<SEC-DOCUMENT>0001279569-21-001130.txt : 20210810
<SEC-HEADER>0001279569-21-001130.hdr.sgml : 20210810
<ACCEPTANCE-DATETIME>20210810075117
ACCESSION NUMBER:		0001279569-21-001130
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20210810
FILED AS OF DATE:		20210810
DATE AS OF CHANGE:		20210810

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			TRANSALTA CORP
		CENTRAL INDEX KEY:			0001144800
		STANDARD INDUSTRIAL CLASSIFICATION:	ELECTRIC SERVICES [4911]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-15214
		FILM NUMBER:		211158450

	BUSINESS ADDRESS:	
		STREET 1:		110 12TH AVE SW BOX 1900 STATION M
		STREET 2:		CALGARY ALBERTA T2P 2MI
		CITY:			CALGARY
		STATE:			A0
		ZIP:			T2P2M1
		BUSINESS PHONE:		403-267-4724

	MAIL ADDRESS:	
		STREET 1:		110-12TH AVENUE SW
		CITY:			CALGARY ALBERTA CANADA
		STATE:			A0
		ZIP:			T2P2M1
</SEC-HEADER>
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<DESCRIPTION>FORM 6-K
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<P STYLE="font: bold 12pt Times New Roman, Times, Serif; margin: 10pt 0 0; text-align: center">UNITED STATES</P>

<P STYLE="font: bold 16pt Times New Roman, Times, Serif; margin: 0 0 6pt; text-align: center"><FONT STYLE="font-size: 14pt">SECURITIES
AND EXCHANGE COMMISSION<BR>
</FONT><FONT STYLE="font-size: 12pt">WASHINGTON, D.C. 20549 </FONT></P>

<P STYLE="font: bold 18pt Times New Roman, Times, Serif; margin: 10pt 0 6pt; text-align: center">FORM 6-K</P>

<P STYLE="font: bold 12pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: center">REPORT OF FOREIGN PRIVATE ISSUER<BR>
PURSUANT TO RULE&nbsp;13a-16 OR 15d-16<BR>
UNDER THE SECURITIES EXCHANGE ACT OF 1934</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 12pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 12pt 0; text-align: center"><B>For the month of August, 2021<BR>
Commission File Number 001-15214</B></P>

<P STYLE="font: bold 16pt Times New Roman, Times, Serif; margin: 10pt 0 6pt; text-align: center"><FONT STYLE="font-size: 20pt">TRANSALTA
CORPORATION<BR>
</FONT><FONT STYLE="font-size: 10pt; font-weight: normal">(Translation of registrant's name into English)</FONT></P>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 12pt 0; text-align: center"><B>110-12th Avenue S.W., Box 1900, Station &ldquo;M&rdquo;,
Calgary, Alberta, Canada, T2P 2M1</B><BR>
(Address of principal executive offices)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Indicate by check mark whether the registrant
files or will file annual reports under cover of Form 20-F or Form 40-F:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">&nbsp;</P>

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    <TD STYLE="width: 50%; font: bold 12pt Times New Roman, Times, Serif; padding-top: 6pt; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><FONT STYLE="font-size: 10pt; font-weight: normal">Form&nbsp;40-F&nbsp;<FONT STYLE="font-family: Wingdings">&#254;</FONT></FONT></TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Indicate by check mark if the registrant is
submitting the Form 6-K in paper as permitted by Regulation&nbsp;S-T Rule&nbsp;101(b)(1). _____</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 6pt 0 0; text-align: justify">Indicate by check mark if the registrant is
submitting the Form 6-K in paper as permitted by Regulation&nbsp;S-T Rule&nbsp;101(b)(7). _____</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 12pt 0 0; text-indent: 0.5in"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0; text-align: left">Signatures</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 12pt 0 0; text-indent: 0.5in">Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 24pt 0 0 3in"><B>&nbsp;</B></P>

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    <TD COLSPAN="2" STYLE="font-size: 10pt"><B>TRANSALTA CORPORATION</B></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 13%; font-size: 10pt">By:</TD>
    <TD STYLE="width: 87%; border-bottom: Black 1pt solid; font-size: 10pt">/s/ Todd Stack</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">Name: Todd Stack</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">Title: Chief Financial Officer</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 12pt 0">Date: August 10, 2021</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 12pt 0; text-align: center">EXHIBIT INDEX</P>

