Aquila Terminates Acadia Tolling Agreement; Aquila Continues to Deliver on its Restructuring Plan.

Energy Editors/Business Editors

KANSAS CITY, Mo.--(BUSINESS WIRE)--May 13, 2003

Continuing to execute on its plan to return the company to its core utility businesses, Aquila, Inc. (NYSE:ILA) today announced it has terminated its 20-year tolling agreement with Acadia Power Partners, LLC.

Under the toll, Aquila supplied the natural gas to a combined cycle power plant in Eunice, La., and paid fixed capacity payments for the right to sell into the wholesale market 580 megawatts of power generated by the plant. Acadia Power Partners is a joint venture between Calpine Corporation (NYSE:CPN) and Cleco Corporation (NYSE:CNL).

Under the termination agreement, Aquila paid Acadia $105.5 million to release Aquila from all of its obligations under the toll. The transaction returned to Aquila $45 million in posted collateral and eliminates $843 million in payments due to Acadia over the remainder of the 20-year term. Aquila entered into the contract with Acadia in 2000.

"Removing these obligations not only strengthens our balance sheet, but, more significantly, moves us closer to completing our exit from the energy merchant business," said Keith Stamm, Aquila's chief operating officer.

"As we have indicated in previous filings with the Securities and Exchange Commission, restructuring our tolling contracts is critical to the long-term success of the company. We will continue to work with our other major counter-parties to implement mutually beneficial workout transactions."

Nearly a year ago Aquila announced that it would exit the energy marketing and trading business and focus on its core natural gas and electric utility businesses. Since then the company has reduced its payroll by about 1,800 employees and sold assets for more than $1.7 billion.

Based in Kansas City, Mo., Aquila operates electricity and natural gas distribution networks serving customers in seven states and in Canada, the United Kingdom and Australia. The company also owns and operates power generation assets. More information is available at www.aquila.com.