12-05-08 TransCanada Corporation announced that the Phoenix, Arizona-based utility Salt River Project (SRP) has signed a 20-year power purchase agreement to secure 100 % of the output from TransCanada's planned Coolidge Generating Station.
The approximately $ 500 mm simple-cycle natural gas-fired peaking power facility, located in Coolidge, 72 km (45 miles) southeast of Phoenix, will have a nominal capacity of 575 MW and is expected to be online by May 2011 in time to meet peak power demand.

The facility will receive natural gas from both the El Paso Natural Gas and Transwestern pipelines, and will connect to a new SRP high-voltage transmission line currently under construction.
"We are delighted to continue expanding our US assets and presence with the completion of this agreement with Salt River Project," said Hal Kvisle, TransCanada president and chief executive officer. "The western US and specifically Arizona represents an attractive growth market in North America for additional power generation and transmission projects. Arizona's population is expected to grow 50 % by 2020 and to double by 2030, and TransCanada wants to help serve this demand."

TransCanada has studied this market for a number of years and has been pursuing select opportunities over the past two years. TransCanada's proposal for the Coolidge Generating Station was submitted in 2006 in response to SRP's request for proposals to provide peak generating capacity for SRP's service territory in Maricopa County and Pinal County.
The simple-cycle natural gas-fired peaking facility will provide a quick response to peak power demand. With 12-LM6000PC turbines, the facility will also provide reserve capacity and the ability to generate power quickly to support power reliability in the region.

The design incorporates nitrogen oxides (NOx) reduction technology including dry low NOx burners and selective catalytic reduction equipment to achieve the emission requirements of Pinal County.
"Power from the proposed Coolidge Generating Station will be an important addition to SRP's energy portfolio," said John Coggins, SRP's manager of resource planning. "This is a cost-effective decision that will benefit our customers as we continue to seek long-term solutions to ensure sufficient energy supplies."

The power purchase agreement provides a 20-year capacity payment, and operating and maintenance cost recovery. SRP has the right to extend the contract for another 10 years. SRP is the sole customer of the capacity and energy from the facility.
The new facility will be an economic boost to the mostly rural community of Coolidge, providing hundreds of jobs during the construction phase and approximately 12 permanent full time jobs when completed. The facility is anticipated to provide a significant amount of revenue to state and local governments.

TransCanada consulted with elected officials and government agencies and held its first round of public stakeholder meetings and a community open house in February. TransCanada hasfiled with the Arizona Corporation Commission a notice of application and will file a full application for a Certificate of Environmental Compatibility in summer 2008.
During the permitting phase, TransCanada will seek an air quality permit and local zoning approvals, and there will be extensive public outreach to keep the community fully informed and to gather input. Construction is expected to begin in late 2009.

SRP is the third-largest public power utility in the United States, serving more than 935,000 electric customers in the greater Phoenix metropolitan area. SRP's revenue bonds are rated "AA" (S&P).
With more than 50 years' experience, TransCanada is a leader in the responsible development and reliable operation of North American energy infrastructure including natural gas pipelines, power generation, gas storage facilities, and projects related to oil pipelines and LNG facilities. TransCanada's network of wholly owned pipelines extends more than 59,000 km (36,500 miles), tapping into virtually all major gas supply basins in North America. TransCanada is one of the continent's largest providers of gas storage and related services with approximately 355 bn cf of storage capacity. A growing independent power producer, TransCanada owns, or has interests in, approximately 7,700 MW of power generation in Canada and the United States.