[X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) | |
OF THE SECURITIES EXCHANGE ACT OF 1934 | ||
For the quarterly period ended September 30, 2012 | ||
Or | ||
[ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) | |
OF THE SECURITIES EXCHANGE ACT OF 1934 |
Large accelerated filer | [X] | Accelerated filer | [ ] | |
Non-accelerated filer | [ ] | (Do not check if a smaller reporting company) | Smaller reporting company | [ ] |
Page | |
ABBREVIATION | DEFINITION | |
2011 Form 10-K | Calpine Corporation's Annual Report on Form 10-K for the year ended December 31, 2011, filed with the SEC on February 9, 2012 | |
2017 First Lien Notes | The $1.2 billion aggregate principal amount of 7.25% senior secured notes due 2017, issued October 21, 2009, in exchange for a like principal amount of term loans under the First Lien Credit Facility | |
2019 First Lien Notes | The $400 million aggregate principal amount of 8.0% senior secured notes due 2019, issued May 25, 2010 | |
2019 First Lien Term Loan | The $835 million first lien senior secured term loan, dated October 9, 2012, among Calpine Corporation, as borrower, and the lenders party hereto, and Morgan Stanley Senior Funding, Inc., as administrative agent and Goldman Sachs Credit Partners L.P., as collateral agent | |
2020 First Lien Notes | The $1.1 billion aggregate principal amount of 7.875% senior secured notes due 2020, issued July 23, 2010 | |
2021 First Lien Notes | The $2.0 billion aggregate principal amount of 7.50% senior secured notes due 2021, issued October 22, 2010 | |
2023 First Lien Notes | The $1.2 billion aggregate principal amount of 7.875% senior secured notes due 2023, issued January 14, 2011 | |
AB 32 | California Assembly Bill 32 | |
Adjusted EBITDA | EBITDA as adjusted for the effects of (a) impairment charges, (b) major maintenance expense, (c) operating lease expense, (d) unrealized gains or losses on commodity derivative mark-to-market activity, (e) adjustments to reflect only the Adjusted EBITDA from our unconsolidated investments, (f) stock-based compensation expense, (g) gains or losses on sales, dispositions or retirements of assets, (h) non-cash gains and losses from foreign currency translations, (i) gains or losses on the repurchase or extinguishment of debt and (j) other extraordinary, unusual or non-recurring items | |
AOCI | Accumulated Other Comprehensive Income | |
Average availability | Represents the total hours during the period that our plants were in-service or available for service as a percentage of the total hours in the period | |
Average capacity factor, excluding peakers | A measure of total actual generation as a percent of total potential generation. It is calculated by dividing (a) total MWh generated by our power plants, excluding peakers, by (b) the product of multiplying (i) the average total MW in operation, excluding peakers, during the period by (ii) the total hours in the period | |
Broad River | Broad River Energy LLC, an indirect, wholly owned subsidiary of Calpine Corporation that leases the Broad River Energy Center from the BR Owner Lessors | |
Broad River Entities | Collectively, Broad River and the BR Owner Lessors | |
ABBREVIATION | DEFINITION | |
BR Owner Lessors | Broad River OL-1, LLC, a Delaware limited liability company, Broad River OL-2, LLC, a Delaware limited liability company, Broad River OL-3, LLC, a Delaware limited liability company, and Broad River OL-4, LLC, a Delaware limited liability company, each of which is an indirect, wholly owned subsidiary of Calpine Corporation, which lease the Broad River Energy Center (i) from Cherokee County, South Carolina and (ii) to Broad River | |
Broad River Power | Broad River Power, LLC, a wholly owned subsidiary of Energy Capital Partners, LLC | |
Btu | British thermal unit(s), a measure of heat content | |
CAA | Federal Clean Air Act, U.S. Code Title 42, Chapter 85 | |
CAIR | Clean Air Interstate Rule | |
CAISO | California Independent System Operator | |
Calpine Equity Incentive Plans | Collectively, the Director Plan and the Equity Plan, which provide for grants of equity awards to Calpine non-union employees and non-employee members of Calpine’s Board of Directors | |
Cap-and-trade | A government imposed emissions reduction program that would place a cap on the amount of emissions that can be emitted from certain sources, such as power plants. In its simplest form, the cap amount is set as a reduction from the total emissions during a base year and for each year over a period of years the cap amount would be reduced to achieve the targeted overall reduction by the end of the period. Allowances or credits for emissions in an amount equal to the cap would be issued or auctioned to companies with facilities, permitting them to emit up to a certain amount of emissions during each applicable period. After allowances have been distributed or auctioned, they can be transferred or traded | |
CARB | California Air Resources Board | |
CCFC | Calpine Construction Finance Company, L.P., an indirect, wholly owned subsidiary | |
CCFC Finance | CCFC Finance Corp. | |
CCFC Notes | The $1.0 billion aggregate principal amount of 8.0% senior secured notes due 2016, issued May 19, 2009, by CCFC and CCFC Finance | |
CDHI | Calpine Development Holdings, Inc., an indirect, wholly owned subsidiary | |
CFTC | U.S. Commodities Futures Trading Commission | |
Chapter 11 | Chapter 11 of the U.S. Bankruptcy Code | |
CO2 | Carbon dioxide | |
COD | Commercial operations date | |
Cogeneration | Using a portion or all of the steam generated in the power generating process to supply a customer with steam for use in the customer's operations | |
Commodity expense | The sum of our expenses from fuel and purchased energy expense, fuel transportation expense, transmission expense and cash settlements from our marketing, hedging and optimization activities including natural gas transactions hedging future power sales that are included in our mark-to-market activity in fuel and purchased energy expense, but excludes the unrealized portion of our mark-to-market activity | |
ABBREVIATION | DEFINITION | |
Commodity Margin | Non-GAAP financial measure that includes power and steam revenues, sales of purchased power and physical natural gas, capacity revenue, REC revenue, sales of surplus emissions allowances, transmission revenue and expenses, fuel and purchased energy expense, fuel transportation expense, RGGI compliance and other environmental costs, and cash settlements from our marketing, hedging and optimization activities including natural gas transactions hedging future power sales that are included in mark-to-market activity, but excludes the unrealized portion of our mark-to-market activity and other revenues | |
Commodity revenue | The sum of our revenues from power and steam sales, sales of purchased power and physical natural gas, capacity revenue, REC revenue, sales of surplus emissions allowances, transmission revenue, and cash settlements from our marketing, hedging and optimization activities that are included in our mark-to-market activity in operating revenues, but excludes the unrealized portion of our mark-to-market activity | |
Company | Calpine Corporation, a Delaware corporation, and its subsidiaries | |
Corporate Revolving Facility | The $1.0 billion aggregate amount revolving credit facility credit agreement, dated as of December 10, 2010, among Calpine Corporation, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Credit Partners L.P., as collateral agent, the lenders party thereto and the other parties thereto | |
CPUC | California Public Utilities Commission | |
Creed | Creed Energy Center, LLC | |
Director Plan | The Amended and Restated Calpine Corporation 2008 Director Incentive Plan | |
Dodd-Frank Act | The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 | |
EBITDA | Net income (loss) attributable to Calpine before net (income) loss attributable to the noncontrolling interest, interest, taxes, depreciation and amortization | |
Effective Date | January 31, 2008, the date on which the conditions precedent enumerated in the Plan of Reorganization were satisfied or waived and the Plan of Reorganization became effective | |
Emergence Date Market Capitalization | Calpine Corporation's market capitalization calculated using the weighted average trading price of Calpine Corporation’s common stock over the 30-day period following the date on which it emerged from Chapter 11 bankruptcy protection, as defined in and calculated pursuant to Calpine Corporation’s amended and restated certificate of incorporation and reported in its Current Report on Form 8-K filed with the SEC on March 25, 2008 | |
EPA | U.S. Environmental Protection Agency | |
Equity Plan | The Amended and Restated Calpine Corporation 2008 Equity Incentive Plan | |
ERCOT | Electric Reliability Council of Texas | |
Exchange Act | U.S. Securities Exchange Act of 1934, as amended | |
FASB | Financial Accounting Standards Board | |
FDIC | U.S. Federal Deposit Insurance Corporation | |
FERC | U.S. Federal Energy Regulatory Commission | |
First Lien Credit Facility | Credit Agreement, dated as of January 31, 2008, as amended by the First Amendment to Credit Agreement and Second Amendment to Collateral Agency and Intercreditor Agreement, dated as of August 20, 2009, among Calpine Corporation, as borrower, certain subsidiaries of the Company named therein, as guarantors, the lenders party thereto, Goldman Sachs Credit Partners L.P., as administrative agent and collateral agent, and the other agents named therein | |
ABBREVIATION | DEFINITION | |
First Lien Notes | Collectively, the 2017 First Lien Notes, the 2019 First Lien Notes, the 2020 First Lien Notes, the 2021 First Lien Notes and the 2023 First Lien Notes | |
First Lien Term Loans | Collectively, the $1.3 billion first lien senior secured term loans dated March 9, 2011 and the $360 million first lien senior secured term loans dated June 17, 2011 | |
GE | General Electric International, Inc. | |
Geysers Assets | Our geothermal power plant assets, including our steam extraction and gathering assets, located in northern California consisting of 15 operating power plants and one plant not in operation | |
GHG(s) | Greenhouse gas(es), primarily carbon dioxide (CO2), and including methane (CH4), nitrous oxide (N2O), sulfur hexafluoride (SF6), hydrofluorocarbons (HFCs) and perfluorocarbons (PFCs) | |
Goose Haven | Goose Haven Energy Center, LLC | |
Greenfield LP | Greenfield Energy Centre LP, a 50% partnership interest between certain of our subsidiaries and a third party which operates the Greenfield Energy Centre, a 1,038 MW natural gas-fired, combined-cycle power plant in Ontario, Canada | |
Heat Rate(s) | A measure of the amount of fuel required to produce a unit of power | |
IOUs | Investor Owned Utilities | |
IRC | Internal Revenue Code | |
ISO(s) | Independent System Operator(s) | |
KWh | Kilowatt hour(s), a measure of power produced, purchased or sold | |
LIBOR | London Inter-Bank Offered Rate | |
Los Esteros Project Debt | Credit Agreement, dated August 23, 2011, between Los Esteros Critical Energy Facility, LLC, as borrower, and the lenders named therein | |
Market Capitalization | As of any date, Calpine Corporation’s then market capitalization calculated using the rolling 30-day weighted average trading price of Calpine Corporation’s common stock, as defined in and calculated in accordance with the Calpine Corporation amended and restated certificate of incorporation | |
Market Heat Rate(s) | The regional power price divided by the corresponding regional natural gas price | |
MMBtu | Million Btu | |
MW | Megawatt(s), a measure of plant capacity | |
MWh | Megawatt hour(s), a measure of power produced, purchased or sold | |
NDH | New Development Holdings, LLC, an indirect, wholly owned subsidiary | |
NDH Project Debt | The $1.3 billion senior secured term loan facility and the $100 million revolving credit facility issued on July 1, 2010, under the credit agreement, dated as of June 8, 2010, among NDH, as borrower, Credit Suisse AG, as administrative agent, collateral agent, issuing bank and syndication agent, Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and Deutsche Bank Securities Inc., as joint book-runners and joint lead arrangers, Credit Suisse AG, Citibank, N.A., and Deutsche Bank Trust Company Americas, as co-documentation agents and the lenders party thereto repaid on March 9, 2011 | |
ABBREVIATION | DEFINITION | |
NOL(s) | Net operating loss(es) | |
NOX | Nitrogen oxides | |
NYMEX | New York Mercantile Exchange | |
OCI | Other Comprehensive Income | |
OTC | Over-the-Counter | |
PG&E | Pacific Gas & Electric Company | |
PJM | PJM Interconnection is a RTO that coordinates the movement of wholesale electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia | |
Plan of Reorganization | Sixth Amended Joint Plan of Reorganization Pursuant to Chapter 11 of the Bankruptcy Code filed by the U.S. Debtors with the U.S. Bankruptcy Court on December 19, 2007, as amended, modified, or supplemented | |
PPA(s) | Any term power purchase agreement or other contract for a physically settled sale (as distinguished from a financially settled future, option or other derivative or hedge transaction) of any power product, including power, capacity and/or ancillary services, in the form of a bilateral agreement or a written or oral confirmation of a transaction between two parties to a master agreement, including sales related to a tolling transaction in which the purchaser provides the fuel required by us to generate such power and we receive a variable payment to convert the fuel into power and steam | |
PUCT | Public Utility Commission of Texas | |
PUHCA 2005 | U.S. Public Utility Holding Company Act of 2005 | |
PURPA | U.S. Public Utility Regulatory Policies Act of 1978 | |
QF(s) | Qualifying facility(ies), which are cogeneration facilities and certain small power production facilities eligible to be “qualifying facilities” under PURPA, provided that they meet certain power and thermal energy production requirements and efficiency standards. QF status provides an exemption from the books and records requirement of PUHCA 2005 and grants certain other benefits to the QF | |
REC(s) | Renewable energy credit(s) | |
Reserve margin(s) | The measure of how much the total generating capacity installed in a region exceeds the peak demand for power in that region | |
RGGI | Regional Greenhouse Gas Initiative | |
Risk Management Policy | Calpine's policy applicable to all employees, contractors, representatives and agents which defines the risk management framework and corporate governance structure for commodity risk, interest rate risk, currency risk and other risks | |
RPS | Renewable Portfolio Standards | |
RTO(s) | Regional Transmission Organization(s) | |
Russell City Project Debt | Credit Agreement dated June 24, 2011, between Russell City Energy Company, LLC, as borrower, and the lenders named therein | |
SEC | U.S. Securities and Exchange Commission | |
Securities Act | U.S. Securities Act of 1933, as amended |
ABBREVIATION | DEFINITION | |
SO2 | Sulfur dioxide | |
Spark Spread(s) | The difference between the sales price of power per MWh and the cost of fuel to produce it | |
Steam Adjusted Heat Rate | The adjusted Heat Rate for our natural gas-fired power plants, excluding peakers, calculated by dividing (a) the fuel consumed in Btu reduced by the net equivalent Btu in steam exported to a third party by (b) the KWh generated. Steam Adjusted Heat Rate is a measure of fuel efficiency, so the lower our Steam Adjusted Heat Rate, the lower our cost of generation | |
U.S. Bankruptcy Court | U.S. Bankruptcy Court for the Southern District of New York | |
U.S. Debtor(s) | Calpine Corporation and each of its subsidiaries and affiliates that filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court, which matter was jointly administered in the U.S. Bankruptcy Court under the caption In re Calpine Corporation, et al., Case No. 05-60200 (BRL) and was dismissed on December 19, 2011 | |
U.S. GAAP | Generally accepted accounting principles in the U.S. | |
VAR | Value-at-risk | |
VIE(s) | Variable interest entity(ies) | |
Whitby | Whitby Cogeneration Limited Partnership, a 50% partnership interest between certain of our subsidiaries and a third party which operates Whitby, a 50 MW natural gas-fired, simple-cycle cogeneration power plant located in Ontario, Canada | |
WP&L | Wisconsin Power and Light Company, a wholly owned subsidiary of Alliant Energy Corporation | |
York Energy Center | 565 MW dual fuel, combined-cycle generation power plant (formerly known as the Delta Project) located in Peach Bottom Township, Pennsylvania which achieved COD on March 2, 2011 |
• | Financial results that may be volatile and may not reflect historical trends due to, among other things, 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 to hedge risks; |
• | Laws, regulations and market rules in the 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; |
• | The unknown future impact on our business from the Dodd-Frank Act and the rules to be promulgated thereunder; |
• | Our ability to manage our liquidity needs and to comply with covenants under our First Lien Notes, Corporate Revolving Facility, First Lien Term Loans, 2019 First Lien Term Loan, CCFC Notes and other existing financing obligations; |
• | Risks associated with the continued economic and financial conditions affecting certain countries in Europe including financial institutions located within those countries and their ability to fund their financial commitments; |
• | 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 wastewater 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; |
