#11 TransɅlta Investor Presentation JANUARY 19, 2022 XXXXXXXXXXXXXXXXXX TransAlta#2Disclaimer and Forward-Looking Statements TransAlta Corporation ("TransAlta" or the "Company") is not making any offer or invitation of any kind by communication of this document to the recipient and under no circumstances is it to be construed as a prospectus or an advertisement. Except where otherwise indicated herein, the information provided herein is based on matters as they exist as at September 30, 2021, or as the context otherwise requires, and is subject to change, and, unless required by law, will not be updated or otherwise revised to reflect information that subsequently becomes available or circumstances existing or changes occurring after the date hereof. Unless otherwise noted, all references to "$" or "Dollars" are to Canadian Dollars. This written and accompanying oral presentation contains "forward-looking information", within the meaning of applicable Canadian securities laws, and "forward-looking statements", within the meaning of applicable United States securities laws, including the United States Private Securities Litigation Reform Act of 1995 (collectively referred to herein as "forward-looking statements"). The forward-looking statements are provided for the purpose of presenting information about management's current expectations and plans and readers are cautioned that such statements may not be appropriate for other purposes. TransAlta's actual results could differ materially from those expressed in, or implied by, these forward-looking statements, and accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur. Forward-looking statements are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects", "anticipates", "plans", "predicts", "believes", "estimates", "intends", "targets", "projects", "forecasts" or negative versions thereof and other similar expressions or future or conditional verbs such as "may", "will", "should", "would" and "could". These statements may include, without limitation, statements regarding: our strategy, including our Clean Electricity Growth Plan, including amount of renewables growth, associated capital expenditures, and annual new EBITDA; increase in renewables fleet and development pipeline beyond 2025; expected 2021 free cash flow of $500 million to $560 million; 2022 financial outlook, including as it pertains to Comparable EBITDA, free cash flow and sustaining capital; 2022 Alberta hedge levels for gas and power; emission reductions to 2026 and carbon neutrality by 2050; expected continued global decarbonization efforts; EBITDA attributable to renewables by end of 2025; future operational performance, including availability, OM&A, sustaining capital expenditures and staffing levels; investment focus from 2021 to 2025, including renewables and storage, gas generation and parallel new investments; ability to deliver the development pipeline and timing of potential commercial operation; the Company's construction and development projects, including the Garden Plain project, Northern Goldfield projects and White Rock East and West project, including the expected commercial operation dates and annualized EBITDA; the expected changes to the Alberta market, including Alberta power pricing and volatility; marginal cost of coal to gas units; five-year expected trend on capital allocation; and the achievement of the Company's sustainability targets. These statements are based upon certain material factors or assumptions that were applied in developing the forward-looking statements, including: the design specifications of development projects; the provisions of contracts to which TransAlta or a subsidiary is a party; management's current plans and its perception of historical trends; current conditions and expected future developments; as well as other factors that are believed to be appropriate in the