"Deregulation is opening tremendous opportunities
for entrepreneurial companies like Calpine," said Peter Cartwright,
chairman, chief executive officer and president of Calpine Corp. "Back
in 1994, we had a power plant portfolio of 141 mega-watts. Today, it is
3,355 net megawatts, representing a 254% compound annual growth rate.
Five years from now it will be 25,000 megawatts-180 times bigger in just
ten years."
Calpine's well-defined growth strategy in the
U.S. power market is twofold: first, to expand and diversify its domestic
portfolio of power projects and to enhance the performance and efficiency
of its existing power plants.
Initially, Calpine provided engineering, management,
finance and operation and maintenance services to the independent power
industry. Today Calpine has interests in 58 operating facilities-totaling
3,355 net megawatts-which were acquired or developed at a steady pace
beginning in the late 1980s.
Calpine successfully completed its initial public
offering in September 1996-the largest in the history of the independent
power industry. Calpine's original investors when the company was founded
in 1984 were Guy F. Atkinson Construction Co. of South San Francisco and
Electrowatt Inc., a major Swiss utility based in Zurich. Electro-watt
eventually bought out Atkinson's interests, making Calpine an indirect,
wholly-owned subsidiary.
When Electrowatt decided to divest of its energy
assets, the timing was right, Cartwright said, to have the public buy
out Electrowatt. With access to public markets for both debt and equity,
the company is now in a comfortable position to embark on its plan to
develop and acquire high-efficiency natural gas and geothermal facilities.
Calpine is active in 14 states, with corporate
headquarters in San Jose, CA and regional offices in Pleasanton, CA; Houston,
TX; and Boston, MA. Calpine has launched one the nation's most progressive
development programs and expects to build its power portfolio to 25,000
megawatts by the end of 2004. The company currently has eight gas-fired
plants in construction, totaling approximately 3,380 net megawatts, and
an additional 2,600 net megawatts in announced development.
To help power its aggressive development program,
Calpine acquired 18 gas turbines in 1999 and purchased 45 gas turbines
in 1998. Earlier this summer, Calpine set another industry first-a $1
billion revolving construction facility.
Since April 1995, Calpine has acquired close
to 2,300 net megawatts of gas-fired and geothermal operating plants. In
1999 alone, Calpine acquired Pacific Gas and Electric Company's 14 geothermal
power plants at The Geysers, making Calpine the world's largest geothermal
provider. The company expects to add 400 megawatts of gas-fired production
by year-end.
To assure itself of reliable gas for its California
plants, Calpine acquired Montis Niger, Inc. in 1997. Montis Niger is a
natural gas production company with an estimated 10 billion cubic feet
of proven natural gas reserves in the Sacramento Valley and an 80-mile
pipeline system. In September 1999, Calpine further expanded its fuels
capabilities, acquiring Houston, Texas-based Sheridan Energy, Inc., a
natural gas exploration and production company. The company's financial
performance mirrors its operational achievements.
"There's a huge market opportunity out there
for new modern power plants to replace today's antiquated power fleet
and to supply tomorrow's ever-increasing need for power," continued
Cartwright "Calpine has proven its ability to grow in 15 years of
business through a consistent, proven strategy to achieve our 25,000-megawatt
program."
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