Calpine to sell interest in Cali energy center

San Jose, CA, and Stamford, CT, Sept. 22, 2006 — The U.S. Bankruptcy Court for the Southern District of New York approved the sale of a 35-percent equity interest in bankrupt power producer Calpine Corp.’s Russell City Energy Center to GE Energy Financial Services for approximately $44 million.

Calpine will own the remaining 65% interest. GE Energy Financial Services’ equity will be applied toward completion of development and construction of the power plant, and it also will provide related credit support for the project. The Russell City Energy Center is a proposed 600-megawatt, natural gas-fired power plant to be built in Hayward, Calif.

Construction of the fuel-efficient, combined-cycle power plant is scheduled to begin by the spring of 2008 and to be completed in mid-2010. In March 2006, a Calpine affiliate agreed in a letter of intent to sell the Russell City Energy Center’s full output to Pacific Gas and Electric Company (PG&E). Calpine and PG&E expect to replace the letter of intent in October 2006 with a ten-year tolling agreement.

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For related articles on the continuing Calpine bankruptcy and recovery, please read these articles:

Court OKs Calpine power plant sale

Calpine repays $645 million of its 9 5/8% First Priority Senior Secured Notes due 2014

Calpine Power Income Fund announces departure of CFO Geoff Krause

Calpine completes sale of Mexican power plant

Calpine to cut 775 jobs; announces plans to sell non-core power plants

Calpine sells interest in Mexican power plant; general counsel departs

Calpine shifting executive staff to go forward with restructuring plan

Calpine closes $2 billion DIP financing

Calpine declares compensation figures for board; purchases geothermal plants; appoints new board member

Calpine finalizes collateral structure for $2 billion DIP facility

Calpine files to reject two power plant lease agreements

Calpine to eliminate 300 jobs, sell non-core business

Calpine Power Income Fund and its manager in dispute

Default avoided on King City Project: Calpine Power Income Fund; Scott Davido named CFO of Calpine

Calpine receives court approval of $2 billion DIP financing

Calpine announces departure of member of board

Calpine terminates tender offer for outstanding first priority senior secured notes

Calpine receives court approval of first day motions

Calpine files for bankruptcy

Calpine given time to repay debts, but not much

Calpine’s common stock to cease trading on NYSE

Fitch says Calpine exposure does not adversely affect public power sector

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