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Message from the CEO


First Quarter 2016: Calpine's Fleet Resilient 

to Low Natural Gas Prices, 

Favorably Positioned for Long Term 

I am pleased to report that first quarter Adjusted EBITDA increased $36 million year-over-year, despite mild winter weather across much of the country. This performance was due to solid operations and effective hedging, and has kept us on track to reaffirm our full year guidance. 

Our first quarter results demonstrate the continued benefits of our geographically diverse, flexible and clean generation fleet. These modern, natural gas-fired power generation resources allow us to be resilient to low natural gas prices in the near term, while favorably positioning us for the long term. 

We also remain focused on building and developing our customer relationships. Over time, we think our customer focus, through both our Champion Energy retail business and our wholesale origination efforts, will deliver better results than simply being a price-taker.  Since our last call, we have signed a new five-year contract in the East, expanded our retail service territory in New England and reached an agreement to sell our South Point Energy Center in Arizona to a local utility. This is in addition to the new ten-year toll of our Morgan plant with the Tennessee Valley Authority that we announced in February. 

The sale of our South Point Energy Center represents progress toward our stated goal of divesting non-core assets through accretive transactions. “Subject to certain conditions and regulatory approvals, we expect this transaction to close no later than the first quarter of 2017. I would like to recognize the South Point employees for their dedication and professionalism as members of the Calpine team. 

The South Point sale proceeds, along with proceeds from our previously announced sale of Osprey Energy Center at the end of this year, will further enhance our capital allocation flexibility as we continue to pursue a well-balanced program consisting of growth, capital return and debt reduction. (Click here to read our first quarter earnings release.)

Thad Hill,
President and CEO