TransAlta Faces Penalty After Shutting Plants at Peak Times

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TransAlta Corp. is facing penalties after Alberta regulators found the power generator shut plants in 2010 and 2011 during periods of high demand “to maximize the benefit to its own portfolio.”

The Alberta Utilities Commission said in a report on Monday that it will consider what remedy to impose after finding the Calgary-based company decided to shut plants during peak hours on four occasions, driving up power prices. The commission could make TransAlta pay an administrative penalty or restrict its electricity market activities.

TransAlta is “reviewing the ruling, which could include the possibility of an appeal to the Alberta Court of Appeal,” according to a statement late Monday. The company said its focus is on efficiently operating power plants “in order to provide customers with a reliable, low-cost source of power.”

TransAlta manipulated power prices “away from a competitive market outcome,” the utilities commission said. “TransAlta could have deferred each of the outage events to off-peak hours but chose instead to take them during peak or super-peak hours.”

Electricity supplier Capital Power Corp., based in Edmonton, estimated TransAlta’s outages in 2010 cost the company C$9.3 million to C$9.8 million ($7.1 million to $7.5 million) because it had to buy replacement supplies, according to the report. Most, if not all, of those costs could have been avoided had TransAlta scheduled the shutdowns based on its previous practices, Capital Power said.