President and CEO Dawn Farrell of TransAlta addresses shareholders during the company's annual general meeting in Calgary, Alberta, April 29, 2014.TODD KOROL/Reuters
TransAlta Corp. is making its first foray into solar power and increasing its wind-generation capacity, as the company seeks to broaden its portfolio of assets beyond coal.
The Calgary-based company said on Monday that it would buy 21 megawatts of solar capacity in Massachusetts and 50 megawatts of wind-power projects in Minnesota for $75.8-million (U.S.) from an affiliate of Rockland Capital LLC.
The assets are contracted under long-term power-purchase agreements that range from 20 to 30 years, TransAlta said. The company is assuming $41.8-million of debt associated with the projects. The deal is expected to close in September.
"This marks our first solar project and aligns with our strategy of growing our renewables platform, diversifying our portfolio, and increasing the pipeline of assets for potential future drop-downs into TransAlta Renewables," chief executive officer Dawn Farrell said in a statement, referring to an affiliate company in which TransAlta holds a majority stake.
About 40 per cent of TransAlta's earnings are tied to coal-fired power plants in Alberta and the western United States.
Ms. Farrell has warned against a speedy phase-out of the fossil fuel planned by Alberta Premier Rachel Notley's NDP government, saying it would have a damaging effect on employment in the province.