Calpine Corporation Enters Alabama Electric Power Market; Company Announces Plans for 700-Megawatt Energy Center at Solutia Inc. Decatur, Alabama Chemical Plant.

Business Editors

SAN JOSE, Calif.--(BUSINESS WIRE)--Feb. 2, 2000

Calpine Corporation (NYSE:CPN), one of the nation's fastest growing power companies, today announced plans to build, own and operate a 700-megawatt natural gas-fired cogeneration power plant at Solutia Inc.'s Decatur, Ala. chemical facility. The proposed Decatur Energy Center will generate approximately 700 megawatts of clean, competitively priced electricity for Solutia's industrial processing and for Alabama's growing power market. Permitting for the $350 million facility will begin immediately, with construction scheduled to start in mid 2000. Energy deliveries are slated to begin in summer 2002.

Under terms of a 20-year agreement, Solutia will lease a portion of the facility to meet its electricity needs and purchase its steam requirements from Calpine. Excess power from the facility will be sold into the Southeastern U.S. wholesale power market under a variety of short-, mid-, and long-term contracts.

&uot;In today's competitive power industry, world-class chemical producers like Solutia demand the highest quality product at competitive prices,&uot; said Diana Naylor, Calpine's senior vice president. &uot;We appreciate Solutia's confidence in Calpine's ability to reliably and cost-effectively meet their long-term energy needs.&uot;

Calpine will manage all aspects of project development for the Decatur Energy Center, including engineering and design, construction, fuel supply and power marketing. In addition, Calpine will build a new intrastate natural gas pipeline to fuel the new plant. This full-service approach enables Calpine to lower costs, control quality and make project enhancements throughout the development process.

To achieve maximum fuel efficiency, Calpine will incorporate three Siemens Westinghouse state-of-the-art 501F combustion turbines, and will utilize advanced emission control technology to dramatically lower emissions compared to the average natural gas-fired utility plant.

&uot;The Decatur Energy Center will be one of the most fuel efficient and environmentally responsible power plants to be built in the United States,&uot; said Naylor. &uot;Customers and the environment win.&uot;

About Calpine

Based in San Jose, Calif., Calpine Corporation is a leading independent power company dedicated to providing customers with reliable and competitively priced electricity. Calpine currently has interests in approximately 14,000 megawatts of capacity in operation, under construction or in announced development in 18 states -- enough energy to power over 13 million households. Calpine has headquarters in San Jose, Calif., with regional offices in Houston, Texas; Pleasanton, Calif.; and Boston, Mass. The company was founded in 1984 and is publicly traded on the New York Stock Exchange under the symbol CPN. To learn more about Calpine, visit its website at www.calpine.com.

This news release discusses certain matters that may be considered &uot;forward-looking&uot; statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the intent, belief or current expectations of Calpine Corporation (&uot;the Company&uot;) and its management. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties that could materially affect actual results such as, but not limited to,(i) changes in government regulations and anticipated deregulation of the electric energy industry; (ii) commercial operations of new plants that may be delayed or prevented because of various development and construction risks, such as a failure to obtain financing and the necessary permits to operate or the failure of third-party contractors to perform their contractual obligations (iii) cost estimates are preliminary and actual cost may be higher than estimated, (iv) the assurance that the Company will develop additional plants, (v) a competitor's development of a lower-cost generating gas-fired power plant or (vi) the risks associated with marketing and selling power from power plants in the newly competitive energy market. Prospective investors are also referred to the other risks identified from time to time in the Company's reports and registration statements filed with the Securities and Exchange Commission.