The continued successful implementation of its aggressive growthstrategy was reflected in the annual and quarterly financialresults of San Jose, CA-based Calpine Corp., which Tuesdayannounced triple-digit percentage increases in revenues, net incomeand earnings-per-share. Net income, before an extraordinary charge,was $324.7 million in 2000, compared to $96.2 million in 1999, a238% increase; revenues were $2.3 billion, compared to $847.7million in 1999, a 171% increase; and earnings-per-share were$1.11, compared to 43 cents/share in 1999, a 158% increase.

“Today Calpine has the largest construction and developmenteffort ever undertaken in the electricity industry,” said PeterCartwright, Calpine CEO. Last week, the company increased its goalfor the end of 2005 to a 70,000 MW total power plant portfolio inoperation. In 2000, the company more than doubled its assets,growing to $9.7 billion compared to $4 billion at the end of 1999.

For the fourth quarter, net income jumped to $107.7 million,compared to $30.7 million for the comparable period in 1999;revenues were $1 billion, compared to $247.4 million in the fourthquarter of 1999; diluted earnings-per-share were $0.34 vs. $0.12.

Calpine said it expected to sign a 10-year contract with theState of California Tuesday at attractive rates, and it expects tobe able to get paid by the two near-insolvent Californiainvestor-owned utilities by the early spring this year. Calpine has400 MW of qualifying facility (QF) generation that is at risk untilthe utility financial problems are resolved.

“Market fundamentals continue to be very strong in California,”said Calpine vice president Jim Macias, who oversees the firm’soperations in the state. “We’re very confident that we are going toget full payment for all accounts due, which are principally tiedto Pacific Gas & Electric Co.”

Projecting the highest growth rate of any merchant power plantdeveloper in the nation, Calpine in 2000 made acquisitions of someexisting power plants and the power plant developer, SkyGen Energy,but also added to its natural gas portfolio with the purchase ofCalgary-based TriGas Exploration, adding 30 MMcf/d of strategic gasreserves.

“We’ve set a target to have equity gas of about 25% of what weconsume,” Cartwright said. “We’re doing this as a means ofincreasing our net income. We have been very successful inproducing gas at substantially below market indexes. We willcontinue to look to expand our ownership in the whole value chainin gas.”

In response to questions about making bigger gas acquisitions,Cartwright said that Calpine now has the “financial resources toacquire larger positions” in natural gas, but he said that thecompany will continue to look for gas properties in which they canreduce the production costs to the advantage of their power plantswith lower-than-market-based energy supplies.

Calpine’s current development of new power plants was summarizedas 24 plants now under construction totaling 13,400 MW, and another24 plants announced totaling another 14,200 MW in 2000. Five plantstotaling 1,500 MW started operating in 2000 in New England, Texasand the Midwest.

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