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Released October 25, 2016 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Capital Power Corporation (TSX:CPX) (Edmonton, Alberta), a power-generation company that has more than 2,600 megawatts (MW) of output across North America, managed to turn a solid profit in third-quarter 2016, despite a dip in revenues and uncertainty surrounding a major natural gas-fired project. Industrial Info is tracking $5.59 billion in active projects involving Capital Power, including $3.9 billion in the U.S.
Net income attributable to shareholders was reported to be $66 million, a 34.69% increase from third-quarter 2015, despite a drop in revenues: $378 million, a 19.4% decrease. Executives cited a strong operational performance, with average plant availability of 96%, as well as portfolio-optimization efforts.
"Our trading desk captured an average realized Alberta power price of $70 per megawatt-hour (MWh) in the third quarter, well above the average spot price of $18 per MWh that reflected excess supply in the market, low natural gas prices and conservative offer strategies from market participants," said Brian Vaasjo, the president and chief executive officer of Capital Power, in a quarterly earnings release.
Uncertainty about Alberta's plans to phase out coal-fired power plants has forced Capital to delay a final investment decision on one of its largest planned projects: the $1.4 billion expansion of the Genesee Generating Station in Warburg, Alberta. The project is split into the $700 million Unit 4 addition and the $700 million Unit 5 addition. Each unit would generate 530 megawatts (MW) via a 320-MW Mitsubishi Hitachi Power combustion turbine generator, with CMI heat-recovery steam generators, and a 210-MW Mitsubishi steam turbine generator. For more information, including contact information, see Industrial Info's project reports on Unit 4 and Unit 5.
Executives say the company now hopes to approve the project in first-quarter 2017. The hang-up involves electricity-market conditions in Alberta, as well as compensation for the early closure of Capital Power's coal facilities. Last week, Alberta Premier Rachel Notley said that the government would provide coal emitters with financial aid to close their plants, and Capital Power now hopes that conditions for such aid will be clarified by the end of the year. The station is located about 50 kilometers southwest of Edmonton, Alberta, and is co-owned by ENMAX Corporation (Calgary, Alberta).
"Discussions with the government-appointed coal facilitator regarding compensation for the coal units, whose operating lives will be shortened by the 2030 coal phase-out component of the Alberta Climate Leadership Plan, concluded in September," Vaasjo said. "We continue to remain optimistic that a fair and appropriate outcome will be reached for our shareholders with an expected announcement by the Alberta government before the end of 2016."
During the third quarter, Capital Power also recognized a $6 million pre-tax impairment charge on another Canadian plant.
In the U.S., the highest-valued Capital Power project tracked by Industrial Info is the $750 million Nolin Hills Windfarm in Pendleton, Oregon, which is in its early permitting phase. If approved, the facility would generate 350 MW by utilizing 140 to 175 Nordex, GE or equivalent wind turbine generators, each with a capacity of 2 or 2.5 MW. For more information, see Industrial Info's project report.
Capital Power began construction on what is expected to be its first U.S. wind-energy project: the $272 million Bloom Windfarm near Dodge City, Kansas, which is designed to produce 178 MW from 54 turbines, each with a capacity of 3.3 MW. Capital Power will operate Bloom Wind under a 10-year, fixed-price contract with Allianz Risk Transfer, a subsidiary of Allianz SE (Munich, Germany), covering all of the facility's output. It is expected to be completed and begin operations in third-quarter 2017. For more information, see Industrial Info's project report.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
Net income attributable to shareholders was reported to be $66 million, a 34.69% increase from third-quarter 2015, despite a drop in revenues: $378 million, a 19.4% decrease. Executives cited a strong operational performance, with average plant availability of 96%, as well as portfolio-optimization efforts.
"Our trading desk captured an average realized Alberta power price of $70 per megawatt-hour (MWh) in the third quarter, well above the average spot price of $18 per MWh that reflected excess supply in the market, low natural gas prices and conservative offer strategies from market participants," said Brian Vaasjo, the president and chief executive officer of Capital Power, in a quarterly earnings release.
Uncertainty about Alberta's plans to phase out coal-fired power plants has forced Capital to delay a final investment decision on one of its largest planned projects: the $1.4 billion expansion of the Genesee Generating Station in Warburg, Alberta. The project is split into the $700 million Unit 4 addition and the $700 million Unit 5 addition. Each unit would generate 530 megawatts (MW) via a 320-MW Mitsubishi Hitachi Power combustion turbine generator, with CMI heat-recovery steam generators, and a 210-MW Mitsubishi steam turbine generator. For more information, including contact information, see Industrial Info's project reports on Unit 4 and Unit 5.
Executives say the company now hopes to approve the project in first-quarter 2017. The hang-up involves electricity-market conditions in Alberta, as well as compensation for the early closure of Capital Power's coal facilities. Last week, Alberta Premier Rachel Notley said that the government would provide coal emitters with financial aid to close their plants, and Capital Power now hopes that conditions for such aid will be clarified by the end of the year. The station is located about 50 kilometers southwest of Edmonton, Alberta, and is co-owned by ENMAX Corporation (Calgary, Alberta).
"Discussions with the government-appointed coal facilitator regarding compensation for the coal units, whose operating lives will be shortened by the 2030 coal phase-out component of the Alberta Climate Leadership Plan, concluded in September," Vaasjo said. "We continue to remain optimistic that a fair and appropriate outcome will be reached for our shareholders with an expected announcement by the Alberta government before the end of 2016."
During the third quarter, Capital Power also recognized a $6 million pre-tax impairment charge on another Canadian plant.
In the U.S., the highest-valued Capital Power project tracked by Industrial Info is the $750 million Nolin Hills Windfarm in Pendleton, Oregon, which is in its early permitting phase. If approved, the facility would generate 350 MW by utilizing 140 to 175 Nordex, GE or equivalent wind turbine generators, each with a capacity of 2 or 2.5 MW. For more information, see Industrial Info's project report.
Capital Power began construction on what is expected to be its first U.S. wind-energy project: the $272 million Bloom Windfarm near Dodge City, Kansas, which is designed to produce 178 MW from 54 turbines, each with a capacity of 3.3 MW. Capital Power will operate Bloom Wind under a 10-year, fixed-price contract with Allianz Risk Transfer, a subsidiary of Allianz SE (Munich, Germany), covering all of the facility's output. It is expected to be completed and begin operations in third-quarter 2017. For more information, see Industrial Info's project report.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
