CALGARY – TransCanada Corp. (TSX:TRP) plans to terminate its agreements to buy power from three coal-fired plants in Alberta.
The Calgary-based company says costs associated with carbon-dioxide emissions from the plants have risen and are forecast to increase further over the remaining term of the agreements.
TransCanada says it can terminate the power purchase contracts under a provision where a change in provincial law makes the agreements unprofitable.
READ MORE: Alberta climate change plan: ‘War on coal’, ‘unfair hit’ or positive step forward?
The decision affects the Sheerness power plant near Hanna, Alta., 230 kilometres northeast of Calgary, and the Sundance A and B plants that are 70 kilometres west of Edmonton.
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TransCanada expects to write down the remaining value of the power purchase agreements for a total non-cash charge of $235 million before taxes and $175 million after taxes.
READ MORE: 30 Alberta municipalities sound alarm over NDP plan to phase out coal power
The president of TransCanada’s energy business says it continues to see investment opportunities in the Alberta energy market, citing new wind projects and the need for gas-fired power capacity.
The NDP government of Rachel Notley announced in November that it planned to impose a carbon tax and phase out coal-fired power plants in order to reduce carbon dioxide emissions, a contributor to global warming.
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