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        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; border-bottom: Black 1pt solid"><B>Exhibit Number</B></P></TD>
    <TD STYLE="width: 2%; padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; width: 81%; padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; border-bottom: Black 1pt solid"><B>Description of Document</B></P></TD></TR>
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    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt"><A HREF="ex991.htm">99.1</A></TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt"><A HREF="ex991.htm">&ldquo;TransAlta Reports Outstanding Second Quarter 2021 Results and Increases
Annual Guidance&rdquo;</A></TD></TR>
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<DESCRIPTION>NEWS RELEASE DATED AUGUST 10, 2021
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<P STYLE="margin: 0; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>Exhibit 99.1</B></FONT></P>

<P STYLE="margin: 0; text-align: right"><FONT STYLE="font: 8pt Arial, Helvetica, Sans-Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="margin: 0; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>&nbsp;</B></FONT>&nbsp;</P>

<P STYLE="margin: 0; text-align: right">&nbsp;</P>

<P STYLE="font: bold 24pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">TransAlta Reports Outstanding Second Quarter
2021 Results and Increases Annual Guidance</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">CALGARY, AB, Aug. 10, 2021 /CNW/ -</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Second Quarter 2021 Highlights</B></P>

<UL STYLE="list-style-type: disc">

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Comparable EBITDA<SUP>(1)</SUP> of $302 million, an increase of
$85 million or 39 per cent compared to the same period in 2020</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Free cash flow (&quot;FCF&quot;)<SUP>(1)</SUP> of $138 million
or $0.51 per share compared to $91 million or $0.33 per share, a 52 per cent increase over the same period in 2020</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Hydro segment delivered $96 million of comparable EBITDA, an increase
of $67 million compared to the same period in 2020</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Alberta Thermal segment delivered $85 million of comparable EBITDA,
an increase of $55 million compared to the same period in 2020</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Adjusted availability was 84.8 per cent compared to 91.5 per cent
for the same period in 2020, largely impacted by planned major maintenance events in the quarter</LI>

</UL>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Other Highlights</B></P>

<UL STYLE="list-style-type: disc">

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Windrise wind project construction was 88 per cent complete as
of June 30, 2021</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Launched 130 MW Garden Plain wind project, 100 MW of which are
contracted to Pembina Pipeline Corporation under an 18-year power purchase agreement</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Closed the sale of the Pioneer Pipeline to ATCO Gas and Pipelines
Ltd. with net cash proceeds of approximately $128 million, resulting in a gain on sale of $33 million</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Executed a 10-year contract extension at Sarnia with one of its
large industrial customers</LI>

</UL>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Subsequent Events &amp; Updates</B></P>

<UL STYLE="list-style-type: disc">

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Completed another milestone in our phase-out of coal with the
completion of the coal-to-gas conversion of Keephills Unit 2</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Reached agreement to construct the 48 MW Northern Goldfields Solar
and Storage Project to deliver renewable electricity to BHP Nickel West Pty Ltd. (&quot;BHP&quot;)</LI>

</UL>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>2021 Revised Outlook</B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">With exceptional year-to-date results, the Company
has increased its 2021 outlook as set out below:</P>

<UL STYLE="list-style-type: disc">

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Comparable EBITDA range of $1.1 to $1.2 billion</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">FCF range of $440 to $515 million</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt">Energy Marketing gross margin contribution range of $170 to $200
million</LI>