• | Competition, including risks associated with marketing and selling power in the evolving energy markets; |
• | The expiration or early termination of our PPAs and the related results on revenues; |
• | Future capacity revenues may not occur at expected levels; |
• | Natural disasters, such as hurricanes, earthquakes and floods, acts of terrorism or cyber attacks that may impact our power plants or the markets our power plants serve and our corporate headquarters; |
• | Disruptions in or limitations on the transportation of natural gas, fuel oil and transmission of power; |
• | Our ability to manage our customer and counterparty exposure and credit risk, including our commodity positions; |
• | Our ability to attract, motivate and retain key employees; |
• | Present and possible future claims, litigation and enforcement actions; and |
• | Other risks identified in this Report and in our 2011 Form 10-K. |
Item 1. | Financial Statements |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
(in millions, except share and per share amounts) | ||||||||||||||||
Operating revenues | $ | 1,996 | $ | 2,209 | $ | 4,111 | $ | 5,341 | ||||||||
Operating expenses: | ||||||||||||||||
Fuel and purchased energy expense | 893 | 1,401 | 2,137 | 3,470 | ||||||||||||
Plant operating expense | 207 | 212 | 699 | 711 | ||||||||||||
Depreciation and amortization expense | 140 | 143 | 418 | 405 | ||||||||||||
Sales, general and other administrative expense | 36 | 33 | 104 | 99 | ||||||||||||
Other operating expenses | 22 | 22 | 67 | 64 | ||||||||||||
Total operating expenses | 1,298 | 1,811 | 3,425 | 4,749 | ||||||||||||
(Income) from unconsolidated investments in power plants | (7 | ) | (5 | ) | (21 | ) | (12 | ) | ||||||||
Income from operations | 705 | 403 | 707 | 604 | ||||||||||||
Interest expense | 183 | 192 | 552 | 575 | ||||||||||||
Loss on interest rate derivatives | — | 3 | 14 | 149 | ||||||||||||
Interest (income) | (2 | ) | (2 | ) | (7 | ) | (7 | ) | ||||||||
Debt extinguishment costs | — | (4 | ) | 12 | 94 | |||||||||||
Other (income) expense, net | 6 | 4 | 14 | 14 | ||||||||||||
Income (loss) before income taxes | 518 | 210 | 122 | (221 | ) | |||||||||||
Income tax expense (benefit) | 81 | 20 | 23 | (45 | ) | |||||||||||
Net income (loss) | 437 | 190 | 99 | (176 | ) | |||||||||||
Net income attributable to the noncontrolling interest | — | — | — | (1 | ) | |||||||||||
Net income (loss) attributable to Calpine | $ | 437 | $ | 190 | $ | 99 | $ | (177 | ) | |||||||
Basic earnings (loss) per common share attributable to Calpine: | ||||||||||||||||
Weighted average shares of common stock outstanding (in thousands) | 462,307 | 486,420 | 470,589 | 486,363 | ||||||||||||
Net income (loss) per common share attributable to Calpine — basic | $ | 0.95 | $ | 0.39 | $ | 0.21 | $ | (0.36 | ) | |||||||
Diluted earnings (loss) per common share attributable to Calpine: | ||||||||||||||||
Weighted average shares of common stock outstanding (in thousands) | 465,953 | 489,062 | 474,131 | 486,363 | ||||||||||||
Net income (loss) per common share attributable to Calpine — diluted | $ | 0.94 | $ | 0.39 | $ | 0.21 | $ | (0.36 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
(in millions) | ||||||||||||||||
Net income (loss) | $ | 437 | $ | 190 | $ | 99 | $ | (176 | ) | |||||||
Cash flow hedging activities: | ||||||||||||||||
Loss on cash flow hedges before reclassification adjustment for cash flow hedges realized in net income (loss) | (22 | ) | (74 | ) | (56 | ) | (60 | ) | ||||||||
Reclassification adjustment for (gain) loss on cash flow hedges realized in net income (loss) | (1 | ) | (20 | ) | (15 | ) | 24 | |||||||||
Foreign currency translation gain (loss) | 6 | (4 | ) | 5 | (4 | ) | ||||||||||
Income tax benefit | 3 | 34 | 7 | 18 | ||||||||||||
Other comprehensive loss | (14 | ) | (64 | ) | (59 | ) | (22 | ) | ||||||||
Comprehensive income (loss) | 423 | 126 | 40 | (198 | ) | |||||||||||
Comprehensive (income) attributable to the noncontrolling interest | — | — | — | (1 | ) | |||||||||||
Comprehensive income (loss) attributable to Calpine | $ | 423 | $ | 126 | $ | 40 | $ | (199 | ) |
September 30, | December 31, | |||||||
2012 | 2011 | |||||||
(in millions, except share and per share amounts) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents ($228 and $285 attributable to VIEs) | $ | 1,097 | $ | 1,252 | ||||
Accounts receivable, net of allowance of $10 and $13 | 500 | 598 | ||||||
Margin deposits and other prepaid expense | 143 | 193 | ||||||
Restricted cash, current ($92 and $57 attributable to VIEs) | 163 | 139 | ||||||
Derivative assets, current | 487 | 1,051 | ||||||
Inventory and other current assets | 297 | 329 | ||||||
Total current assets | 2,687 | 3,562 | ||||||
Property, plant and equipment, net ($4,535 and $4,313 attributable to VIEs) | 13,129 | 13,019 | ||||||
Restricted cash, net of current portion ($62 and $53 attributable to VIEs) | 63 | 55 | ||||||
Investments | 79 | 80 | ||||||
Long-term derivative assets | 146 | 113 | ||||||
Other assets | 489 | 542 | ||||||
Total assets | $ | 16,593 | $ | 17,371 | ||||
LIABILITIES & STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 361 | $ | 435 | ||||
Accrued interest payable ($47 and $19 attributable to VIEs) | 163 | 200 | ||||||
Debt, current portion ($40 and $41 attributable to VIEs) | 105 | 104 | ||||||
Derivative liabilities, current | 457 | 1,144 | ||||||
Other current liabilities | 265 | 279 | ||||||
Total current liabilities | 1,351 | 2,162 | ||||||
Debt, net of current portion ($2,819 and $2,522 attributable to VIEs) | 10,567 | 10,321 | ||||||
Long-term derivative liabilities | 286 | 279 | ||||||
Other long-term liabilities | 275 | 245 | ||||||
Total liabilities | 12,479 | 13,007 | ||||||
Commitments and contingencies (see Note 11) | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value per share; authorized 100,000,000 shares, none issued and outstanding | — | — | ||||||
Common stock, $0.001 par value per share; authorized 1,400,000,000 shares, 492,072,137 and 490,468,815 shares issued, respectively, and 465,572,396 and 481,743,738 shares outstanding, respectively | 1 | 1 | ||||||
Treasury stock, at cost, 26,499,741 and 8,725,077 shares, respectively | (439 | ) | (125 | ) | ||||
Additional paid-in capital | 12,327 | 12,305 | ||||||
Accumulated deficit | (7,600 | ) | (7,699 | ) | ||||
Accumulated other comprehensive loss | (237 | ) | (178 | ) | ||||
Total Calpine stockholders’ equity | 4,052 | 4,304 | ||||||
Noncontrolling interest | 62 | 60 | ||||||
Total stockholders’ equity | 4,114 | 4,364 | ||||||
Total liabilities and stockholders’ equity | $ | 16,593 | $ | 17,371 |
Nine Months Ended September 30, | ||||||||
2012 | 2011 | |||||||
(in millions) | ||||||||
Cash flows from operating activities: | ||||||||
Net income (loss) | $ | 99 | $ | (176 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||
Depreciation and amortization expense(1) | 449 | 431 | ||||||
Debt extinguishment costs | — | 82 | ||||||
Deferred income taxes | (7 | ) | (56 | ) | ||||
Loss on disposition of assets | 10 | 18 | ||||||
Unrealized mark-to-market activities, net | (103 | ) | 42 | |||||
(Income) from unconsolidated investments in power plants | (21 | ) | (12 | ) | ||||
Return on unconsolidated investments in power plants | 20 | 6 | ||||||
Stock-based compensation expense | 19 | 18 | ||||||
Other | 1 | 5 | ||||||
Change in operating assets and liabilities: | ||||||||
Accounts receivable | 96 | (87 | ) | |||||
Derivative instruments, net | (114 | ) | (6 | ) | ||||
Other assets | 97 | 27 | ||||||
Accounts payable and accrued expenses | (119 | ) | 95 | |||||
Settlement of non-hedging interest rate swaps | 156 | 147 | ||||||
Other liabilities | 25 | 2 | ||||||
Net cash provided by operating activities | 608 | 536 | ||||||
Cash flows from investing activities: | ||||||||
Purchases of property, plant and equipment | (509 | ) | (511 | ) | ||||
Settlement of non-hedging interest rate swaps | (156 | ) | (147 | ) | ||||
Return of investment in unconsolidated investment in power plants | 5 | — | ||||||
(Increase) decrease in restricted cash | (32 | ) | 9 | |||||
Purchases of deferred transmission credits | (12 | ) | (16 | ) | ||||
Other | 3 | 5 | ||||||
Net cash used in investing activities | (701 | ) | (660 | ) | ||||
Cash flows from financing activities: | ||||||||
Repayment of First Lien Term Loans | (12 | ) | — | |||||
Borrowings under First Lien Term Loans | — | 1,657 | ||||||
Repayments on NDH Project Debt | — | (1,283 | ) | |||||
Issuance of 2023 First Lien Notes | — | 1,200 | ||||||
Repayments on First Lien Credit Facility | — | (1,191 | ) | |||||
Borrowings from project financing, notes payable and other | 312 | 223 | ||||||
Repayments of project financing, notes payable and other | (53 | ) | (476 | ) | ||||
Capital contributions from noncontrolling interest holder | — | 34 | ||||||
Financing costs | (6 | ) | (78 | ) | ||||
Stock repurchases | (308 | ) | — | |||||
Other | 5 | (4 | ) | |||||
Net cash provided by (used in) financing activities | (62 | ) | 82 | |||||
Net decrease in cash and cash equivalents | (155 | ) | (42 | ) | ||||
Cash and cash equivalents, beginning of period | 1,252 | 1,327 | ||||||
Cash and cash equivalents, end of period | $ | 1,097 | $ | 1,285 |
Nine Months Ended September 30, | ||||||||
2012 | 2011 | |||||||
(in millions) | ||||||||
Cash paid during the period for: | ||||||||
Interest, net of amounts capitalized | $ | 565 | $ | 509 | ||||
Income taxes | $ | 14 | $ | 15 | ||||
Supplemental disclosure of non-cash investing and financing activities: | ||||||||
Change in capital expenditures included in accounts payable | $ | (3 | ) | $ | (13 | ) | ||
Additions to property, plant and equipment through assumption of long-term note payable | $ | 8 | $ | — |
(1) | Includes depreciation and amortization included in fuel and purchased energy expense and interest expense on our Consolidated Condensed Statements of Operations. |
1. | Basis of Presentation and Summary of Significant Accounting Policies |
September 30, 2012 | December 31, 2011 | ||||||||||||||||||||||
Current | Non-Current | Total | Current | Non-Current | Total | ||||||||||||||||||
Debt service(1) | $ | 22 | $ | 42 | $ | 64 | $ | 11 | $ | 42 | $ | 53 | |||||||||||
Rent reserve | 3 | — | 3 | — | — | — | |||||||||||||||||
Construction/major maintenance | 37 | 11 | 48 | 33 | 10 | 43 | |||||||||||||||||
Security/project/insurance | 101 | 8 | 109 | 79 | — | 79 | |||||||||||||||||
Other | — | 2 | 2 | 16 | 3 | 19 | |||||||||||||||||
Total | $ | 163 | $ | 63 | $ | 226 | $ | 139 | $ | 55 | $ | 194 |
(1) | At September 30, 2012 and December 31, 2011, amounts restricted for debt service included approximately $24 million and $25 million, respectively, of repurchase agreements with a financial institution containing maturity dates greater than one year. |
September 30, 2012 | December 31, 2011 | ||||||
Buildings, machinery and equipment | $ | 15,150 | $ | 15,074 | |||
Geothermal properties | 1,212 | 1,163 | |||||
Other | 158 | 156 | |||||
16,520 | 16,393 | ||||||
Less: Accumulated depreciation | 4,518 | 4,158 | |||||
12,002 | 12,235 | ||||||
Land | 91 | 91 | |||||
Construction in progress | 1,036 | 693 | |||||
Property, plant and equipment, net | $ | 13,129 | $ | 13,019 |
2012 | $ | 114 | |
2013 | 527 | ||
2014 | 452 | ||
2015 | 461 | ||
2016 | 375 | ||
Thereafter | 2,270 | ||
Total | $ | 4,199 | |
• | quantitative information about the unobservable inputs used in a fair value measurement that is categorized within level 3 of the fair value hierarchy; |
• | for those fair value measurements categorized within level 3 of the fair value hierarchy, both the valuation processes used and the sensitivity of the fair value measurement to changes in unobservable inputs and the interrelationships between those unobservable inputs, if any; and |
• | the categorization by level of the fair value hierarchy for items that are not measured at fair value in the statement of financial position but for which the fair value is required to be disclosed. |
2. | Acquisition and Divestitures |
3. | Variable Interest Entities and Unconsolidated Investments |
Ownership Interest as of September 30, 2012 | September 30, 2012 | December 31, 2011 | |||||||
Greenfield LP | 50% | $ | 70 | $ | 72 | ||||
Whitby | 50% | 9 | 8 | ||||||
Total investments | $ | 79 | $ | 80 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Greenfield LP | $ | (5 | ) | $ | (4 | ) | $ | (13 | ) | $ | (5 | ) | |||
Whitby | (2 | ) | (1 | ) | (8 | ) | (7 | ) | |||||||
Total | $ | (7 | ) | $ | (5 | ) | $ | (21 | ) | $ | (12 | ) |
4. | Debt |
September 30, 2012 | December 31, 2011 | ||||||
First Lien Notes | $ | 5,892 | $ | 5,892 | |||
Project financing, notes payable and other | 1,949 | 1,691 | |||||
First Lien Term Loans | 1,634 | 1,646 | |||||
CCFC Notes | 976 | 972 | |||||
Capital lease obligations | 221 | 224 | |||||
Total debt | 10,672 | 10,425 | |||||
Less: Current maturities | 105 | 104 | |||||
Debt, net of current portion | $ | 10,567 | $ | 10,321 |
September 30, 2012 | December 31, 2011 | ||||||
2017 First Lien Notes | $ | 1,200 | $ | 1,200 | |||
2019 First Lien Notes | 400 | 400 | |||||
2020 First Lien Notes | 1,092 | 1,092 | |||||
2021 First Lien Notes | 2,000 | 2,000 | |||||
2023 First Lien Notes | 1,200 | 1,200 | |||||
Total First Lien Notes | $ | 5,892 | $ | 5,892 |
• | incur or guarantee additional first lien indebtedness; |
• | enter into certain types of commodity hedge agreements that can be secured by first lien collateral; |
• | enter into sale and leaseback transactions; |
• | create or incur liens; and |
• | consolidate, merge or transfer all or substantially all of our assets and the assets of our restricted subsidiaries on a combined basis. |
September 30, 2012 | December 31, 2011 | ||||||
Corporate Revolving Facility | $ | 280 | $ | 440 | |||
CDHI | 275 | 193 | |||||
Various project financing facilities | 130 | 130 | |||||
Total | $ | 685 | $ | 763 |
September 30, 2012 | December 31, 2011 | ||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||
First Lien Notes | $ | 6,378 | $ | 5,892 | $ | 6,219 | $ | 5,892 | |||||||
Project financing, notes payable and other(1) | 1,750 | 1,789 | 1,467 | 1,504 | |||||||||||
First Lien Term Loans | 1,644 | 1,634 | 1,615 | 1,646 | |||||||||||
CCFC Notes | 1,073 | 976 | 1,070 | 972 | |||||||||||
Total | $ | 10,845 | $ | 10,291 | $ | 10,371 | $ | 10,014 |
(1) | Excludes a lease that is accounted for as a failed sale-leaseback transaction under U.S. GAAP. |
5. | Assets and Liabilities with Recurring Fair Value Measurements |
Quantitative Information about Level 3 Fair Value Measurements | ||||||||||
September 30, 2012 | ||||||||||
Fair Value, Net Asset | Significant Unobservable | |||||||||
(Liability) | Valuation Technique | Input | Range | |||||||
(in millions) | ||||||||||
Physical Power | $ | 15 | Discounted cash flow | Market price (per MWh) | $20.95 — $56.78/MWh |
Assets and Liabilities with Recurring Fair Value Measures as of September 30, 2012 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
(in millions) | |||||||||||||||
Assets: | |||||||||||||||
Cash equivalents(1) | $ | 1,275 | $ | — | $ | — | $ | 1,275 | |||||||
Margin deposits | 103 | — | — | 103 | |||||||||||
Commodity instruments: | |||||||||||||||
Commodity exchange traded futures and swaps contracts | 559 | — | — | 559 | |||||||||||
Commodity forward contracts(2) | — | 47 | 22 | 69 | |||||||||||
Interest rate swaps | — | 5 | — | 5 | |||||||||||
Total assets | $ | 1,937 | $ | 52 | $ | 22 | $ | 2,011 | |||||||
Liabilities: | |||||||||||||||
Margin deposits held by us posted by our counterparties | $ | 9 | $ | — | $ | — | $ | 9 | |||||||
Commodity instruments: | |||||||||||||||
Commodity exchange traded futures and swaps contracts | 497 | — | — | 497 | |||||||||||
Commodity forward contracts(2) | — | 32 | 6 | 38 | |||||||||||
Interest rate swaps | — | 208 | — | 208 | |||||||||||
Total liabilities | $ | 506 | $ | 240 | $ | 6 | $ | 752 |
Assets and Liabilities with Recurring Fair Value Measures as of December 31, 2011 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
(in millions) | |||||||||||||||
Assets: | |||||||||||||||
Cash equivalents(1) | $ | 1,415 | $ | — | $ | — | $ | 1,415 | |||||||
Margin deposits | 140 | — | — | 140 | |||||||||||
Commodity instruments: | |||||||||||||||
Commodity exchange traded futures and swaps contracts | 1,043 | — | — | 1,043 | |||||||||||
Commodity forward contracts(2) | — | 74 | 37 | 111 | |||||||||||
Interest rate swaps | — | 10 | — | 10 | |||||||||||
Total assets | $ | 2,598 | $ | 84 | $ | 37 | $ | 2,719 | |||||||
Liabilities: | |||||||||||||||
Margin deposits held by us posted by our counterparties | $ | 34 | $ | — | $ | — | $ | 34 | |||||||
Commodity instruments: | |||||||||||||||
Commodity exchange traded futures and swaps contracts | 899 | — | — | 899 | |||||||||||
Commodity forward contracts(2) | — | 184 | 20 | 204 | |||||||||||
Interest rate swaps | — | 320 | — | 320 | |||||||||||
Total liabilities | $ | 933 | $ | 504 | $ | 20 | $ | 1,457 |
(1) | As of September 30, 2012 and December 31, 2011, we had cash equivalents of $1,074 million and $1,249 million included in cash and cash equivalents and $201 million and $166 million included in restricted cash, respectively. |
(2) | Includes OTC swaps and options. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Balance, beginning of period | $ | (10 | ) | $ | 21 | $ | 17 | $ | 30 | ||||||
Realized and unrealized gains (losses): | |||||||||||||||
Included in net income (loss): | |||||||||||||||
Included in operating revenues(1) | 1 | (8 | ) | 3 | (1 | ) | |||||||||
Included in fuel and purchased energy expense(2) | 1 | 1 | 1 | 1 | |||||||||||