circumstances. Some of the factors, many of which are beyond TransAlta's control and the effects of which can be difficult to predict, but may cause actual results to differ materially from those contemplated or implied by forward looking statements include, but are not limited to: more restrictive directives of government and public health authorities; reduced labour availability and ability to continue to staff the Company's operations and facilities; disruptions to TransAlta's supply chains, including its ability to secure necessary equipment and to obtain regulatory approvals on the expected timelines or at all; force majeure claims impacting the Company's operations and construction projects; curtailments reducing merchant production; TransAlta's ability to maintain its credit ratings; restricted access to capital and increased borrowing costs; increased costs, including those resulting from TransAlta's efforts to mitigate the impact of the COVID-19 pandemic; regulatory and environmental process delays; adverse impacts on the Company's information technology systems and its internal control systems; political uncertainty; disruptions in the transmission and distribution of electricity; the effects of weather, natural disasters and other climate-related risks; results and exposures of TransAlta's Energy Marketing segment, including deviations from historical trends; disruptions to the operations, including unplanned outages, equipment failures and TransAlta's ability to carry out repairs in a cost-effective or timely manner; and general competition and industry risks. TransAlta cautions that the foregoing list of important factors that may affect future results is not exhaustive. When relying on the Company's forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, TransAlta undertakes no obligation to publicly update or revise any forward-looking statements or information in this presentation, whether as a result of new information, future events or otherwise. Past performance is not indicative or a guarantee of future results. The foregoing risk factors, among others, are described in further detail in the Company's Management Discussion and Analysis and Annual Information Form for the year ended December 31, 2020, filed under the Company's profile on SEDAR at www.sedar.com and with the U.S. Securities and Exchange Commission at www.sec.gov. 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 presentation. The purpose of the financial outlooks contained in this presentation 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. This presentation contains references to financial measures that are calculated and presented using methodologies other than in accordance with International Financial Reporting Standards ("IFRS"), as issued by the International Accounting Standards Board, including EBITDA, funds from operations ("FFO") and free cash flow ("FCF"), and such measures may not be comparable to similar measures presented by other entities. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS. Please refer to the "Additional IFRS Measures and Non-IFRS Measures" and "Reconciliation of Non-IFRS Measures" section of Management's Discussion and Analysis for the nine months ended September 30, 2021 for further discussion of these items, including, where applicable, reconciliations to measures calculated in accordance with IFRS. The Company utilizes these measures in managing the business, including for performance measurement, capital allocation and valuation purposes and believe that providing these performance measures on a supplemental basis to its IFRS results is helpful to investors in assessing the overall performance of TransAlta's businesses. The Company cautions readers that these non-IFRS financial measures or other financial metrics may differ from the calculations disclosed by other businesses and, as a result, may not be comparable to similar measures presented by other issuers and entities. 