Capital Power (TSX: CPX), at a Dec. 5 investor day event, announced a number of positive corporate developments, including a development agreement with ENMAX Corp. for the gas-fired Genesee 4 & 5 project.
Capital Power and ENMAX have executed a letter of intent to pursue joint venture agreements to develop, construct, own and operate the Genesee 4 & 5 facility. Agreements are expected to be completed in the first quarter of 2014.
The proposed Genesee 4 & 5 will be a natural gas-fired combined-cycle facility that will be built on a site near Capital Power’s Genesee facility west of Edmonton, Alberta. Genesee 4 & 5 will be utilizing the latest state-of-the-art high efficiency gas turbine technology and will have a generation capacity of up to 1,050 MW.
Genesee Units 1 and 2 are coal-fired facilities dating from 1989 and 1994, with a combined capacity of 852 MW, that are wholly owned by Capital Power. Genesee Unit 3 is a 516-MW, coal-fired facility that was commissioned in 2005 and is 50-50 owned with TransAlta.
Capital Power said it will lead the construction of the Genesee 4 & 5 project and will be the operator of the facility. Construction is expected to be completed between 2018 and 2020 when additional generation is required to meet growing demand and to replace generation from the retirement of coal-fired units in the province.
“I’m excited about the prospect to have ENMAX as our partner in the Genesee 4 & 5 facility in Alberta,” said Brian Vaasjo, President and CEO of Capital Power. “This agreement builds on a similar partnership that we have on the Shepard Energy Centre and reinforces our leadership position in the attractive Alberta market.”
Also cited by Capital Power were:
New wind project spins into operation – On Nov. 7, the Port Dover & Nanticoke wind project in Ontario began commercial operations. The 105-MW facility was completed on time and under its C$340m budget, with final construction costs expected to be about C$315m. The Port Dover & Nanticoke wind project was awarded a 20-year power purchase agreement in April 2010 with the Ontario Power Authority (OPA), as part of the OPA’s Feed-in-Tariff (FIT) program. The contracted price for power at commercial operations is C$144 per megawatt hour and thereafter, 20% of the contract price will escalate annually at inflation throughout the 20-year term.
800-MW gas-fired project – Capital Power, along with its joint venture partner ENMAX, also announced that construction of the 800-MW Shepard Energy Centre is on schedule and below budget. Shepard is a natural gas-fired combined cycle facility located on the southeast edge of Calgary, Alberta, with commercial operations targeted for early 2015. The construction project is expected to be completed below budget with Capital Power’s portion reduced to about C$821m from its original C$860m budget.
At its investor day, the company reviewed its corporate priorities and financial targets for 2014 including operational targets of 95% capacity-weighted average plant availability, reflecting planned turnarounds at the Genesee 2 and Genesee 3 facilities, plant maintenance capital and other capital expenditures of up to C$85m, and plant operating and maintenance expenses of C$165m to C$185m.
Also reported were on-time, on-budget and safe construction of current development projects, including:
- commissioning of the Shepard Energy Centre in early 2015;
- continue with permitting process for Genesee 4 & 5 with approval targeted in the first quarter of 2015; and
- commence construction and completion of project financing for the K2 Wind project. K2, located in the Township of Ashfield-Colborne-Wawanosh in Ontario, is a 270 MW project, with Capital Power controlling 90 MW of that, with other project partners being Samsung Renewable Energy and Pattern Renewable Holdings Canada ULC.
Capital Power is a growth-oriented North American power producer headquartered in Edmonton, Alberta. The company develops, acquires, operates and optimizes power generation from a variety of energy sources. Capital Power owns more than 2,600 MW of capacity at 14 facilities across North America and owns 371 MW of capacity through a power purchase agreement. An additional 490 MW of owned generation capacity is under construction or in advanced development in Alberta and Ontario.