</UL>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">TransAlta Corporation (&quot;TransAlta&quot; or the
&quot;Company&quot;) (TSX: TA) (NYSE: TAC) today reported its financial results for the three and six months ended June 30, 2021.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">&quot;TransAlta continues to deliver outstanding results
in 2021.&nbsp; We exceeded expectations during the second quarter with strong performances from our Alberta Hydro and Thermal fleets.&nbsp;
We are focused on optimizing our Alberta fleet, working to ensure maximum fleet flexibility and high availability during periods of high
demand, in order to realize the value of our Alberta generating portfolio.&nbsp; Our strategic management of our diversified fleet of
hydro, wind, energy storage and thermal assets has demonstrated its competitiveness and value in Alberta's merchant market structure,&quot;
said John Kousinioris, President and Chief Executive Officer. &quot;Our Energy Marketing segment also continues to have a strong year
with favourable results across North American markets outside of Alberta.&nbsp; With these results, we have the confidence to revise upwards
our outlook for free cash flow to between $440 and $515 million, exceeding&nbsp; our previous 2021 guidance range.&quot;</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Set out below are additional highlights from the quarter
as well as more details regarding the Company's financial results, liquidity and financial position.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Financial Results</B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The Company reported outstanding second quarter 2021
results with comparable EBITDA<SUP>(1) </SUP>of $302 million compared to $217 million in the same period of 2020. Funds from operations
(&quot;FFO&quot;)<SUP>(1) </SUP>were $250 million for the quarter compared to $159 million in the same period of 2020.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Comparable EBITDA for the three and six months ended
June 30, 2021 increased by $85&nbsp;million and $175 million, respectively, compared with the same periods in 2020, largely due to higher
comparable EBITDA at our Alberta Thermal and Hydro segments which was partially offset by lower performance at the Centralia, North American
Gas,&nbsp; and Wind and Solar segments.&nbsp; On a year-to-date basis, our Energy Marketing segment also had stronger results compared
to 2020. The strong performance of the Hydro and&nbsp; Alberta Thermal segments was due to higher average merchant prices in the Alberta
power market, the expiry of the Alberta power purchase arrangements (&quot;Alberta PPAs&quot;), which resulted in the elimination of the
net obligation payments made to the Alberta Balancing Pool in prior periods, and managing to high unit availability during periods of
high market demand.&nbsp;</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">FCF, one of the Company's key financial metrics, totaled
$138 million and $267 million, respectively, for the three and six months ended June 30, 2021, an increase of $47 million and&nbsp; $67&nbsp;million
compared to the same periods in 2020, driven primarily by the higher comparable EBITDA noted above, partially offset by an increase in
sustaining capital due to additional planned major maintenance events across the fleet compared to the same periods in 2020, the settlement
of provisions, and higher distributions paid to subsidiaries' non-controlling interest.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Operations, maintenance and administration (&quot;OM&amp;A&quot;)
expenses for the three and six months ended June 30, 2021 increased by $39&nbsp;million and&nbsp;$16&nbsp;million, respectively, compared
to the same periods in 2020. &nbsp;During the second quarter of 2021, a writedown of $25&nbsp;million was recorded on parts and material
inventory related to the Highvale mine and coal operations at our gas-converted facilities. &nbsp;In addition, for the three and six months
ended June 30, 2021, variability caused by the total return swap resulted in an unfavourable change of $5&nbsp;million and a favourable
change of $13&nbsp;million, respectively.&nbsp; During the first quarter of 2021, we also received a Canada Emergency Wage Subsidy (&quot;CEWS&quot;)
payment of $8&nbsp;million. Excluding the impact of the total return swap, CEWS funding and inventory writedown, OM&amp;A expenses were&nbsp;
higher for the&nbsp; three and six months ended June 30, 2021, compared to the same periods in 2020, primarily due to increased staffing
costs for growth and strategic initiatives, settlement of provisions, and higher incentive costs.&nbsp; As previously committed, the CEWS
funding was used to support incremental employment within the Company.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Liquidity and Financial Position</B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The Company continues to maintain a strong financial
position in part due to our long-term contracts and hedged positions. At the end of the second quarter, TransAlta had access to $2.0 billion,
including $642 million of cash and cash equivalents.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Alberta Electricity Portfolio</B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">On Dec. 31, 2020, the Alberta PPAs expired and, effective
Jan. 1, 2021, the applicable facilities began operating on a fully merchant basis in the Alberta market, forming a core part of our Alberta
electricity portfolio optimization activities. The variability in production by facility is driven by the diversity in our fuel types,
which enables portfolio management and allows for maximization of operating margins. The Alberta portfolio includes hydro, wind, energy
storage and thermal units. A portion of the baseload generation in the portfolio is hedged to provide cash flow certainty.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">In the six months ended June 30, 2021, the Hydro and
Alberta Thermal segments achieved realized power prices of $128 per MWh and $91 per MWh, respectively, compared to the Alberta spot price
which averaged $100 per MWh. The Company was able to benefit during higher-priced periods by optimizing dispatch in the hydro and thermal
fleet, ensuring high availability during peak demand while our hedged positions at Alberta Thermal minimized unfavourable market pricing
during lower-priced hours in the quarter.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>2021 Outlook</B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The Company is revising its 2021 outlook with comparable
EBITDA estimated to be between $1.1 and $1.2 billion. The midpoint of the range represents a 13 per cent increase over the Company's previous
2021 outlook.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The Company expects sustaining capital to be in the
elevated range of $200 million to $225 million. This is driven by final revisions to the maintenance capital for the planned outages at
Alberta Thermal and Hydro and the acceleration of the acquisition of a critical spare for customer and contractual reliability management.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">FCF is now expected to be between $440 and $515 million.
The midpoint of the range represents a 22 per cent increase over the Company's previous 2021 outlook.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The following table provides additional details pertaining
