Company: TSLTF
Filing Date: 2025-12-12
Form Type: SUPPL
Source: 0001193125-25-317786
Chunk: 382

Company: TRANSALTA CORP
Filing Date: 2025-12-12
Form: SUPPL
Chunk 382
---
ers. |

| (2) | During the first quarter of 2025, our Adjusted EBITDA composition was amended to exclude the                                                                                                                  
 impact of realized gain (loss) on closed exchange positions and Australian interest income. Therefore, the Company has applied this composition to all previously reported periods. Refer to the Non-IFRS and 
 Supplementary Financial Measures section of this MD&A.                                                                                                                                                        |

| (3) | Earnings (loss) before income taxes for the Wind and Solar segment exclude the contribution from 
 Skookumchuck wind facility.                                                                      |

Optimization of the Alberta Portfolio The Alberta electricity portfolio metrics disclosed below are supplementary financial measures used to present the detailed performance by segment for the Alberta market. Our merchant exposure is primarily in Alberta, where 58 per cent of our capacity is located, 77 per cent of which is available to participate in the merchant market. Our portfolio of assets consists of hydro, wind, battery storage and natural gas generation facilities. The acquisition of Heartland enhanced and further diversified TransAlta’s competitive portfolio in the highly dynamic and shifting electricity landscape in Alberta, by adding 507 MW of contracted cogeneration capacity, 387 MW of contracted and merchant peaking generation capacity, 950 MW of merchant natural gas-firedthermal generation capacity and transmission capacity. We believe that the fast-ramping nature of certain Heartland facilities is well positioned to respond to price volatility and deliver peaking capacity during periods of higher demand in the Alberta market. Generating capacity in Alberta is subject to market forces. Power from commercial generation is cleared through a wholesale electricity market. Power is dispatched in accordance with an economic merit order administered by the AESO, based upon offers by generators to sell power in the real-time energy-only market. Our merchant Alberta fleet operates under this framework and we internally manage our offers to sell power. Optimization of portfolio performance in the Alberta merchant market is driven by the diversity of fuel types, which enables portfolio management. It also provides us with capacity that can be monetized as either energy production or ancillary services. A significant portion of the installed generation capacity in the portfolio has been hedged to provide greater cash flow certainty. The Company’s hedging strategy includes maintaining a

| TransAlta Corporation |     | M35 |

Management’s Discussion and Analysis significant base of Commercial and Industrial (C&I) customers and is supplemented with financial hedges. During periods of low market prices, the Company may choose not to generate power from the thermal fleet and monetize its hedged or contract positions. This