Texas’ power generation capacity continues to grow with two newmerchant plants, one just coming on line and one announced foroperation in 1999. California-based Calpine Corp. said its 240 MWgas-fired Pasadena 1 Power Plant began producing power for thederegulated Texas wholesale market, just in time to help meet peaksummer power demand. The plant, under construction since 1997, cameon-line three months ahead of schedule and about $21 million underbudget. The $131 million power plant is selling power under short-,mid- and long-term contracts and into the open market. Pasadena 1will generate up to 240 MW.

West Texas Utilities, a Central and South West Corp. operatingcompany, is buying 50 MW of capacity through the end of 1998. InSeptember, Pasadena 1 will begin providing 90 MW of electricity and200,000 pounds/hour of steam to Calpine’s anchor tenant, thePhillips Petroleum Houston Chemical Complex. Calpine is sellingpower to the open market and under short-, mid- and long-termcontracts. Texas Utilities Electric Co. will also participate inthe Pasadena 1 power marketing program, purchasing up to 150 MW ofelectricity under a two-year agreement beginning Dec. 1, 1999.

CSW Energy Inc., a subsidiary of Central and South West Corp.,plans to begin construction next month of a 500 MW merchant plantin the Rio Grande Valley of Texas. The gas-fired, combined-cyclefacility is to be on line by the end of 1999. Additionally, part ofthe facility, two 170 MW gas turbines, will begin partial operationby summer 1999. Cost is expected to be $200 million. The project,known as Frontera, will be near the city of Mission in HidalgoCounty.

“The Rio Grande Valley has seen rapid growth over the last fewyears and is expected to need more power to meet its requirements,”said Terry Dennis, CSWE CEO. “Although announcements of other powerplant projects recently have been made to address this shortage,CSWE’s Frontera project is the only one with the potential to beginoperation by the 1999 summer peak season. By locating the FronteraProject in the Valley, we expect to improve the reliability of theValley’s electric system and be able to supply customers throughoutthe state.”

Frontera will be CSWE’s third merchant plant in Texas. In April,CSWE dedicated the Sweeny Cogeneration Facility, Brazoria County.The 330 MW plant provides 90 MW of electricity to PhillipsPetroleum Company’s nearby refining and petrochemicals complex andoffers the remainder of its capacity to electric utilities andpower marketers on a merchant basis. The Newgulf Project, nearBoling, Texas, which began commercial operation in 1997, is thestate’s first exempt wholesale generator, intended to takeadvantage of power market fluctuations. The plant is generating 85MW.

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