Calpine Power Income Fund Announces Unaudited Operational Results, Distributable Cash for 2005 and Cash Distributions for February 2006.CALGARY Calgary (kăl`gərē), city (1991 pop. 710,677), S Alta., Canada, at the confluence of the Bow and Elbow rivers. The largest city in Alberta and the fastest-growing major city in Canada, Calgary is a corporate, transportation, and financial , Alberta Alberta (ălbûr`tə), province (2001 pop. 2,974,807), 255,285 sq mi (661,188 sq km), including 6,485 sq mi (16,796 sq km) of water surface, W Canada. -- Calpine
TSX Transfer from Stack Pointer to Index TSX True Space Extension :CF.UN) today announced its unaudited operating results and distributable cash ("Distributable Cash") for the year ended December December: see month. 31, 2005. In 2005, Calpine Power Income Fund (the "Fund") reported Distributable Cash of $60.6 million ($0.9816 per Trust Unit), an increase of 7.6% from $56.3 million ($0.9620 per Trust Unit) in 2004. Calpine Power, L.P. (the "Partnership"), of which the Fund owns a 70% priority interest, reported Distributable Cash of $73.9 million in 2005 compared to $75.5 million in 2004. In 2005, Class A Priority Unit distributions from the Partnership to the Fund increased by 1% to $0.0798 per unit per month from $0.079 per unit per month in 2004. The annual financial statement audit is proceeding as planned; any adjustments which may result will be updated in the audited financial statements. In addition, Calpine Power Income Fund today announced that the cash distribution for the month of February February: see month. 2006 will be $0.0818 per trust unit, consistent with the cash distribution for January January: see month. 2006.
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Ex-Distribution Distribution Distribution
Record Date Date Date per Unit
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February 28, 2006 February 24, 2006 March 20, 2006 $0.0818
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The above reflects distributions expected to be paid, however,
distributions are subject to change based upon actual conditions.
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"I am pleased to report that in 2005 the Calpine Power Income Fund again delivered strong operational results, enabling the Fund to meet all expected distributions to its unitholders in 2005", said Toby Austin Austin. 1 City (1990 pop. 21,907), seat of Mower co., SE Minn., on the Cedar River, near the Iowa line; inc. 1868. The commercial and industrial center of a rich farm region, it is noted as home to the Hormel meatpacking company, whose Spam Town museum , President and Chief Executive Officer of Calpine Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of Power Ltd. (the "Manager"), manager of the Fund. "With respect to the February 2006 cash distribution, Management and the Trustees have decided to maintain the distribution at current levels and will continue to assess the financial position of the Fund to determine the future level of cash distributions." "During 2005, all of our plants performed extremely well, operating at very high levels of availability and generating sufficient cash flow to meet the Fund's distribution expectations. Operational cash flow benefited from a full year of increased capacity at the Partnership's Island Cogen facility, more than offsetting the non-payment non-payment Noun failure to pay money owed non-payment n → Nichtzahlung f, Zahlungsverweigerung f non-payment n of December 1st to December 20th tolling revenue from the Calgary Energy Centre arising from the voluntary reorganization filing by Calpine Corporation ("Calpine") and certain of its subsidiaries on December 20th. Post filing tolling revenues from December 21st to January 16th, the date of repudiation See non-repudiation. of the tolling agreement by Calpine Energy Services Canada Partnership ("CESCP"), were received on February 15, 2006." "Despite this setback setback In architecture, a steplike recession in the profile of a high-rise building. Usually dictated by building codes to allow sunlight to reach streets and lower floors, the building must take another step back from the street for every specified added height interval. , both the Fund and the Partnership exited 2005 in strong cash positions minimizing the impact on distributions in January and February of 2006. We are pleased with our success in establishing a short term tolling agreement with Epcor See Equal percentage contribution rule. Merchant and Capital L.P. until the end of June June: see month. and look forward to reporting on our efforts to secure a long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. tolling arrangement for the facility." The summary operating results and Distributable Cash information presented are unaudited and do not constitute the complete consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge of the Fund or Partnership. The following discussion and analysis as provided by the Manager is based on information to February 16, 2006 and should be read in conjunction with all previously released unaudited quarterly consolidated financial statements and the notes thereto there·to adv. 1. To that, this, or it. 2. Archaic In addition to that; furthermore. thereto Adverb Formal 1. to that or it 2. of the Fund and the Partnership for the quarters ended March 31, June 30, and September September: see month. 30, 2005 and 2004, which have been prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . All dollar amounts are shown in thousands of Canadian dollars Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents unless otherwise specified. Additional information concerning the Fund is available at www.calpinepif.com or on SEDAR SEDAR System for Electronic Document Analysis and Retrieval SEDAR Southeast Data, Assessment, and Review at www.sedar.com. 2005 HIGHLIGHTS - The Fund declared distributions of $0.9816 per Trust Unit to Unitholders during 2005 compared to $0.9620 per Trust Unit in 2004. - The Fund's power generation facilities continued to produce strong and reliable operating results in 2005 as demonstrated below.