to our 2021 outlook:</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 7.5pt Arial, Helvetica, Sans-Serif; border-collapse: collapse">
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    <P STYLE="font: 8pt Arial, Helvetica, Sans-Serif; margin: 0"><B>Measure </B></P>
    <P STYLE="font: 8pt Arial, Helvetica, Sans-Serif; margin: 0"><B><I>(C$ millions unless otherwise noted)</I></B></P></TD>
    <TD STYLE="border-top: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>Revised Outlook</B></FONT></TD>
    <TD STYLE="border: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>Previous Outlook</B></FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Comparable EBITDA</FONT></TD>
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$1,100 to $1,200</FONT></TD>
    <TD STYLE="border-right: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$960&nbsp; to $1,080</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">FCF</FONT></TD>
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$440 to $515</FONT></TD>
    <TD STYLE="border-right: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$340&nbsp; to $440</FONT></TD></TR>
  </TABLE>
<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><BR>
<I><U>Range of key power price assumptions</U></I>:</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 7.5pt Arial, Helvetica, Sans-Serif; border-collapse: collapse">
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-top: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>Market</B></FONT></TD>
    <TD STYLE="border-top: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>Power Prices ($/MWh)</B></FONT></TD>
    <TD STYLE="border: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>Power Prices ($/MWh)</B></FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Alberta Spot</FONT></TD>
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$80 to&nbsp; $100</FONT></TD>
    <TD STYLE="border-right: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$58 to $68</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Mid-C Spot (US$)</FONT></TD>
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$45 to $55</FONT></TD>
    <TD STYLE="border-right: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$25 to $35</FONT></TD></TR>
  </TABLE>
<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><BR>
<I><U>Other assumptions relevant to 2021 financial
outlook:</U></I></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 7.5pt Arial, Helvetica, Sans-Serif; border-collapse: collapse">
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-top: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Sustaining capital</FONT></TD>
    <TD STYLE="border-top: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$200 to $225</FONT></TD>
    <TD STYLE="border: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$175 to $210</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Energy marketing gross margin</FONT></TD>
    <TD STYLE="border-left: black 1pt solid; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$170 to $200</FONT></TD>
    <TD STYLE="border-right: black 1pt solid; border-bottom: black 1pt solid; border-left: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$90&nbsp; to $110 </FONT></TD></TR>
  </TABLE>
<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><BR>
<B>Other Activities</B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B><I>Northern Goldfields Solar and Storage Project</I></B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">On July 29, 2021, TransAlta Renewables Inc. (&quot;TransAlta
Renewables&quot;) announced that Southern Cross Energy, a subsidiary of the Company and an entity in which TransAlta Renewables owns an
indirect economic interest, had reached an agreement to provide BHP with renewable electricity to its Goldfields-based operations through
the construction of the Northern Goldfields Solar and Storage Project. The project comprises the 27 MW Mount Keith Solar Farm, 11 MW Leinster
Solar Farm, 10 MW/5MWh Leinster battery energy storage system and interconnecting transmission infrastructure, all of which will be integrated
into our 169 MW Southern Cross Energy North remote network in Western Australia. Construction activities are scheduled to start in the
fourth quarter of 2021 with completion of the projects expected in the second half of 2022. Total construction capital of the project
is estimated at approximately AU$73 million.&nbsp; The project is expected to contribute between $8 and $9 million of annual EBITDA.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B><I>Garden Plain Wind Project</I></B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">On May 3, 2021, the Company announced that it entered
into a long-term power purchase agreement (&quot;PPA&quot;) with Pembina Pipeline Corporation (&quot;Pembina&quot;) pursuant to which
Pembina has contracted for the renewable electricity and environmental attributes of 100 MW of the 130 MW Garden Plain wind project (&quot;Garden
Plain&quot;). Under a separate agreement, Pembina has the option to purchase an approximate 38 per cent interest in the project (49 per
cent of the project associated with the PPA). The option must be exercised no later than 30 days after the commercial operational date.
TransAlta will remain the operator of the facility and earn a management fee if Pembina exercises this option. Garden Plain will be located
approximately 30 km north of Hanna, Alberta. Construction activities are scheduled to start in fall 2021 with completion of the project
expected in the second half of 2022. Total construction capital of the project is estimated at approximately $195 million.&nbsp; The project
is expected to contribute between $14 and $18 million of annual EBITDA.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B><I>Windrise Wind</I></B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Construction activities on the Windrise wind project
continue to advance with all appropriate procedures in place to protect the construction team during the COVID-19 pandemic. All major
equipment has been delivered to site and turbine erection activities are ongoing. The project has advanced significantly and, as at the
end of June 2021, was approximately 88 per cent complete. The main transmission line was energized on June 10 and the project is tracking
to be completed during the second half of 2021.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B><I>Conversion to Gas</I></B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">During the first half of 2021, we completed the conversion
to gas at Sundance Unit 6 and our non-operated Sheerness Unit 1 completed its conversion to gas, resulting in both units now running solely
on gas. On July 19, 2021, we announced the completion of the conversion to gas at Keephills Unit 2 with a total spend of&nbsp;$35 million.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The Keephills Unit 3 conversion to gas is planned
to begin at the end of the third quarter of 2021. We continue to progress our off-coal transition plan and are on track to eliminate coal
as a fuel source in Alberta by the end of 2021.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">We continue to evaluate and assess the Sundance 5
repowering project in light of escalating costs, the changing supply and demand dynamics in the Alberta market as well as the evolving
