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Calpine Acquires Bechtel's Fifty Percent Interest In Calpine/bechtel Joint Development Energy Center Projects

San Jose, CA - November 6, 2001 Calpine Corporation [NYSE:CPN], the nation’s leading independent power company, announced that it has completed a transaction with San Francisco-based Bechtel Enterprises Holdings, Inc., and has acquired Bechtel’s fifty percent interest in the Calpine/Bechtel Joint Development energy center projects. With this transaction, Calpine has acquired Bechtel’s development rights, equipment and assets for all of the joint development projects. Total consideration for the transaction included a cash payment of approximately $154 million and the assumption of approximately $141 million of debt. As a result of this transaction, Calpine will add more than 1,000 megawatts of capacity to its San Francisco Bay Area portfolio, which now includes approximately 2,900 megawatts of modern, natural gas-fired capacity in operation, under construction and in advanced development.

“This agreement strengthens Calpine’s commitment to California and further advances our $6 billion development and construction program in California. Calpine intends to have 12,000 megawatts of clean, efficient generating capacity on line in the California market within the next five years," said Calpine’s Vice President of Finance and Development Rick Thomas. “Today, our California portfolio includes approximately 9,800 megawatts of natural gas-fired and geothermal facilities in operation, under construction and in announced development.”

“In addition, this strategic acquisition enables Calpine to add value at every level of a project’s life—from design, engineering and construction management—through finance, fuel supply, operations and power marketing. It also gives us the ability to operate these facilities as an integrated system. By owning a 100% interest in these plants and operating them as part of Calpine’s portfolio system, we can further enhance plant performance, lower costs and add value for our shareholders and customers,” added Thomas.

With this acquisition, Calpine has added to its California portfolio Bechtel’s 50% interest in the following projects:

The Delta Energy Center is an 880-megawatt natural gas-fired plant currently under construction in Pittsburg, Calif. This modern, fuel efficient facility will help stem supply shortfalls in the greater San Francisco Bay Area. Delta is expected to enter operations in the spring of 2002.

The Metcalf Energy Center is a 600-megawatt natural gas-fired center, recently licensed in San Jose, Calif. This project is expected be in operation by the end of 2003. Metcalf is designed to serve the greater Silicon Valley area, which is considered the most electrically vulnerable region in California.

The Russell City Energy Center is a 600-megawatt natural gas-fired center under development in Hayward, Calif. The Russell City Energy Center will also play a vital role in repowering the Bay Area’s antiquated generating infrastructure. The project is currently before the California Energy Commission for licensing. If approved, Calpine expects this facility to begin energy deliveries in time for the summer of 2004.

“We are pleased to have been part of an effort that will bring more than 2,000 megawatts of clean, modern power generation to the Bay Area in record time,” said Doug Brown, Bechtel Enterprises’ vice president and manager of power development. “And we intend to continue to play an active role in the California power generation market, by investing in the state’s energy infrastructure, and helping them meet their growing energy and fuel supply needs.”

Bechtel Enterprises Holdings, Inc. is the development, financing and ownership affiliate of the Bechtel organization, a global engineering and construction firm. Bechtel has been at the center of energy development since the 1940’s, having built more than 450 power stations with a total generating capacity exceeding 250,000 megawatts. Through its power development affiliate, InterGen, and its own portfolio, Bechtel Enterprises has more than 17,600 megawatts of energy capacity in operation, under construction, or in advanced development around the world.

Based in San Jose, Calif., Calpine Corporation is dedicated to providing customers with reliable and competitively priced electricity. Calpine is focused on clean, efficient, natural gas-fired generation and is the world’s largest producer of renewable geothermal energy. Calpine has launched the largest power development program in North America. To date, the company has approximately 37,700 megawatts of base load capacity and 8,000 megawatts of peaking capacity in operation, under construction and in announced development in 29 states, the United Kingdom and Canada. The company was founded in 1984 and is publicly traded on the New York Stock Exchange under the symbol CPN. For more information about Calpine, visit its Website at www.calpine.com.