Included in OCI | — | (2 | ) | 1 | 3 | ||||||||||
Purchases, issuances and settlements: | |||||||||||||||
Issuances | (1 | ) | — | (1 | ) | — | |||||||||
Settlements | 25 | 16 | (4 | ) | (6 | ) | |||||||||
Transfers in and/or out of level 3(3): | |||||||||||||||
Transfers into level 3(4) | — | — | — | — | |||||||||||
Transfers out of level 3(5) | — | (1 | ) | (1 | ) | — | |||||||||
Balance, end of period | $ | 16 | $ | 27 | $ | 16 | $ | 27 | |||||||
Change in unrealized gains (losses) relating to instruments still held at end of period | $ | 2 | $ | (7 | ) | $ | 4 | $ | — |
(1) | For power contracts and Heat Rate swaps and options, included on our Consolidated Condensed Statements of Operations. |
(2) | For natural gas contracts, swaps and options, included on our Consolidated Condensed Statements of Operations. |
(3) | We transfer amounts among levels of the fair value hierarchy as of the end of each period. There were no transfers into/out of level 1 during the three and nine months ended September 30, 2012 and 2011. |
(4) | There were no transfers out of level 2 into level 3 for the three and nine months ended September 30, 2012 and 2011. |
(5) | We had nil and $1 million in gains transferred out of level 3 into level 2 for the three months ended September 30, 2012 and 2011, respectively. There were $1 million in gains and nil transferred out of level 3 into level 2 for the nine months ended September 30, 2012 and 2011, respectively. |
6. | Derivative Instruments |
Derivative Instruments | Notional Amounts | |||||||
September 30, 2012 | December 31, 2011 | |||||||
Power (MWh) | (13 | ) | (21 | ) | ||||
Natural gas (MMBtu) | 2 | (200 | ) | |||||
Interest rate swaps(1) | $ | 1,629 | $ | 5,639 |
(1) | Approximately $4.1 billion at December 31, 2011 was related to hedges of our First Lien Credit Facility's variable rate debt that was converted to fixed rate debt. On March 26, 2012, we terminated the interest rate swaps formerly hedging our First Lien Credit Facility. |
September 30, 2012 | |||||||||||
Interest Rate Swaps | Commodity Instruments | Total Derivative Instruments | |||||||||
Balance Sheet Presentation | |||||||||||
Current derivative assets | $ | — | $ | 487 | $ | 487 | |||||
Long-term derivative assets | 5 | 141 | 146 | ||||||||
Total derivative assets | $ | 5 | $ | 628 | $ | 633 | |||||
Current derivative liabilities | $ | 36 | $ | 421 | $ | 457 | |||||
Long-term derivative liabilities | 172 | 114 | 286 | ||||||||
Total derivative liabilities | $ | 208 | $ | 535 | $ | 743 | |||||
Net derivative assets (liabilities) | $ | (203 | ) | $ | 93 | $ | (110 | ) |
December 31, 2011 | |||||||||||
Interest Rate Swaps | Commodity Instruments | Total Derivative Instruments | |||||||||
Balance Sheet Presentation | |||||||||||
Current derivative assets | $ | — | $ | 1,051 | $ | 1,051 | |||||
Long-term derivative assets | 10 | 103 | 113 | ||||||||
Total derivative assets | $ | 10 | $ | 1,154 | $ | 1,164 | |||||
Current derivative liabilities | $ | 166 | $ | 978 | $ | 1,144 | |||||
Long-term derivative liabilities | 154 | 125 | 279 | ||||||||
Total derivative liabilities | $ | 320 | $ | 1,103 | $ | 1,423 | |||||
Net derivative assets (liabilities) | $ | (310 | ) | $ | 51 | $ | (259 | ) |
September 30, 2012 | December 31, 2011 | ||||||||||||||
Fair Value of Derivative Assets | Fair Value of Derivative Liabilities | Fair Value of Derivative Assets | Fair Value of Derivative Liabilities | ||||||||||||
Derivatives designated as cash flow hedging instruments(1): | |||||||||||||||
Interest rate swaps | $ | 5 | $ | 189 | $ | 10 | $ | 149 | |||||||
Commodity instruments | 17 | 2 | 51 | 18 | |||||||||||
Total derivatives designated as cash flow hedging instruments | $ | 22 | $ | 191 | $ | 61 | $ | 167 | |||||||
Derivatives not designated as hedging instruments: | |||||||||||||||
Interest rate swaps | $ | — | $ | 19 | $ | — | $ | 171 | |||||||
Commodity instruments | 611 | 533 | 1,103 | 1,085 | |||||||||||
Total derivatives not designated as hedging instruments | $ | 611 | $ | 552 | $ | 1,103 | $ | 1,256 | |||||||
Total derivatives | $ | 633 | $ | 743 | $ | 1,164 | $ | 1,423 |
(1) | Includes accumulated fair value of derivative instruments as of the date hedge accounting was discontinued, net of amortized fair value for settlement periods which have transpired. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Realized gain (loss) | |||||||||||||||
Interest rate swaps | $ | — | $ | (44 | ) | $ | (157 | ) | $ | (150 | ) | ||||
Commodity derivative instruments | 113 | 65 | 325 | 117 | |||||||||||
Total realized gain (loss) | $ | 113 | $ | 21 | $ | 168 | $ | (33 | ) | ||||||
Unrealized gain (loss)(1) | |||||||||||||||
Interest rate swaps | $ | 3 | $ | 43 | $ | 152 | $ | 5 | |||||||
Commodity derivative instruments | 219 | (8 | ) | (49 | ) | (47 | ) | ||||||||
Total unrealized gain (loss) | $ | 222 | $ | 35 | $ | 103 | $ | (42 | ) | ||||||
Total mark-to-market activity, net | $ | 335 | $ | 56 | $ | 271 | $ | (75 | ) |
(1) | In addition to changes in market value on derivatives not designated as hedges, changes in unrealized gain (loss) also includes de-designation of interest rate swap cash flow hedges and related reclassification from AOCI into earnings, hedge ineffectiveness and adjustments to reflect changes in credit default risk exposure. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Realized and unrealized gain (loss) | |||||||||||||||
Power contracts included in operating revenues | $ | 329 | $ | 18 | $ | 149 | $ | 9 | |||||||
Natural gas contracts included in fuel and purchased energy expense | 3 | 39 | 127 | 61 | |||||||||||
Interest rate swaps included in interest expense | 3 | 2 | 9 | 4 | |||||||||||
Loss on interest rate derivatives | — | (3 | ) | (14 | ) | (149 | ) | ||||||||
Total mark-to-market activity, net | $ | 335 | $ | 56 | $ | 271 | $ | (75 | ) |
Three Months Ended September 30, | |||||||||||||||||||||||
Gain (Loss) Recognized in OCI (Effective Portion) | Gain (Loss) Reclassified from AOCI into Income (Effective Portion)(1) | Gain (Loss) Reclassified from AOCI into Income (Ineffective Portion) | |||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | ||||||||||||||||||
Interest rate swaps | $ | (14 | ) | $ | (103 | ) | $ | (8 | ) | (2) | $ | (7 | ) | (2) | $ | — | $ | (1 | ) | ||||
Commodity derivative instruments | (9 | ) | 9 | 9 | (3) | 27 | (3) | — | (1 | ) | |||||||||||||
Total | $ | (23 | ) | $ | (94 | ) | $ | 1 | $ | 20 | $ | — | $ | (2 | ) |
Nine Months Ended September 30, | |||||||||||||||||||||||
Gain (Loss) Recognized in OCI (Effective Portion) | Gain (Loss) Reclassified from AOCI into Income (Effective Portion)(1) | Gain (Loss) Reclassified from AOCI into Income (Ineffective Portion) | |||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | ||||||||||||||||||
Interest rate swaps | $ | (48 | ) | $ | (9 | ) | $ | (23 | ) | (4) | $ | (130 | ) | (4) | $ | — | $ | (2 | ) | ||||
Commodity derivative instruments | (23 | ) | (27 | ) | 38 | (3) | 106 | (3) | 2 | — | |||||||||||||
Total | $ | (71 | ) | $ | (36 | ) | $ | 15 | $ | (24 | ) | $ | 2 | $ | (2 | ) |
(1) | Cumulative cash flow hedge losses, net of tax, remaining in AOCI were $236 million and $172 million at September 30, 2012 and December 31, 2011, respectively. |
(2) | Reclassification of losses from OCI to earnings consisted of $8 million and $7 million from the reclassification of interest rate contracts due to settlement for the three months ended September 30, 2012 and 2011, respectively. |
(3) | Included in operating revenues and fuel and purchased energy expense on our Consolidated Condensed Statement of Operations. |
(4) | Reclassification of losses from OCI to earnings consisted of $23 million and $24 million from the reclassification of interest rate contracts due to settlement for the nine months ended September 30, 2012 and 2011, respectively, $15 million in losses from terminated interest rate contracts due to repayment of project debt in June 2011, and $91 million in losses from existing interest rate contracts reclassified from OCI into earnings due to the refinancing of variable rate First Lien Credit Facility term loans for the nine months ended September 30, 2011. |
7. | Use of Collateral |
September 30, 2012 | December 31, 2011 | ||||||
Margin deposits(1) | $ | 103 | $ | 140 | |||
Natural gas and power prepayments | 34 | 42 | |||||
Total margin deposits and natural gas and power prepayments with our counterparties(2) | $ | 137 | $ | 182 | |||
Letters of credit issued | $ | 525 | $ | 581 | |||
First priority liens under power and natural gas agreements | 13 | 1 | |||||
First priority liens under interest rate swap agreements | 214 | 318 | |||||
Total letters of credit and first priority liens with our counterparties | $ | 752 | $ | 900 | |||
Margin deposits held by us posted by our counterparties(1)(3) | $ | 9 | $ | 34 | |||
Letters of credit posted with us by our counterparties | 1 | — | |||||
Total margin deposits and letters of credit posted with us by our counterparties | $ | 10 | $ | 34 |
(1) | Balances are subject to master netting arrangements and presented on a gross basis on our Consolidated Condensed Balance Sheets. We do not offset fair value amounts recognized for derivative instruments executed with the same counterparty under a master netting arrangement for financial statement presentation. |
(2) | At September 30, 2012 and December 31, 2011, $115 million and $162 million, respectively, were included in margin deposits and other prepaid expense and $22 million and $20 million, respectively, were included in other assets on our Consolidated Condensed Balance Sheets. |
(3) | Included in other current liabilities on our Consolidated Condensed Balance Sheets. |
8. | Income Taxes |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||||
Income tax expense (benefit) | $ | 81 | $ | 20 | $ | 23 | $ | (45 | ) | (1 | ) | ||||||
Imputed tax rate | 16 | % | 10 | % | 19 | % | 20 | % |
(1) | Includes a tax benefit of approximately $76 million related to the election to consolidate our CCFC and Calpine groups for federal income tax reporting purposes for the nine months ended September 30, 2011. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Intraperiod tax allocation expense included in continuing operations | $ | 3 | $ | 36 | $ | 7 | $ | 20 | |||||||
Intraperiod tax allocation benefit included in OCI | $ | (3 | ) | $ | (34 | ) | $ | (7 | ) | $ | (18 | ) |
9. | Earnings (Loss) per Share |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||
Diluted weighted average shares calculation: | |||||||||||
Weighted average shares outstanding (basic) | 462,307 | 486,420 | 470,589 | 486,363 | |||||||
Share-based awards | 3,646 | 2,642 | 3,542 | — | |||||||
Weighted average shares outstanding (diluted) | 465,953 | 489,062 | 474,131 | 486,363 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||
Share-based awards | 9,356 | 12,696 | 11,677 | 15,202 |
10. | Stock-Based Compensation |
Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Term (in years) | Aggregate Intrinsic Value (in millions) | |||||||||
Outstanding — December 31, 2011 | 17,665,902 | $ | 17.32 | 4.8 | $ | 26 | ||||||
Granted | 898,115 | $ | 15.35 | |||||||||
Exercised | 276,300 | $ | 15.16 | |||||||||
Forfeited | 171,267 | $ | 13.17 | |||||||||
Expired | 114,300 | $ | 17.72 | |||||||||
Outstanding — September 30, 2012 | 18,002,150 | $ | 17.29 | 4.3 | $ | 35 | ||||||
Exercisable — September 30, 2012 | 10,356,198 | $ | 19.13 | 3.8 | $ | 9 | ||||||
Vested and expected to vest – September 30, 2012 | 17,668,022 | $ | 17.34 | 4.2 | $ | 34 |
2012 | 2011 | |||||||
Expected term (in years)(1) | 6.5 | 6.5 | ||||||
Risk-free interest rate(2) | 1.2 – 1.6 | % | 1.7 – 3.2 | % | ||||
Expected volatility(3) | 27.0 – 30.5 | % | 31.2 – 44.9 | % | ||||
Dividend yield(4) | — | — | ||||||
Weighted average grant-date fair value (per option) | $ | 5.18 | $ | 5.49 |
(1) | Expected term calculated using the simplified method prescribed by the SEC due to the lack of sufficient historical exercise data to provide a reasonable basis to estimate the expected term. |
(2) | Zero Coupon U.S. Treasury rate or equivalent based on expected term. |
(3) | Volatility calculated using the implied volatility of our exchange traded stock options. |
(4) | We have never paid cash dividends on our common stock, and it is not anticipated that any cash dividends will be paid on our common stock in the near future. |
Number of Restricted Stock Awards | Weighted Average Grant-Date Fair Value | |||||
Nonvested — December 31, 2011 | 3,510,358 | $ | 12.10 | |||
Granted | 1,557,214 | $ | 15.38 | |||
Forfeited | 207,798 | $ | 13.61 | |||
Vested | 1,052,157 | $ | 10.10 | |||
Nonvested — September 30, 2012 | 3,807,617 | $ | 13.89 |
11. | Commitments and Contingencies |
12. | Segment Information |
Three Months Ended September 30, 2012 | |||||||||||||||||||||||
West | Texas | North | Southeast | Consolidation and Elimination | Total | ||||||||||||||||||
Revenues from external customers | $ | 509 | $ | 886 | $ | 407 | $ | 194 | $ | — | $ | 1,996 | |||||||||||
Intersegment revenues | 2 | (34 | ) | 4 | 68 | (40 | ) | — | |||||||||||||||
Total operating revenues | $ | 511 | $ | 852 | $ | 411 | $ | 262 | $ | (40 | ) | $ | 1,996 | ||||||||||
Commodity Margin(1) | $ | 330 | $ | 218 | $ | 266 | $ | 83 | $ | — | $ | 897 | |||||||||||
Add: Mark-to-market commodity activity, net and other(2)(3) | (40 | ) | 249 | (26 | ) | 27 | (8 | ) | 202 | ||||||||||||||
Less: | |||||||||||||||||||||||
Plant operating expense | 88 | 49 | 51 | 29 | (10 | ) | 207 | ||||||||||||||||
Depreciation and amortization expense | 52 | 35 | 33 | 21 | (1 | ) | 140 | ||||||||||||||||
Sales, general and other administrative expense | 9 | 12 | 8 | 8 | (1 | ) | 36 | ||||||||||||||||
Other operating expenses(4) | 10 | 1 | 6 | (1 | ) | 2 | 18 | ||||||||||||||||
(Income) from unconsolidated investments in power plants | — | — | (7 | ) | — | — | (7 | ) | |||||||||||||||
Income from operations | 131 | 370 | 149 | 53 | 2 | 705 | |||||||||||||||||
Interest expense, net of interest income | 181 | ||||||||||||||||||||||
Other (income) expense, net | 6 | ||||||||||||||||||||||
Income before income taxes | $ | 518 |
Three Months Ended September 30, 2011 | |||||||||||||||||||||||
West | Texas | North | Southeast | Consolidation and Elimination | Total | ||||||||||||||||||
Revenues from external customers | $ | 688 | $ | 843 | $ | 430 | $ | 248 | $ | — | $ | 2,209 | |||||||||||
Intersegment revenues | 3 | 3 | (8 | ) | 31 | (29 | ) | — | |||||||||||||||
Total operating revenues | $ | 691 | $ | 846 | $ | 422 | $ | 279 | $ | (29 | ) | $ | 2,209 | ||||||||||
Commodity Margin(1) | $ | 329 | $ | 162 | $ | 259 | $ | 75 | $ | — | $ | 825 | |||||||||||
Add: Mark-to-market commodity activity, net and other(2)(3) | 20 | (21 | ) | (11 | ) | — | (8 | ) | (20 | ) | |||||||||||||
Less: | |||||||||||||||||||||||
Plant operating expense | 94 | 50 | 44 | 33 | (9 | ) | 212 | ||||||||||||||||
Depreciation and amortization expense | 52 | 34 | 36 | 22 | (1 | ) | 143 | ||||||||||||||||
Sales, general and other administrative expense | 10 | 10 | 7 | 7 | (1 | ) | 33 | ||||||||||||||||
Other operating expenses(4) | 11 | (1 | ) | 7 | — | 2 | 19 | ||||||||||||||||
(Income) from unconsolidated investments in power plants | — | — | (5 | ) | — | — | (5 | ) | |||||||||||||||
Income from operations | 182 | 48 | 159 | 13 | 1 | 403 | |||||||||||||||||
Interest expense, net of interest income | 190 | ||||||||||||||||||||||
Loss on interest rate derivatives | 3 | ||||||||||||||||||||||
Debt extinguishment costs and other (income) expense, net | — | ||||||||||||||||||||||
Income before income taxes | $ | 210 |
Nine Months Ended September 30, 2012 | |||||||||||||||||||||||
West | Texas | North | Southeast | Consolidation and Elimination | Total | ||||||||||||||||||
Revenues from external customers | $ | 1,183 | $ | 1,430 | $ | 974 | $ | 524 | $ | — | $ | 4,111 | |||||||||||
Intersegment revenues | 7 | 27 | 9 | 84 | (127 | ) | — | ||||||||||||||||
Total operating revenues | $ | 1,190 | $ | 1,457 | $ | 983 | $ | 608 | $ | (127 | ) | $ | 4,111 | ||||||||||
Commodity Margin(1) | $ | 748 | $ | 472 | $ | 591 | $ | 212 | $ | — | $ | 2,023 | |||||||||||
Add: Mark-to-market commodity activity, net and other(2)(5) | (80 | ) | 66 | (17 | ) | (5 | ) | (22 | ) | (58 | ) | ||||||||||||
Less: | |||||||||||||||||||||||
Plant operating expense | 281 | 189 | 154 | 98 | (23 | ) | 699 | ||||||||||||||||
Depreciation and amortization expense | 151 | 104 | 100 | 66 | (3 | ) | 418 | ||||||||||||||||
Sales, general and other administrative expense | 23 | 36 | 22 | 23 | — | 104 | |||||||||||||||||
Other operating expenses(4) | 30 | 4 | 21 | 2 | 1 | 58 | |||||||||||||||||
(Income) from unconsolidated investments in power plants | — | — | (21 | ) | — | — | (21 | ) | |||||||||||||||
Income from operations | 183 | 205 | 298 | 18 | 3 | 707 | |||||||||||||||||
Interest expense, net of interest income | 545 | ||||||||||||||||||||||
Loss on interest rate derivatives | 14 | ||||||||||||||||||||||
Debt extinguishment costs and other (income) expense, net | 26 | ||||||||||||||||||||||
Income before income taxes | $ | 122 |
Nine Months Ended September 30, 2011 | |||||||||||||||||||||||
West | Texas | North | Southeast | Consolidation and Elimination | Total | ||||||||||||||||||
Revenues from external customers | $ | 1,753 | $ | 1,939 | $ | 1,025 | $ | 624 | $ | — | $ | 5,341 | |||||||||||
Intersegment revenues | 7 | 13 | 5 | 116 | (141 | ) | — | ||||||||||||||||
Total operating revenues | $ | 1,760 | $ | 1,952 | $ | 1,030 | $ | 740 | $ | (141 | ) | $ | 5,341 | ||||||||||
Commodity Margin(1) | $ | 798 | $ | 357 | $ | 578 | $ | 188 | $ | — | $ | 1,921 | |||||||||||