Availability Generation (MWh)
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2005 2004 2005 2004
------- ------ ---------- -----------
Calgary Energy Centre 98% 92% 318,594 858,662
Island Cogeneration Facility 97% 84% 2,042,824 1,628,402
Whitby Cogeneration Facility 96% 96% 337,281 368,172
King City Facility(1) 86% 98% 794,591 596,254
(1) Acquired May 19, 2004 - availability and generation factors are
from date of acquisition only.
At December 31, 2005, the Fund had 61,742,288 Trust Units outstanding, none of which are held by Calpine and trade on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. . SIGNIFICANT EVENTS Calpine Credit Event On December 20, 2005 Calpine and certain subsidiaries and affiliates filed for voluntary reorganization under Chapter 11 of the US Bankruptcy Code Bankruptcy Code may refer to:
CCAA China Center of Adoption Affairs CCAA Companies' Creditors Arrangement Act (Canada) CCAA California Collegiate Athletic Association CCAA Commercial Collection Agency Association ") in Canada. The Manager and CESCP are among the Canadian subsidiaries of Calpine that filed under CCAA. The Manager manages and administers both the Fund and Partnership. As well, through the Fund's subsidiary, Calpine Commercial Trust ("CCT CCT Circuit CCT Commission Canadienne du Tourisme (Canadian Tourism Commission) CCT Correlated Color Temperature CCT Common Customs Tariff (EU) CCT Certificate of Completion of Training "), the Fund has made a six year term loan to the Manager in May 2004, with interest at 13% per annum Per annum Yearly. due ("the Manager Loan"). The Manager Loan is a full recourse Full recourse No matter what risk event occurs, the borrower or its guarantors guarantee to repay the debt. This is not a project financing unless the borrower's sole asset is the project. obligation of the Manager and is secured by a pledge of the Manager's limited partnership interest in the Partnership, including the Manager's right to receive distributions under its ownership of Class B Subordinated Units of the Partnership. In addition, Calpine King City Cogen LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control (the "Lessee One who rents real property or Personal Property from another. A lessee of land is a tenant. Cross-references Landlord and Tenant. lessee n. the person renting property under a written lease from the owner (lessor). "), a subsidiary of Calpine, which leases the King City cogeneration cogeneration In power systems, use of steam for both power generation and heating. High-temperature, high-pressure steam from a boiler and superheater first passes through a turbine to produce power. facility (the "King City Facility"), provided the Fund with a limited recourse Limited recourse A term describing a type of loan in which the lender has limited or no claim against the parent company if the collateral is insufficient to repay the debt. See:Nonrecourse. guarantee of the Manager's obligations under the Manager Loan and granted the Fund a security interest in its distributable cash flow held in a bank account in connection with the project financing Project financing A form of asset-based financing in which a firm finances a discrete set of assets on a stand-alone basis. of the King City Facility. CESCP was the counterparty Counterparty The other participant, including intermediaries, in a swap or contract. to a tolling agreement with the Partnership whereby the Calgary Energy Centre earned revenue through monthly payments from CESCP in exchange for providing the full operating capacity of the plant (the "Tolling Agreement"). CESCP did not make its December 2005 toll payment as required by the Tolling Agreement and on January 16, 2006 advised that it had repudiated the Tolling Agreement. On February 15, 2006, CESCP paid tolling revenues to the Partnership applicable to the period from the date of filing for CCAA protection to the date of repudiation. The Partnership has entered into a short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. tolling arrangement with Epcor Merchant and Capital L.P. which will provide tolling revenue until June 30, 2006. The Partnership and the Manager have commenced a process to re-market the generation capacity of the Calgary Energy Centre on a long-term basis. The Partnership is determining damages to seek that resulted from the non-performance and repudiation by CESCP. Two other subsidiaries of Calpine that are central to the Fund were not named in the reorganization proceedings. These were the Lessee, which leases the King City Facility from a subsidiary of the Fund (the "Lessor One who rents real property or Personal Property to another. A lessor of land is a landlord. Cross-references Landlord and Tenant. lessor n. the owner of real property who rents it to a lessee pursuant to a written lease. ") pursuant to a long term lease (the "Lease"), and Calpine Canada Whitby Whitby, town (1991 pop. 61,281), SE Ont., Canada, NE of Toronto, on Lake Ontario. It has a good harbor. The town's manufactures include tires and electronic equipment. Holdings Company ("CCWHC CCWHC Canadian Cooperative Wildlife Health Centre ") which owns a 50% interest in the Whitby power plant in Ontario Ontario, city, United States Ontario, city (1990 pop. 133,179), San Bernardino co., S Calif., near Los Angeles, in a region of vineyards; inc. 1891. and is the counterparty to a participating loan held by the Partnership ("the Whitby Loan"). The Chapter 11 proceedings Chapter 11 Proceedings Provisions of the Bankruptcy Reform Act under which the debtor firm is reorganized by