2 TransAlta#33 TransAlta at a Glance $9.2 billion ENTERPRISE VALUE Strong balance sheet and capital discipline 110 Years GENERATION EXPERIENCE The foundation of our focused strategy ~8,000 MW DIVERSIFIED PORTFOLIO 74 generating facilities in Canada, the United States and Australia $500 $560 million - 2021 EXPECTED FREE CASH FLOW Continued strong performance $3.5 billion ➤ 1,300 MARKET CAPITALIZATION Listed on the TSX and NYSE EMPLOYEES Central to value creation 25 million tonnes ANNUAL EMISSIONS REDUCTIONS SINCE 2005 8% of Canada's emissions reduction target TransAlta#42021 Financial Strength FCF ($MILLIONS) Updated Guidance $500 - $560 $456 $367 $379 $358 $328 2017 2018 FCF PER SHARE Updated Guidance $1.85 - $2.07 $1.68 $1.28 $1.34 $1.30 $1.14 2019 2020 2021 YTD 2017 2018 SENIOR CORPORATE DEBT ($BILLIONS) - 58% $2.6 + 35% 2019 2020 2021 YTD LIQUIDITY ($BILLIONS) $0.7 $1.1 $0.3 $0.4 $1.8 $1.4 $1.4 $1.6 $1.3 $0.1 $1.2 $1.3 $1.1 $0.9 2017 2018 2019 2020 2021 Q3 2017 2018 2019 2020 2021 Q3 TransAlta#52022 Outlook ($millions) Comparable EBITDA FCF Sustaining Capital (1) 2022 Target $1,065 $1,185 $455-$555 $150-$170 2021 Target (as at Q3 2021) $1,200 $1,300 $500 - $560 $200 - $225 Market Alberta Spot AECO Gas Price ($/GJ) 2022 Prices $80 to $90 $3.60 2021 Prices (as at Q3 2021) $95 to $105 $3.45 Alberta Hedging Hedged Production (GWh) Hedge Price ($/MWh) Hedged Gas Volume (GJ) Hedge Gas Price ($/GJ) 2022 Assumptions Continuing Strong Cash Flow for 2022 LO 5 12022 Target excludes Kent Hills rehabilitation 6,278 $75 50 million $2.75 2022 Assumptions (as at Q3 2021) 4,387 $71 49 million $2.74 TransAlta#6Who We Are Our Vision A leader in clean electricity - committed to a sustainable future A Customer- Centred Clean Energy Leader OUR STRATEGY Customer Needs Operational Excellence OUR VALUES Safety People Shareholder Value Innovation Sustainability Respect Integrity TransAlta#7TransAlta's Core Businesses TransAlta MERCHANT HYDRO THERMAL GENERATION ENERGY MARKETING AND TRADING BUSINESS DEVELOPMENT TransAlta renewables inc T Diversified and reliable generation with world-class trading and business development teams 7 TransAlta#8Fleet Overview Wind and Solar 29 Facilities Coal 1 Facility Hydro 27 Facilities 8 1After suspension of Sundance 5 and retirement of Keephills Unit 1 and Sundance Unit 4 Natural Gas¹ 15 Facilities TECHNOLOGY WIND SOLAR HYDRO BATTERY NATURAL GAS COAL TransAlta#9Clean Energy Transition Ahead of Plan CLEAN ENERGY GROWTH CARBON TRANSITION EMISSIONS REDUCTIONS Over 400 MW of renewables and storage added, including first utility-scale storage ✓ Established ~3 GW wind and solar pipeline Established Canadian, US and Australian growth teams 1,600 MW of coal generation retired by end of 2021 ✓ 1,660 MW of conversions completed by end of 2021 ✓ Ceased active mining operations by end of 2021 Pioneer gas pipeline completed and sold ✓ CO2 emissions reduced by 61% from 2005 Targeting 75% below 2015 levels by 2026 ✓ Carbon neutrality by 2050 RENEWABLE CAPACITY (MW) ALBERTA THERMAL CAPACITY (MW) EMISSIONS REDUCTIONS (MM T CO2) 6 +19% 1,750 1,467 3,032 -33% 2,041 41.9 -61% 20.6 16.4 2019 2021 2005 2019 2020 2019 2021 TransAlta#10Strategic Accomplishments Led to Dramatic Evolution 10 SENIOR CORPORATE DEBT ($ billion) $1.6 -27% FREE CASH FLOW ($ million) $1.1 $379 SHARE PRICE ($ / share) +40%¹ $500-$560 +41%² $9.28 $13.09 2019 2021 Q3 2019 2021 E 2019 Today 1Midpoint of 2021 guidance 2As of closing on January 13, 2022 8% annual dividend increase since 2019 TransAlta#11The Global Race to Decarbonize is On Global efforts to decarbonize are accelerating at a rapid pace Strong political support gaining momentum with explicit net zero goals Technology cost of renewables and energy storage declining rapidly and competing with fossil fuel generation SIGNIFICANT INVESTMENT REQUIRED TO MEET THE