canada and
U.S.investor_relations@transalta.com Media inquiries: Stacey
Hatcher Senior Corporate Relations Advisor Cell: 587-216 2242
Toll-free media number: 1-855-255-9184 Local number:
403-267-2540
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