Calpine Corporation (NYSE:CPN) today received approval to build
the nation’s first power plant with a federal limit on greenhouse
gas emissions – putting both the plant and the company at the
forefront of the fight against global warming.
As national and world leaders continue to move toward regulation
of global warming pollutants, Calpine, long a leader in generating
environmentally responsible renewable and natural gas fired
electric power, has worked to establish a first-of-its-kind limit
on emissions of carbon dioxide (CO2) and other greenhouse gases
from the company’s planned 600-megawatt Russell City Energy Center
located in the City of Hayward in Alameda County, Calif.
Construction of the natural gas-fired power plant is expected to
begin later this year.
Today’s action by the Bay Area Air Quality Management District
(BAAQMD) to grant a Prevention of Significant Deterioration (PSD)
permit is the final federal regulatory approval needed for the
project to move forward. This action comes the day after the U.S.
Environmental Protection Agency’s senior policy advisory committee
voted on guidelines for issuing permits to major sources of
greenhouse gas emissions that contribute to global climate change,
such as power plants and oil refineries. At the committee’s meeting
in Washington, DC, the groundbreaking PSD permit for Russell City
Energy Center was presented as a “case study” for how the existing
Clean Air Act can be used to regulate emissions of heat-trapping
pollutants.
“Since our inception in 1984, Calpine has been an environmental
leader investing in power plants that use modern emissions control
technology and consistently outperform conventional fossil-fueled
plants in curbing emissions that contribute to global warming,”
said Jack A. Fusco, president and chief executive officer of
Calpine. “By utilizing these environmentally responsible
technologies, at plants such as Russell City, Calpine will help
meet California’s growing demand for electricity while dramatically
decreasing emissions.”
The Russell City facility will be designed to operate in a way
that produces 50 percent fewer greenhouse gas emissions than even
the most advanced coal-fired plants and 25 percent fewer greenhouse
gas emissions than the standard set by the California Public
Utilities Commission.
“Once again California is demonstrating leadership on greenhouse
gas related issues. We applaud the BAAQMD and Calpine for going
beyond existing federal law and being the first in the nation to
require an enforceable greenhouse gas limit,” said Linda Adams,
California State Secretary for Environmental Protection. “This
action furthers efforts at a statewide level to balance our
economic needs while meeting our environmental challenges.
Aggressive and early action like this is needed to fight global
warming and is critical to our economic recovery.”
Using the most advanced emissions control technology available
today for a natural gas-fired power plant, Russell City Energy
Center will be an energy efficient supplier of electricity to the
Bay Area. The facility is expected to play a critical role in
helping to meet the region’s growing demand for cleaner energy as
older, emissions-intensive power plants are shut down.
“Carbon emissions have clearly emerged as a critical indicator
of environmental performance for power plants, and we commend
Calpine for acknowledging as much by securing the first
plant-specific mandatory limits on greenhouse gas emissions,” said
Ralph Cavanagh, Energy Program Co-Director for the Natural
Resources Defense Council (NRDC). “We look forward to the
not-too-distant day when all power plants will operate under
greenhouse gas performance standards.”
The California Independent System Operation (CAISO), the
nonprofit public benefit organization that operates the state's
electric transmission grid, has been enthusiastic and supportive of
the project.
“CAISO is encouraged by plants such as the Russell City facility
which help ensure the reliable and efficient delivery of power to
hundreds of thousands of consumers in the Bay Area,” said Jim
Detmers, CAISO’s Vice President of Operations. “In addition to the
plant’s environmental benefits, Russell City Energy Center will
assist with successful integration of California's ambitious
renewable portfolio.”
Powered by cleaner burning natural gas, plants like the Russell
City Energy Center that use advanced combined-cycle technology are
significantly cleaner than older power plants currently in
operation. By providing a reliable backstop for intermittent
renewable generating resources, such as wind and solar, these
plants will help meet Governor Schwarzenegger’s aggressive goals
that, by 2020, 33 percent of California utilities’ power be
generated by renewable sources and statewide greenhouse gas
emissions be reduced by 15 percent from current levels.
In addition to the environmental benefits, Russell City Energy
Center will produce significant economic benefits for the City of
Hayward and the Bay Area, creating 650 union construction jobs,
injecting millions into the local economy and generating
approximately $30 million in one-time tax revenue and more than $5
million annually in property tax revenue to help fund local
government services.
The facility also will use 100 percent reclaimed water from the
City of Hayward’s Water Pollution Control Facility for cooling and
boiler makeup. This environmentally responsible process conserves
water and prevents nearly four million gallons of wastewater per
day from being discharged into San Francisco Bay.
Russell City Energy Center also will donate $10 million to help
build a new library for Hayward and is working with stakeholders to
make improvements and support programs that enhance the enjoyment
of the San Francisco Bay shoreline.
The California Energy Commission granted a license for the plant
in September 2007, and the California Public Utilities Commission
approved a 10-year power purchase agreement in April 2009 under
which PG&E will purchase the electricity generated by the
plant.
The Russell City project is jointly owned by Calpine
Corporation, which holds a 65 percent equity interest and serves as
development manager, and an affiliate of GE Energy Financial
Services, which holds a 35 percent equity interest.
For more information about Russell City Energy Center, visit
www.russellcityenergycenter.com.
Details about PSD permit can be found at www.baaqmd.gov.
Calpine’s Commitment to California
Calpine has built and operated power plants in the State of
California for 25 years and prides itself in developing innovative
and environmentally responsible energy solutions for the people of
California. Taken as a whole, Calpine’s projects produce enough
electricity to satisfy the power needs of more than six million
California households.
Calpine remains committed to California by providing clean,
efficient and renewable power generation. With 5,800 megawatts in
operation, including the newly commissioned, state-of-the-art 600
MW Otay Mesa Energy Center in San Diego, additional development
projects include the 600 MW Russell City Energy Center in Hayward
discussed above, the Los Esteros Critical Energy Center upgrade
project and continuing expansion at The Geysers.
About Calpine
Calpine Corporation is helping meet the needs of an economy that
demands more and cleaner sources of electricity. Founded in 1984,
Calpine is a major U.S. power company, currently capable of
delivering nearly 25,000 megawatts of clean, cost-effective,
reliable and fuel-efficient electricity to customers and
communities in 16 states in the United States and Canada. Calpine
owns, leases, and operates low-carbon, natural gas-fired, and
renewable geothermal power plants. Using advanced technologies,
Calpine generates electricity in a reliable and environmentally
responsible manner for the customers and communities it serves.
Please visit www.calpine.com for more information.
Forward-Looking Information
This release contains 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.
Words such as "believe," "intend," "expect," "anticipate," "plan,"
"may," "will" and similar expressions identify forward-looking
statements. Such statements include, among others, those concerning
expected financial performance and strategic and operational plans,
as well as assumptions, expectations, predictions, intentions or
beliefs about future events. You are cautioned that any such
forward-looking statements are not guarantees of future performance
and that a number of risks and uncertainties could cause actual
results to differ materially from those anticipated in the
forward-looking statements. Please see the risks identified in this
release or in Calpine's reports and registration statements filed
with the Securities and Exchange Commission, including, without
limitation, the risk factors identified in its Quarterly Report on
Form 10-Q for the three months ended September 30, 2009, and its
Annual Report on Form 10-K for the year ended December 31, 2008.
These filings are available by visiting the Securities and Exchange
Commission's web site at www.sec.gov or Calpine's web site at
www.calpine.com. Actual results or developments may differ
materially from the expectations expressed or implied in the
forward-looking statements, and Calpine undertakes no obligation to
update any such statements.
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