CHALLENGE $0.8 trillion - $1.8 trillion per year 2.5x to 6x higher than today 505 GW OF NEW WIND PER YEAR Corporations are delivering leadership by committing to net zero goals Investors are ramping up clean investments towards net zero push + 11 Source: Bloomberg NEF New Energy Outlook 2021 455 GW OF NEW SOLAR PER YEAR 245 GW OF NEW STORAGE PER YEAR TransAlta#12Accelerating Renewables Growth: 2021 to 2030 2021 2025 12 2 GW $3 billion 2025 $250 million OF RENEWABLES GROWTH OF GROWTH CAPEX NEW ANNUAL EBITDA 5 GW OF GROWTH PIPELINE 2030 INCREASE IN 2X RENEWABLES FLEET TransAlta#13Our Clean Energy Evolution LEGEND 35% EBITDA TODAY 24% Renewables 11% 30% 70% EBITDA 20251 Energy Marketing Natural Gas Coal 5% 25% EBITDA attributable to renewables will reach 70% by end of 2025 13 1Post-Centralia retirement TransAlta#14Operational Excellence: Where We Are Going 14 AVAILABILITY GENERATION OM&A 94% +3% $400 92% 90% 88% 86% $350 $300 $250 84% 82% $200 2017-2020 Average 2022-2026 Average 2017-2020 Average $200 $150 $100 SUSTAINING CAPEX -25% -23% 2022-2026 Average GENERATION STAFFING LEVELS 1400 1100 800 - 49% 500 $50 2017-2020 Average 2022-2026 Average 2017-2020 Average 2022-2026 Average TransAlta#15Our Investment Focus: 2021 to 2025 5 RENEWABLES AND STORAGE GAS GENERATION PARALLEL NEW INVESTMENTS Expand core focus of onshore wind in North America with customer-centred greenfield development • Establish position in solar targeting the United States, Canada and Australia markets through acquisition Establish position in storage, targeting Alberta to meet future grid stability requirements Establish position in hybrid solutions in Alberta and Australia with customer- centred focus Optimize legacy Alberta Hydro assets and maximize cash flow from fleet • Optimize existing gas generation to maximize value and cash flows to support renewables and storage growth • Assess parallel ESG or new industry sectors such as water treatment, transmission/distribution and car charging. • Monitor new technologies such as storage, hydrogen and carbon capture technologies for deployment post-2025 15 ~3 GW of development and three advanced-stage wind projects TransAlta#16Our Competitive Advantage: Foundations for Growth • Extensive North American renewables fleet Local Presence • Extensive full lifecycle development, optimization and operational excellence 16 Strong Robust balance sheet and competitive cost of capital with TransAlta Renewables Balance Sheet ESG Strategy Customer Focus Operational Excellence Highly Credible Developer Optimization and Trading Expertise TransAlta#17Development Pipeline UNITED STATES LEGEND 17 ADVANCED-STAGE DEVELOPMENT SITE UNDER CONSTRUCTION EARLY-STAGE DEVELOPMENT SITE Total All Stages: 1,195 MW PROJECT MW FUEL LOCATION STAGE COD RANGE Horizon Hill 200 Wind OK 2023 White Rock East 200 Wind OK 2023 White Rock West 100 Wind OK 2023 Prairie Violet 185 Wind IL 2024-2025 Big Timber 50 Wind PA 2024-2025 Wild Waters 40 Wind MN 2024-2025 Coolspring 120 Wind PA 2025-2026 Wyoming Exp. 100 Wind WY 2024-2025 Chisholm 100 Solar TX 2025-2026 Big Blue River 100 Solar IN TBD TransAlta#18Development Pipeline CANADA LEGEND: 18 ADVANCED-STAGE DEVELOPMENT SITE EARLY-STAGE DEVELOPMENT SITE Total All Stages: 1,465 – 2,080 MW PROJECT MW FUEL LOCATION STAGE COD RANGE Riplinger 300 Wind AB Willow Creek 1 70 70 2024-2025 Wind AB 2024 Willow Creek 2 70 Wind AB 2024 Tempest 90 Wind AB 2024 Alberta Cogen 15-30 Gas AB 2023 Ontario Cogen 20 Gas ON 2023 WaterCharger 180 Battery AB 2023 SunHills Solar 85 Solar AB 2023 Alberta Solar 85 Solar AB 2024 Antelope Coulee 200 Wind SK TBD Red Rock 50 Wind AB TBD Brazeau Pumped Storage 300- 900 Hydro AB 2032 TransAlta#19Development Pipeline AUSTRALIA LEGEND 19 ADVANCED-STAGE DEVELOPMENT SITE EARLY-STAGE DEVELOPMENT SITE Total All Stages: 210 - 270 MW PROJECT MW FUEL LOCATION STAGE COD RANGE Mt Keith Capacity Additions 25-50 Gas WA 2023 