a court because the estimated value of the reorganized firm exceeds the expected proceeds from its liquidation. initiated by Calpine could have resulted in an event of default occurring under the Lease and the Lessor's non-recourse loan agreement totaling US $82.0 million in place relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the King City Facility (the "King City Loan"). To remedy and prevent default under the King City Loan, cash or a letter of credit for US $20 million ("Acceptable Credit Assurance") needed to be provided to the Lender of the King City Loan. On January 19, 2006, all parties reached an agreement whereby the Lessee agreed to cause approximately US $11.7 million of its cash flow to be held in a depositary DEPOSITARY, contracts. He with whom a deposit is confided or made. 2. It is, the essence of the contract of deposits that it should be gratuitous on the part 'of the depositary. 9 M. R. 470. account as Acceptable Credit Assurance and applied as needed as needed prn. See prn order. to make specified payments to the Lender. The Lessee also agreed that future cash flows would be added to this depositary account until the aggregate deposits total US $20 million. The Lender agreed that these Lessee commitments would satisfy the Acceptable Credit Assurance obligation and avoid any event of default on the Lease and the King City Loan. Should the Lessee fail to perform its obligations in connection with the provision of such Acceptable Credit Assurance, the Lessor shall have a remedy period to deliver Acceptable Credit Assurance. While this press release and financial information as of February 16, 2006 considers the Chapter 11 and CCAA proceedings to date, additional events or activities could arise that may impact the operations and financial position of the Fund and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. the Partnership, and such matters will be considered and reported as they arise.
CALPINE POWER INCOME FUND
Year ended Year ended
December 31, 2005 December 31, 2004
Distributable Cash (unaudited) (unaudited)
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Cash distributions received
from Calpine Power, L.P. $ 52,408 $ 54,692
Lease receipts - 16,392
Interest and other income 6,210 4,681
Interest paid on long-term debt - (8,236)
Interest expense (603) (761)
Management and administration (3,660) (3,096)
Other 120 98
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$ 54,475 $ 63,770
Add (Deduct):
Change in working capital
and management reserves 872 (2,982)
Financing costs - (71)
Payment of principal on
long term debt - (2,770)
Principal repayment on loan
to Calpine Canada Power Ltd. 10,686 8,014
Levelization reserve (5,427) (9,643)
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DISTRIBUTABLE CASH (1) $ 60,606 $ 56,318
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Weighted average number of
Trust Units outstanding 61,742,288 58,042,861
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Distributable Cash per
Trust Unit $ 0.9816 $ 0.9620
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(1) Distributable Cash is not a measure under Canadian generally
accepted accounting principles and there is no standardized
measure of Distributable Cash. Distributable Cash, as presented,
may not be comparable to similar measures presented by other
issuers. Distributable Cash cannot be assured and may vary.
The amount of Distributable Cash of the Fund to be distributed monthly to Unitholders is, as defined in the Fund Trust Indenture An agreement declaring the benefits and obligations of two or more parties, often applicable in the context of Bankruptcy and bond trading. The term indenture primarily describes secured contracts and has several applications in U.S. law. , based generally on the amount by which the Fund's cash on hand exceeds: (i) administration expenses of the Fund; (ii) amounts required for the business and operations (including fees payable to the Manager under the Administration and Management Agreements); and (iii) any cash reserve which the Trustees or the Manager determines is necessary to satisfy the Fund's current and anticipated obligations. The Fund pays monthly cash distributions to Unitholders on or about the 20th day of each month following the record date, which is the last business day of the preceding month. Distributable Cash of the Fund totaled $60.6 million or $0.9816 per Trust Unit for the year ended December 31, 2005 compared to $56.3 million or $0.9620 per unit in 2004. The Fund, through its indirect 70% ownership of the Partnership, received $0.0798 of Distributable Cash per Class A Priority Unit per month (in addition to a special distribution equal to certain management and administrative expenses incurred directly by the Fund) for the year ended December 31, 2005 up from $0.079 per month in 2004. The 2005 King City Lease payment of $19.5 million was received on January 3, 2006 and in combination with restricted cash of $4.1 million, was used to fund principal payments of $11.7 million and interest payments of $11.9 million on the King City Loan on January 3, 2006. Interest and other income relates to interest, net of amortization of the discount, on the Manager Loan, interest earned on the loan to the Partnership and interest earned on other cash balances held. The increase over the prior year is due to a full year of interest earned in 2005 as the Manager Loan originated in May 2004 offset by the impact on interest earned of a lower outstanding loan balance as a result of scheduled principal repayments. As of January 