Add: Mark-to-market commodity activity, net and other(2)(5) | 36 | (54 | ) | (12 | ) | (4 | ) | (23 | ) | (57 | ) | ||||||||||||
Less: | |||||||||||||||||||||||
Plant operating expense | 297 | 193 | 136 | 107 | (22 | ) | 711 | ||||||||||||||||
Depreciation and amortization expense | 140 | 99 | 102 | 67 | (3 | ) | 405 | ||||||||||||||||
Sales, general and other administrative expense | 29 | 33 | 19 | 18 | — | 99 | |||||||||||||||||
Other operating expenses(4) | 30 | 2 | 23 | 3 | (1 | ) | 57 | ||||||||||||||||
(Income) from unconsolidated investments in power plants | — | — | (12 | ) | — | — | (12 | ) | |||||||||||||||
Income (loss) from operations | 338 | (24 | ) | 298 | (11 | ) | 3 | 604 | |||||||||||||||
Interest expense, net of interest income | 568 | ||||||||||||||||||||||
Loss on interest rate derivatives | 149 | ||||||||||||||||||||||
Debt extinguishment costs and other (income) expense, net | 108 | ||||||||||||||||||||||
Loss before income taxes | $ | (221 | ) |
(1) | Our North segment includes Commodity Margin related to Riverside Energy Center, LLC of $32 million and $31 million for the three months ended September 30, 2012 and 2011, respectively, and $64 million and $62 million for the nine months ended September 30, 2012 and 2011, respectively. |
(2) | Mark-to-market commodity activity represents the change in the unrealized portion of our mark-to-market activity, net, included in operating revenues and fuel and purchased energy expense on our Consolidated Condensed Statements of Operations. |
(3) | Includes $16 million and $11 million of lease levelization for the three months ended September 30, 2012 and 2011, respectively, and $4 million of amortization expense for each of the three months ended September 30, 2012 and 2011. |
(4) | Excludes $4 million and $3 million of RGGI compliance and other environmental costs for the three months ended September 30, 2012 and 2011, respectively, and $9 million and $7 million for the nine months ended September 30, 2012 and 2011, respectively, which are components of Commodity Margin. |
(5) | Includes $7 million and $15 million of lease levelization and $11 million and $5 million of amortization expense for the nine months ended September 30, 2012 and 2011, respectively. |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | We produced approximately 90 million MWh of electricity during the nine months ended September 30, 2012, 31% more than the same period in 2011 (includes generation from power plants owned but not operated by us and our share of generation from our unconsolidated power plants). |
• | Our entire fleet achieved a forced outage factor of 1.6% during the nine months ended September 30, 2012, our lowest on record for this period. |
• | Our entire fleet achieved a starting reliability of 98.5% during the nine months ended September 30, 2012, our highest on record for this period. |
• | During the nine months ended September 30, 2012, we achieved our best year-to-date safety performance on record. |
• | During the first quarter of 2012, we terminated our legacy interest rate swaps formerly hedging our First Lien Credit Facility for approximately $156 million. |
• | On October 3, 2012, we agreed to purchase a natural gas-fired, combined-cycle power plant with a nameplate capacity of 800 MW located in Bosque County, Texas for approximately $432 million which will increase capacity in our Texas segment. |
• | On October 9, 2012, we issued our 2019 First Lien Term Loan and will use the proceeds to reduce our overall cost of debt and simplify our capital structure by redeeming a portion of our First Lien Notes and repaying project debt. |
• | On November 1, 2012, we, through our indirect, wholly owned subsidiary Calpine Power Company, entered into an agreement with Broad River Power to sell 100% of our ownership interests in each of the Broad River Entities for approximately $427 million, including a five year consulting agreement and subject to certain working capital adjustments at closing. We expect to use the sale proceeds to focus more resources on our core markets and for general corporate purposes. |
• | Construction of our Russell City Energy Center and modernization at our Los Esteros Critical Energy Facility continue to move forward with expected completion dates during the summer of 2013. |
• | On August 23, 2011, we announced that our Board of Directors had authorized the repurchase of up to $300 million in shares of our common stock. In April 2012, our Board of Directors authorized us to double the size of our share |
• | We continue to grow our presence in core markets with an emphasis on expansions or upgrades at existing sites and power plants. We have continued to make progress with our turbine upgrade program and have ongoing development activities including the advanced development of the Garrison Energy Center located in Dover, Delaware and expansion of our Deer Park and Channel Energy Centers in Texas. |
• | We have entered into new long-term customer contracts including new PPAs associated with our Oneta Energy Center, new resource adequacy contracts and an amended PPA associated with our Los Medanos Energy Center and a new resource adequacy contract associated with our Gilroy Cogeneration Plant. |
2012 | 2011 | Change | % Change | |||||||||||
Operating revenues: | ||||||||||||||
Commodity revenue | $ | 1,693 | $ | 2,189 | $ | (496 | ) | (23 | ) | |||||
Mark-to-market activity(1) | 304 | 21 | 283 | # | ||||||||||
Other(2) | (1 | ) | (1 | ) | — | — | ||||||||
Operating revenues | 1,996 | 2,209 | (213 | ) | (10 | ) | ||||||||
Operating expenses: | ||||||||||||||
Fuel and purchased energy expense: | ||||||||||||||
Commodity expense | 808 | 1,372 | 564 | 41 | ||||||||||
Mark-to-market activity(1) | 85 | 29 | (56 | ) | # | |||||||||
Fuel and purchased energy expense | 893 | 1,401 | 508 | 36 | ||||||||||
Plant operating expense | 207 | 212 | 5 | 2 | ||||||||||
Depreciation and amortization expense | 140 | 143 | 3 | 2 | ||||||||||
Sales, general and other administrative expense | 36 | 33 | (3 | ) | (9 | ) | ||||||||
Other operating expenses(3) | 22 | 22 | — | — | ||||||||||
Total operating expenses | 1,298 | 1,811 | 513 | 28 | ||||||||||
(Income) from unconsolidated investments in power plants | (7 | ) | (5 | ) | 2 | 40 | ||||||||
Income from operations | 705 | 403 | 302 | 75 | ||||||||||
Interest expense | 183 | 192 | 9 | 5 | ||||||||||
Loss on interest rate derivatives | — | 3 | 3 | # | ||||||||||
Interest (income) | (2 | ) | (2 | ) | — | — | ||||||||
Debt extinguishment costs | — | (4 | ) | (4 | ) | # | ||||||||
Other (income) expense, net | 6 | 4 | (2 | ) | (50 | ) | ||||||||
Income before income taxes | 518 | 210 | 308 | # | ||||||||||
Income tax expense | 81 | 20 | (61 | ) | # | |||||||||
Net income | 437 | 190 | 247 | # | ||||||||||
Net income attributable to the noncontrolling interest | — | — | — | — | ||||||||||
Net income attributable to Calpine | $ | 437 | $ | 190 | $ | 247 | # |
2012 | 2011 | Change | % Change | ||||||||
Operating Performance Metrics: | |||||||||||
MWh generated (in thousands)(4) | 32,291 | 28,400 | 3,891 | 14 | |||||||
Average availability | 97.7 | % | 95.9 | % | 1.8 | % | 2 | ||||
Average total MW in operation(4) | 27,229 | 27,354 | (125 | ) | — | ||||||
Average capacity factor, excluding peakers | 61.0 | % | 53.8 | % | 7.2 | % | 13 | ||||
Steam Adjusted Heat Rate | 7,404 | 7,464 | 60 | 1 |
# | Variance of 100% or greater |
(1) | Amount represents the change in the unrealized portion of our mark-to-market activity. |
(2) | Includes $4 million of amortization expense for each of the three months ended September 30, 2012 and 2011, related to an acquired contract that became effective in June 2011. |
(3) | Includes $4 million and $3 million of RGGI compliance and other environmental costs for the three months ended September 30, 2012 and 2011, respectively, which are components of Commodity Margin. |
(4) | Represents generation and capacity from power plants that we both consolidate and operate and excludes Greenfield LP, Whitby, Freeport Energy Center, 21.5% of Hidalgo Energy Center and 25% of Freestone Energy Center. |
• | higher contribution from hedges in our Texas segment during the third quarter of 2012 compared to the third quarter of 2011; and |
• | higher regulatory capacity revenue in the Mid-Atlantic market in the third quarter of 2012 compared to the third quarter of 2011. |
2012 | 2011 | Change | % Change | |||||||||||
Operating revenues: | ||||||||||||||
Commodity revenue | $ | 4,089 | $ | 5,280 | $ | (1,191 | ) | (23 | ) | |||||
Mark-to-market activity(1) | 24 | 56 | (32 | ) | (57 | ) | ||||||||
Other(2) | (2 | ) | 5 | (7 | ) | # | ||||||||
Operating revenues | 4,111 | 5,341 | (1,230 | ) | (23 | ) | ||||||||
Operating expenses: | ||||||||||||||
Fuel and purchased energy expense: | ||||||||||||||
Commodity expense | 2,064 | 3,367 | 1,303 | 39 | ||||||||||
Mark-to-market activity(1) | 73 | 103 | 30 | 29 | ||||||||||
Fuel and purchased energy expense | 2,137 | 3,470 | 1,333 | 38 | ||||||||||
Plant operating expense | 699 | 711 | 12 | 2 | ||||||||||
Depreciation and amortization expense | 418 | 405 | (13 | ) | (3 | ) | ||||||||
Sales, general and other administrative expense | 104 | 99 | (5 | ) | (5 | ) | ||||||||
Other operating expenses(3) | 67 | 64 | (3 | ) | (5 | ) | ||||||||
Total operating expenses | 3,425 | 4,749 | 1,324 | 28 | ||||||||||
(Income) from unconsolidated investments in power plants | (21 | ) | (12 | ) | 9 | 75 | ||||||||
Income from operations | 707 | 604 | 103 | 17 | ||||||||||
Interest expense | 552 | 575 | 23 | 4 | ||||||||||
Loss on interest rate derivatives | 14 | 149 | 135 | 91 | ||||||||||
Interest (income) | (7 | ) | (7 | ) | — | — | ||||||||
Debt extinguishment costs | 12 | 94 | 82 | 87 | ||||||||||
Other (income) expense, net | 14 | 14 | — | — | ||||||||||
Income (loss) before income taxes | 122 | (221 | ) | 343 | # | |||||||||
Income tax expense (benefit) | 23 | (45 | ) | (68 | ) | # | ||||||||
Net income (loss) | 99 | (176 | ) | 275 | # | |||||||||
Net income attributable to the noncontrolling interest | — | (1 | ) | 1 | # | |||||||||
Net income (loss) attributable to Calpine | $ | 99 | $ | (177 | ) | $ | 276 | # |
2012 | 2011 | Change | % Change | ||||||||
Operating Performance Metrics: | |||||||||||
MWh generated (in thousands)(4) | 87,027 | 65,921 | 21,106 | 32 | |||||||
Average availability | 91.5 | % | 89.8 | % | 1.7 | % | 2 | ||||
Average total MW in operation(4) | 27,207 | 27,191 | 16 | — | |||||||
Average capacity factor, excluding peakers | 55.7 | % | 42.9 | % | 12.8 | % | 30 | ||||
Steam Adjusted Heat Rate | 7,357 | 7,434 | 77 | 1 |
# | Variance of 100% or greater |
(1) | Amount represents the change in the unrealized portion of our mark-to-market activity. |
(2) | Includes $11 million and $5 million of amortization expense for the nine months ended September 30, 2012 and 2011, respectively, related to an acquired contract that became effective in June 2011. |
(3) | Includes $9 million and $7 million of RGGI compliance and other environmental costs for the nine months ended September 30, 2012 and 2011, respectively, which are components of Commodity Margin. |
(4) | Represents generation and capacity from power plants that we both consolidate and operate and excludes Greenfield LP, Whitby, Freeport Energy Center, 21.5% of Hidalgo Energy Center and 25% of Freestone Energy Center. |
• | higher contribution from hedges primarily in our Texas segment during the third quarter of 2012 compared to the same period in 2011; |
• | higher generation due to increased market opportunities primarily driven by lower natural gas prices in all segments during the first half of 2012 compared to the same period in 2011 as well as lower hydroelectric generation and a nuclear power plant outage in California during the nine months ended September 30, 2012; and |
• | an extreme cold weather event in Texas that occurred on February 2, 2011, and resulted in unplanned outages at some of our power plants, negatively impacting our revenue in the nine months ended September 30, 2011, which did not reoccur in same period in 2012; partially offset by |
• | lower regulatory capacity revenue during the first half of 2012 compared to the same period in 2011; and |
• | the expiration of contracts which decreased revenue during the nine months ended September 30, 2012 compared to the same period in 2011. |
West: | 2012 | 2011 | Change | % Change | ||||||||||
Commodity Margin (in millions) | $ | 330 | $ | 329 | $ | 1 | — | |||||||
Commodity Margin per MWh generated | $ | 33.62 | $ | 50.31 | $ | (16.69 | ) | (33 | ) | |||||
MWh generated (in thousands) | 9,817 | 6,540 | 3,277 | 50 | ||||||||||
Average availability | 98.5 | % | 91.2 | % | 7.3 | % | 8 | |||||||
Average total MW in operation | 6,751 | 6,898 | (147 | ) | (2 | ) | ||||||||
Average capacity factor, excluding peakers | 70.7 | % | 47.4 | % | 23.3 | % | 49 | |||||||
Steam Adjusted Heat Rate | 7,313 | 7,479 | 166 | 2 |
Texas: | 2012 | 2011 | Change | % Change | ||||||||||
Commodity Margin (in millions) | $ | 218 | $ | 162 | $ | 56 | 35 | |||||||
Commodity Margin per MWh generated | $ | 21.75 | $ | 14.95 | $ | 6.80 | 45 | |||||||
MWh generated (in thousands) | 10,025 | 10,833 | (808 | ) | (7 | ) | ||||||||
Average availability | 97.2 | % | 98.2 | % | (1.0 | )% | (1 | ) | ||||||
Average total MW in operation | 7,016 | 7,003 | 13 | — | ||||||||||
Average capacity factor, excluding peakers | 64.7 | % | 70.1 | % | (5.4 | )% | (8 | ) | ||||||
Steam Adjusted Heat Rate | 7,211 | 7,296 | 85 | 1 |
North: | 2012 | 2011 | Change | % Change | ||||||||||
Commodity Margin (in millions) | $ | 266 | $ | 259 | $ | 7 | 3 | |||||||
Commodity Margin per MWh generated | $ | 40.13 | $ | 50.69 | $ | (10.56 | ) | (21 | ) | |||||
MWh generated (in thousands) | 6,628 | 5,109 | 1,519 | 30 | ||||||||||
Average availability | 96.9 | % | 97.5 | % | (0.6 | )% | (1 | ) | ||||||
Average total MW in operation | 7,379 | 7,370 | 9 | — | ||||||||||
Average capacity factor, excluding peakers | 56.1 | % | 43.4 | % | 12.7 | % | 29 | |||||||
Steam Adjusted Heat Rate | 7,943 | 8,003 | 60 | 1 |
Southeast: | 2012 | 2011 | Change | % Change | ||||||||||
Commodity Margin (in millions) | $ | 83 | $ | 75 | $ | 8 | 11 | |||||||
Commodity Margin per MWh generated | $ | 14.26 | $ | 12.67 | $ | 1.59 | 13 | |||||||
MWh generated (in thousands) | 5,821 | 5,918 | (97 | ) | (2 | ) | ||||||||
Average availability | 98.3 | % | 96.6 | % | 1.7 | % | 2 | |||||||
Average total MW in operation | 6,083 | 6,083 | — | — | ||||||||||
Average capacity factor, excluding peakers | 48.4 | % | 48.9 | % | (0.5 | )% | (1 | ) | ||||||
Steam Adjusted Heat Rate | 7,325 | 7,344 | 19 | — |
West: | 2012 | 2011 | Change | % Change | ||||||||||
Commodity Margin (in millions) | $ | 748 | $ | 798 | $ | (50 | ) | (6 | ) | |||||
Commodity Margin per MWh generated | $ | 30.90 | $ | 49.29 | $ | (18.39 | ) | (37 | ) | |||||
MWh generated (in thousands) | 24,211 | 16,189 | 8,022 | 50 | ||||||||||
Average availability | 91.2 | % | 86.4 | % | 4.8 | % | 6 | |||||||
Average total MW in operation | 6,739 | 6,891 | (152 | ) | (2 | ) | ||||||||
Average capacity factor, excluding peakers | 58.7 | % | 39.6 | % | 19.1 | % | 48 | |||||||
Steam Adjusted Heat Rate | 7,267 | 7,488 | 221 | 3 |
Texas: | 2012 | 2011 | Change | % Change | ||||||||||
Commodity Margin (in millions) | $ | 472 | $ | 357 | $ | 115 | 32 | |||||||
Commodity Margin per MWh generated | $ | 16.70 | $ | 14.86 | $ | 1.84 | 12 | |||||||
MWh generated (in thousands) | 28,257 | 24,019 | 4,238 | 18 | ||||||||||
Average availability | 90.4 | % | 88.8 | % | 1.6 | % | 2 | |||||||
Average total MW in operation | 7,012 | 6,983 | 29 | — | ||||||||||
Average capacity factor, excluding peakers | 61.3 | % | 52.5 | % | 8.8 | % | 17 | |||||||
Steam Adjusted Heat Rate | 7,149 | 7,256 | 107 | 1 |
North: | 2012 | 2011 | Change | % Change | ||||||||||
Commodity Margin (in millions) | $ | 591 | $ | 578 | $ | 13 | 2 | |||||||
Commodity Margin per MWh generated | $ | 35.15 | $ | 51.50 | $ | (16.35 | ) | (32 | ) | |||||
MWh generated (in thousands) | 16,815 | 11,224 | 5,591 | 50 | ||||||||||
Average availability | 90.5 | % | 92.3 | % | (1.8 | )% | (2 | ) | ||||||
Average total MW in operation | 7,373 | 7,234 | 139 | 2 | ||||||||||
Average capacity factor, excluding peakers | 49.7 | % | 34.4 | % | 15.3 | % | 44 | |||||||
Steam Adjusted Heat Rate | 7,918 | 7,939 | 21 | — |
Southeast: | 2012 | 2011 | Change | % Change | ||||||||||
Commodity Margin (in millions) | $ | 212 | $ | 188 | $ | 24 | 13 | |||||||
Commodity Margin per MWh generated | $ | 11.95 | $ | 12.98 | $ | (1.03 | ) | (8 | ) | |||||
MWh generated (in thousands) | 17,744 | 14,489 | 3,255 | 22 | ||||||||||
Average availability | 94.4 | % | 92.0 | % | 2.4 | % | 3 | |||||||
Average total MW in operation | 6,083 | 6,083 | — | — | ||||||||||
Average capacity factor, excluding peakers | 49.6 | % | 41.0 | % | 8.6 | % | 21 | |||||||
Steam Adjusted Heat Rate | 7,302 | 7,323 | 21 | — |
Three Months Ended September 30, 2012 | |||||||||||||||||||||||
West | Texas | North | Southeast | Consolidation and Elimination | Total | ||||||||||||||||||
Net income attributable to Calpine | $ | 437 | |||||||||||||||||||||
Income tax expense | 81 | ||||||||||||||||||||||
Other (income) expense, net | 6 | ||||||||||||||||||||||
Interest expense, net of interest income | 181 | ||||||||||||||||||||||
Income from operations | $ | 131 | $ | 370 | $ | 149 | $ | 53 | $ | 2 | $ | 705 | |||||||||||
Add: | |||||||||||||||||||||||
Adjustments to reconcile income from operations to Adjusted EBITDA: | |||||||||||||||||||||||
Depreciation and amortization expense, excluding deferred financing costs(1) | 52 | 35 | 33 | 21 | (1 | ) | 140 | ||||||||||||||||
