Aquila Energy Teams With Calpine Corp. On Missouri Power Plant Ownership.

Business Editors

KANSAS CITY, Mo.--(BUSINESS WIRE)--Jan. 14, 2000

Aquila Energy, a wholly-owned subsidiary of UtiliCorp United (NYSE: UCU), has sold to San Jose-based Calpine Corporation (NYSE:CPN) a 50 percent interest in its 600-megawatt, natural gas-fired, combined-cycle Aries power plant now under construction in Pleasant Hill, Missouri.

Under the agreement Merchant Energy Partners, an Aquila subsidiary, will manage the fuel supply for the plant as well as all the power produced by the plant. Calpine will oversee construction of and operate and maintain the plant.

"Teaming with Calpine represents an opportunity to develop a strong working relationship with one of the leading power plant builders and operators in the country," says V. J. Horgan, president of Merchant Energy Partners. "It also represents an opportunity to move forward with our strategy to expand our power plant portfolio."

Aquila has an investment in 16 power plants in seven states and Jamaica having a total capacity of approximately 2,200 megawatts, and Aquila's share is approximately 825 megawatts of this total capacity.

The Aries plant will occupy 25 acres on a 67-acre site near Pleasant Hill, some 20 miles southeast of Kansas City. The plant will be fueled by natural gas and will consist of two combustion turbines, two heat recovery steam boilers, and a steam turbine. Water and air emissions are expected to be among the lowest in the industry. The designer and builder of the plant is Black & Veatch, a Kansas City-based firm that is a world leader in power plant design and construction.

"Economic growth in the Midwest, including Missouri, has resulted in a need for more power supplies, which this plant will help satisfy," Horgan said.

Last year MEP won a four-year, competitively-bid contract to supply power to Missouri Public Service, a division of UtiliCorp United which serves more than 180,000 customers in western Missouri.

Aquila Energy is the second largest wholesaler of natural gas and third largest wholesaler of power in North America. Aquila also provides wholesale energy services in the U.K. and in 1999 established a presence in Scandinavia, Germany and Spain.

Aquila's parent, UtiliCorp United, is based in Kansas City and is an international energy company with about 4.5 million customers across the U.S. and in Canada, Great Britain, New Zealand and Australia. At September 30, 1999, UtiliCorp had $8.5 billion in assets and 12-month sales of $17.5 billion.