TransCanada: Agreement Reached To Develop Ontario Power Plant

Calgary, AB (Marketwire) - TransCanada Corporation (TSX:TRP) (NYSE:TRP) (TransCanada) announced today it has signed a memorandum of understanding with the Ontario Power Authority (OPA) to develop, own and operate a new 900-megawatt natural gas-fired power plant at Ontario Power Generation's Lennox Generating Station property near the village of Bath in eastern Ontario.

"We are very pleased an agreement was signed today to build a power plant in Ontario," said Russ Girling, TransCanada's president and chief executive officer. "TransCanada looks forward to expanding our contribution of clean, safe and reliable power to the residents of Ontario."

The OPA and TransCanada will finalize a contract based on the terms of the memorandum of understanding. It is expected that all contracts will be finalized by December 14, 2012. The Lennox power plant would act as a replacement facility for one that was planned in the community of Oakville.

TransCanada currently operates the 683-megawatt (MW) Halton Hills Generating Station in Ontario, has a 50 per cent ownership in the 550-MW Portlands Energy Centre on the Toronto waterfront and has agreed to purchase nine Ontario solar plants that would produce 86 MW of clean energy. TransCanada also owns a large portion of the Bruce Power nuclear facility - 49 per cent of Bruce A and 32 per cent of Bruce B. Bruce Power consists of two generating stations (Bruce A & B) with each station housing four nuclear reactors. Six of those reactors are currently operational, producing more than 4,700 MW of power. A refurbishment of the Unit 1 and 2 reactors is nearing completion, which will boost power output to 6,200 MW.

With more than 60 years' experience, TransCanada is a leader in the responsible development and reliable operation of North American energy infrastructure including natural gas and oil pipelines, power generation and gas storage facilities. TransCanada operates a network of natural gas pipelines that extends more than 68,500 kilometres (42,500 miles), tapping into virtually all major gas supply basins in North America. TransCanada is one of the continent's largest providers of gas storage and related services with approximately 380 billion cubic feet of storage capacity. A growing independent power producer, TransCanada owns or has interests in over 10,900 megawatts of power generation in Canada and the United States. TransCanada is developing one of North America's largest oil delivery systems. TransCanada's common shares trade on the Toronto and New York stock exchanges under the symbol TRP. For more information visit: www.transcanada.com or check us out on Twitter @TransCanada.

FORWARD LOOKING INFORMATION This publication contains certain information that is forward-looking and is subject to important risks and uncertainties (such statements are usually accompanied by words such as "anticipate", "expect", "would" or other similar words). Forward-looking statements in this document are intended to provide TransCanada security holders and potential investors with information regarding TransCanada and its subsidiaries, including management's assessment of TransCanada's and its subsidiaries' future financial and operation plans and outlook. All forward-looking statements reflect TransCanada's beliefs and assumptions based on information available at the time the statements were made. Readers are cautioned not to place undue reliance on this forward-looking information. TransCanada undertakes no obligation to update or revise any forward-looking information except as required by law. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from the anticipated results, refer to TransCanada's Management's Discussion and Analysis filed February 15, 2012 under TransCanada's profile on SEDAR at www.sedar.com and other reports filed by TransCanada with Canadian securities regulators and with the U.S. Securities and Exchange Commission.