TransAlta said its strong financial performance in Q1 2021 was led by the “exceptional performance” of its hydro projects in Alberta.
TransAlta owns 26 hydroelectric projects in Alberta, British Columbia, Ontario and the U.S. (one plant) with a total capacity of 949 MW. In total, the company has more than 70 power plants in Canada, the U.S. and Australia, with total capacity of more than 7,500 MW.
The company reported comparable EBITD of $310 million, an increase of $90 million or 41% compared to the same period in 2020. Free cash flow (FCF) was $129 million or $0.48 per share, compared to $109 million or $0.39 per share, a 23% increase on a per-share basis, for the same period in 2020. The hydro segment delivered $77 million of comparable EBITDA, an increase of $51 million or 96% compared to the same period in 2020. And adjusted availability was 88.6% compared to 92.8% for the same period in 2020.
On Dec. 31, 2020, all power purchase arrangements (PPAs) with the Alberta Balancing Pool for TransAlta’s Alberta hydro facilities, Keephills Units 1 and 2, and Sheerness Units 1 and 2 expired and these facilities began fully merchant operations in the Alberta electricity market.
In the three months ended March 31, 2021, the hydro and Alberta thermal segments achieved realized power prices of $122/MWh and $87/MWh respectively compared to the Alberta spot price, which averaged $95/MWh. The company was able to benefit during higher-priced periods by optimizing dispatch in the hydro segment while its hedging positions at Alberta Thermal minimized unfavorable market pricing during lower-priced hours in the quarter.
“TransAlta delivered excellent results during the first quarter, ahead of our financial expectations. Our strong performance was led by our Alberta Hydro fleet as we experienced the first few months of fully merchant operations in the Alberta electricity market. Our strategically diversified fleet of hydro, wind, energy storage and thermal assets demonstrated its competitiveness and continued value in the new market structure,” said John Kousinioris, president and chief executive officer. “Our Energy Marketing segment also had an exceptional start to the year with favorable trading results across North America. Given these exceptional results, we expect performance to track to the upper end of the range of our 2021 guidance.”
TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the U.S. and Australia. TransAlta the largest producer of hydroelectric power in Alberta.