Transalta Buys Interest In Mercury Electric

Calgary, AB. -- CALGARY, ALBERTA, MAY 3, 2001 (CCN Newswire via COMTEX) -- TransAlta today entered into an agreement to purchase a minority interest in Calgary-based Mercury Electric Corporation for $5 million. Mercury Electric Corporation is a privately held independent power producer focused on serving the distributed generation and oilfield marketplaces.

"We're continuing to build our investment in distributed generation," says Dawn Farrell, TransAlta's executive vice-president, Corporate Development. "Mercury Electric is one of the leading distributors of microturbines and has successfully applied this technology to flare gas markets. We look forward to a long association with them."

"This is a great opportunity for Mercury to move forward in developing cost effective, on-site generation facilities for our customers, which provides them with security of supply and long term energy price stability," said Richard Kline, president and CEO of Mercury. "We believe that our relationship with TransAlta will open up further opportunities for Mercury in the growing distributed generation and cogeneration markets. The credibility and experience which TransAlta brings to Mercury through their longstanding service in the Alberta and international power markets will clearly enable us to build on our successful distributed generation efforts."

This is TransAlta's second investment in a distributed generation company. The first was a $5.2 million investment in The ADCO Group of Companies announced April 9. ADCO and Mercury have different approaches to delivering distributed generation. Participation in both of these companies will give TransAlta better visibility of how small generation provides solutions to customer needs.

Distributed generation, often natural gas-fired, uses small-scale electric generators close to the user or load being served, rather than large centralized power stations. Distribution and transmission costs are reduced as power is generated directly on the user's site, which is particularly effective in remote areas or when lines cannot be upgraded.

TransAlta is building a portfolio of investments in emerging power and environmental technologies. The company aims to increase the competitiveness of TransAlta's core businesses and gain exposure to the growing markets for distributed generation and renewable energy. Through its Technology and New Ventures group, TransAlta follows emerging power technology trends and leverages its experience as a strategic industry venture partner with investments in promising new firms.

As an IPP, Mercury employs a range of power generation solutions from 75 kW to 20 MW. Mercury is the exclusive Western Canadian distributor of the Honeywell Power Systems Parallon 75 (R) microturbine, and has preferred distribution rights for waste gas and oilfield applications throughout the Americas. Mercury is the largest Honeywell microturbine fleet owner and world leader in employing microturbine technology for waste gas mitigation, turning an environmental liability into useful energy.

TransAlta is an international electric energy company with more than $7 billion in assets. The company is focused on achieving strong earnings growth and enhancing its competitive edge as a low-cost operator of generation and transmission assets, and a successful developer of gas-fired independent power projects. The company is concentrating its growth in Canada, the United States, Australia and Mexico. TransAlta owns and operates more than 8,000 megawatts of generation plus significant transmission assets in Alberta.