Benefits to Regional Economies

• Alberta

• Northern Alberta

• Central Alberta

• Southern Alberta

• Ontario

• Washington State

• Goldfields Region, Western Australia

• Mexico

Alberta

For more than 90 years, our company has contributed to Alberta’s economy through jobs, taxes and electricity production. We provide full-time jobs to about 1,500 people in the province. Nearly $12 million in taxes were paid to regional and provincial governments in 2004. Besides our contribution to the provincial economy, we have the potential to stimulate economic activity in different areas of the province.

Northern Alberta

There is a direct link between the availability of electricity and steam and the province’s capabilities to develop its abundant oil sands deposits. We own and operate the Poplar Creek gas plant near Fort McMurray, supplying electricity to the region’s rapidly growing oil sands development.

Central Alberta

Since the 1950s, we have been a major part of the economic life of the Wabamun Lake region west of Edmonton. In 2004, we provided more than 480 full-time equivalent jobs at three coal plants in the region. Luscar, which operates our Highvale and Whitewood mines, provides another 502 full-time equivalent jobs.

We are also a 50 per cent owner of the Genesee 3 generating facility, in partnership with EPCOR. In 2004, the plant’s construction site was one of the largest and busiest in Alberta. At peak construction, 2,100 tradespeople and contractors worked to complete the 450-MW plant. In March 2005, the plant began commercial operation. The addition of the plant further increases the reliability of Alberta’s power supply.

Southern Alberta

We employ over 500 people at our Calgary head office. We also contribute to the quality of life in Calgary through the volunteer efforts of our employees and our community investments. In 2004, our employees, retirees and company raised $546,000 for the Calgary and Area’s United Way campaign, about 45 per cent of our total contribution to the United Way worldwide.

In southern Alberta, our investments in wind farms benefit the regional economy, contributing to jobs, municipal tax revenues and local purchases and services. In 2004, we commissioned a wind farm at Summerview near Pincher Creek. This project, our fifth wind farm in the region, is expected to inject about $20 million into the local economy over its 30-year life.

Our power facilities benefit the regional economy in other ways. Our hydro dams are now an essential part of Alberta’s water management, providing irrigation for agriculture in southern regions.

Ontario

We have operated in Ontario since the 1990s when we built our first gas plants at Ottawa and Mississauga. These were followed by our Windsor plant and, most recently, by our gas plant at Sarnia. To date, we have invested over $750 million to build and operate these plants. The Ottawa, Windsor and Mississauga plants are owned 50 per cent by TransAlta Power L.P.

We employ 160 people at the plants and each year contribute to the Ontario economy about $15 million in wages and benefits, about $25 million through the purchase of supplies and services, and about $2 million in provincial taxes.

Our plants in Ottawa, Windsor and Mississauga have long-term contracts at prices that allow reasonable returns. Our 575-MW Sarnia plant, despite being one of the most efficient gas plants in the province, is operating below capacity, because of market conditions and recent government policy changes. We are discussing opportunities with the Ontario government to allow Sarnia to operate as intended and to sell more power into the province’s wholesale electricity market.

Washington State

We are the largest regional industrial employer in Centralia, Washington. We directly employ 800 people at two power plants and one mine, and spend US$56 million each year on payroll at Centralia.

Our power plant and mine generate about 10 per cent of the total property tax collected in Lewis County and 30 per cent of the Centralia school district property tax. Each year our facilities contribute nearly US$7 million in municipal and state government taxes. We are also an important donor in the community. In 2004, our employees and company donated US$330,000 to help fund local charitable initiatives.

Goldfields Region, Western Australia

Operating our two natural gas/diesel simple cycle plants in the Goldfields region of Western Australia benefits the local economy. The plants provide low cost electricity for mining operations and reinforce electricity supply in the region. We spend more than $5 million each year on employee pay and about $8 million in contractor services and material purchases. We employ more than 50 staff at our plants and head office in Perth.

Mexico

TransAlta operates two gas plants in Mexico, one in Campeche and the other in the state of Chihuahua. Together these plants supply 511 MW of reliable, affordable generation to the Mexican electricity market, which, at projected growth rates of between five and six per cent over the next decade, is one of the fastest growing in the Americas. TransAlta has a long-term sales contract for both plants to provide power to the Comisión Federal de Electricidad, Mexico’s state-owned electricity company, over the next 25 years.

Our investments in Mexico of approximately US$450 million help to sustain infrastructure for industry and services and introduce high technology jobs into traditional agricultural regions, helping to diversify the local job market and contributing to local well-being. Overall, we employ 78 people at the plants and our TransAlta Mexico head office in Mexico City, and only two are expatriates.

Yearly operating expenses for our Mexican operations include about US$2 million for employee pay and more than US$3 million for contractor supplies and services.