Despite a 150% increase in its gas-fired power portfolio lastyear, San Jose-based Calpine Corp. proved last week its buyingspree isn’t letting up. The company has entered into exclusivenegotiations to acquire Dow Chemical’s 70 MW natural gas-firedpower plant and a natural gas pipeline system located adjacent toDow’s chemical plant in Pittsburg, CA. The pipeline delivers gas tothe plant directly from Sacramento basin fields. Calpine sees thesite as a perfect location to add more generation capacity andcontinue to grow its position in the deregulating Californiaelectricity and gas marketplace.

Calpine expects to complete the acquisition during the secondquarter. As part of the deal, it will enter into long-termagreements with Dow to provide electricity and steam to itschemical facility and steam to the nearby USS-POSCO Industriessteel mill. In addition, Calpine will acquire a site at the Dowchemical facility suitable for future development of a modern 250to 500 MW gas-fired power plant.

“The Dow transaction exemplifies the new opportunities forCalifornia customers to benefit in a deregulated energy market,”said Calpine Vice President John King. “We look forward toproviding Dow and other industrial and retail customers with along-term, economic energy program tailored to meet their uniqueelectricity and steam requirements.”

In 1997, Calpine purchased interests in eight gas-fired powerplants (729 MW) in Texas, Florida, Virginia and New York. It alsofiled plans to build a 500 MW gas-fired power plant in Sacramento,CA, called the Sutter plant. At the end of the year, the companyhad 4,000 net megawatts of gas-fired power in operation,construction and development.

Rocco Canonica

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