Calpine Corporation Announces Community Support Efforts and
April 06 2020 - 8:00AM
Business Wire
As the COVID-19 virus continues to significantly impact life in
the United States and globally, we at Calpine Corporation have
implemented a robust business continuity plan to ensure the safety
of our employees and communities within which we operate, while
maintaining continued reliable operations at our generating
facilities.
“We are clearly in unprecedented and difficult times. Despite
the challenges that the COVID-19 outbreak presents, our employees
are staffing our power plants to ‘keep the lights on.’ I am proud
of them and our Company’s critical contribution to electrical
reliability and commitment to serving our customers. As our teams
fulfill these important roles, we are working in the safest
possible manner – from home where possible – but where not, like in
our plants, with an absolute focus on best practices of hygiene,
social distancing, thoughtful staffing, and health screening.
Although there is real uncertainty, we believe our Company’s
business is sound and we take pride in our mission,” said Thad
Hill, CEO of Calpine Corporation.
“We also care deeply about the communities where our employees
live and work. With that in mind, we have established a community
assistance fund to provide help where it is most needed and seeded
it with an initial $1 million,” said Hill.
The pandemic presents potential new risks to the Company’s
business. Although to date there have been logistical and other
challenges, there has been no material adverse impact to the
Company's operations as a result of COVID-19. Although the
Company’s first quarter 2020 results will be significantly lower
than first quarter 2019, driven primarily by lower regional
capacity prices and a difference in our hedging profile, even in
the face of COVID-19 challenges as currently understood, the
Company currently believes it is positioned to achieve full year
2020 unlevered free cash flow and other liquidity metrics, as well
as financial performance metrics material to our debt investors,
within the range of its results in 2018 and 2019. This belief is
based on the Company’s robust hedging program that has in the past
substantially mitigated its exposure to economic slowdowns and on
the long-term contracted nature and stability of the Company’s
revenue streams. Finally, the Company believes it has sufficient
liquidity on hand to manage its operations through this crisis.
Of course, the situation surrounding COVID-19 remains fluid and
the potential for a material impact on the Company increases the
longer the virus impacts activity levels in the United States. For
this reason, it is difficult to predict with certainty the impact
of the virus on the Company's business, operations, and financial
condition. The Company will evaluate further actions as
circumstances warrant.
We expect to provide a further update on the impact of COVID-19
on our liquidity, business operations, financial condition and
results of operations in our first quarter 2020 earnings release
and in our Form 10-Q for the quarter ended March 31, 2020.
About Calpine
Calpine Corporation is America’s largest generator of
electricity from natural gas and geothermal resources with
operations in competitive power markets. Our fleet of 77 power
plants in operation or under construction represents over 26,000
megawatts of generation capacity. Through wholesale power
operations and our retail businesses Calpine Energy Solutions and
Champion Energy, we serve customers in 23 states, Canada and
Mexico. Our clean, efficient, modern and flexible fleet uses
advanced technologies to generate power in a low-carbon and
environmentally responsible manner. We are uniquely positioned to
benefit from the secular trends affecting our industry, including
the abundant and affordable supply of clean natural gas,
environmental regulation, aging power generation infrastructure and
the increasing need for dispatchable power plants to successfully
integrate intermittent renewables into the grid.
Forward-Looking Information
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995, Section 27A of the Securities Act, and Section 21E of the
Exchange Act. Forward-looking statements may appear throughout this
press release. We use words such as “believe,” “intend,” “expect,”
“anticipate,” “plan,” “may,” “will,” “should,” “estimate,”
“potential,” “project” and similar expressions to identify
forward-looking statements. Such statements include, among others,
those concerning our expected financial performance and strategic
and operational plans, as well as all assumptions, expectations,
predictions, intentions or beliefs about future events. We believe
that the forward-looking statements are based upon reasonable
assumptions and expectations. However, 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. Such risks and uncertainties
include, but are not limited to the following:
- The impact of the COVID-19 pandemic on the Company’s financial
condition and business operations;
- Financial results that may be volatile and may not reflect
historical trends due to, among other things, seasonality of
demand, fluctuations in prices for commodities such as natural gas
and power, changes in U.S. macroeconomic conditions, fluctuations
in liquidity and volatility in the energy commodities markets and
our ability and extent to which we hedge risks;
- Laws, regulations and market rules in the wholesale and retail
markets in which we participate and our ability to effectively
respond to changes in laws, regulations or market rules or the
interpretation thereof including those related to the environment,
derivative transactions and market design in the regions in which
we operate;
- Our ability to manage our liquidity needs, access the capital
markets when necessary and comply with covenants under our Senior
Unsecured Notes, First Lien Term Loans, First Lien Notes, Corporate
Revolving Facility, CCFC Term Loan and other existing financing
obligations;
- Risks associated with the operation, construction and
development of power plants, including unscheduled outages or
delays and plant efficiencies;
- Risks related to our geothermal resources, including the
adequacy of our steam reserves, unusual or unexpected steam field
well and pipeline maintenance requirements, variables associated
with the injection of water to the steam reservoir and potential
regulations or other requirements related to seismicity concerns
that may delay or increase the cost of developing or operating
geothermal resources;
- Extensive competition in our wholesale and retail businesses,
including from renewable sources of power, interference by states
in competitive power markets through subsidies or similar support
for new or existing power plants, lower prices and other incentives
offered by retail competitors, and other risks associated with
marketing and selling power in the evolving energy markets;
- Structural changes in the supply and demand of power, resulting
from the development of new fuels or technologies and demand-side
management tools (such as distributed generation, power storage and
other technologies);
- The expiration or early termination of our PPAs and the related
results on revenues;
- Future capacity revenue may not occur at expected levels;
- Natural disasters, such as hurricanes, earthquakes, droughts
and floods, acts of terrorism, cyber attacks or wildfires that may
affect our power plants or the markets our power plants or retail
operations serve and our corporate offices;
- Disruptions in or limitations on the transportation of natural
gas or fuel oil and the transmission of power;
- Our ability to manage our counterparty and customer exposure
and credit risk, including our commodity positions or if a
significant customer were to seek bankruptcy protection under
Chapter 11;
- Our ability to attract, motivate and retain key employees;
- Present and possible future claims, litigation and enforcement
actions that may arise from noncompliance with market rules
promulgated by the SEC, CFTC, FERC and other regulatory bodies;
and
- Other risks identified in this press release and in reports
filed with the SEC.
Given the risks and uncertainties surrounding forward-looking
statements, you should not place undue reliance on these
statements. Many of these factors are beyond our ability to control
or predict. Our forward-looking statements speak only as of the
date of this press release. Other than as required by law, we
undertake no obligation to update or revise forward-looking
statements, whether as a result of new information, future events,
or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20200406005208/en/
Media Contact: Brett Kerr Vice
President, External Affairs 713-830-8809 brett.kerr@calpine.com
Investor Contact: W. Bryan Kimzey
Senior Vice President, Finance & Treasurer 713-830-8775
bryan.kimzey@calpine.com
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