As reported, in response to the State of California’s programme to manage the energy crisis of 2000-2001, Calpine entered into long-term contracts with the state. Now, in furtherance of the California Public Utilities Commission’s and the state’s policy objectives of removing the California Department of Water Resources (DWR) from its energy crisis role as the power purchaser of last resort, Calpine and PG&E have finalized contracts to replace two of these DWR contracts to ensure ratepayers continue to get the benefits of Calpine’s power facilities.
As part of this negotiation, Calpine and PG&E have agreed to upgrade the Los Esteros critical energy facility, located in Silicon Valley, to operate in combined-cycle mode.
Jack Fusco, president and CEO of Calpine, said: “Through these agreements Calpine is very pleased to assist PG&E in serving the changing generation needs in California. We welcome the opportunity to work with PG&E to supply both incremental renewable power and flexible and reliable natural gas-fired generation necessary to integrate intermittent renewable energy supplies coming on-line in furtherance of the State of California’s 33% renewable goal.”
The agreements, which are to be submitted to the California Public Utilities Commission for approval, include extension of Calpine Northern California peaking power plant contract; upgrade of the Los Esteros critical energy facility; and extension and expansion of PG&E’s contract for renewable power from Calpine’s Geysers geothermal facility.