31, 2006, all scheduled payments on the Manager Loan have been received. Interest expense relates to standby standby Medtalk adjective Referring to the immediate availability of a certain specialist–anesthesiologist, surgeon, who can be deployed in a medical emergency. Cf Concurrent. charges and interest on the outstanding balance of the CCT Credit Facility ("Credit Facility"). The amount outstanding under this Credit Facility was $8.0 million at the end of 2004. In 2005, the Fund has repaid all $8.0 million and as a result has incurred lower interest in the year. After removing the effect of a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. recovery of $0.5 million in 2004 in respect of the 2003 management incentive payment to the Manager, management and administration expenses increased in 2005 mainly due to additional legal and advisory costs incurred as a result of the Calpine Canadian and US restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). proceedings. Levelization Reserve In 2004 in connection with the King City transaction, the Fund established a Distribution Levelization Reserve ("the Levelization Reserve"), the purpose of which is to levelize, over the long-term, the distributions paid by the Fund to Unitholders to enable the Fund to provide a level cash stream to the Unitholders. In 2005, an additional $5.4 million was contributed to the reserve, bringing total undistributed Adj. 1. undistributed - (of investments) not distributed among a variety of securities undiversified - not diversified cash at December 31, 2005 to $15.1 million. The CCT Trustees intend to annually increase or decrease this reserve with long-term consideration given to the expected cash generated by the Fund and future distribution requirements to Unitholders. However, the CCT Trustees are subject to no mandatory requirements with respect to the timing or manner of utilization of the Levelization Reserve, which is within their discretion.
Levelization Reserve (unaudited)
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Balance at May 19, 2004 $ -
Contributions 9,605
Income reinvested 38
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Balance at December 31, 2004 $ 9,643
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Contributions 5,143
Income reinvested 285
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Balance at December 31, 2005 $ 15,071
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As at December 31, 2005 and December 31, 2004, the Levelization
Reserve had been invested as follows:
Year ended Year ended
December 31, 2005 December 31, 2004
(unaudited) (unaudited)
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Guaranteed investment
certificates ("GIC")
and cash $ 15,071 $ 5,643
Loan to Calpine Power L.P. - 4,000
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Total Levelization Reserve $ 15,071 $ 9,643
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Working Capital The working capital amount of $3.0 million in 2004 includes accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. costs relating to the review of the Deer Park Deer Park. 1 Uninc. village (1990 pop. 28,840), Babylon town, Suffolk co., SE N.Y., a primarily residential suburb on Long Island. 2 City (1990 pop. 27,652), Harris co., SE Tex. acquisition opportunity. Tax Treatment of Distributions For Canadian tax purposes, the taxable amounts of distributions to the Fund's Unitholders is estimated to be approximately 20% for 2005. The remaining amount of the distributions reduce the adjusted cost base of the Trust Units, thereby providing a significant tax deferral tax deferral The delay of a tax liability until a future date. For example, an IRA may result in a tax deferral on the amount contributed to the IRA and on any income earned on funds in the IRA until withdrawals are made. for the Unitholders. The tax deferral arises primarily due to the ability of the Partnership to shelter its taxable income Under the federal tax law, gross income reduced by adjustments and allowable deductions. It is the income against which tax rates are applied to compute an individual or entity's tax liability. The essence of taxable income is the accrual of some gain, profit, or benefit to a taxpayer. with capital cost allowance claims on the Facilities. As a result, in 2005, approximately 80% of the distributions to Unitholders were a return of capital rather than an allocation The apportionment or designation of an item for a specific purpose or to a particular place. In the law of trusts, the allocation of cash dividends earned by a stock that makes up the principal of a trust for a beneficiary usually means that the dividends will be treated as of income. In 2004, the taxable amount was 20%. The Manager anticipates that a higher proportion of cash distributions made by the Fund in the future will be included in the income of the Unitholders for income tax purposes. Further Fund acquisitions could serve to increase or reduce the tax-deferred tax-de·ferred adj. 1. Of or relating to an investment that is not liable to taxation until income is withdrawn or an appointed date is reached. 2. component of distributions. The Fund recommends that Unitholders consult their tax advisors A tax advisor is a financial expert especially trained in tax law. Some countries require tax advisors to verify the balance sheets of companies above a certain size. Individuals usually require tax advisors to minimize taxation, to avoid learning the details of tax law in regarding the tax implications of their investment in Trust Units.
