Slide 1: Third Quarter 2020 Results
Third Quarter 2020 Results November 4, 2020 TransAlta Corporation 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation includes forward-looking statements or information (collectively referred to herein as “forward-looking statements”) within the meaning of applicable securities legislation. All forward-looking statements are based on our beliefs as well as assumptions ba
Slide 3: Dawn Farrell, Chief Executive Officer
Dawn Farrell Chief Executive Officer 3
Slide 4: 2020 Q3 Highlights & Advancements
2020 Q3 Highlights & Advancements ▪ FCF of $106 million or $0.39 per share in line with 2019 ▪ Year-to-date FCF of $306 million or $1.11 per share, a 22% increase Q3 Results (1) ▪ Diversified portfolio enabling resilient cash flow generation ▪ Strong performance of trading and optimization capabilit
Slide 5: Execution of Clean Energy Investment Plan (1 of 2)
Execution of Clean Energy Investment Plan (1 of 2) WindCharger Sundance 6 Conversion Sundance 5 Repowering 10 MW 401 MW 730 MW ▪ Powered by Summerview II ▪ Construction completed, ▪ Board approved with expected wind farm – truly renewable currently testing and COD of Q4 2023 battery energy storage c
Slide 6: Execution of Clean Energy Investment Plan (2 of 2)
Execution of Clean Energy Investment Plan (2 of 2) Skookumchuck Wind Windrise Wind Kaybob Cogen 67 MW 207 MW 40 MW ▪ Expected COD: Early Nov. ▪ Expected COD: H2 2021 ▪ Expected COD: H1 2022 ▪ No cash outlay until COD, ▪ ~45% complete ▪ Purchased reciprocating expect investment by mid- ▪ Receiving wi
Slide 7: Robust Development Pipeline to Supply Customer Needs
Robust Development Pipeline to Supply Customer Needs ▪ Significant number of growth projects in Projects Owned Location COD Range MW advanced or early staged development Advanced-Stage Projects in Development Garden Plain Wind 130 AB 2022 – 2023 Tempest Wind 70 AB 2023 – 2024 Horizon Hill Wind 200 O
Slide 8: Alberta Conversion to Gas by End of 2021
Alberta Conversion to Gas by End of 2021 Sun KPH KPH Highvale Gas-firing Sun 6 2 3 Mine Closure Sun 4 + KPH 1 5 2020 2021 2022 2023 Boiler Conversion Repowered Combined Cycle Retirement Gas-Fire Only ▪ Mining operations at Highvale Mine will end by Dec. 31, 2021 ▪ Alberta thermal fleet will no longe
Slide 9: TransAlta Exceeds Targets Outlined in Paris Agreement
TransAlta Exceeds Targets Outlined in Paris Agreement TRANSALTA EMISSIONS 50 Emissions (million tonnes CO2e) 40 30 20 TA On Track for > 70% Reductions by 2022 10 0 2005 2010 2015 2019 2022E 2026E Canada Other ▪ To achieve Paris Agreement targets, Canada would need to reduce emissions by 220 million
Slide 10: Providing Pathway for Further Carbon Reductions to Customers
Providing Pathway for Further Carbon Reductions to Customers 2021 2025 2030 Long-Duration Brazeau Existing Renewable Flow Battery Pumped Hydro Electricity Long-duration flow battery Transformative renewable Purchase existing Alberta renewable Proven track record of storage project to fully electrici
Slide 11: TransAlta's E-ESG Health Check
TransAlta’s E-ESG Health Check diversified Conversion to Well- Strong E-ESG focus, portfolio of assets gas in AB by end of 2021 on track for with a fully funded ~70% reduction driving resilient and approved in GHG by 2030 cash flows transition plan Removing systemic Robust development pipeline Prove
Slide 12: Todd Stack, Chief Financial Officer
Todd Stack Chief Financial Officer 12
Slide 13: Third Quarter 2020 Financial Highlights
Third Quarter 2020 Financial Highlights 3-MONTHS ENDED SEPTEMBER 30, 2020 $305 $0.60 $170 Including PPA Termination Payment of $56 million in Q3 2019 Excellent cash flow generation despite weaker AB merchant market 13
Slide 14: Segmented Cash Flow
Segmented Cash Flow Q3/YTD SEGMENTED CASH FLOWS ($MILLIONS) Q3 2019 Q3 2020 YTD 2019 YTD 2020 61 14 Alberta Thermal(1) 121 57 30 46 Centralia 29 94 29 27 NA Gas 77 81 28 33 Australian Gas 87 90 28 32 Wind and Solar 134 161 24 22 Hydro 80 72 200 174 Generation segmented CF 528 555 30 51 Energy Market
Slide 15: Strong Cash Flow Generation
Strong Cash Flow Generation FCF ($MILLIONS)(1) LIQUIDITY POSITION ($BILLIONS) $450 $2.0 2020 Guidance $325 - $375 million $0.3 $0.3 $379 $1.5 $0.4 $367 $0.3 $300 $328 $1.4 $1.4 $306 $1.3 $1.3 $257 YTD $1.0 $0.1 $150 $0.9 $0.5 $- $- 2016 2017 2018 2019 2020E 2016 2017 2018 2019 YTD 2020 Available Cre
Slide 16: Alberta Electricity Prices & Outlook
Alberta Electricity Prices & Outlook ALBERTA POOL PRICE AND FORWARD CURVE ($/MWH) $80 $70 $62 $60 $55 2021 Forward $50 $49 $49 Market Price $50 $47 ($56 MWh) $44 $/MWh $40 $30 $20 $10 $- Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Q1/20 Q2/20 Q3/20 Bal Q1/21 Q2/21 Q3/21 Q4/21 2020 Moderated recovery in Q3 a
Slide 17: Highly Diversified Asset Base
Highly Diversified Asset Base BOY 2020 Q1 2021 BOY 2021 AB Thermal Baseload Merchant 90% 44% 15% Generation Hedged Hedged Price $53 $60 $55 ($/MWh) Forward Market Prices $54 $62 $53 ($/MWh) $1/MWh EBITDA Sensitivity +/- $1 million $12 million ▪ Recent strength in forward market prices in 2021 after
Slide 18: TransAlta - An Attractive Investment
TransAlta - An Attractive Investment Highly diversified, low carbon portfolio ▪ On track to reduce total GHG emissions by ~32 million tonnes by 2022 ▪ Largest hydro fleet in Alberta with upside post-PPA ▪ Highly-contracted renewables portfolio ▪ High-return marketing business ▪ Unique trading, comme
Slide 19: Questions and Answers
Questions and Answers TransAlta Powering Economies and Communities TransA\t: