Calpine to Acquire Interest in 827 MW of Gas-Fired Power Plants.

SAN JOSE, Calif.--(BUSINESS WIRE)--March 31, 1997--Calpine Corporation (NYSE:CPN), the San Jose, CA-based power company, today announced it has entered into a purchase agreement with a subsidiary of Enron Corp. to acquire its 50% ownership interest in Enron/Dominion Cogen Corp. (EDCC), which owns two operating, gas-fired cogeneration projects totaling 827 megawatts.

The proposed acquisition will nearly double the Company's net interest in gas-fired power plants, to 881 mw and increase its total operating capacity to 1,461 mw. In combination with Calpine's 240 mw power plant under construction in Pasadena, TX, the acquisition will significantly strengthen Calpine's position in the Texas power market.

Under the terms of the purchase agreement, Calpine will acquire Enron's interest in EDCC. Dominion Cogen, Inc., a subsidiary of Dominion Resources, Inc., owns the remaining 50% interest. Completion of the acquisition is expected during the second quarter, contingent upon third-party approvals.

EDCC's power generation assets include the 377 mw Clear Lake Power Plant, located in Pasadena, TX, and the 450 mw Texas City Power Plant in Texas City, TX. The Clear Lake plant entered commercial operation in 1984. Electricity is sold to Texas-New Mexico Power Company, Hoechst Celanese Company and Houston Lighting & Power Company under contracts which extend to 2004-2005. The Texas City Power Plant came on line in 1987. Electricity is sold to Texas Utilities Electric Company under a contract extending through June 1999. After completion of the current power sales agreements, these plants, which are well placed on the Texas grid, will have the ability of operating as merchant plants selling power into a deregulated market, or may continue to sell power under longer term power sales agreements. The plants are cogenerators, providing thermal energy to Union Carbide's chemical plant and to Hoechst Celanese*s chemical plant.

Calpine Corporation is a fully integrated power company, providing electricity and thermal energy to customers in the U.S. and selected international markets. -0-

Note to Editors: The matters discussed in this news release may be considered "forward-looking" statements within the meaning of Section 27A of the Securities and Exchange Act of 1993, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include declarations regarding the intent, belief or current expectations of the Company 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; actual results could differ materially from those indicated by such forward-looking statements. Among the important factors that could cause results to differ materially from those indicated by such forward-looking statements are: (i) that the information is of a preliminary nature and may be subject to further adjustments, (ii) the possible unavailability of financing, (iii) risks associated with power plant acquisitions, (iv) changes in government regulation, (v) general operating risks, (vi) the dependence on third parties, (vii) the dependence on senior management and (viii) other risks identified from time to time in the Company*s reports and registration statements filed with the Securities and Exchange Commission.

CONTACT: Calpine

Katherine Potter, 408/995-5115

or

Enron

Terri James, 713/853-7727