Major maintenance expense | 13 | 6 | 9 | 3 | — | 31 | |||||||||||||||||
Operating lease expense | 3 | — | 6 | — | — | 9 | |||||||||||||||||
Unrealized (gain) loss on commodity derivative mark-to-market activity | 36 | (244 | ) | 17 | (28 | ) | — | (219 | ) | ||||||||||||||
Adjustments to reflect Adjusted EBITDA from unconsolidated investments(2)(3) | — | — | 7 | — | — | 7 | |||||||||||||||||
Stock-based compensation expense | 2 | 2 | 1 | 1 | — | 6 | |||||||||||||||||
Loss on dispositions of assets | 1 | 3 | 2 | — | (1 | ) | 5 | ||||||||||||||||
Acquired contract amortization | — | — | 4 | — | — | 4 | |||||||||||||||||
Other | 6 | 1 | 8 | 3 | — | 18 | |||||||||||||||||
Total Adjusted EBITDA | $ | 244 | $ | 173 | $ | 236 | $ | 53 | $ | — | $ | 706 |
Three Months Ended September 30, 2011 | |||||||||||||||||||||||
West | Texas | North | Southeast | Consolidation and Elimination | Total | ||||||||||||||||||
Net income attributable to Calpine | $ | 190 | |||||||||||||||||||||
Income tax expense | 20 | ||||||||||||||||||||||
Debt extinguishment costs and other (income) expense, net | — | ||||||||||||||||||||||
Loss on interest rate derivatives | 3 | ||||||||||||||||||||||
Interest expense, net of interest income | 190 | ||||||||||||||||||||||
Income from operations | $ | 182 | $ | 48 | $ | 159 | $ | 13 | $ | 1 | $ | 403 | |||||||||||
Add: | |||||||||||||||||||||||
Adjustments to reconcile income from operations to Adjusted EBITDA: | |||||||||||||||||||||||
Depreciation and amortization expense, excluding deferred financing costs(1) | 52 | 34 | 36 | 22 | (1 | ) | 143 | ||||||||||||||||
Major maintenance expense | 13 | 9 | 6 | 5 | — | 33 | |||||||||||||||||
Operating lease expense | 3 | — | 6 | — | — | 9 | |||||||||||||||||
Unrealized (gain) loss on commodity derivative mark-to-market activity | (21 | ) | 25 | 2 | 3 | — | 9 | ||||||||||||||||
Adjustments to reflect Adjusted EBITDA from unconsolidated investments(2)(3) | — | — | 9 | — | — | 9 | |||||||||||||||||
Stock-based compensation expense | 2 | 1 | 2 | 1 | — | 6 | |||||||||||||||||
Loss on dispositions of assets | 5 | 2 | 1 | — | — | 8 | |||||||||||||||||
Acquired contract amortization | — | — | 4 | — | — | 4 | |||||||||||||||||
Other | 7 | 1 | 6 | — | — | 14 | |||||||||||||||||
Total Adjusted EBITDA | $ | 243 | $ | 120 | $ | 231 | $ | 44 | $ | — | $ | 638 |
Nine Months Ended September 30, 2012 | |||||||||||||||||||||||
West | Texas | North | Southeast | Consolidation and Elimination | Total | ||||||||||||||||||
Net income attributable to Calpine | $ | 99 | |||||||||||||||||||||
Income tax expense | 23 | ||||||||||||||||||||||
Debt extinguishment costs and other (income) expense, net | 26 | ||||||||||||||||||||||
Loss on interest rate derivatives | 14 | ||||||||||||||||||||||
Interest expense, net of interest income | 545 | ||||||||||||||||||||||
Income from operations | $ | 183 | $ | 205 | $ | 298 | $ | 18 | $ | 3 | $ | 707 | |||||||||||
Add: | |||||||||||||||||||||||
Adjustments to reconcile income from operations to Adjusted EBITDA: | |||||||||||||||||||||||
Depreciation and amortization expense, excluding deferred financing costs(1) | 151 | 104 | 99 | 67 | (2 | ) | 419 | ||||||||||||||||
Major maintenance expense | 58 | 53 | 31 | 16 | — | 158 | |||||||||||||||||
Operating lease expense | 7 | — | 19 | — | — | 26 | |||||||||||||||||
Unrealized (gain) loss on commodity derivative mark-to-market activity | 88 | (51 | ) | 6 | 6 | — | 49 | ||||||||||||||||
Adjustments to reflect Adjusted EBITDA from unconsolidated investments(2)(3) | — | — | 23 | — | — | 23 | |||||||||||||||||
Stock-based compensation expense | 6 | 6 | 3 | 4 | — | 19 | |||||||||||||||||
Loss on dispositions of assets | 2 | 4 | 3 | 1 | (1 | ) | 9 | ||||||||||||||||
Acquired contract amortization | — | — | 11 | — | — | 11 | |||||||||||||||||
Other | (1 | ) | 2 | 7 | 5 | — | 13 | ||||||||||||||||
Total Adjusted EBITDA | $ | 494 | $ | 323 | $ | 500 | $ | 117 | $ | — | $ | 1,434 |
Nine Months Ended September 30, 2011 | |||||||||||||||||||||||
West | Texas | North | Southeast | Consolidation and Elimination | Total | ||||||||||||||||||
Net loss attributable to Calpine | $ | (177 | ) | ||||||||||||||||||||
Net income attributable to the noncontrolling interest | 1 | ||||||||||||||||||||||
Income tax benefit | (45 | ) | |||||||||||||||||||||
Debt extinguishment costs and other (income) expense, net | 108 | ||||||||||||||||||||||
Loss on interest rate derivatives | 149 | ||||||||||||||||||||||
Interest expense, net of interest income | 568 | ||||||||||||||||||||||
Income (loss) from operations | $ | 338 | $ | (24 | ) | $ | 298 | $ | (11 | ) | $ | 3 | $ | 604 | |||||||||
Add: | |||||||||||||||||||||||
Adjustments to reconcile income (loss) from operations to Adjusted EBITDA: | |||||||||||||||||||||||
Depreciation and amortization expense, excluding deferred financing costs(1) | 140 | 99 | 102 | 68 | (3 | ) | 406 | ||||||||||||||||
Major maintenance expense | 51 | 68 | 19 | 31 | — | 169 | |||||||||||||||||
Operating lease expense | 7 | — | 19 | — | — | 26 | |||||||||||||||||
Unrealized (gain) loss on commodity derivative mark-to-market activity | (32 | ) | 70 | 1 | 9 | — | 48 | ||||||||||||||||
Adjustments to reflect Adjusted EBITDA from unconsolidated investments(2)(3) | — | — | 30 | — | — | 30 | |||||||||||||||||
Stock-based compensation expense | 7 | 5 | 3 | 3 | — | 18 | |||||||||||||||||
Loss on dispositions of assets | 7 | 6 | 2 | 2 | — | 17 | |||||||||||||||||
Acquired contract amortization | — | — | 5 | — | — | 5 | |||||||||||||||||
Other | 8 | 1 | 14 | 1 | — | 24 | |||||||||||||||||
Total Adjusted EBITDA | $ | 526 | $ | 225 | $ | 493 | $ | 103 | $ | — | $ | 1,347 |
(1) | Depreciation and amortization expense in the income from operations calculation on our Consolidated Condensed Statements of Operations excludes amortization of other assets. |
(2) | Included on our Consolidated Condensed Statements of Operations in (income) from unconsolidated investments in power plants. |
(3) | Adjustments to reflect Adjusted EBITDA from unconsolidated investments include unrealized (gain) loss on mark-to-market activity of nil for each of the three and nine months ended September 30, 2012 and $1 million for each of the three and nine months ended September 30, 2011. |
September 30, 2012 | December 31, 2011 | ||||||
Cash and cash equivalents, corporate(1) | $ | 886 | $ | 946 | |||
Cash and cash equivalents, non-corporate | 211 | 306 | |||||
Total cash and cash equivalents | 1,097 | 1,252 | |||||
Restricted cash | 226 | 194 | |||||
Corporate Revolving Facility availability | 720 | 560 | |||||
Letter of credit availability(2) | 25 | 7 | |||||
Total current liquidity availability | $ | 2,068 | $ | 2,013 |
(1) | Includes $9 million and $34 million of margin deposits held by us posted by our counterparties at September 30, 2012 and December 31, 2011, respectively. |
(2) | Includes availability under our CDHI letter of credit facility. On January 10, 2012, we increased the CDHI letter of credit facility to $300 million and extended the maturity date to January 2, 2016. |
• | the level of Market Heat Rates; |
• | our continued ability to successfully hedge our Commodity Margin; |
• | the speed, strength and duration of an economic recovery; |
• | maintaining acceptable availability levels for our fleet; |
• | the impact of current and pending environmental regulations in the markets in which we participate; |
• | improving the efficiency and profitability of our operations; |
• | increasing future contractual cash flows; and |
• | our significant counterparties performing under their contracts with us. |
September 30, 2012 | December 31, 2011 | ||||||
Corporate Revolving Facility | $ | 280 | $ | 440 | |||
CDHI | 275 | 193 | |||||
Various project financing facilities | 130 | 130 | |||||
Total | $ | 685 | $ | 763 |
• | We entered into a new twenty-year PPA with Western Farmers Electric Cooperative to provide 160 MW of power generated by our Oneta Energy Center, commencing in June 2014. The capacity under contract will increase in increments, up to a maximum of 280 MW in years 2019 through 2035. |
• | We entered into a new five-year PPA with Southwestern Public Service Company, a subsidiary of Xcel Energy, to provide an additional 200 MW of power generated by our Oneta Energy Center commencing on June 1, 2014. |
• | We entered into a new five-year resource adequacy contract with PG&E for approximately 280 MW of combined heat and power capacity from our Los Medanos Energy Center commencing in summer 2013. |
• | We entered into a new seven-year resource adequacy contract with Southern California Edison Company (“SCE”) for approximately 280 MW of combined heat and power capacity from our Los Medanos Energy Center and a new five-year resource adequacy contract with SCE for approximately 120 MW of combined heat and power capacity from our Gilroy Cogeneration Plant, both commencing in January 2014. |
• | We amended an existing PPA with Dow Chemical Company for an incremental energy sale of up to approximately 158,000 MWh per year of energy from our Los Medanos Energy Center which runs through February 2025. |
• | We entered into a new fifteen-year PPA with American Electric Power Service Corporation, as agent for Public Service Company of Oklahoma, to provide 260 MW of energy, capacity and ancillary services from our Oneta Energy Center commencing in June 2016. |
2012 | 2011 | ||||||
Beginning cash and cash equivalents | $ | 1,252 | $ | 1,327 | |||
Net cash provided by (used in): | |||||||
Operating activities | 608 | 536 | |||||
Investing activities | (701 | ) | (660 | ) | |||
Financing activities | (62 | ) | 82 | ||||
Net decrease in cash and cash equivalents | (155 | ) | (42 | ) | |||
Ending cash and cash equivalents | $ | 1,097 | $ | 1,285 |
• | Income from operations — Income from operations, adjusted for non-cash items increased by $112 million for the nine months ended September 30, 2012 as compared to the nine months ended September 30, 2011. Non-cash items consist primarily of depreciation and amortization, income from unconsolidated investments and unrealized gains and losses in mark-to-market activity; partially offset by |
• | Interest paid — Cash paid for interest increased by $56 million to $565 million for the nine months ended September 30, 2012, as compared to $509 million for the nine months ended September 30, 2011. The increase was primarily due to timing of interest payments on our First Lien Term Loans and First Lien Notes offset by lower payments on our NDH Project Debt and other project debt. |
• | Settlement of non-hedging interest rate swaps — During the nine months ended September 30, 2012, we terminated our legacy interest rate swaps formerly hedging our First Lien Credit Facility resulting in payments of approximately $156 million, compared to payments of approximately $147 million during the nine months ended September 30, 2011. |
• | Restricted cash — Restricted cash increased approximately $32 million for nine months ended September 30, 2012 compared to a decrease of $9 million for the same period in 2011. The increase in restricted cash was primarily due to a 2011 reduction in restricted cash balances related to changes in project related debt which did not recur in the nine months ended September 30, 2012, partially offset by an increase in restricted cash related to normal operating activity. |
• | First Lien Term Loans — During the nine months ended September 30, 2012, we made repayments on the First Lien Term Loans of approximately $12 million. During the nine months ended September 30, 2011, we received proceeds of approximately $1.7 billion from the issuance of the First Lien Term Loans. We used the proceeds to repay the NDH Project Debt of approximately $1.3 billion resulting in a net increase of $374 million. |
• | Stock repurchases — During the nine months ended September 30, 2012, we made payments under the share repurchase program of approximately $308 million. |
• | First Lien Notes — During the nine months ended September 30, 2011, we received proceeds of approximately $1.2 billion from the issuance of the 2023 First Lien Notes and used those proceeds to terminate the First Lien Credit Facility in accordance with its repayment terms resulting in a net increase of approximately $9 million. |
• | Decreased contributions from noncontrolling interest holder — During the nine months ended September 30, 2012, we received contributions from a noncontrolling interest holder of nil compared to approximately $34 million during the nine months ended September 30, 2011. |
• | Proceeds from project debt — During the nine months ended September 30, 2012, we received proceeds of approximately $312 million from project debt compared to $223 million for the nine months ended September 30, 2011. The proceeds received were related to our Russell City Project Debt and Los Esteros Project Debt. |
• | Lower repayments of project debt — During the nine months ended September 30, 2012, we made repayments on project debt of approximately $53 million compared to repayments of approximately $476 million for the nine months ended September 30, 2011. |
• | Lower financing costs — During the nine months ended September 30, 2012, we paid financing costs of approximately $6 million compared to approximately $78 million for the nine months ended September 30, 2011. |
Interest Rate Swaps | Commodity Instruments | Total | |||||||||
Fair value of contracts outstanding at January 1, 2012 | $ | (310 | ) | $ | 51 | $ | (259 | ) | |||
Items recognized or otherwise settled during the period(1)(2) | 165 | (27 | ) | 138 | |||||||
Fair value attributable to new contracts | — | 62 | 62 | ||||||||
Changes in fair value attributable to price movements | (56 | ) | 8 | (48 | ) | ||||||
Changes in fair value attributable to nonperformance risk | (2 | ) | (1 | ) | (3 | ) | |||||
Fair value of contracts outstanding at September 30, 2012(3) | $ | (203 | ) | $ | 93 | $ | (110 | ) |
(1) | Interest rate settlements consist of recognized losses of $146 million related to interest rate swaps that were terminated during the nine months ended September 30, 2012, $9 million related to recognition of losses from settlements of designated cash flow hedges and $10 million in losses from settlements of undesignated interest rate swaps (represents a portion of interest expense and loss on interest rate derivatives as reported on our Consolidated Condensed Statements of Operations). |
(2) | Gains on settlement of commodity contracts not designated as hedging instruments of $83 million (represents a portion of operating revenues and fuel and purchased energy expense as reported on our Consolidated Condensed Statements of Operations) and $56 million related to recognition of losses from other changes in derivative assets and liabilities not reflected in OCI or earnings, partially offset by de-designated cash flow hedges, previously reflected in AOCI. |
(3) | Net commodity and interest rate derivative assets and liabilities reported in Notes 5 and 6 of the Notes to Consolidated Condensed Financial Statements. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Realized gain (loss) | |||||||||||||||
Interest rate swaps | $ | — | $ | (44 | ) | $ | (157 | ) | $ | (150 | ) | ||||
Commodity derivative instruments | 113 | 65 | 325 | 117 | |||||||||||
Total realized gain (loss) | $ | 113 | $ | 21 | $ | 168 | $ | (33 | ) | ||||||
Unrealized gain (loss)(1) | |||||||||||||||
Interest rate swaps | $ | 3 | $ | 43 | $ | 152 | $ | 5 | |||||||
Commodity derivative instruments | 219 | (8 | ) | (49 | ) | (47 | ) | ||||||||
Total unrealized gain (loss) | $ | 222 | $ | 35 | $ | 103 | $ | (42 | ) | ||||||
Total mark-to-market activity, net | $ | 335 | $ | 56 | $ | 271 | $ | (75 | ) |
(1) | In addition to changes in market value on derivatives not designated as hedges, changes in unrealized gain (loss) also includes de-designation of interest rate swap cash flow hedges and related reclassification from AOCI into earnings, hedge ineffectiveness and adjustments to reflect changes in credit default risk exposure. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Realized and unrealized gain (loss) | |||||||||||||||
Power contracts included in operating revenues | $ | 329 | $ | 18 | $ | 149 | $ | 9 | |||||||
Natural gas contracts included in fuel and purchased energy expense | 3 | 39 | 127 | 61 | |||||||||||
Interest rate swaps included in interest expense | 3 | 2 | 9 | 4 | |||||||||||
Loss on interest rate derivatives | — | (3 | ) | (14 | ) | (149 | ) | ||||||||
Total mark-to-market activity, net | $ | 335 | $ | 56 | $ | 271 | $ | (75 | ) |
Fair Value Source | 2012 | 2013-2014 | 2015-2016 | After 2016 | Total | |||||||||||||||
Prices actively quoted | $ | 25 | $ | 16 | $ | 5 | $ | — | $ | 46 | ||||||||||
Prices provided by other external sources | 21 | 11 | — | — | 32 | |||||||||||||||
Prices based on models and other valuation methods | 7 | 8 | — | — | 15 | |||||||||||||||
Total fair value | $ | 53 | $ | 35 | $ | 5 | $ | — | $ | 93 |
2012 | 2011 | ||||||
Three months ended September 30: | |||||||
High | $ | 67 | $ | 34 | |||
Low | $ | 37 | $ | 21 | |||
Average | $ | 49 | $ | 28 | |||
Nine months ended September 30: | |||||||
High | $ | 77 | $ | 39 | |||
Low | $ | 34 | $ | 20 | |||
Average | $ | 49 | $ | 31 | |||
As of September 30 | $ | 39 | $ | 31 |
• | credit approvals; |
• | routine monitoring of counterparties’ credit limits and their overall credit ratings; |
• | limiting our marketing, hedging and optimization activities with high risk counterparties; |
• | margin, collateral or prepayment arrangements; and |
• | payment netting arrangements or master netting arrangements that allow for the netting of positive and negative exposures of various contracts associated with a single counterparty. |