New Mine Supply 25 Gas WA 2024 SCE North Wind 25-60 Wind WA 2023 Higginsville Supply Transmission WA 2024 Line South Hedland Solar 50 Solar WA 2022 New Mine Supply 85 Gas WA 2025 TransAlta#20Windrise Project Highlights Location Ft Macleod, Alberta Size 206 MW Technology SiemensGamesa COD v4.8 - 145 November 2021 Contracted 100% Customer AESO Term 20 years EBITDA $20-$22 million Now in commercial operations All turbines commissioned and now in operation Transmission interconnection fully complete and commissioned Work successfully competed through the pandemic Our 10th wind facility in Alberta 20 20 TransAlta#21Garden Plain Project Highlights Location Hanna, Alberta Contracted 77% Size 130 MW Customer Pembina Technology Siemens Gamesa Term 18 years SG5.0-145 COD H2 2022 EBITDA $14-$18 million Construction activities now underway Alberta Utilities Commission permits have been secured for the wind and interconnection facilities Detailed engineering ongoing with full geotechnical complete Advanced negotiations underway for the remaining 30 MW capacity Our 11th wind facility in Alberta 21 21 TransAlta#22Northern Goldfields Project Highlights Location Western Australia Contracted 100% Size 48 MW Technology Solar PV & Battery Term Customer BHP 16.3 years COD H2 2022 EBITDA $8-$9 million Construction activities underway Reduces BHP's Scope 2 emissions by up to 12% at Mount Keith and Leinster Comprised of 38 MW solar portfolio and 10 MW/5 MWh battery energy storage system First major growth project under extended PPA executed in 2020 Our 1st renewable project in Australia 22 22 TransAlta#23North Carolina Solar Portfolio Highlights Contracted 100% Location North Carolina Size 122 MW Customer Duke Energy Technology Solar PV Term 12 years Acquisition November 5, 2021 EBITDA US$9 million COD dates ranging from Nov. 2019 to May 2021 Acquisition cost of US$99 million Expected production of approximately 195,000 MWh per year Long term contracted cashflows with investment grade counterparties 20 operating facilities across North Carolina ranging in size from 3.2 MW to 6.7 MW 23 23 Our 2nd solar portfolio in the US FACILITY SOLAR TransAlta#24White Rock East and West Project Highlights Location Caddo County, OK Contracted 100% Size 300 MW Customer PPA Executed Technology Vestas V162 6.0 - 162 Term TBA Vestas V136 3.45 - 136 COD H2 2023 EBITDA US$44 million On-site construction to begin in later 2022 White Rock East and White Rock West will collectively be TransAlta's largest wind facility Provides a significant step towards 2 GW target Consists of 51 Vestas turbines between both sites 24 24 Our 6th and 7th wind facilities in the US TransAlta#25Alberta Business MAXIMIZE shareholder returns through active management of our diversified merchant portfolio PROVIDE dynamic, cost-effective and low carbon solutions to meet customer power demand and ESG goals IDENTIFY and evaluate market and technological sources for long-term growth 25 TECHNOLOGY WIND HYDRO BATTERY NATURAL GAS TransAlta#26Alberta Merchant Market is Evolving . Load growth moderating • Strong customer demand for renewables and storage • Cost of carbon emissions increasing • CCS/CCUS solutions costly and uncertain 2021 26 2022 HIGHER AVERAGE PRICING Moderate Volatility Baseload Generation Merchant exposure > Optimization • . Significant supply additions ~8,500 MW of gas, wind and solar planned or under construction ~2,500 MW of storage planned or under construction 2023 2024 2030 LOWER AVERAGE PRICING Higher Volatility > Fleet diversity > Peaking generation > Ancillary services Low carbon footprint Hedging and optimization TransAlta#27Price Volatility Expected to Increase 100% FORECASTED POWER PRICE LEVELS ($ / MWH) 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 $0 <$50 $50-$100 >$100 27 . Number of $0 hours expected to increase TransAlta well-positioned to compete in $50+ zone TransAlta#28Hydro and