Cash Balances
Year ended Year ended
December 31, 2005 December 31, 2004
(unaudited) (audited)
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Cash and cash equivalents $ 1,726 $ 2,495
Restricted cash, current portion 5,597 4,490
Restricted cash, less current portion - 1,114
Levelization Reserve held
in cash and GICs 15,071 5,643
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Total cash and cash equivalents $ 22,394 $ 13,742
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Cash balances in the Fund have increased 63% over the prior year. The cash balance in the Levelization Reserve has increased by $9.4 million, due to the collection of the loan to the Partnership in December 2005 in combination with cash generated in excess of distribution requirements. The US dollar denominated restricted cash balance is held by the Lessor and has remained unchanged from the prior year and will be used to make interest and principal payments on the King City Loan in 2006.
CALPINE POWER, L.P.
Year ended Year ended
December 31, 2005 December 31, 2004
Distributable Cash (unaudited) (unaudited)
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Island Facility net earnings $ 36,308 $ 25,472
Calgary Energy Centre net earnings 34,438 35,450
Interest income - Whitby 3,337 3,393
Add back depreciation & accretion 21,920 20,774
Other 195 (287)
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$ 96,198 $ 84,802
Add (Deduct):
Capital expenditures (193) (22,145)
Maintenance reserve increase (6,330) (1,636)
Loan payable (11,993) 11,993
Change in working capital
and management reserves (3,813) 2,456
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DISTRIBUTABLE CASH (1) $ 73,869 $ 75,470
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Allocation of Distributable Cash
Class A Priority Units $ 53,039 $ 53,819
Class B Subordinated Units 20,830 21,651
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$ 73,869 $ 75,470
------------------ ------------------
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Per Unit allocation of
Distributable Cash
Class A Priority Units $ 1.0200 $ 1.0350
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Class B Subordinated Units $ 0.9347 $ 0.9715
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(1) Distributable Cash is not a measure under Canadian generally
accepted accounting principles and there is no standardized
measure of Distributable Cash. Distributable Cash, as presented,
may not be comparable to similar measures presented by other
issuers. Distributable Cash cannot be assured and may vary.
The amount of Distributable Cash, as defined in the Calpine Power, L.P. Partnership Agreement, is to be distributed monthly and is based generally on the amount by which the Partnership's cash on hand exceeds: (i) management and administration expenses of the Partnership; (ii) amounts required for the business and operations of the Partnership and its Facilities (including expenses payable to the Manager under the operating and maintenance agreements); and (iii) any cash reserve which the Manager determines is necessary to satisfy the Partnership's current and anticipated obligations, including an annual reserve for the average estimated major maintenance expenditures. The Partnership distributes Distributable Cash of the Partnership in respect of each month to the partners of record on the last day of each month based on the priority rights of the Partnership units. Payments are made on or about the 20th day after each record date. The base distribution per Class A Priority Unit and Class B Subordinated Unit increases annually by 1%. The Partnership makes monthly cash distributions to both the Class A Priority Unitholders and Class B Subordinated Unitholders. The Fund, as the holder of Class A Priority Units in the Partnership, must be paid its base distribution before the Manager receives distributions on its Class B Subordinated Units. In addition, the Partnership makes a special distribution to the Class A Priority Unitholders equivalent to the amount of certain general and administrative expenses of the Fund. The Class B Subordinated Units represent a 30% economic interest in the Island Facility, the Calgary Energy Centre and the Whitby Loan and their entitlement An individual's right to receive a value or benefit provided by law. Commonly recognized entitlements are benefits, such as those provided by Social Security or Workers' Compensation. to distributions is subordinated to that of Class A Priority Unitholders until 2022. In light of the Manager's reorganization proceedings, distributions on the Class B Subordinated Units for December of 2005 were reduced to match the required principal and interest payment on the Manager Loan for January 2006.