regulatory environment. We have completed an additional competitive tendering process for the engineering, procurement and construction
contract and are now reviewing those bids and as well as the&nbsp; overall Sundance 5 repowering&nbsp; project costs.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B><I>Sarnia Recontracting</I></B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">On May 12, 2021, the Company executed an Amended and
Restated Energy Supply Agreement with one of its large industrial customers at the Sarnia cogeneration facility which provides for the
supply of electricity and steam.&nbsp; This agreement will extend the term of the original agreement from Dec. 31, 2022 to Dec. 31, 2032.
The agreement provides that if the Company is unable to enter into a new contract with the Ontario Independent Electricity System Operator
(&quot;IESO&quot;) or enter into agreements with its other industrial customers at the Sarnia cogeneration facility that extend past Dec.
31, 2025, then this agreement will automatically terminate on Dec. 31, 2025. The current contract with the IESO in respect of the Sarnia
cogeneration facility expires on Dec. 31, 2025. The Company is in active discussions with the three other existing industrial off-takers
regarding extensions to their supply of electricity and steam from the Sarnia cogeneration facility on comparable terms.&nbsp; On July
19, 2021, the IESO released its Annual Acquisition Report which included draft details for mid and long-term procurement mechanisms for
capacity for 2026 and beyond for existing and new generation. The Company will participate in the consultation process, seeking to secure
a contract extension for the Sarnia cogeneration facility following the end of the current IESO contract.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>COVID-19 Response Update</B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The World Health Organization declared a Public Health
Emergency of International Concern relating to COVID-19 on Jan. 30, 2020, which they subsequently declared, on March 11, 2020, as a global
pandemic.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The Company continues to operate under its business
continuity plan and has adopted local public health authority and government guidelines in all&nbsp; jurisdictions in which we operate
to promote the health and safety of all employees and contractors.&nbsp; All of TransAlta's offices and sites follow health screening
and social distancing protocols, including the use of personal protective equipment. Further, TransAlta maintains travel limitations that
are aligned to local jurisdictional guidance, enhanced cleaning procedures, revised work schedules, contingent work teams and the reorganization
of processes and procedures to minimize any workplace transmission of the virus.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">All facilities continue to remain fully operational
and are capable of meeting our customers' needs. The Company continues to work and serve all of our customers and counterparties under
the terms of their contracts. We have not experienced interruptions to service requirements due to COVID-19. Electricity and steam supply
continue to remain a critical service requirement to all of our customers and have been deemed an essential service in our jurisdictions.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">The Company continues to maintain a strong financial
position due in part to its long-term contracts and hedged positions and its ample financial liquidity.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Segment Results</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 7.5pt Arial, Helvetica, Sans-Serif; border-collapse: collapse">
  <TR>
    <TD ROWSPAN="2" STYLE="border-bottom: Black 1pt inset"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>Second Quarter 2021 Segmented Results Comparable EBITDA <I>(C$ millions)</I></B></FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>3 Months Ended</B></FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>6 Months Ended</B></FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="white-space: nowrap; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>June 30, 2021</B></FONT></TD>
    <TD STYLE="white-space: nowrap; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">June 30, 2020</FONT></TD>
    <TD STYLE="white-space: nowrap; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>June 30, 2021</B></FONT></TD>
    <TD STYLE="white-space: nowrap; border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">June 30, 2020</FONT></TD></TR>
  <TR>
    <TD><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Hydro</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>96</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">29</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>173</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">55</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Wind and Solar</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>55</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">61</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>131</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">135</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">North American Gas</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>18</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">27</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>53</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">56</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Australian Gas</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>31</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">29</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>63</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">59</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Alberta Thermal</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>85</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">30</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>128</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">74</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Centralia</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>14</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">27</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>26</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">60</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Energy Marketing </FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>27</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">28</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>70</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">41</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Corporate</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>(24)</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">(14)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>(32)</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">(43)</FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>Total Comparable EBITDA<SUP>(1)</SUP></B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>302</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">217</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>612</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">437</FONT></TD></TR>
  </TABLE>
<UL STYLE="list-style-type: disc">

