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Otay Mesa Energy Center Commences Commercial Operation

Full Output Sales Contract with San Diego Gas & Electric
HOUSTON, Oct 21, 2009 (BUSINESS WIRE) -- Calpine Corporation (NYSE:CPN) today announced that it has successfully placed into service the newly constructed Otay Mesa Energy Center (OMEC) near San Diego, California. The plant, with a capacity of almost 600 megawatts, began commercial operation Oct. 3 and is generating electric power for customers of San Diego Gas & Electric (SDG&E) under a 10-year tolling agreement for the full output of the plant, giving SDG&E the ability to dispatch power and ancillary services from the plant. SDG&E also will supply natural gas to fuel the plant.

OMEC is a state-of-the-art, highly efficient, environmentally responsible combined cycle power plant, fueled with natural gas and fitted with advanced air emissions control equipment. In addition, in a first-of-its-kind program dating back to the beginning of construction, mobile emission reduction credits were created when Calpine paid for retrofitting local marine vessels and sanitation vehicles with vastly improved technology. These permanently retired emissions more than offset emissions from the plant, resulting in a net air quality benefit for the San Diego region. Finally, OMEC is the largest air cooled power plant in the State of California, conserving precious water by eliminating the need to use ground or potable municipal water to cool recirculated steam.

"The Otay Mesa Energy Center demonstrates Calpine's continuing commitment to helping create a sustainable future for Californians by building cleaner, more flexible power plants designed to meet the reliability needs of the State's electric consumers," said Calpine President and Chief Executive Officer Jack Fusco. "We are most pleased to have SDG&E as our contract partner and look forward to continuing our strong, long-term relationship."

"The Otay Mesa Energy Center will play an important role in our long-term energy resource plan that includes aggressive energy efficiency programs, more renewable power, local generation and new transmission lines," said Debra L. Reed, President and Chief Executive Officer of San Diego Gas & Electric. "We look forward to the Otay Mesa Energy Center providing clean, cost-effective and reliable energy to our customers for many years to come."

Support for Otay Mesa Energy Center

Calpine has received strong support for this project from the local community to the highest level of State Government.

"In California we are leading the way to a brighter future with more clean power, clean energy and clean technology, and it is projects like this one that will help our state achieve our ambitious environmental and energy goals," said Governor Arnold Schwarzenegger. "This new state-of-the-art facility is great news because it means almost 600 megawatts of clean and reliable energy coming on line for the people of California."

"This project helps meet the growing electricity needs of the San Diego region with new, clean gas-fired generation," stated Michael R. Peevey, President - California Public Utilities Commission. "This project and others like it help the state meet its energy needs in a balanced way as we ramp up our commitment to renewable projects like solar, wind and geothermal, coupled with baseload power such as Otay Mesa."

"Otay Mesa is the right power plant in the right place to provide cleaner, reliable power to the San Diego region," said California ISO Vice President - Operations, Jim Detmers. "It's a stable source of power in a location that will help integrate intermittent wind and solar power plants also planned for the region."

Calpine's Commitment to California

Calpine has built and operated power plants in the State of California for 25 years and prides itself in developing innovative and environmentally responsible energy solutions for the people of California. The Otay Mesa Energy Center will increase Calpine's California portfolio to 36 power plants and more than 5,800 megawatts including 725 megawatts of renewable geothermal energy. Calpine's geothermal facilities at The Geysers supply about 20 percent of California's renewable electric generation. Taken as a whole, Calpine's projects produce enough electricity to satisfy the power needs of more than six million California households.

About Calpine

Calpine Corporation is helping meet the needs of an economy that demands more and cleaner sources of electricity. Founded in 1984, Calpine is a major U.S. power company, currently capable of delivering nearly 25,000 megawatts of clean, cost-effective, reliable and fuel-efficient electricity to customers and communities in 16 states in the United States and Canada. Calpine owns, leases, and operates low-carbon, natural gas-fired, and renewable geothermal power plants. Using advanced technologies, Calpine generates electricity in a reliable and environmentally responsible manner for the customers and communities it serves. Please visit www.calpine.com for more information.

Forward-Looking Information

In addition to historical information, this release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Words such as "believe," "intend," "expect," "anticipate," "plan," "may," "will" and similar expressions identify forward-looking statements. Such statements include, among others, those concerning expected financial performance and strategic and operational plans, as well as assumptions, expectations, predictions, intentions or beliefs about future events. You are cautioned that any such forward-looking statements are not guarantees of future performance and that a number of risks and uncertainties could cause actual results to differ materially from those anticipated in the forward-looking statements. Please see the risks identified in this release or in Calpine's reports and registration statements filed with the Securities and Exchange Commission, including, without limitation, the risk factors identified in its Annual Report on Form 10-K for the year ended December 31, 2008. These filings are available by visiting the Securities and Exchange Commission's web site at www.sec.gov or Calpine's web site at www.calpine.com. Actual results or developments may differ materially from the expectations expressed or implied in the forward-looking statements, and Calpine undertakes no obligation to update any such statements.

SOURCE: Calpine Corporation

Calpine Corporation
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