Island Cogeneration Facility
Selected Annual Information Year ended Year ended
December 31, 2005 December 31, 2004
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Availability 97% 84%
Electricity generated (MWh) 2,042,824 1,628,402
Steam generated (GJ) 1,645,840 1,635,422
Summary of Financial Results (unaudited) (audited)
Revenues $ 59,101 $ 47,166
Operating and maintenance expense (9,884) (9,588)
Depreciation and accretion (12,320) (11,864)
Interest expense (589) (242)
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Net earnings $ 36,308 $ 25,472
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The Island Facility is a 240 MW combined cycle A combined cycle is characteristic of a power producing engine or plant that employs more than one thermodynamic cycle. Heat engines are only able to use a portion of the energy their fuel generates (usually less than 50%). The remaining heat from combustion is generally wasted. cogeneration plant located at Duncan Duncan, city (1990 pop. 21,732), seat of Stephens co., SW Okla., in an oil, farm, and cattle area; inc. 1892. There is an oil industry, and electronics, concrete, and apparel are manufactured. During the late 19th cent. Bay, near Campbell Campbell, city, United States Campbell, city (1990 pop. 36,048), Santa Clara co., W Calif., in the fertile Santa Clara valley; founded 1885, inc. 1952. River, on Vancouver Island Vancouver Island (1991 pop. 579,921), 12,408 sq mi (32,137 sq km), SW British Columbia, Canada, in the Pacific Ocean; largest island off W North America. It is c.285 mi (460 km) long and c. , British Columbia British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography . Power generation has increased 25% over 2004 due to increased capacity and availability of the plant relating to the capital upgrade completed in the second quarter of 2004. The upgrades improved output of the Island Facility by approximately 25 MW which was delivered to BC Hydro BC Hydro and Power Authority is one of the largest electric utilities in Canada, serving more than 1.7 million customers[2] in an area containing over 94 per cent of British Columbia's population is mandated to provide, "reliable power, at low cost, for generations. under the existing terms of the Electricity Purchase Agreement ("EPA EPA eicosapentaenoic acid. EPA abbr. eicosapentaenoic acid EPA, n.pr See acid, eicosapentaenoic. EPA, n. "). The total cost of the upgrades was $16.0 million, substantially as budgeted. All of the upgrade expenditures were financed through a loan from the Fund (the "Partnership Loan"). This loan was fully repaid in December 2005. Revenues Electricity generation revenue was $43.4 million for the year ended December 31, 2005, compared to $35.5 million for the year ended December 31, 2004. The increase in year over year performance is due to both the increased capacity of the plant from the capital upgrades and no planned outages occurring in 2005. Electricity revenue is net of any heat rate penalty payable to BC Hydro pursuant to the terms of the EPA. A heat rate penalty is payable when the annual heat rate of the Island Facility exceeds the heat rate guaranteed in the EPA and as a result BC Hydro incurs additional costs for gas. The amount of the penalty payable is a function of natural gas prices and the amount that the actual heat rate exceeds the guaranteed heat rate stated in the EPA. Heat rate penalties for the year ended December 31, 2005 totaled $7.1 million compared to $7.5 million in the year ended December 31, 2004. Pursuant to an agreement between the Partnership and Calpine, the Island Facility is indemnified by Calpine for annual heat rate penalties incurred over specified amounts. No amounts under this agreement were paid in 2005 (2004 - $0.2 million). Included in electricity generation revenue was $5.1 million of settlement revenue from Alstom Alstom (formerly GEC-Alsthom) (Euronext: ALO) is a large French multinational conglomerate whose businesses are power generation, railway signalling; and manufacturing trains (e.g. the TGV and Eurostar as well as Citadis trams) and the world's largest ships (e.g. Canada Inc. ("Alstom") for the year ended December 31, 2005, compared to $4.3 million in 2004. Pursuant to a settlement agreement reached in 2002 (the "Settlement Agreement") with Alstom related to performance guarantees set out under the Island Facility Construction Contract, Alstom agreed to pay certain amounts totaling $50.0 million to the Partnership over a ten year period because certain performance targets for the Island Facility were not met. The increased earnings in 2005 over 2004 is a direct result of the plant shutdown shut·down n. A cessation of operations or activity, as at a factory. shutdown Noun the closing of a factory, shop, or other business Verb shut down in 2004 during which time no settlement revenue was earned as the plant was not operational. At December 31, 2005, the remaining amount due from Alstom under the terms of the Settlement Agreement was $28.7 million (December 31, 2004 - $34.1 million) which will be earned over approximately the next five to seven years, based on the expected operations of the plant during that period. Remaining amounts owing under the Settlement Agreement, if any, will be payable upon termination of the maintenance agreement with Alstom, expected to be no later than April 2017. Performance of this obligation is secured by a letter of credit issued by a Canadian financial institution. Revenue from steam sold to Catalyst Paper Corporation Catalyst Paper Corporation was founded in 1946 as British Columbia Forest Products Limited. Its purpose was sawmilling and logging in the Canadian province of British Columbia. In 1987 BCFP was purchased by Fletcher Challenge, a company from New Zealand. ("Catalyst"), formerly known as Norske Skog Norske Skogindustrier ASA or Norske Skog, (OSE: NSG) which translates as Norwegian Forest Industries, is a Norwegian pulp and paper company based in Oslo, Norway and etablished in 1962. Canada Limited, was $15.7 million for the year ended December 31, 2005 compared to $11.6 million in 2004. As a result of the strengthening Canadian dollar as well as higher natural gas prices, the steam price has increased 37% in 2005 over 2004. Price increases in 2005 were the main increase in revenues as steam volumes in 2005 only increased slightly over 2004. Expenses Operating and maintenance expense attributable to the Island Facility was $9.9 million for the year ended December 31, 2005, compared to $9.6 million for 2004. The $0.3 million increase in operating and maintenance expense for the year is due to increased production from the facility. Depreciation expense attributable to the Island Facility was $12.3 million for the year ended December 31, 2005, compared to $11.8 million for 2004. Capital expenditures relating to the Island capital upgrade of $16.0 million, completed in the second quarter of 2004, are being depreciated Depreciated may refer to:
Interest expense for the year ended December 31, 2005 totaled $0.6 million related to the Partnership Loan. The Partnership Loan bore interest at the Fund's cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. plus 10 basis points and averaged 4.78% for the year ended December 31, 2005. The loan balance of $12.0 million at the beginning of 2005 was fully repaid by December of 2005.