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt"><U>Hydro:</U> Comparable EBITDA for the three and six months ended
June 30, 2021, increased by $67 million and $118 million, respectively, compared with the same periods in 2020. With strong availability
during periods of market volatility, the Company was able to capture higher energy and ancillary service revenues.</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt"><U>Wind and Solar:</U> Comparable EBITDA for the three and six
months ended June 30, 2021, decreased by $6 million and $4 million, respectively, compared with the same periods in 2020, primarily due
to lower production and lower gains on foreign exchange, which was partially offset by the new Skookumchuck facility and higher pricing
in Alberta.</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt"><U>North American Gas:</U> Comparable EBITDA for the three and
six months ended June 30, 2021, decreased by $9 million and $3 million, respectively, compared to the same periods in 2020, primarily
due to unplanned outage events at Sarnia. The decrease was partially offset by the May 2020 acquisition of the Ada facility and higher
realized pricing in Alberta.</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt"><U>Australian Gas:</U> Comparable EBITDA for the three and six
months ended June 30, 2021, increased by $2 million and $4 million, respectively, compared with the same periods in 2020. The increase
was mainly due to the strengthening of the Australian dollar relative to the Canadian dollar.</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt"><U>Alberta Thermal:</U> Comparable EBITDA for the three and six
months ended June 30, 2021, increased by $55 million and $54 million, respectively, compared to the same periods in 2020. Higher availability
during periods of tight market conditions and higher Alberta pricing was partially offset by increases in fuel and carbon compliance costs.</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt"><U>Centralia:</U> Comparable EBITDA for the three and six months
ended June 30, 2021, decreased by $13 million and $34 million, respectively, compared with the same periods in 2020 primarily due to outages
occurring during periods of higher merchant pricing partially offset by lower OM&amp;A costs.</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt"><U>Energy Marketing:</U> Comparable EBITDA for three months ended
June 30, 2021 was consistent with the same period in 2020. Comparable EBITDA for six months ended June 30, 2021 increased by $29 million,
compared to the same period in 2020, due to favourable short-term trading of both physical and financial power and gas products across
all North American markets.</LI>

