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BPA Looks beyond Federal Hydro System to Help Integrate Wind Power

09/10/2010
Pilot Project Balances Wind's Variability with Natural Gas

PORTLAND, Ore., Sep 10, 2010 (BUSINESS WIRE) -- Calpine Corporation (NYSE:CPN) has entered into an agreement with the Bonneville Power Administration (BPA) for a pilot project to provide up to 75 megawatts of generation flexibility from its cleaner burning, natural gas-fired Hermiston Power Project.

Maintaining a balance between the supply of electricity and the amount used is crucial to keeping the lights on, but the variability of wind power complicates that effort. With the new agreement, when wind generators produce more electricity than forecasted, BPA can request that Calpine quickly reduce Hermiston's output to accommodate the renewable wind power. Calpine will then buy the excess power on BPA's system to fulfill its existing obligations to customers served by Hermiston.

"The federal hydro system has historically provided the vast majority of within-hour reserves for wind power in the Pacific Northwest," said Elliot Mainzer, executive vice president of Corporate Strategy for BPA. "But as the amount of wind power increases, BPA has been looking at other sources to help reduce the balancing burden on the federal hydro system. This pilot project fits very nicely into BPA's overall strategy of using non-federal power supplies to help support wind."

"Calpine continually works with our customers to find innovative solutions to the opportunities and challenges presented by integrating renewable resources into the power grid," said Jeff Woodall, Calpine's VP of Power Trading for California. "This pilot project is an example of how natural gas generation will play a critical role in America's clean-energy future. By providing this flexibility product from our Hermiston plant, we help BPA optimize use of its hydroelectric generation system, integrate wind power, and reduce greenhouse gas emissions in the Pacific Northwest."

About Calpine

Founded in 1984, Calpine Corporation is a major U.S. power company, currently capable of delivering nearly 29,000 megawatts of clean, cost-effective, reliable and fuel-efficient power from its 93 operating plants to customers and communities in 21 U.S. states and Canada. Calpine Corporation is committed to helping meet the needs of an economy that demands more and cleaner sources of electricity. Calpine owns, leases and operates low-carbon, natural gas-fired and renewable geothermal power plants. Using advanced technologies, Calpine generates power in a reliable and environmentally responsible manner for the customers and communities it serves. Please visit our website at http://www.calpine.com for more information.

About the Bonneville Power Administration

The Bonneville Power Administration, headquartered in Portland, Ore., is a not-for-profit federal electric utility that operates a high-voltage transmission grid comprising more than 15,000 miles of lines and associated substations in Washington, Oregon, Idaho and Montana. It also markets more than a third of the electricity consumed in the Pacific Northwest. The power is produced at 31 federal dams operated by the Army Corps of Engineers and Bureau of Reclamation and one nuclear plant in the Northwest and is sold to more than 140 Northwest utilities. BPA purchases power from seven wind projects and has more than 3,000 megawatts of wind interconnected to its transmission system.

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 Dec. 31, 2009, and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2010. These filings are available by visiting the Securities and Exchange Commission's website at http://www.sec.gov or Calpine's website at http://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
Media Relations:
Norma F. Dunn, 713-830-8883
norma.dunn@calpine.com
or
Investor Relations:
Andre Walker, 713-830-8775
andrew@calpine.com
or
BPA
Katie Pruder-Scruggs, 503-230-3111
Media Line: 503-230-5131