TransAlta takes action to prepare for a potential breach in the dyke wall at Keephills’ ash lagoon site

Jul 27, 2008

CALGARY, Alberta (July 27, 2008) – TransAlta Corporation (TSX: TA; NYSE: TAC) is announcing the potential for a breach in the dyke wall at its Keephills’ ash lagoon located approximately 70 kilometres west of Edmonton. On July 26, 2008 the company detected a crack in the dyke wall. The company immediately notified Alberta Environment and the local authorities, and began taking measures to control and mitigate the effects of any potential breach and release of water from the lagoon.

There are no residents in the vicinity and TransAlta is restricting access to the area to ensure no one is at risk. The company’s primary concern is to maintain safety and minimize environmental impact. TransAlta will continue to cooperate with the appropriate authorities.

TransAlta will provide further updates on the situation as they become available.

This news release may contain forward-looking statements, including statements regarding the business and anticipated financial performance of TransAlta Corporation. These statements are subject to a number of risks and uncertainties that may cause actual results to differ materially from those contemplated by the forward-looking statements. Some of the factors that could cause such differences include legislative or regulatory developments, competition, global capital markets activity, changes in prevailing interest rates, currency exchange rates, inflation levels and general economic conditions in geographic areas where TransAlta Corporation operates.

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

For more information:

Media Inquiries:

Michael Lawrence
Manager, External Relations
Phone: (403) 267-7330

Investor Inquiries:

Jennifer Pierce
Vice President, Communications and Investor Relations
Phone: (403) 267-7622
Fax: (403) 267-2590

Jess Nieukerk
Manager, Investor Relations
Phone: (403) 267-3607