Capital Power has a pipeline of projects that are at various stages of development. Capital Power currently has one major projects under construction and is also managing major upgrades to two CPILP facilities.
Capital Power also has several development opportunities that it is currently pursuing. In addition to development projects, Capital Power continues to review acquisition opportunities for assets that fit with its strategic objectives. Capital Power’s focus in the U.S. will be primarily on acquisition opportunities; however, it will consider greenfield developments as opportunities arise.
Capital Power’s current construction projects and major development opportunities include the following:
Keephills 3
Keephills 3 is a 495 MW coal-fired power plant being built on TransAlta’s Keephills site just west of Edmonton, Alberta. Capital Power and TransAlta are equal partners in the plant. Capital Power has overall responsibility for construction while TransAlta will be responsible for operations once the plant is commissioned. Construction remains on target to the revised project cost forecast of $1.9 billion and on schedule to commence operations in the second quarter of 2011.
The plant is a sister plant to the Genesee 3 facility, utilizing similar Hitachi supercritical boiler technology.
Capital Power believes that the project will begin to make a meaningful contribution to its cash flow in 2011. The addition of new generating capacity is occurring at a slower rate than the expected rate of increase in demand in Alberta. Capital Power expects that the quantity of baseload coal-fired generation capacity will remain essentially constant as the completion of Keephills 3 and capacity increases to existing coal plants are offset by retirements of smaller and older units.
Capital Power anticipates that Keephills 3, based on its similar technology and feedstock, will perform similarly to Genesee 3 once fully operational and will generate comparable operating cash flows under the same power prices. Keephills 3 is being designed to meet the 2006 new unit emission limits for SO2, NOx, mercury, and particulate matter under the 2006 Alberta Air Emissions Standards for Electricity Generation. The Company estimates that the plant will emit 24% less CO2 per megawatt hour (MWh) than four coal plant units that are expected to be retired in the near future by another power producer in the province. Capital Power and TransAlta will independently dispatch and market their share of the unit’s electrical output.