Credit Quality (Based on Standard & Poor’s Ratings as of September 30, 2012) | 2012 | 2013-2014 | 2015-2016 | After 2016 | Total | |||||||||||||||
Investment grade | $ | 59 | $ | 35 | $ | 5 | $ | — | $ | 99 | ||||||||||
Non-investment grade | (1 | ) | — | — | — | (1 | ) | |||||||||||||
No external ratings | (5 | ) | — | — | — | (5 | ) | |||||||||||||
Total fair value | $ | 53 | $ | 35 | $ | 5 | $ | — | $ | 93 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
Item 4. | Controls and Procedures |
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | (a) Total Number of Shares Purchased(1) | (b) Average Price Paid Per Share | (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2) | (d) Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in millions) | ||||||||||
July | — | $ | — | — | $ | 191 | ||||||||
August | 1,087,797 | $ | 16.86 | 1,086,214 | $ | 173 | ||||||||
September | 2,157 | $ | 17.51 | — | $ | 173 | ||||||||
Total | 1,089,954 | $ | 16.86 | 1,086,214 | $ | 173 |
(1) | Upon vesting of restricted stock awarded by us to employees, we withhold shares to cover employees' tax withholding obligations, other than for employees who have chosen to satisfy their tax withholding obligations in cash. During the third quarter of 2012, we withheld a total of 3,740 shares in the indicated months that are included in total number of shares purchased. |
(2) | On August 23, 2011, we announced that our Board of Directors had authorized the repurchase of up to $300 million in shares of our common stock. In April 2012, our Board of Directors authorized us to double the size of our share repurchase program, increasing our permitted cumulative repurchases to $600 million in shares of our common stock. The announced share repurchase program did not specify an expiration date. The repurchases may be commenced or suspended from time to time without prior notice. Through the filing of this Report, a total of 25,632,334 shares of our outstanding common stock have been repurchased under this program for approximately $427 million at an average price of $16.66 per share. The shares repurchased under our share repurchase program were purchased in open market transactions and are held as treasury stock. |
Item 3. | Defaults Upon Senior Securities |
Item 4. | Mine Safety Disclosures |
Item 5. | Other Information |
Item 6. | Exhibits |
Exhibit Number | Description | |
4.1 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of October 21, 2009, providing for the issuance of 7.25% Senior Secured Notes due 2017. | |
4.2 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of May 25, 2010, providing for the issuance of 8.0% Senior Secured Notes due 2019. | |
4.3 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of July 23, 2010, providing for the issuance of 7.875% Senior Secured Notes due 2020. | |
4.4 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of October 22, 2010, providing for the issuance of 7.50% Senior Secured Notes due 2021. | |
4.5 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of January 14, 2011, providing for the issuance of 7.875% Senior Secured Notes due 2023. | |
31.1 | Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1 | Certification of the Chief Executive Officer and the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. * | |
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase. |
* | Furnished herewith. |
CALPINE CORPORATION | ||
(Registrant) | ||
By: | /s/ ZAMIR RAUF | |
Zamir Rauf Executive Vice President and Chief Financial Officer (principal financial officer) |
Exhibit Number | Description | |
4.1 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of October 21, 2009, providing for the issuance of 7.25% Senior Secured Notes due 2017. | |
4.2 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of May 25, 2010, providing for the issuance of 8.0% Senior Secured Notes due 2019. | |
4.3 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of July 23, 2010, providing for the issuance of 7.875% Senior Secured Notes due 2020. | |
4.4 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of October 22, 2010, providing for the issuance of 7.50% Senior Secured Notes due 2021. | |
4.5 | Third Supplemental Indenture dated as of August 20, 2012, among each of Calpine Energy Services GP, LLC and Calpine Energy Services LP, LLC and Wilmington Trust Company, as trustee under the indenture, dated as of January 14, 2011, providing for the issuance of 7.875% Senior Secured Notes due 2023. | |
31.1 | Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1 | Certification of the Chief Executive Officer and the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. * | |
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase. |
* | Furnished herewith. |
By: | /s/ Zamir Rauf |
By: | /s/ Andre Walker |
By: | /s/ W. Thaddeus Miller |
By: | /s/ Todd Thornton |
By: | /s/ Zamir Rauf |
By: | /s/ Prital Patel |
Calpine Energy Services GP, LLC |
Calpine Energy Services LP, LLC |
Calpine Construction Management Company, Inc. |
Calpine Mid-Atlantic Operating, LLC |
Calpine Operating Services Company, Inc. |
Calpine Power Services, Inc. |
Thomassen Turbine Systems America, Inc. |
Name of Guarantor |
Anacapa Land Company, LLC |
Anderson Springs Energy Company |
Auburndale Peaker Energy Center, LLC |
Aviation Funding Corp. |
Baytown Energy Center, LLC |
Bellingham Cogen, Inc. |
CalGen Expansion Company, LLC |
CalGen Finance Corp. |
CalGen Project Equipment Finance Company Three, LLC |
Calpine Administrative Services Company, Inc. |
Calpine Auburndale Holdings, LLC |
Calpine c*Power, Inc. |
Calpine CalGen Holdings, Inc. |
Calpine California Holdings, Inc. |
Calpine Calistoga Holdings, LLC |
Calpine CCFC Holdings, Inc. |
Calpine Central Texas GP, Inc. |
Calpine Central, Inc. |
Calpine Central-Texas, Inc. |
Calpine Cogeneration Corporation |
Calpine Eastern Corporation |
Calpine Edinburg, Inc. |
Calpine Energy Services, L.P. |
Calpine Fuels Corporation |
Calpine Generating Company, LLC |
Calpine Geysers Company, L.P. |
Calpine Gilroy 1, Inc. |
Calpine Gilroy 2, Inc. |
Calpine Global Services Company, Inc. |
Calpine Hidalgo Energy Center, L.P. |
Name of Guarantor |
Calpine Hidalgo Holdings, Inc. |
Calpine Hidalgo, Inc. |
Calpine Jupiter, LLC |
Calpine Kennedy Operators, Inc. |
Calpine KIA, Inc. |
Calpine King City, Inc. |
Calpine King City, LLC |
Calpine Leasing Inc. |
Calpine Long Island, Inc. |
Calpine Magic Valley Pipeline, Inc. |
Calpine MVP, Inc. |
Calpine Newark, LLC |
Calpine Northbrook Holdings Corporation |
Calpine Northbrook Investors, LLC |
Calpine Northbrook Project Holdings, LLC |
Calpine Oneta Power, LLC |
Calpine Operations Management Company, Inc. |
Calpine Power Company |
Calpine Power, Inc. |
Calpine Power Management, LLC |
Calpine PowerAmerica, LLC |
Calpine PowerAmerica-CA, LLC |
Calpine PowerAmerica-ME, LLC |
Calpine Project Holdings, Inc. |
Calpine Pryor, Inc. |
Calpine Rumford I, Inc. |
Calpine Rumford, Inc. |
Calpine Schuylkill, Inc. |
Calpine Sonoran Pipeline, LLC |
Calpine Stony Brook Operators, Inc. |
Calpine Stony Brook, Inc. |
Name of Guarantor |
Calpine Sumas, Inc. |
Calpine TCCL Holdings, Inc. |
Calpine Texas Pipeline GP, Inc. |
Calpine Texas Pipeline LP, Inc. |
Calpine Texas Pipeline, L.P. |
Calpine Tiverton I, Inc. |
Calpine Tiverton, Inc. |
Calpine University Power, Inc. |
Carville Energy LLC |
CES Marketing IX, LLC |
CES Marketing V, LLC |
CES Marketing X, LLC |
Channel Energy Center, LLC |
Clear Lake Cogeneration Limited Partnership |
Columbia Energy LLC |
Corpus Christi Cogeneration, LLC |
CPN 3rd Turbine, Inc. |
CPN Acadia, Inc. |
CPN Cascade, Inc. |
CPN Clear Lake, Inc. |
CPN East Fuels, LLC |
CPN Pipeline Company |
CPN Pryor Funding Corporation |
CPN Telephone Flat, Inc. |
Decatur Energy Center, LLC |
Delta Energy Center, LLC |
Fontana Energy Center, LLC |
Freestone Power Generation, LLC |
GEC Bethpage Inc. |
Geysers Power Company, LLC |
Geysers Power I Company |
Name of Guarantor |
Hillabee Energy Center, LLC |
Idlewild Fuel Management Corp. |
JMC Bethpage, Inc. |
Los Medanos Energy Center LLC |
Magic Valley Pipeline, L.P. |
Mobile Energy LLC |
Modoc Power, Inc. |
Morgan Energy Center, LLC |
Northwest Cogeneration, Inc. |
NTC Five, Inc. |
Pastoria Energy Center, LLC |
Pastoria Energy Facility, L.L.C. |
Pine Bluff Energy, LLC |
RockGen Energy LLC |
Rumford Power Associates Limited Partnership |
Santa Rosa Energy Center, LLC |
Stony Brook Cogeneration, Inc. |
Stony Brook Fuel Management Corp. |
Sutter Dryers, Inc. |
Texas City Cogeneration, LLC |
Texas Cogeneration Five, Inc. |
Texas Cogeneration One Company |
Thermal Power Company |
Tiverton Power Associates Limited Partnership |
Zion Energy LLC |
Calpine Bethlehem, LLC |
Calpine Mid-Atlantic Energy, LLC |
Calpine Mid-Atlantic Generation, LLC |
Calpine Mid-Atlantic Marketing, LLC |
Calpine New Jersey Generation, LLC |
Calpine Solar, LLC |
Calpine Vineland Solar, LLC |
New Development Holdings, LLC |
Deer Park Energy Center LLC |
Deer Park Holdings, LLC |
Metcalf Energy Center, LLC |
Metcalf Holdings, LLC |
By: | /s/ Zamir Rauf _ |
By: | /s/ Andre Walker _ |
By: | /s/ W. Thaddeus Miller _ |
By: | /s/ Todd Thornton _ |
By: | /s/ Zamir Rauf _ |
By: | /s/ Prital Patel _ |
Calpine Energy Services GP, LLC |
Calpine Energy Services LP, LLC |
Calpine Construction Management Company, Inc. |
Calpine Mid-Atlantic Operating, LLC |
Calpine Operating Services Company, Inc. |
Calpine Power Services, Inc. |
Thomassen Turbine Systems America, Inc. |
Name of Guarantor |
Anacapa Land Company, LLC |
Anderson Springs Energy Company |
Auburndale Peaker Energy Center, LLC |
Aviation Funding Corp. |
Baytown Energy Center, LLC |
Bellingham Cogen, Inc. |
CalGen Expansion Company, LLC |
CalGen Finance Corp. |
CalGen Project Equipment Finance Company Three, LLC |
Calpine Administrative Services Company, Inc. |
Calpine Auburndale Holdings, LLC |
Calpine c*Power, Inc. |
Calpine CalGen Holdings, Inc. |
Calpine California Holdings, Inc. |
Calpine Calistoga Holdings, LLC |
Calpine CCFC Holdings, Inc. |
Calpine Central Texas GP, Inc. |
Calpine Central, Inc. |
Calpine Central-Texas, Inc. |
Calpine Cogeneration Corporation |
Calpine Eastern Corporation |
Calpine Edinburg, Inc. |
Calpine Energy Services, L.P. |
Calpine Fuels Corporation |
Calpine Generating Company, LLC |
Calpine Geysers Company, L.P. |
Calpine Gilroy 1, Inc. |
Calpine Gilroy 2, Inc. |
Calpine Global Services Company, Inc. |
Calpine Hidalgo Energy Center, L.P. |
Name of Guarantor |
Calpine Hidalgo Holdings, Inc. |
Calpine Hidalgo, Inc. |
Calpine Jupiter, LLC |
Calpine Kennedy Operators, Inc. |
Calpine KIA, Inc. |
Calpine King City, Inc. |
Calpine King City, LLC |
Calpine Leasing Inc. |
Calpine Long Island, Inc. |
Calpine Magic Valley Pipeline, Inc. |
Calpine MVP, Inc. |
Calpine Newark, LLC |
Calpine Northbrook Holdings Corporation |
Calpine Northbrook Investors, LLC |
Calpine Northbrook Project Holdings, LLC |
Calpine Oneta Power, LLC |
Calpine Operations Management Company, Inc. |
Calpine Power Company |
Calpine Power, Inc. |
Calpine Power Management, LLC |
Calpine PowerAmerica, LLC |
Calpine PowerAmerica-CA, LLC |
Calpine PowerAmerica-ME, LLC |
Calpine Project Holdings, Inc. |
Calpine Pryor, Inc. |
Calpine Rumford I, Inc. |
Calpine Rumford, Inc. |
Calpine Schuylkill, Inc. |
Calpine Sonoran Pipeline, LLC |
Calpine Stony Brook Operators, Inc. |
Calpine Stony Brook, Inc. |
Name of Guarantor |
Calpine Sumas, Inc. |
Calpine TCCL Holdings, Inc. |
Calpine Texas Pipeline GP, Inc. |
Calpine Texas Pipeline LP, Inc. |
Calpine Texas Pipeline, L.P. |
Calpine Tiverton I, Inc. |
Calpine Tiverton, Inc. |
Calpine University Power, Inc. |
Carville Energy LLC |
CES Marketing IX, LLC |
CES Marketing V, LLC |
CES Marketing X, LLC |
Channel Energy Center, LLC |
Clear Lake Cogeneration Limited Partnership |
Columbia Energy LLC |
Corpus Christi Cogeneration, LLC |
CPN 3rd Turbine, Inc. |
CPN Acadia, Inc. |
CPN Cascade, Inc. |
CPN Clear Lake, Inc. |
CPN East Fuels, LLC |
CPN Pipeline Company |
CPN Pryor Funding Corporation |
CPN Telephone Flat, Inc. |
Decatur Energy Center, LLC |
Delta Energy Center, LLC |
Fontana Energy Center, LLC |
Freestone Power Generation, LLC |
GEC Bethpage Inc. |
Geysers Power Company, LLC |
Geysers Power I Company |
Name of Guarantor |
Hillabee Energy Center, LLC |
Idlewild Fuel Management Corp. |
JMC Bethpage, Inc. |
Los Medanos Energy Center LLC |
Magic Valley Pipeline, L.P. |
Mobile Energy LLC |
Modoc Power, Inc. |
Morgan Energy Center, LLC |
Northwest Cogeneration, Inc. |
NTC Five, Inc. |
Pastoria Energy Center, LLC |
Pastoria Energy Facility, L.L.C. |
Pine Bluff Energy, LLC |
RockGen Energy LLC |
Rumford Power Associates Limited Partnership |
Santa Rosa Energy Center, LLC |
Stony Brook Cogeneration, Inc. |
Stony Brook Fuel Management Corp. |
Sutter Dryers, Inc. |
Texas City Cogeneration, LLC |
Texas Cogeneration Five, Inc. |
Texas Cogeneration One Company |
Thermal Power Company |
Tiverton Power Associates Limited Partnership |
Zion Energy LLC |
Calpine Bethlehem, LLC |
Calpine Mid-Atlantic Energy, LLC |
Calpine Mid-Atlantic Generation, LLC |
Calpine Mid-Atlantic Marketing, LLC |
Calpine New Jersey Generation, LLC |
Calpine Solar, LLC |
Calpine Vineland Solar, LLC |
New Development Holdings, LLC |
Deer Park Energy Center LLC |
Deer Park Holdings, LLC |
Metcalf Energy Center, LLC |
Metcalf Holdings, LLC |
By: | /s/ Zamir Rauf |
By: | /s/ Andre Walker _ |
By: | /s/ W. Thaddeus Miller _ |
By: | /s/ Todd Thornton _ |
By: | /s/ Zamir Rauf _ |
By: | /s/ Prital Patel _ |
Calpine Energy Services GP, LLC |
Calpine Energy Services LP, LLC |
Calpine Construction Management Company, Inc. |
Calpine Mid-Atlantic Operating, LLC |
Calpine Operating Services Company, Inc. |
Calpine Power Services, Inc. |
Thomassen Turbine Systems America, Inc. |
Name of Guarantor |
Anacapa Land Company, LLC |
Anderson Springs Energy Company |
Auburndale Peaker Energy Center, LLC |
Aviation Funding Corp. |
Baytown Energy Center, LLC |
Bellingham Cogen, Inc. |
CalGen Expansion Company, LLC |
CalGen Finance Corp. |
CalGen Project Equipment Finance Company Three, LLC |
Calpine Administrative Services Company, Inc. |
Calpine Auburndale Holdings, LLC |
Calpine c*Power, Inc. |
Calpine CalGen Holdings, Inc. |
Calpine California Holdings, Inc. |
Calpine Calistoga Holdings, LLC |
Calpine CCFC Holdings, Inc. |
Calpine Central Texas GP, Inc. |
Calpine Central, Inc. |
Calpine Central-Texas, Inc. |
Calpine Cogeneration Corporation |
Calpine Eastern Corporation |
Calpine Edinburg, Inc. |
Calpine Energy Services, L.P. |
Calpine Fuels Corporation |
Calpine Generating Company, LLC |
Calpine Geysers Company, L.P. |
Calpine Gilroy 1, Inc. |
Calpine Gilroy 2, Inc. |
Calpine Global Services Company, Inc. |
Calpine Hidalgo Energy Center, L.P. |
Name of Guarantor |
Calpine Hidalgo Holdings, Inc. |
Calpine Hidalgo, Inc. |
Calpine Jupiter, LLC |
Calpine Kennedy Operators, Inc. |
Calpine KIA, Inc. |
Calpine King City, Inc. |
Calpine King City, LLC |
Calpine Leasing Inc. |
Calpine Long Island, Inc. |
Calpine Magic Valley Pipeline, Inc. |
Calpine MVP, Inc. |
Calpine Newark, LLC |
Calpine Northbrook Holdings Corporation |
Calpine Northbrook Investors, LLC |
Calpine Northbrook Project Holdings, LLC |
Calpine Oneta Power, LLC |
Calpine Operations Management Company, Inc. |
Calpine Power Company |
Calpine Power, Inc. |
Calpine Power Management, LLC |
Calpine PowerAmerica, LLC |
Calpine PowerAmerica-CA, LLC |
Calpine PowerAmerica-ME, LLC |
Calpine Project Holdings, Inc. |
Calpine Pryor, Inc. |
Calpine Rumford I, Inc. |
Calpine Rumford, Inc. |
Calpine Schuylkill, Inc. |
Calpine Sonoran Pipeline, LLC |
Calpine Stony Brook Operators, Inc. |
Calpine Stony Brook, Inc. |
Name of Guarantor |
Calpine Sumas, Inc. |
Calpine TCCL Holdings, Inc. |
Calpine Texas Pipeline GP, Inc. |
Calpine Texas Pipeline LP, Inc. |
Calpine Texas Pipeline, L.P. |
Calpine Tiverton I, Inc. |
Calpine Tiverton, Inc. |
Calpine University Power, Inc. |
Carville Energy LLC |
CES Marketing IX, LLC |
CES Marketing V, LLC |
CES Marketing X, LLC |
Channel Energy Center, LLC |
Clear Lake Cogeneration Limited Partnership |
Columbia Energy LLC |
Corpus Christi Cogeneration, LLC |
CPN 3rd Turbine, Inc. |
CPN Acadia, Inc. |
CPN Cascade, Inc. |
CPN Clear Lake, Inc. |
CPN East Fuels, LLC |
CPN Pipeline Company |
CPN Pryor Funding Corporation |
CPN Telephone Flat, Inc. |
Decatur Energy Center, LLC |
Delta Energy Center, LLC |
Fontana Energy Center, LLC |
Freestone Power Generation, LLC |
GEC Bethpage Inc. |
Geysers Power Company, LLC |
Geysers Power I Company |
Name of Guarantor |
Hillabee Energy Center, LLC |
Idlewild Fuel Management Corp. |
JMC Bethpage, Inc. |
Los Medanos Energy Center LLC |
Magic Valley Pipeline, L.P. |
Mobile Energy LLC |
Modoc Power, Inc. |
Morgan Energy Center, LLC |
Northwest Cogeneration, Inc. |
NTC Five, Inc. |
Pastoria Energy Center, LLC |
Pastoria Energy Facility, L.L.C. |
Pine Bluff Energy, LLC |
RockGen Energy LLC |
Rumford Power Associates Limited Partnership |
Santa Rosa Energy Center, LLC |
Stony Brook Cogeneration, Inc. |
Stony Brook Fuel Management Corp. |
Sutter Dryers, Inc. |
Texas City Cogeneration, LLC |
Texas Cogeneration Five, Inc. |
Texas Cogeneration One Company |
Thermal Power Company |
Tiverton Power Associates Limited Partnership |
Zion Energy LLC |
Calpine Bethlehem, LLC |
Calpine Mid-Atlantic Energy, LLC |
Calpine Mid-Atlantic Generation, LLC |
Calpine Mid-Atlantic Marketing, LLC |
Calpine New Jersey Generation, LLC |
Calpine Solar, LLC |
Calpine Vineland Solar, LLC |
New Development Holdings, LLC |
Deer Park Energy Center LLC |
Deer Park Holdings, LLC |
Metcalf Energy Center, LLC |
Metcalf Holdings, LLC |
By: | /s/ Zamir Rauf |