<LI STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0pt 0 12pt"><U>Corporate</U>: Corporate overhead costs for the three months
ended June 30, 2021, increased by $10 million compared to the same period in 2020, primarily due to realized losses from the the total
return swap, additional legal fees and dispute settlement costs. Corporate costs for the six months ended June 30, 2021 decreased by $11
million, compared to the same period in 2020, primarily due to the receipt of CEWS funding and realized gains from the total return swap,
partially offset by higher legal fees, dispute settlement costs and higher staffing costs. A portion of the settlement costs of our employee
share-based payment plans is hedged by entering into total return swaps, which are cash settled every quarter.</LI>

</UL>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Consolidated Financial Highlights </B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Net loss attributable to common shareholders, for
the three and six months ended June 30, 2021 was $12 million and $42 million, respectively, compared to net losses of $60 million and
$33 million, respectively, in the same periods in 2020. For the three and six months ended June 30, 2021, net earnings increased by $48
million and decreased by $9&nbsp;million, respectively, from the same periods in 2020, as a result of higher comparable EBITDA, the gain
on the sale of the Pioneer Pipeline and lower depreciation, which was partially offset by higher income tax. In the six-month period ended
June 30, 2021, earnings were additionally impacted by an increase in finance lease income and higher foreign exchange changes, which was
offset by greater asset impairments than in the same period in 2020.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Total year-to-date sustaining capital expenditure
of $100 million was $45 million higher compared to 2020 primarily due to higher planned major maintenance across the segments.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Second Quarter 2021 Highlights</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 7.5pt Arial, Helvetica, Sans-Serif; border-collapse: collapse">
  <TR STYLE="vertical-align: bottom">
    <TD ROWSPAN="2" STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B><I>In C$ millions, unless otherwise stated </I></B></FONT></TD>
    <TD COLSPAN="6" STYLE="padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>3 Months Ended</B></FONT></TD>
    <TD COLSPAN="6" STYLE="padding-right: 6pt; padding-left: 6pt; text-align: center"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>6 Months Ended</B></FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>June 30, 2021</B></FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>June 30, 2020</B></FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>June 30, 2021</B></FONT></TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>June 30, 2020</B></FONT></TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Comparable EBITDA<SUP>(1)</SUP></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>302</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">217</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>612</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">437</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Free cash flow<SUP>(1)</SUP></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>138</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">91</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>267</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">200</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Adjusted availability (%)<SUP>(2)</SUP></FONT></TD>
    <TD COLSPAN="2" STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>84.8</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">91.5</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>86.7</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">92.2</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Production (GWh)</FONT></TD>
    <TD COLSPAN="2" STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>4,688</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">4,607</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>10,229</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">11,093</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Revenues</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>619</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">437</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>1,261</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">1,043</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Fuel and purchased power<SUP>(3)</SUP></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>212</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">116</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>455</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">309</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Carbon compliance<SUP>(3)</SUP></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>42</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">35</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>92</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">80</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Operations, maintenance and administration</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>151</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">112</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>256</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">240</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Net loss attributable to common shareholders</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 6pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>(12)</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 6pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">(60)</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 6pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>(42)</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 6pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">(33)</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Cash flow from operating activities</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>80</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">121</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>337</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">335</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Funds from operations<SUP>(1)</SUP></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>250</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">159</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>461</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">331</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Net loss per share attributable to common shareholders, basic and diluted</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 6pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>(0.04)</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 6pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">(0.22)</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 6pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>(0.16)</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 6pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">(0.12)</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Funds from operations per share<SUP>(1)</SUP></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>0.92</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">0.58</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>1.70</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">1.20</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Free cash flow per share<SUP>(1)</SUP></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>0.51</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">0.33</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>0.99</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">0.72</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Dividends declared per common share<SUP>(4)</SUP></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>0.0450</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">0.0425</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>0.0450</B></FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">0.0850</FONT></TD>
    <TD STYLE="padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  <TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 6pt; padding-left: 6pt"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">Dividends declared per preferred share<SUP>(5)</SUP></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>0.2536</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">0.2533</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt"><B>0.2536</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">$</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt; text-align: right"><FONT STYLE="font-family: Arial, Helvetica, Sans-Serif; font-size: 8pt">0.5123</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; padding-right: 8.05pt; padding-left: 6pt">&nbsp;</TD></TR>
  </TABLE>
<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">&nbsp;</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">TransAlta is in the process of filing its unaudited
interim Consolidated Financial Statements and accompanying notes, as well as the associated Management's Discussion &amp; Analysis (&quot;MD&amp;A&quot;).