Unhedged Thermal Realized Prices in Alberta 28 $140 $120 $100 $80 $60 $40 $20 $0 2021 UNHEDGED REALIZED PRICES ($ / MWH) Q1 2021 Q2 2021 Q3 2021 Spot Price ■Alberta Thermal ■Alberta Hydro 23% ALBERTA HYDRO AVERAGE PREMIUM 14% ALBERTA THERMAL AVERAGE PREMIUM TransAlta#29Performance Standard Change Makes CTG More Competitive 29 29 Marginal Cost ($/MWh) $90 $80 $70 $60 $50 $40 $30 $20 $10 $0 MARGINAL COST UNDER EVOLVING PERFORMANCE STANDARD 2022 Existing CCGT ■Converted Gas 2025 2030 ■Proposed New CCGT (Unabated) Converted gas (CTG) to have lower variable costs under more stringent policy TransAlta#30Our Evolving Position in the Alberta Market LEGEND: 10 MW 2020 REPORTED 1,250 MW 265 MW 2025 WITH GROWTH AND RETIREMENTS2 1,724 MW 1,967 MW 2,666 MW Renewables Battery Natural Gas Coal 110 MW Well-positioned to perform in energy-only market 1 Growth includes Windrise, Garden Plain, Riplinger, SunHills Solar and Watercharger 30 2 Includes the suspension of Sundance Unit 5 and the retirements of Sundance Unit 4 and Keephills Unit 1 TransAlta#31Disciplined Capital Allocation Factors Impacting Risk Premium 31 Project Development Technology Economies of Scale Future Business Synergies Operational Synergies Counterparty Quality Contract Tenor Merchant Exposure Geography Regulatory Exposure Inflation Exposure Project Return Future Optimizations and Synergies • • Tax Optimization Operational and Platform Commercial Financing • Power Marketing Drop-downs to RNW • Merchant Optimization Portfolio Return Capital Recovery Our ability to identify and capture value drives enhanced portfolio returns TransAlta#32Prudent Capital Allocation DECONSOLIDATED FF01 Amortizing Debt (6-8%) Preferred Dividends (8-10%) Common Dividends (10-15%) Sustaining Capital (25-35%) Growth Capital Debt Reduction Share Buyback (30-50%) 32 32 1 Refer to Forward Looking Statements (slide 2) 5-YEAR TREND Improving performance provides increased allocation to: S Growth Dividends Share Buybacks TransAlta#33Growth Plan is Fully Funded CONSOLIDATED SOURCES AND USES 2021-2025 RNW Equity & Other Adjusted FFO 1 Return to Shareholders³ RNW Dividend Amortizing Debt Growth Capital Project Financing Net Cash 2 2022 Bond Refinance Sources 2022 Bond Maturity Uses 2 GW growth plan fully funded with cash flow and asset-level financing 1Adjusted FFO is equal to FFO, less sustaining capital, lease obligations and distributions to NCI (excluding RNW public NCI). 33 2Net Cash is equal to cash less credit facility as of December 31, 2020 3 Includes common share dividend, dividend on preferred shares and share buybacks TransAlta#34Sustainability Target Highlights ENVIRONMENTAL GOALS SOCIAL GOALS GOVERNANCE GOALS End coal generation by 2021 in Canada and 2025 in US Support Indigenous communities • Reduce safety incidents • • Reduce GHG emissions by 75% from 2015 levels by 2026 50% female representation on the Board by 2030 company by 2030 40% female employment across the . Reclaim mined land in Alberta and Washington State • Equal pay for women in equivalent roles as men Carbon neutral by 2050 34 == • Remove systemic barriers across the organization Demonstrate leadership on ESG reporting within financial disclosures TransAlta Our sustainability goals and targets support the long-term success of our business#35Strategic Priorities to 2025 35 1 Clean Electricity Growth Plan Accelerate growth into customer-centred renewables and storage 2 Targeted approach to diversification 3 Maintain financial strength and capital allocation discipline 4 Define next generation of power solutions 5 Lead in ESG policy development 6 Successfully navigate through COVID-19 pandemic TransAlta#36Diversified and Clean power leader Our Value Proposition resilient fleet ~3 GW growth pipeline with ESG focus Strong financial position 36 I TransAlta#37Questions & Answers Visit us at: www.transalta.com Investor [email protected] 37 TransAlta