On Monday, TransAlta announced its Clean Energy Investment Plan which will see the company convert its existing Alberta coal assets to natural gas.
TransAlta says its $2 billion plan will advance its leadership position in renewable energy. The $2 billion price tag includes approximately $800 million of renewable energy projects that are already under construction.
In 2020 and 2021, TransAlta says it will convert three of its existing Alberta thermal units to gas by replacing existing coal burners with natural gas burners. The company says it will also convert two of its units to highly efficient combined cycle natural gas units in the late 2023 to late 2024 period.
According to a press release from TransAlta, the switch to natural gas will significantly cut air emissions and costs and position the Calgary-based company as a low-cost generator in the Alberta energy-only market. It will also help “generate attractive returns” by leveraging its existing infrastructure, and the shift is expected to extend the life and cash flows of the Alberta thermal assets.
TransAlta says its Clean Energy Investment Plan also includes four wind projects in the United States and Alberta that are currently under construction. The company says the projects are underpinned by long-term power purchase agreements “with highly creditworthy counterparties.”
“The Clean Energy Investment Plan will be funded from the cash raised earlier this year through the strategic investment with an affiliate of Brookfield Renewable Partners, cash generated from operations, and through TransAlta Renewables Inc.,” the company wrote in a press release.
In addition to funding the plan, TransAlta says it remains committed to returning up to $250 million to shareholders over the next three years through share repurchases and reducing its corporate level debt by $400 million in 2020.