Portlands Energy Centre Signs Accelerated Clean Energy Supply Contract

TORONTO, Ontario - September 18, 2006 – (TSX: TRP) (NYSE: TRP) Portlands Energy Centre L.P. today announced that it has signed a 20 year Accelerated Clean Energy Supply (ACES) contract with the Ontario Power Authority for Portlands Energy Centre (PEC), a 550 megawatt high-efficiency, combined cycle natural gas generation plant to be constructed in downtown Toronto. PEC is a limited partnership of Ontario Power Generation and TransCanada Energy Ltd., a wholly owned subsidiary of TransCanada Corporation.

The ACES contract is the outcome of negotiations initiated in February 2006. PEC received Environmental Approval from the Ontario Ministry of Environment in April 2005 following two years of extensive studies, expert reviews, applications and public consultation.

The capital cost of PEC is estimated to be approximately $730 million. PEC is expected to create more than 500 construction jobs during the peak building period and about 25 full time positions.

PEC is expected to be operational in simple cycle mode and delivering 340 megawatts of electricity to the City of Toronto to meet peak summer demand beginning June 1, 2008. When completed in the second quarter of 2009, the plant will provide up to 550 megawatts of power under the ACES contract – 25 per cent of central Toronto’s needs. Visit www.portlandsenergycentre.com.

About TransCanada

TransCanada is a leader in the responsible development and reliable operation of North American energy infrastructure. TransCanada’s network of more than 41,000 kilometres (25,600 miles) of pipeline transports the majority of Western Canada’s natural gas production to key Canadian and U.S. markets. A growing independent power producer, TransCanada owns, or has interests in, approximately 7,000 megawatts of power generation in Canada and the United States. TransCanada’s common shares trade on the Toronto and New York stock exchanges under the symbol TRP.

About Ontario Power Generation

Ontario Power Generation Inc. is an Ontario-based electricity generation company whose principal business is the generation and sale of electricity in Ontario. Our focus is on the efficient production and sale of electricity from our generation assets, while operating in a safe, open and environmentally responsible manner.

Note: All financial figures are in Canadian dollars unless noted otherwise.

LEGAL NOTICE - FORWARD LOOKING INFORMATION FOR TRANSCANADA

Certain information in this news release is forward-looking and is subject to important risks and uncertainties. The results or events predicted in this information may differ from actual results or events. Factors which could cause actual results or events to differ materially from current expectations include, among other things, the ability of TransCanada to successfully implement its strategic initiatives and whether such strategic initiatives will yield the expected benefits, the availability and price of energy commodities, regulatory decisions, competitive factors in the pipeline and power industry sectors, and the current economic conditions in North America. For additional information on these and other factors, see the reports filed by TransCanada with Canadian securities regulators and with the United States Securities and Exchange Commission. TransCanada disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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For further information, please contact:

TransCanada

Media Inquiries:
Jennifer Varey/Shela Shapiro
(403) 920-7859 or Toll Free (800) 608-7859

Investor & Analyst Inquiries:
David Moneta/Myles Dougan
(403) 920-7911

Portlands Energy Centre
Media Inquiries:
Ted Gruetzner
(416) 592-3867

OPG
Media Inquiries:
John Earl
(416) 592-4008 or (877) 592-4008