Calgary Energy Centre
Selected Annual Information Year ended Year ended
December 31, 2005 December 31, 2004
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Availability 98% 92%
Electricity generated (MWh) 318,594 858,662
Summary of Financial Results (unaudited) (audited)
Revenues $ 52,972 $ 54,375
Operating and maintenance expense (8,934) (10,015)
Depreciation and accretion (9,600) (8,910)
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Net Earnings $ 34,438 $ 35,450
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The Calgary Energy Centre is a natural gas-fired gas-fired adj → de gas gas-fired adj → au gaz gas-fired adj (heater etc) → Gas- combined cycle plant located in Calgary, Alberta which commenced operations on March 31, 2003. The Calgary Energy Centre has a capacity of 300 MW, consisting of 250 MW of base capacity plus 50 MW of peaking capacity. Revenue was earned through both a fixed and variable charge payable by CESCP, a wholly-owned partnership of Calpine, under the terms of the tolling agreement, where the fixed charge component represented approximately 99% of the total revenue and was a function of plant availability. The Partnership collected all 2005 toll payments except for tolling revenue of $3.0 million relating to the period of December 1st to December 20th 2005 following the filing for CCAA protection by CESCP. Post-filing tolling revenue related to December 21st to January 16th, the date at which CESCP repudiated the contract, was received on February 15, 2006. On February 16, 2006 the Partnership announced that it had completed a short term toll of the generation capacity with Epcor Merchant and Capital L.P. until the end of June 2006 and is actively seeking to re-market the long term capacity of the facility. Annual availability for 2004 was slightly lower than expected due to a forced outage out·age n. 1. A quantity or portion of something lacking after delivery or storage. 2. A temporary suspension of operation, especially of electric power. in August 2004 caused by a combustion combustion, rapid chemical reaction of two or more substances with a characteristic liberation of heat and light; it is commonly called burning. The burning of a fuel (e.g., wood, coal, oil, or natural gas) in air is a familiar example of combustion. turbine turbine, rotary engine that uses a continuous stream of fluid (gas or liquid) to turn a shaft that can drive machinery. A water, or hydraulic, turbine is used to drive electric generators in hydroelectric power stations. hardware failure. The lost revenue during this outage was offset in part by a recovery pursuant to an availability guarantee set out in the Calgary Long Term Service Agreement ("LTSA LTSA Land Transport Safety Authority (New Zealand) LTSA Learning Technology Systems Architecture LTSA Long Term Service Agreement LTSA Long-Term Space Astrophysics LTSA Labeled Transition System Analyzer LTSA Linearly Tapered Slot Antenna ") with Siemens Westinghouse Siemens Power Generation, Inc (SPGI) is a power generation company based in the United States. Run by the German Siemens AG Corporation, Formerly Siemens Westinghouse, SPGI, was formed by the acquisition of the Westinghouse Electric Corporation by the Siemens power generation ("Siemens"). Revenues Electricity revenues at the Calgary Energy Centre were $53.0 million for the year ended December 31, 2005 compared to revenues for the year ended December 31, 2004 of $54.4 million. The decrease over the prior year is due to the non-payment of December 1st to December 20th 2005 revenue of $3.0 million. For 2005, the tolling revenue earned was above net revenue the plant would have earned had it been selling power to the merchant market. CESCP was entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: , under the Tolling Agreement, to dispatch A dispatch or dispatches can refer to:
Expenses Annual operating and maintenance expense attributable to the Calgary Energy Centre was $8.9 million for the year ended December 31, 2005, compared to $10.1 million for 2004. Major maintenance expenses related to the planned outage in the second quarter of 2004 accounts for the year over year decrease in operating and maintenance expenses in 2005. There were no major maintenance outages in 2005. Depreciation expense attributable to the Calgary Energy Centre was $9.6 million for the year ended December 31, 2005 compared to $8.8 million for 2004. The increase over the prior year is due to a reassessment Reassessment The process of re-determining the value of property or land for tax purposes. Notes: Property is usually reassessed on an annual basis. You may request a "reassessment" if you disagree with your assessment. of the useful life of certain spare parts Spare parts, also referred to as Service Parts is a term used to indicate extra parts available and in proximity to the mechanical item, such as a automobile, boat, engine, for which they might be used. Spare parts are also called “spares. in 2005 resulting in a shorter depreciable depreciable Of, relating to, or being a long-term tangible asset that is subject to depreciation. life. Maintenance Reserve The Partnership has established a maintenance reserve (the "Maintenance Reserve"), the purpose of which is to substantially fund future maintenance costs. The annual increase/decrease in the Maintenance Reserve is deducted de·duct v. de·duct·ed, de·duct·ing, de·ducts v.tr. 1. To take away (a quantity) from another; subtract. 