Delta Energy Center Application is Deemed `Data Adequate' by California Energy Commission; Ruling Triggers Stringent, Year-long Environmental Review Process.

PITTSBURG, Calif.--(BUSINESS WIRE)--Feb. 17, 1999--San Jose-based Calpine Corporation (NYSE: CPN) and San Francisco-based Bechtel Enterprises today announced that the Application for Certification (AFC) for their joint development project, the Delta Energy Center, has met the California Energy Commission's (CEC) data adequacy requirements.

The Energy Commission's data adequacy ruling means that the Delta Energy Center AFC contains sufficient information for the CEC staff to begin their permitting and licensing process and initiates a twelve-month technical and environmental review process for the project. Calpine and Bechtel submitted the AFC to the CEC on December 18, 1998.

Located in an industrial area to the north of Highway 4 in Pittsburg, Calif., the Delta Energy Center will be an 880-megawatt electric generating facility that will provide steam and electricity to the nearby Dow Chemical Company facility and also provide power to homes and businesses in Pittsburg and the greater Bay Area.

"Utilizing clean-burning natural gas for fuel, the Delta Energy Center is being designed to minimize emissions," said Douglas W. Buchanan, Delta Energy Center development manager. "As we indicated in the AFC filing, this project will be one of the cleanest and most efficient power generation facilities in the nation."

Compared to the average utility gas-fired plant operating in California today, the facility will burn up to 40 percent less fuel and will achieve dramatic emissions reductions by using state-of-the-art, combined-cycle combustion turbine design and advanced emissions control systems.

Buchanan noted, "The Delta Energy Center will be built by local union labor and will generate significant tax revenue to fund local programs and services."

Calpine and the California State Building and Construction Trades Council recently reached a series of agreements regarding the construction and major maintenance of Calpine's new Northern California energy-generating facilities.

"These labor agreements confirm that Calpine and Bechtel will use local workers, pay family wages and benefits, utilize the most highly skilled workforce available and benefit the local economy," said Greg Feere, chief executive officer of the Contra Costa County Building and Construction Trades Council.

It is anticipated that the CEC review, licensing and public hearing process will be completed by early 2000. If approved, construction will start soon after the license is issued, and commercial operation will commence in early 2002.

Throughout the CEC process, local area residents will be encouraged to voice their opinions about the Delta Energy Center. As part of this effort to seek public participation, Calpine and Bechtel conducted a community open house on February 6, 1999 to discuss the project and to answer questions from the community before the formal review process begins.

"Calpine and Bechtel are committed to working closely with community members, environmental groups and local governmental agencies to maximize public participation and input," said Buchanan. "We understand our obligation to the community and to the environment and want to make this a model project."

Based in San Jose, Calpine is a leading national power company that currently has 5,900 megawatts of energy capacity in operation, under construction or in announced development in the U.S. Calpine was founded in 1984 and is publicly traded on the New York Stock Exchange under the symbol CPN.

Bechtel Enterprises is the development, financing and ownership affiliate of the Bechtel organization, a global engineering and construction firm based in San Francisco. The company celebrated its centennial year of service in 1998 and has been a part of the San Francisco Bay Area since 1904. Bechtel has been at the center of energy development since the 1940's, having built more than 450 power stations with a total generating capacity exceeding 250,000 megawatts.

This news release discusses certain matters that may be considered "forward-looking" 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 ("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 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 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) the assurance that the Company will develop additional plants, (iv) a competitor's development of a lower-cost generating gas-fired power plant or (v) 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.

A website with more information on the Delta Energy Center is located at www.deltaenergycenter.com.