By: | /s/ Andre Walker |
By: | /s/ W. Thaddeus Miller |
By: | /s/ Todd Thornton |
By: | /s/ Zamir Rauf |
By: | /s/ Prital Patel |
Calpine Energy Services GP, LLC |
Calpine Energy Services LP, LLC |
Calpine Construction Management Company, Inc. |
Calpine Mid-Atlantic Operating, LLC |
Calpine Operating Services Company, Inc. |
Calpine Power Services, Inc. |
Thomassen Turbine Systems America, Inc. |
Name of Guarantor |
Anacapa Land Company, LLC |
Anderson Springs Energy Company |
Auburndale Peaker Energy Center, LLC |
Aviation Funding Corp. |
Baytown Energy Center, LLC |
Bellingham Cogen, Inc. |
CalGen Expansion Company, LLC |
CalGen Finance Corp. |
CalGen Project Equipment Finance Company Three, LLC |
Calpine Administrative Services Company, Inc. |
Calpine Auburndale Holdings, LLC |
Calpine c*Power, Inc. |
Calpine CalGen Holdings, Inc. |
Calpine California Holdings, Inc. |
Calpine Calistoga Holdings, LLC |
Calpine CCFC Holdings, Inc. |
Calpine Central Texas GP, Inc. |
Calpine Central, Inc. |
Calpine Central-Texas, Inc. |
Calpine Cogeneration Corporation |
Calpine Eastern Corporation |
Calpine Edinburg, Inc. |
Calpine Energy Services, L.P. |
Calpine Fuels Corporation |
Calpine Generating Company, LLC |
Calpine Geysers Company, L.P. |
Calpine Gilroy 1, Inc. |
Calpine Gilroy 2, Inc. |
Calpine Global Services Company, Inc. |
Calpine Hidalgo Energy Center, L.P. |
Name of Guarantor |
Calpine Hidalgo Holdings, Inc. |
Calpine Hidalgo, Inc. |
Calpine Jupiter, LLC |
Calpine Kennedy Operators, Inc. |
Calpine KIA, Inc. |
Calpine King City, Inc. |
Calpine King City, LLC |
Calpine Leasing Inc. |
Calpine Long Island, Inc. |
Calpine Magic Valley Pipeline, Inc. |
Calpine MVP, Inc. |
Calpine Newark, LLC |
Calpine Northbrook Holdings Corporation |
Calpine Northbrook Investors, LLC |
Calpine Northbrook Project Holdings, LLC |
Calpine Oneta Power, LLC |
Calpine Operations Management Company, Inc. |
Calpine Power Company |
Calpine Power, Inc. |
Calpine Power Management, LLC |
Calpine PowerAmerica, LLC |
Calpine PowerAmerica-CA, LLC |
Calpine PowerAmerica-ME, LLC |
Calpine Project Holdings, Inc. |
Calpine Pryor, Inc. |
Calpine Rumford I, Inc. |
Calpine Rumford, Inc. |
Calpine Schuylkill, Inc. |
Calpine Sonoran Pipeline, LLC |
Calpine Stony Brook Operators, Inc. |
Calpine Stony Brook, Inc. |
Name of Guarantor |
Calpine Sumas, Inc. |
Calpine TCCL Holdings, Inc. |
Calpine Texas Pipeline GP, Inc. |
Calpine Texas Pipeline LP, Inc. |
Calpine Texas Pipeline, L.P. |
Calpine Tiverton I, Inc. |
Calpine Tiverton, Inc. |
Calpine University Power, Inc. |
Carville Energy LLC |
CES Marketing IX, LLC |
CES Marketing V, LLC |
CES Marketing X, LLC |
Channel Energy Center, LLC |
Clear Lake Cogeneration Limited Partnership |
Columbia Energy LLC |
Corpus Christi Cogeneration, LLC |
CPN 3rd Turbine, Inc. |
CPN Acadia, Inc. |
CPN Cascade, Inc. |
CPN Clear Lake, Inc. |
CPN East Fuels, LLC |
CPN Pipeline Company |
CPN Pryor Funding Corporation |
CPN Telephone Flat, Inc. |
Decatur Energy Center, LLC |
Delta Energy Center, LLC |
Fontana Energy Center, LLC |
Freestone Power Generation, LLC |
GEC Bethpage Inc. |
Geysers Power Company, LLC |
Geysers Power I Company |
Name of Guarantor |
Hillabee Energy Center, LLC |
Idlewild Fuel Management Corp. |
JMC Bethpage, Inc. |
Los Medanos Energy Center LLC |
Magic Valley Pipeline, L.P. |
Mobile Energy LLC |
Modoc Power, Inc. |
Morgan Energy Center, LLC |
Northwest Cogeneration, Inc. |
NTC Five, Inc. |
Pastoria Energy Center, LLC |
Pastoria Energy Facility, L.L.C. |
Pine Bluff Energy, LLC |
RockGen Energy LLC |
Rumford Power Associates Limited Partnership |
Santa Rosa Energy Center, LLC |
Stony Brook Cogeneration, Inc. |
Stony Brook Fuel Management Corp. |
Sutter Dryers, Inc. |
Texas City Cogeneration, LLC |
Texas Cogeneration Five, Inc. |
Texas Cogeneration One Company |
Thermal Power Company |
Tiverton Power Associates Limited Partnership |
Zion Energy LLC |
Calpine Bethlehem, LLC |
Calpine Mid-Atlantic Energy, LLC |
Calpine Mid-Atlantic Generation, LLC |
Calpine Mid-Atlantic Marketing, LLC |
Calpine New Jersey Generation, LLC |
Calpine Solar, LLC |
Calpine Vineland Solar, LLC |
New Development Holdings, LLC |
Deer Park Energy Center LLC |
Deer Park Holdings, LLC |
Metcalf Energy Center, LLC |
Metcalf Holdings, LLC |
By: | /s/ Zamir Rauf |
By: | /s/ Andre Walker |
By: | /s/ W. Thaddeus Miller |
By: | /s/ Todd Thornton |
By: | /s/ Zamir Rauf |
By: | /s/ Prital Patel |
Calpine Energy Services GP, LLC |
Calpine Energy Services LP, LLC |
Calpine Construction Management Company, Inc. |
Calpine Mid-Atlantic Operating, LLC |
Calpine Operating Services Company, Inc. |
Calpine Power Services, Inc. |
Thomassen Turbine Systems America, Inc. |
Name of Guarantor |
Anacapa Land Company, LLC |
Anderson Springs Energy Company |
Auburndale Peaker Energy Center, LLC |
Aviation Funding Corp. |
Baytown Energy Center, LLC |
Bellingham Cogen, Inc. |
CalGen Expansion Company, LLC |
CalGen Finance Corp. |
CalGen Project Equipment Finance Company Three, LLC |
Calpine Administrative Services Company, Inc. |
Calpine Auburndale Holdings, LLC |
Calpine c*Power, Inc. |
Calpine CalGen Holdings, Inc. |
Calpine California Holdings, Inc. |
Calpine Calistoga Holdings, LLC |
Calpine CCFC Holdings, Inc. |
Calpine Central Texas GP, Inc. |
Calpine Central, Inc. |
Calpine Central-Texas, Inc. |
Calpine Cogeneration Corporation |
Calpine Eastern Corporation |
Calpine Edinburg, Inc. |
Calpine Energy Services, L.P. |
Calpine Fuels Corporation |
Calpine Generating Company, LLC |
Calpine Geysers Company, L.P. |
Calpine Gilroy 1, Inc. |
Calpine Gilroy 2, Inc. |
Calpine Global Services Company, Inc. |
Calpine Hidalgo Energy Center, L.P. |
Name of Guarantor |
Calpine Hidalgo Holdings, Inc. |
Calpine Hidalgo, Inc. |
Calpine Jupiter, LLC |
Calpine Kennedy Operators, Inc. |
Calpine KIA, Inc. |
Calpine King City, Inc. |
Calpine King City, LLC |
Calpine Leasing Inc. |
Calpine Long Island, Inc. |
Calpine Magic Valley Pipeline, Inc. |
Calpine MVP, Inc. |
Calpine Newark, LLC |
Calpine Northbrook Holdings Corporation |
Calpine Northbrook Investors, LLC |
Calpine Northbrook Project Holdings, LLC |
Calpine Oneta Power, LLC |
Calpine Operations Management Company, Inc. |
Calpine Power Company |
Calpine Power, Inc. |
Calpine Power Management, LLC |
Calpine PowerAmerica, LLC |
Calpine PowerAmerica-CA, LLC |
Calpine PowerAmerica-ME, LLC |
Calpine Project Holdings, Inc. |
Calpine Pryor, Inc. |
Calpine Rumford I, Inc. |
Calpine Rumford, Inc. |
Calpine Schuylkill, Inc. |
Calpine Sonoran Pipeline, LLC |
Calpine Stony Brook Operators, Inc. |
Calpine Stony Brook, Inc. |
Name of Guarantor |
Calpine Sumas, Inc. |
Calpine TCCL Holdings, Inc. |
Calpine Texas Pipeline GP, Inc. |
Calpine Texas Pipeline LP, Inc. |
Calpine Texas Pipeline, L.P. |
Calpine Tiverton I, Inc. |
Calpine Tiverton, Inc. |
Calpine University Power, Inc. |
Carville Energy LLC |
CES Marketing IX, LLC |
CES Marketing V, LLC |
CES Marketing X, LLC |
Channel Energy Center, LLC |
Clear Lake Cogeneration Limited Partnership |
Columbia Energy LLC |
Corpus Christi Cogeneration, LLC |
CPN 3rd Turbine, Inc. |
CPN Acadia, Inc. |
CPN Cascade, Inc. |
CPN Clear Lake, Inc. |
CPN East Fuels, LLC |
CPN Pipeline Company |
CPN Pryor Funding Corporation |
CPN Telephone Flat, Inc. |
Decatur Energy Center, LLC |
Delta Energy Center, LLC |
Fontana Energy Center, LLC |
Freestone Power Generation, LLC |
GEC Bethpage Inc. |
Geysers Power Company, LLC |
Geysers Power I Company |
Name of Guarantor |
Hillabee Energy Center, LLC |
Idlewild Fuel Management Corp. |
JMC Bethpage, Inc. |
Los Medanos Energy Center LLC |
Magic Valley Pipeline, L.P. |
Mobile Energy LLC |
Modoc Power, Inc. |
Morgan Energy Center, LLC |
Northwest Cogeneration, Inc. |
NTC Five, Inc. |
Pastoria Energy Center, LLC |
Pastoria Energy Facility, L.L.C. |
Pine Bluff Energy, LLC |
RockGen Energy LLC |
Rumford Power Associates Limited Partnership |
Santa Rosa Energy Center, LLC |
Stony Brook Cogeneration, Inc. |
Stony Brook Fuel Management Corp. |
Sutter Dryers, Inc. |
Texas City Cogeneration, LLC |
Texas Cogeneration Five, Inc. |
Texas Cogeneration One Company |
Thermal Power Company |
Tiverton Power Associates Limited Partnership |
Zion Energy LLC |
Calpine Bethlehem, LLC |
Calpine Mid-Atlantic Energy, LLC |
Calpine Mid-Atlantic Generation, LLC |
Calpine Mid-Atlantic Marketing, LLC |
Calpine New Jersey Generation, LLC |
Calpine Solar, LLC |
Calpine Vineland Solar, LLC |
New Development Holdings, LLC |
Deer Park Energy Center LLC |
Deer Park Holdings, LLC |
Metcalf Energy Center, LLC |
Metcalf Holdings, LLC |
1. | I have reviewed this quarterly report on Form 10-Q of Calpine Corporation (the “registrant”); |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ JACK A. FUSCO |
Jack A. Fusco |
President, Chief Executive Officer and Director |
Calpine Corporation |
1. | I have reviewed this quarterly report on Form 10-Q of Calpine Corporation (the “registrant”); |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ ZAMIR RAUF |
Zamir Rauf |
Executive Vice President and Chief Financial Officer |
Calpine Corporation |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company. |
/s/ JACK A. FUSCO | /s/ ZAMIR RAUF | |||||
Jack A. Fusco | Zamir Rauf | |||||
President, Chief Executive Officer | Executive Vice President and | |||||
and Director | Chief Financial Officer | |||||
Calpine Corporation | Calpine Corporation |
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Debt (First Lien Notes) (Details) (USD $)
In Millions, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
---|---|---|
Debt Instrument [Line Items] | ||
Long-term Debt | $ 10,672 | $ 10,425 |
First Lien Notes 2017 [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | 1,200 | 1,200 |
First Lien Notes 2019 [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | 400 | 400 |
First Lien Notes 2020 [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | 1,092 | 1,092 |
First Lien Notes 2021 [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | 2,000 | 2,000 |
First Lien Notes 2023 [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | 1,200 | 1,200 |
Corporate Debt Securities [Member]
|
||
Debt Instrument [Line Items] | ||
Long-term Debt | $ 5,892 | $ 5,892 |
Derivative Instruments (Details 4) (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 9 Months Ended | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|||||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||||||||||||
Gains (Loss) Recognized in OCI (Effective Portion) | $ (23) | $ (94) | $ (71) | $ (36) | ||||||||||||
Gain (Loss) Reclassified from AOCI into Income (EffectivePortion) | 1 | [1] | 20 | [1] | 15 | [1] | (24) | [1] | ||||||||
Gain (Loss) Reclassified from AOCI into Income (IneffectivePortion) | 0 | (2) | 2 | (2) | ||||||||||||
Interest Rate Swap [Member]
|
||||||||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||||||||||||
Gains (Loss) Recognized in OCI (Effective Portion) | (14) | (103) | (48) | (9) | ||||||||||||
Gain (Loss) Reclassified from AOCI into Income (EffectivePortion) | (8) | [1],[2] | (7) | [1],[2] | (23) | [1],[3] | (130) | [1],[3] | ||||||||
Gain (Loss) Reclassified from AOCI into Income (IneffectivePortion) | 0 | (1) | 0 | (2) | ||||||||||||
Commodity Option [Member]
|
||||||||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||||||||||||
Gains (Loss) Recognized in OCI (Effective Portion) | (9) | 9 | (23) | (27) | ||||||||||||
Gain (Loss) Reclassified from AOCI into Income (EffectivePortion) | 9 | [1],[4] | 27 | [1],[4] | 38 | [1],[4] | 106 | [1],[4] | ||||||||
Gain (Loss) Reclassified from AOCI into Income (IneffectivePortion) | $ 0 | $ (1) | $ 2 | $ 0 | ||||||||||||
|
Segment and Significant Customer Information (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 9 Months Ended | ||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|||||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||||||||
Revenues from external customers | $ 1,996 | $ 2,209 | $ 4,111 | $ 5,341 | ||||||||||||||
Intersegment revenues | 0 | 0 | 0 | 0 | ||||||||||||||
Total operating revenues | 1,996 | 2,209 | 4,111 | 5,341 | ||||||||||||||
Commodity Margin | 897 | 825 | 2,023 | 1,921 | ||||||||||||||
Add: Mark-to-market commodity activity, net and other | 202 | [1],[2] | (20) | [1],[2] | (58) | [1],[3] | (57) | [1],[3] | ||||||||||
Plant operating expense | 207 | 212 | 699 | 711 | ||||||||||||||
Depreciation and amortization expense | 140 | 143 | 418 | 405 | ||||||||||||||
Sales, general and other administrative expense | 36 | 33 | 104 | 99 | ||||||||||||||
Other operating expenses | 18 | [4] | 19 | [4] | 58 | [4] | 57 | [4] | ||||||||||
(Income) loss from unconsolidated investments in power plants | (7) | (5) | (21) | (12) | ||||||||||||||
Income (loss) from operations | 705 | 403 | 707 | 604 | ||||||||||||||
Interest expense, net of interest income | 181 | 190 | 545 | 568 | ||||||||||||||
Loss on interest rate derivatives | 0 | 3 | 14 | 149 | ||||||||||||||
Debt Extinguishment Costs and Other (Income) Expense, Net | 6 | 0 | 26 | 108 | ||||||||||||||
Income (loss) before income taxes and discontinued operations | 518 | 210 | 122 | (221) | ||||||||||||||
Lease levelization | 16 | 11 | 7 | 15 | ||||||||||||||
Contract amortization | 4 | 4 | 11 | 5 | ||||||||||||||
RGGI Compliance and Other Environmental Costs | 4 | 3 | 9 | 7 | ||||||||||||||
Commodity Margin Riverside Energy Center | 32 | 31 | 64 | 62 | ||||||||||||||
West [Member]
|
||||||||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||||||||
Revenues from external customers | 509 | 688 | 1,183 | 1,753 | ||||||||||||||
Intersegment revenues | 2 | 3 | 7 | 7 | ||||||||||||||
Total operating revenues | 511 | 691 | 1,190 | 1,760 | ||||||||||||||
Commodity Margin | 330 | 329 | 748 | 798 | ||||||||||||||
Add: Mark-to-market commodity activity, net and other | (40) | [1],[2] | 20 | [1],[2] | (80) | [1],[3] | 36 | [1],[3] | ||||||||||
Plant operating expense | 88 | 94 | 281 | 297 | ||||||||||||||
Depreciation and amortization expense | 52 | 52 | 151 | 140 | ||||||||||||||
Sales, general and other administrative expense | 9 | 10 | 23 | 29 | ||||||||||||||
Other operating expenses | 10 | [4] | 11 | [4] | 30 | [4] | 30 | [4] | ||||||||||
(Income) loss from unconsolidated investments in power plants | 0 | 0 | 0 | 0 | ||||||||||||||
Income (loss) from operations | 131 | 182 | 183 | 338 | ||||||||||||||
Texas [Member]
|
||||||||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||||||||
Revenues from external customers | 886 | 843 | 1,430 | 1,939 | ||||||||||||||
Intersegment revenues | (34) | 3 | 27 | 13 | ||||||||||||||
Total operating revenues | 852 | 846 | 1,457 | 1,952 | ||||||||||||||
Commodity Margin | 218 | 162 | 472 | 357 | ||||||||||||||
Add: Mark-to-market commodity activity, net and other | 249 | [1],[2] | (21) | [1],[2] | 66 | [1],[3] | (54) | [1],[3] | ||||||||||
Plant operating expense | 49 | 50 | 189 | 193 | ||||||||||||||
Depreciation and amortization expense | 35 | 34 | 104 | 99 | ||||||||||||||
Sales, general and other administrative expense | 12 | 10 | 36 | 33 | ||||||||||||||
Other operating expenses | 1 | [4] | (1) | [4] | 4 | [4] | 2 | [4] | ||||||||||
(Income) loss from unconsolidated investments in power plants | 0 | 0 | 0 | 0 | ||||||||||||||
Income (loss) from operations | 370 | 48 | 205 | (24) | ||||||||||||||
North [Member]
|
||||||||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||||||||
Revenues from external customers | 407 | 430 | 974 | 1,025 | ||||||||||||||
Intersegment revenues | 4 | (8) | 9 | 5 | ||||||||||||||
Total operating revenues | 411 | 422 | 983 | 1,030 | ||||||||||||||
Commodity Margin | 266 | [5] | 259 | [5] | 591 | [5] | 578 | [5] | ||||||||||
Add: Mark-to-market commodity activity, net and other | (26) | [1],[2] | (11) | [1],[2] | (17) | [1],[3] | (12) | [1],[3] | ||||||||||
Plant operating expense | 51 | 44 | 154 | 136 | ||||||||||||||
Depreciation and amortization expense | 33 | 36 | 100 | 102 | ||||||||||||||
Sales, general and other administrative expense | 8 | 7 | 22 | 19 | ||||||||||||||
Other operating expenses | 6 | [4] | 7 | [4] | 21 | [4] | 23 | [4] | ||||||||||
(Income) loss from unconsolidated investments in power plants | (7) | (5) | (21) | (12) | ||||||||||||||
Income (loss) from operations | 149 | 159 | 298 | 298 | ||||||||||||||
Southeast [Member]
|
||||||||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||||||||
Revenues from external customers | 194 | 248 | 524 | 624 | ||||||||||||||
Intersegment revenues | 68 | 31 | 84 | 116 | ||||||||||||||
Total operating revenues | 262 | 279 | 608 | 740 | ||||||||||||||
Commodity Margin | 83 | 75 | 212 | 188 | ||||||||||||||
Add: Mark-to-market commodity activity, net and other | 27 | [1],[2] | 0 | [1],[2] | (5) | [1],[3] | (4) | [1],[3] | ||||||||||
Plant operating expense | 29 | 33 | 98 | 107 | ||||||||||||||
Depreciation and amortization expense | 21 | 22 | 66 | 67 | ||||||||||||||
Sales, general and other administrative expense | 8 | 7 | 23 | 18 | ||||||||||||||
Other operating expenses | (1) | [4] | 0 | [4] | 2 | [4] | 3 | [4] | ||||||||||
(Income) loss from unconsolidated investments in power plants | 0 | 0 | 0 | 0 | ||||||||||||||
Income (loss) from operations | 53 | 13 | 18 | (11) | ||||||||||||||
Consolidation and Elimination [Member]
|
||||||||||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||||||||||||||||
Revenues from external customers | 0 | 0 | 0 | 0 | ||||||||||||||
Intersegment revenues | (40) | (29) | (127) | (141) | ||||||||||||||
Total operating revenues | (40) | (29) | (127) | (141) | ||||||||||||||
Commodity Margin | 0 | 0 | 0 | 0 | ||||||||||||||
Add: Mark-to-market commodity activity, net and other | (8) | [1],[2] | (8) | [1],[2] | (22) | [1],[3] | (23) | [1],[3] | ||||||||||
