Alberta Climate Change Report

Alberta has released a climate change report. It includes higher carbon taxes and a phase out of coal fired generation by 2030. And there will be a cap on oil sands emissions.

Clearly, we have arrived at the point where there will be financial incentives to reduce CO2 emissions and to reduce consumption of fossil fuels.

There was an indication that coal generation companies will be at least partially compensated with a promise not to “unnecessarily strand capital”. That seems like a promise to compensate although the¬†word unnecessarily weakens the assurance.

Perhaps TransAlta will bounce on this news. That depends how much of its low price was simply due to its horrible track record and how much was due to fears of a phase out of coal without adequate compensation. At best TransAlta is a cigar-butt type stock, it looks cheap in some respects. But it remains a poorly managed company.

Capital Power could also get a boost on the news. It has had a relatively poor track record also but not nearly as bad as TransAlta.

There are also other companies that own coal generation in Alberta.

If there is any bounce on this news it may not be much of a bounce became the details and the level of compensation for early retirements of coal-fired electricity plants are far from clear at this point.