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A TransAlta executive says the company has focused on diversifying its fleet away from coal. <137>A pedestrian walks past the TransAlta building in downtown Calgary, Monday, Oct. 5, 2009. Canadian Hydro Developers Inc. has accepted a takeover bid by TransAlta Corp. valued at approximately $1.6 billion. THE CANADIAN PRESS/Jeff McIntosh<137><137><252><137>

Jeff McIntosh/The Canadian Press

TransAlta Corp. releases its fourth quarter 2012 results Wednesday with long hoped for certainty regarding Canada's greenhouse gas rules under its belt. But the Alberta power producer will continue to keep an eye on its mix of coal, natural gas and renewable generation to ensure it remains competitive.

Now focused solely on electricity generation for more than a decade, TransAlta is one of the country's largest independent power producers. It has about 8,500 megawatts of generation capacity in Canada, the U.S. and Australia, with plans to go to 9,000 megawatts this year.

No one from TransAlta was available to comment in advance of the quarterly results, but chief executive Dawn Farrell described some recent ups and downs at last month's CIBC Whistler Institutional Investor Conference. She noted five years ago, environmental groups started pushing for TransAlta to shut down its Washington state Centralia plant, which the Seattle Times pegged as the state's largest emitter of greenhouse gases.

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The company eventually made a deal with the state that allows the last unit of the plant to remain open until 2025. Over the same period, natural gas prices dropped lower than anyone expected. "Power prices have really been chasing coal out of the market," Ms. Farrell said.

However TransAlta not only locked in a long-term contract for Centralia, but re-negotiated rail and coal contracts, and laid off some workers to make sure that plant would remain competitive.

Into future years, Ms. Farrell said the company has more certainty than the past because of Canada's coal emission rules unveiled last fall. Until those rules were clear, she said, investors didn't know how to assess TransAlta's future value.

"They wondered if we were going to face ever-climbing environmental costs. And that legislation has made it very clear that we don't," she said.

But already, she said, the company has focused on diversifying its fleet away from coal.

It hasn't all been rosy. Last week, a U.S. Federal Energy Regulatory Commission judge issued an initial ruling – yet to be accepted by the commission – that said TransAlta and other firms unfairly drove up prices for California utilities through market manipulation in 2000, and should refunded those overcharges.

TransAlta's power generation mix is already half coal, one-quarter natural gas and one-quarter renewables in the form of wind, hydro and geothermal. Last October, TransAlta also joined with Warren Buffett's MidAmerican Energy Holdings Co. in a partnership to build natural-gas-fired power plants in Canada.

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