2. To derive by deduction; deduce. v.intr. from/added to cash available for distribution. During the year ended December 31, 2005, $6.6 million (2004 - $6.5 million) was contributed to the reserve and $0.5 million (2004 - $4.9 million) was withdrawn to fund maintenance costs. The funds in the reserve are invested in liquid securities with maturities coinciding co·in·cide intr.v. co·in·cid·ed, co·in·cid·ing, co·in·cides 1. To occupy the same relative position or the same area in space. 2. To happen at the same time or during the same period. 3. with expected cash requirements. Interest income of $0.3 million (2004 - $0.1 million) was earned on the Maintenance Reserve during 2005. The Manager is subject to no mandatory requirements with respect to the timing of manner of utilization of the Maintenance Reserve, which are within the Manager's discretion. If needed, the funds in the Maintenance Reserve could be applied by the Partnership for another purpose. Maintenance Reserve (unaudited) --------------------------------------------------------------------- Balance at December 31, 2003 $ 9,288 Contributions 6,476 Withdrawals (4,862) Income reinvested 126 Foreign exchange loss on US dollars (104) --------------------------------------------------------------------- Balance at December 31, 2004 $ 10,924 Contributions 6,558 Withdrawals (521) Income reinvested 276 Foreign exchange loss on US dollars 16 --------------------------------------------------------------------- Balance at December 31, 2005 $ 17,253 --------------------------------------------------------------------- --------------------------------------------------------------------- Partnership Loan The Partnership used cash from operations of $12.0 million in the year ended December 31, 2005 to make principal payments on the Partnership Loan payable to the Fund in 2005. This loan was fully repaid on December 16, 2005. The loan originated in the second quarter of 2004 and no principal payments were made in the year ended December 31, 2004. Working Capital and Management Reserves Cash used to fund working capital in 2005 is significantly higher than the prior year due to increases in management reserves set aside in 2005 to support future distribution requirements.
Cash Balances
Year ended Year ended
December 31, 2005 December 31, 2004
(unaudited) (audited)
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Cash and cash equivalents $ 10,650 $ 2,791
Maintenance reserve 17,253 10,924
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Total cash and cash equivalents $ 27,903 $ 13,715
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Cash balances in the Partnership have increased 103% over the prior year reflecting the increase in the Maintenance Reserve coupled with higher earnings from the Island Facility. FORWARD-LOOKING INFORMATION This review of operational results and Distributable Cash for 2005 may contain forward-looking information as defined under applicable Canadian securities laws, including information regarding possible events, conditions or results with respect to the Calpine Power Income Fund. This information is subject to a numbers of risks that may cause actual results to differ materially from the forward-looking information. Some of the factors that could cause such differences include the outcome of the voluntary reorganization filings by Calpine Corporation and applicable subsidiaries, including Calpine Canada Power Ltd., performance or non-performance by Calpine Corporation and applicable subsidiaries of contracts with Calpine Power Income Fund and its applicable subsidiaries or investees, legislative or regulatory developments, competition, general economic conditions and other risks identified in the management and discussion and analysis of Calpine Power Income Fund for the fiscal year ended December 31, 2004 and fiscal quarter ended September 30, 2005, each of which is available on www.sedar.com and the Fund's website at www.calpinepif.com. Calpine Power Income Fund is an unincorporated Adj. 1. unincorporated - not organized and maintained as a legal corporation unorganised, unorganized - not having or belonging to a structured whole; "unorganized territories lack a formal government" open-ended trust that invests in electrical power assets. The Fund indirectly owns interests in power generating facilities in British Columbia, Alberta and California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). . In addition, the Fund owns a participating loan interest in a power plant in Ontario and has made a loan to Calpine Canada Power Ltd. The Fund is managed by Calpine Canada Power Ltd., which is headquartered in Calgary, Alberta. The Calpine Power Income Fund trust units are listed on the Toronto Stock Exchange under the symbol CF.UN. For further information on the Fund, please visit our website at www.calpinepif.com or contact: Calpine Power Income Fund (TSX:CF.UN) |
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