TransCanada to terminate Alberta coal power contracts due to higher emissions costs

​TransCanada Corp. says three of its Alberta power plants will become unprofitable as a result of a change in provincial law, so it plans to terminate their power purchase agreements.

The Calgary-based company says costs associated with carbon-dioxide emissions from the coal-fired plants have risen and are forecast to increase further over the remaining term of the agreements.

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.

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.

The president of TransCanada's energy business says the company will continue to be part of Alberta's energy sector through its gas-fired co-generation plants and wind projects.

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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