For Immediate Release: January 21, 1998
Media Contact: Claudia Chandler -- 916 - 654 - 4989





Electricity Market Deregulation Generates
Second Private Sector Power Plant Project Application



SACRAMENTO - The California Energy Commission has voted unanimously to begin reviewing plans for the $250 million, 500-megawatt electrical generating plant proposed for construction in Sutter County.

Today's action marks the start of a 12-month process during which the Commission ensures that construction and operation of the natural gas-fired power plant will comply with provisions of the Warren-Alquist Act and the California Environmental Quality Act.

The plant has been proposed for licensing by the Calpine Corporation, a San Jose-based energy company, and would be built adjacent to its existing 49.5-MW Greenleaf Unit 1 cogeneration power plant near Yuba City. The new project would create more than 250 jobs during construction and offer 20 permanent jobs at the 12-acre site upon completion.

The facility, referred to as a "merchant plant" by the energy industry, proposes to sell electricity to customers under bilateral contracts and to California's new power pool. The project's application estimates commercial operation to begin late in the year 2000.

"Under the newly deregulated electricity market this is the second power plant in the state and the first in Northern California accepted into the Energy Commission's licensing process," commented Energy Commission Chairman William Keese. "Merchant projects proposed under deregulation benefit the ratepayer by ensuring that the cost and risk for new state power projects is borne by investors not ratepayers."

Chairman Keese also noted, "Staff has reported that the applicant has done a very good job in assembling their application and working cooperatively with the staff as we initiate the licensing phase of the power project."

The Energy Commission also at the Business Meeting assigned Commissioner Michal Moore as the Presiding Member for this power plant licensing committee with Chairman Keese as the Associate Member. The committee plans to hold its first informational hearing and tour of the project in early March 1998.

During the licensing process, the Energy Commission looks at transmission system impacts, including congestion and system stability. This project has the potential for solving a current transmission system stability problem through development of a generation facility.

On December 3, 1997, the Commission voted to begin the licensing process for the Inland Energy and Constellation Energy Companies' High Desert Power Project, a 680-830 MW natural gas-fired plant at the Southern California International Airport, formerly known as George Air Force Base, in San Bernardino County.

Along with the Sutter and High Desert projects, three other power proposals are expected to be brought to the Energy Commission for licensing in 1998. Together, these five projects would represent nearly $1.5 billion of investment and produce 3,000 megawatts of energy for sale to markets both inside and outside of California.

The Energy Commission has exclusive jurisdiction to certify sites and related facilities for thermal power plants that generate 50 megawatts or more within California.

Access Energy, the Energy Commission's Web site, contains current information on the Sutter Project at:

http://www.energy.ca.gov/sitingcases/index.html

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