These documents will be available August 10, 2021 on the Investor Centre of TransAlta's website at <U>www.transalta.com</U> or through
SEDAR at <U>www.sedar.com</U> and EDGAR at <U>www.sec.gov/edgar.shtml</U>.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Notes</B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><I>(1) These items are not defined under IFRS. Presenting
these items from period to period provides management and investors with the ability to evaluate earnings trends more readily in comparison
with prior periods' results. Refer to the Comparable EBITDA, Funds from Operations and Free Cash Flow and Earnings and Discussion of Consolidated
Financial Results&nbsp; sections of the MD&amp;A for further discussion of these items, including, where applicable, reconciliations to
measures calculated in accordance with IFRS.</I></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><I>(2) Prior period adjusted availability has been
revised to include the Hydro segment.</I></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><I>(3)&nbsp; In the first and second quarters of 2021,
carbon compliance costs have been reclassified from fuel and purchase power costs and disclosed separately. Prior periods have been adjusted
for comparative purposes.</I></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><I>(4) No dividends were declared in the first quarter
of 2021 as the quarterly dividend related to the period was declared in December 2020. </I></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><I>(5) Weighted average of the Series A, B, C, E,
and G preferred share dividends declared. Dividends declared vary year over year due to timing of dividend declarations.</I></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B>Conference call </B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">TransAlta will hold a conference call and webcast
at 9:00 a.m. MT (11:00 a.m. ET) today, August 10, 2021, to discuss our second quarter 2021 results. The call will begin with a short address
by John Kousinioris, President and Chief Executive Officer, and Todd Stack, Executive Vice President, Finance and Chief Financial Officer,<B>&nbsp;</B>followed
by a question and answer period for investment analysts and investors. A question and answer period for the media will immediately follow.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; text-align: center; margin-right: 0; margin-left: 0"><B><U>Second Quarter 2021 Conference
Call:<BR>
</U></B>Toll-free North American participants call: 1-888-664-6392</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Webcast link: <B><U>https://produceredition.webcasts.com/starthere.jsp?ei=1481658&amp;tp_key=fe2b22408</U></B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Related materials will be available on the Investor
Centre section of TransAlta's website at http://www.transalta.com/investors/events-and-presentations. If you are unable to participate
in the call, the instant replay is accessible at 1-888-390-0541 (Canada and USA toll free) with TransAlta passcode 902288 followed by
the # sign. A transcript of the broadcast will be posted on TransAlta's website once it becomes available.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B><I>About TransAlta Corporation: </I></B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><I>TransAlta owns, operates and develops a diverse
fleet of electrical power generation assets in Canada, the United States and Australia with a focus on long-term shareholder value. TransAlta
provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy efficient and reliable
power. Today, TransAlta is one of Canada's largest producers of wind power and Alberta's largest producer of hydroelectric power. For
over 100 years, TransAlta has been a responsible operator and a proud community-member where its employees work and live. TransAlta aligns
its corporate goals with the <U>UN Sustainable Development Goals</U> and has been recognized by CDP (formerly Climate Disclosure Project)
as an industry leader on Climate Change Management, having recently achieved an A- score.</I></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><I>For more information about TransAlta, visit our
web site at <U>transalta.com</U>.</I></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><B><I>Cautionary Statement Regarding Forward-Looking
Information </I></B></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0"><I>This news release contains forward-looking statements,
including statements regarding the business and anticipated financial performance of the Company that are based on the Company's current
expectations, estimates, projections and assumptions in light of its experience and its perception of historical trends. In some cases,
forward-looking statements can be identified by terminology such as &quot;expects&quot;, &quot;plans&quot;, &quot;will&quot;, &quot;develop&quot;,
&quot;continue&quot;, and similar expressions suggesting future events or future performance. In particular, this news release contains
forward-looking statements, pertaining to, without limitation, the following: the potential impact of COVID-19 on the Company and the
actions to be undertaken by the Company in response to the COVID-19 pandemic;&nbsp; the conversion of Keephills Unit 3 and the timing
thereof; the repowering of Sundance Unit 5; the Windrise wind project and the timing for commercial operation; the Northern Goldfields
Solar and Storage Project and the Garden Plain wind project, including the timing and cost thereof and expected contributions to EBITDA;
financial outlooks, including the revised outlook for Comparable EBITDA, FCF and Energy Marketing's contributions to gross margin; sustaining
capital spend of $200 million to $225 million in 2021; the recontracting of the Sarnia facility; and the optimization of the Alberta fleet,
including through flexibility and high availability. The forward-looking statements contained in this news release are based on many assumptions,
including, but not limited to, an Alberta spot price of $80 to $100/MWh and Mid-C pricing of between $45 and $55/MWh.&nbsp; The forward-looking
statements are also subject to a number of significant risks and uncertainties that could cause actual plans, performance, results or
outcomes to differ materially from current expectation. Factors that may adversely impact what is expressed or implied by the forward-looking
statements contained in this news release include risks relating to: the impact of COVID-19, such as more restrictive directives of government
and public health authorities, reduced labour availability, inability to staff the Company's construction and operating activities, or
disruptions to the Company's supply chain; impairments and/or write-downs of assets; adverse impacts on the Company's information technology
systems and the Company's internal control systems; the price of electricity in Alberta or Mid-C differing significantly from those assumptions
noted above; operational risks involving the Company's facilities, including unplanned outages at such facilities; losses from Energy
Marketing, including due to unanticipated volatility; adverse regulatory developments; disruptions in the transmission and distribution
of electricity; the effects of weather and other climate-related risks; disruptions in the source of water, wind, solar, coal or gas resources
required to operate our facilities; natural disasters; equipment failure and our ability to carry out repairs in a cost-effective or timely
manner; decreases to the Company's relative efficiency and capacity factors; and greater competition and other industry risks.&nbsp; The
foregoing risk factors, among others, are described in further detail in the Company's Management's Discussion and Analysis and Annual
Information Form for the year ended Dec. 31, 2020, which are available on SEDAR at <B>www.sedar.com</B>. Readers are cautioned not to
place undue reliance on these forward-looking statements, which reflect the Company's expectations only as of the date of this news release.
The purpose of the financial outlooks contained herein are to give the reader information about management's current expectations and
plans and readers are cautioned that such information may not be appropriate for other purposes. The Company disclaims any intention or
obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, except
as required by law. </I></P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">Note: All financial figures are in Canadian dollars
unless otherwise indicated.</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">View original content:https://www.prnewswire.com/news-releases/transalta-reports-outstanding-second-quarter-2021-results-and-increases-annual-guidance-301352038.html</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">SOURCE TransAlta Corporation</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">View original content: http://www.newswire.ca/en/releases/archive/August2021/10/c1394.html</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">%CIK: 0001144800</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin: 0"><B>For further information: </B>Investor Inquiries: Phone: 1-800-387-3598
in Canada and U.S., Email: investor_relations@transalta.com; Media Inquiries: Phone: 1-855-255-9184, Email: ta_media_relations@transalta.com</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">CO: TransAlta Corporation</P>

<P STYLE="font: 15pt Arial, Helvetica, Sans-Serif; margin-right: 0; margin-left: 0">CNW 07:18e 10-AUG-21</P>

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