DOW JONES NEWSWIRES
Calpine Corp. (CPN) and General Electric Co. (GE) obtained an
$844.5 million credit facility for the construction of a California
power plant, bringing the long-awaited project another step closer
to completion.
The project finance facility includes a construction loan for
the 619-megawatt Hayward, Calif., plant, which will convert to a
10-year term loan when commercial operations begin--expected in
mid-2013.
The new natural gas-fired plant, under development since 2001,
is the nation's first to receive a federal air permit that includes
a voluntary limit on greenhouse-gas emissions. California in recent
years has put in place regulations requiring power companies to
adopt more environmentally friendly operations.
"This financing marks an important milestone in our effort to
bring much-needed electric power supply to California's Bay Area,
allowing us to complete the construction of a modern, flexible,
highly efficient, clean and low-carbon energy resource," said Jack
Fusco, the merchant generator's president and chief executive.
Calpine, which has a 75% stake in the project, in April reported
that its first-quarter loss widened sharply on higher fuel costs
and hedging losses.
General Electric, which has the remaining project stake, in
April posted a 77% increase in first-quarter earnings that blew
past analysts' estimates, lifted by marked improvement at its GE
Capital financing arm and gains at most of its industrial
units.
Shares of Calpine and General Electric closed Friday at $15.72
and $17.97, respectively. Neither was active premarket.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
Tess.Stynes@dowjones.com