Plant operating expense | (10) | (9) | (23) | (22) | ||||||||||||||
Depreciation and amortization expense | (1) | (1) | (3) | (3) | ||||||||||||||
Sales, general and other administrative expense | (1) | (1) | 0 | 0 | ||||||||||||||
Other operating expenses | 2 | [4] | 2 | [4] | 1 | [4] | (1) | [4] | ||||||||||
(Income) loss from unconsolidated investments in power plants | 0 | 0 | 0 | 0 | ||||||||||||||
Income (loss) from operations | $ 2 | $ 1 | $ 3 | $ 3 | ||||||||||||||
|
Acquisitions and Divestitures Acquisition of Bosque (Details) (USD $)
In Millions, unless otherwise specified |
Sep. 30, 2012
MW
|
Dec. 31, 2011
MW
|
---|---|---|
Business Acquisition [Line Items] | ||
Power generation capacity | 10,500 | 11,391 |
Bosque Energy Center [Member]
|
||
Business Acquisition [Line Items] | ||
Business Acquisition, Purchase Price Allocation, Assets Acquired | 432 | |
Power generation capacity | 800 | |
Block one power generation capacity | 250 | |
Block two power generation capacity | 550 |
Use of Collateral (Tables)
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
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Use of Collateral [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Collateral | The table below summarizes the balances outstanding under margin deposits, natural gas and power prepayments, and exposure under letters of credit and first priority liens for commodity procurement and risk management activities as of September 30, 2012 and December 31, 2011 (in millions):
___________
|
Use of Collateral (Details) (USD $)
In Millions, unless otherwise specified |
Sep. 30, 2012
|
Dec. 31, 2011
|
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Use of Collateral [Abstract] | ||||||||||
Margin deposits | $ 103 | [1] | $ 140 | [1] | ||||||
Natural gas and power prepayments | 34 | 42 | ||||||||
Total margin deposits and natural gas and power prepayments with our counterparties | 137 | [2] | 182 | [2] | ||||||
Letters of credit issued | 525 | 581 | ||||||||
First priority liens under power and natural gas agreements | 13 | 1 | ||||||||
First priority liens under interest rate swap agreements | 214 | 318 | ||||||||
Total letters of credit and first priority liens with our counterparties | 752 | 900 | ||||||||
Margin deposits held by us posted by our counterparties | 9 | [1],[3] | 34 | [1],[3] | ||||||
Letters of credit posted with us by our counterparties | 1 | 0 | ||||||||
Total margin deposits and letters of credit posted with us by our counterparties | 10 | 34 | ||||||||
Use of Collateral (Textuals) [Abstract] | ||||||||||
Margin And Prepayment Amounts Included In Other Assets | 22 | 20 | ||||||||
Margin And Prepayment Amounts Included In Margin Deposits And Other Prepaid Expenses | $ 115 | $ 162 | ||||||||
|
Debt (Debt Textuals) (Details) (USD $)
|
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2012
MW
|
Sep. 30, 2011
|
Sep. 30, 2012
MW
|
Sep. 30, 2011
|
Dec. 31, 2011
MW
|
|
Debt Instrument [Line Items] | |||||
Gains (Losses) on Extinguishment of Debt | $ 0 | $ 4,000,000 | $ (12,000,000) | $ (94,000,000) | |
Power generation capacity | 10,500 | 10,500 | 11,391 | ||
Letters of Credit Outstanding, Amount | 685,000,000 | 685,000,000 | 763,000,000 | ||
2019 First Lien Term Loan [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Redemption amount percentage | 10.00% | ||||
Debt Instrument Redemption Premium Percentage | 103.00% | ||||
Debt Instrument, Face Amount | 835,000,000 | 835,000,000 | |||
Gains (Losses) on Extinguishment of Debt | 18,000,000 | ||||
Debt Instrument, Interest Rate, Stated Percentage | 4.50% | 4.50% | |||
First Lien Term Loans [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Term loan interest rate spread option Federal Funds effective rate | 0.50% | ||||
Term loan interest rate spread option Prime Rate | 2.25% | ||||
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | 3.25% | ||||
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum | 1.25% | ||||
Percentage of principal amount of Term Loan to be paid quarterly | 0.25% | ||||
BRSP [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Face Amount | 218,000,000 | 218,000,000 | |||
Russell City Project [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Face Amount | 845,000,000 | 845,000,000 | |||
Power generation capacity | 619 | 619 | |||
Long-term Construction Loan, Noncurrent | 700,000,000 | 700,000,000 | |||
Project Letter of Credit Facility | 77,000,000 | 77,000,000 | |||
Term Loan Period | 10 years | 10 years | |||
Debt Service Letter of Credit Facility | 68,000,000 | 68,000,000 | |||
Amount Drawn Under Construction Loan | 468,000,000 | 468,000,000 | |||
Noncontrolling Interest, Ownership Percentage by Parent | 75.00% | 75.00% | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 25.00% | 25.00% | |||
Applicable Margin Range Percentage Above British Bankers' Association Interest Settlement Rates | 2.25% | ||||
Letters of Credit Outstanding, Amount | 61,000,000 | 61,000,000 | |||
Los Esteros Project [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Face Amount | 373,000,000 | 373,000,000 | |||
Power generation capacity | 188 | 188 | |||
Power generation capacity after upgrade | 309 | 309 | |||
Long-term Construction Loan, Noncurrent | 305,000,000 | 305,000,000 | |||
Project Letter of Credit Facility | 38,000,000 | 38,000,000 | |||
Term Loan Period | 10 years | 10 years | |||
Debt Service Letter of Credit Facility | 30,000,000 | 30,000,000 | |||
Amount Drawn Under Construction Loan | 171,000,000 | 171,000,000 | |||
Applicable Margin Range Percentage Above British Bankers' Association Interest Settlement Rates | 2.25% | ||||
Letters of Credit Outstanding, Amount | 30,000,000 | 30,000,000 | |||
Corporate Revolving Facility [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Percentage added to Federal Funds Effective Rate to arrive at base rate | 0.50% | ||||
Repayment time for drawings under letters of credit | 2 days | ||||
Excess amount of asset sales requiring mandatory prepayments | 3,000,000,000 | ||||
Corporate Revolving Facility [Member] | One Month [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Interest periods for LIBOR rate borrowings | 1 month | ||||
Corporate Revolving Facility [Member] | Two Months [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Interest periods for LIBOR rate borrowings | 2 months | ||||
Corporate Revolving Facility [Member] | Three Months [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Interest periods for LIBOR rate borrowings | 3 months | ||||
Corporate Revolving Facility [Member] | Six Months [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Interest periods for LIBOR rate borrowings | 6 months | ||||
Corporate Revolving Facility [Member] | Nine Months [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Interest periods for LIBOR rate borrowings | 9 months | ||||
Corporate Revolving Facility [Member] | Twelve Months [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Interest periods for LIBOR rate borrowings | 12 months | ||||
Corporate Revolving Facility [Member] | Minimum [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Applicable margin range percentage above base rate | 2.00% | ||||
Applicable Margin Range Percentage Above British Bankers' Association Interest Settlement Rates | 3.00% | ||||
Unused commitment fee range percentage | 0.50% | ||||
Corporate Revolving Facility [Member] | Maximum [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Applicable margin range percentage above base rate | 2.25% | ||||
Applicable Margin Range Percentage Above British Bankers' Association Interest Settlement Rates | 3.25% | ||||
Unused commitment fee range percentage | 0.75% | ||||
CDHI [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Upsize Facility Total | $ 300,000,000 | ||||
First Lien Notes 2017 [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 7.25% | 7.25% | |||
First Lien Notes 2019 [Member]
|
|||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% |
Variable Interest Entities and Unconsolidated Investments (VIE Textuals) (Details)
In Millions, unless otherwise specified |
3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
USD ($)
MW
|
Sep. 30, 2011
USD ($)
|
Sep. 30, 2012
USD ($)
MW
|
Sep. 30, 2011
USD ($)
|
Dec. 31, 2011
USD ($)
MW
|
Sep. 30, 2012
Greenfield [Member]
USD ($)
|
Sep. 30, 2011
Greenfield [Member]
USD ($)
|
Sep. 30, 2012
Greenfield [Member]
USD ($)
|
Sep. 30, 2011
Greenfield [Member]
USD ($)
|
Sep. 30, 2012
Greenfield [Member]
CAD
MW
|
Sep. 30, 2012
Whitby [Member]
USD ($)
MW
|
Sep. 30, 2011
Whitby [Member]
USD ($)
|
Sep. 30, 2012
Whitby [Member]
USD ($)
MW
|
Sep. 30, 2011
Whitby [Member]
USD ($)
|
Sep. 30, 2012
Inland Empire Energy Center [Member]
Y
MW
|
Sep. 30, 2012
Inland Empire Energy Center [Member]
Maximum [Member]
Y
|
Sep. 30, 2012
Inland Empire Energy Center [Member]
Minimum [Member]
Y
|
|
Variable Interest Entity [Line Items] | |||||||||||||||||
Power generation capacity | 10,500 | 10,500 | 11,391 | 1,038 | 50 | 50 | 775 | ||||||||||
Variable Interest Entity, Financial or Other Support, Amount | $ 0 | $ 15 | $ 0 | $ 87 | |||||||||||||
Equity Method Investment, Ownership Percentage | 50.00% | 50.00% | 50.00% | ||||||||||||||
Equity Method Investment, Summarized Financial Information, Debt | 460 | 460 | 462 | ||||||||||||||
Prorata Share of Equity Method Investment, Summarized Financial Information, Debt | 230 | 230 | 231 | ||||||||||||||
Equity Method Investment, Summarized Financial Information, Term Loan Period | 18 years | ||||||||||||||||
Equity Method Investment, Summarized Financial Information, Term Loan | 648 | ||||||||||||||||
Project financing interest rate spread - Canadian LIBOR | 1.125% | ||||||||||||||||
Project financing interest rate spread - Canadian Prime Rate | 0.125% | ||||||||||||||||
Distribution from equity method investee | $ 9 | $ 0 | $ 18 | $ 2 | $ 0 | $ 0 | $ 7 | $ 4 | |||||||||
Call Option Exercise Period | 2,024 | 2,017 | |||||||||||||||
Put Option Exercise Period | 2,025 |
Earnings (Loss) per Share (Details)
|
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|
Earnings (Loss) per Share [Abstract] | ||||
Share-based awards | 9,356,000 | 12,696,000 | 11,677,000 | 15,202,000 |
Shares Of New, Reorganized Common Stock | 485,000,000 | |||
Weighted Average Number of Shares Outstanding, Basic | 462,307,000 | 486,420,000 | 470,589,000 | 486,363,000 |
Weighted Average Number Diluted Shares Outstanding Adjustment | 3,646,000 | 2,642,000 | 3,542,000 | 0 |
Weighted Average Number of Shares Outstanding, Diluted | 465,953,000 | 489,062,000 | 474,131,000 | 486,363,000 |
Derivative Instruments (Details 3) (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 9 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|||||||
Summary of Derivative Instruments by Risk Exposure [Abstract] | ||||||||||
Power contracts included in operating revenues | $ 329 | $ 18 | $ 149 | $ 9 | ||||||
Natural gas contracts included in fuel and purchased energy expense | 3 | 39 | 127 | 61 | ||||||
Interest rate swaps included in interest expense | 3 | 2 | 9 | 4 | ||||||
Gain (Loss) on interest rate derivatives, net | 0 | (3) | (14) | (149) | ||||||
Gain (Loss) on Derivative Instruments, Net, Pretax | 335 | [1] | 56 | [1] | 271 | [1] | (75) | [1] | ||
Gain (Loss) on Sale of Derivatives | 113 | 21 | 168 | (33) | ||||||
Unrealized gain (loss) | 222 | [1] | 35 | [1] | 103 | [1] | (42) | [1] | ||
Interest Rate Swap [Member]
|
||||||||||
Summary of Derivative Instruments by Risk Exposure [Abstract] | ||||||||||
Gain (Loss) on Sale of Derivatives | 0 | (44) | (157) | (150) | ||||||
Unrealized gain (loss) | 3 | [1] | 43 | [1] | 152 | [1] | 5 | [1] | ||
Commodity Option [Member]
|
||||||||||
Summary of Derivative Instruments by Risk Exposure [Abstract] | ||||||||||
Gain (Loss) on Sale of Derivatives | 113 | 65 | 325 | 117 | ||||||
Unrealized gain (loss) | $ 219 | [1] | $ (8) | [1] | $ (49) | [1] | $ (47) | [1] | ||
|
Variable Interest Entities and Unconsolidated Investments
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2012
|
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Variable Interest Entities and Unconsolidated Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entities and Unconsolidated Investments | Variable Interest Entities and Unconsolidated Investments We consolidate all of our VIEs where we have determined that we are the primary beneficiary. There were no changes to our determination of whether we are the primary beneficiary of our VIEs for the nine months ended September 30, 2012. See Note 5 in our 2011 Form 10-K for further information regarding our VIEs. VIE Disclosures Our consolidated VIEs include natural gas-fired power plants with an aggregate capacity of 10,500 MW and 11,391 MW, at September 30, 2012 and December 31, 2011, respectively. For these VIEs, we may provide other operational and administrative support through various affiliate contractual arrangements among the VIEs, Calpine Corporation and its other wholly owned subsidiaries whereby we support the VIE through the reimbursement of costs and/or the purchase and sale of energy. In addition to amounts contractually required, Calpine Corporation provided support to these VIEs in the form of cash and other contributions of nil during each of the three and nine months ended September 30, 2012, and $15 million and $87 million during the three and nine months ended September 30, 2011, respectively. U.S. GAAP requires separate disclosure on the face of our Consolidated Condensed Balance Sheets of the significant assets of a consolidated VIE that can be used only to settle obligations of the consolidated VIE and the significant liabilities of a consolidated VIE for which creditors (or beneficial interest holders) do not have recourse to the general credit of the primary beneficiary. In determining which assets of our VIEs meet the separate disclosure criteria, we consider that this separate disclosure requirement is met where Calpine Corporation is substantially limited or prohibited from access to assets (primarily cash and cash equivalents, restricted cash and property, plant and equipment), and where our VIEs had project financing that prohibits the VIE from providing guarantees on the debt of others. In determining which liabilities of our VIEs meet the separate disclosure criteria, we consider that this separate disclosure requirement is met where there are agreements that prohibit the debt holders of the VIEs from recourse to the general credit of Calpine Corporation and where the amounts were material to our financial statements. Unconsolidated VIEs and Investments We have a 50% partnership interest in Greenfield LP and in Whitby. Greenfield LP and Whitby are also VIEs; however, we do not have the power to direct the most significant activities of these entities and therefore do not consolidate them. We account for these entities under the equity method of accounting and include our net equity interest in investments on our Consolidated Condensed Balance Sheets. At September 30, 2012 and December 31, 2011, our equity method investments included on our Consolidated Condensed Balance Sheets were comprised of the following (in millions):
Our risk of loss related to our unconsolidated VIEs is limited to our investment balance. Holders of the debt of our unconsolidated investments do not have recourse to Calpine Corporation and its other subsidiaries; therefore, the debt of our unconsolidated investments is not reflected on our Consolidated Condensed Balance Sheets. At September 30, 2012 and December 31, 2011, equity method investee debt was approximately $460 million and $462 million, respectively, and based on our pro rata share of each of the investments, our share of such debt would be approximately $230 million and $231 million at September 30, 2012 and December 31, 2011, respectively. Our equity interest in the net income from Greenfield LP and Whitby for the three and nine months ended September 30, 2012 and 2011 is recorded in (income) from unconsolidated investments in power plants. The following table sets forth details of our (income) from unconsolidated investments in power plants for the periods indicated (in millions):
Greenfield LP — Greenfield LP is a limited partnership between certain subsidiaries of ours and of Mitsui & Co., Ltd., which operates the Greenfield Energy Centre, a 1,038 MW natural gas-fired, combined-cycle power plant located in Ontario, Canada. We and Mitsui & Co., Ltd. each hold a 50% interest in Greenfield LP. Greenfield LP holds an 18-year term loan with an original principal amount of CAD $648 million. Borrowings under the project finance facility bear interest at Canadian LIBOR plus 1.125% or Canadian prime rate plus 0.125%. Distributions from Greenfield LP were $9 million and $18 million during the three and nine months ended September 30, 2012, respectively, and nil and $2 million during the three and nine months ended September 30, 2011, respectively. Whitby — Whitby is a limited partnership between certain subsidiaries of ours and Atlantic Packaging Ltd., which operates the Whitby facility, a 50 MW natural gas-fired, simple-cycle cogeneration power plant located in Ontario, Canada. We and Atlantic Packaging Ltd. each hold a 50% partnership interest in Whitby. Distributions from Whitby were nil and $7 million during the three and nine months ended September 30, 2012, respectively, and nil and $4 million during the three and nine months ended September 30, 2011, respectively. Inland Empire Energy Center Put and Call Options — We hold a call option to purchase the Inland Empire Energy Center (a 775 MW natural gas-fired power plant located in California which achieved COD on May 3, 2010) from GE that may be exercised between years 2017 and 2024. GE holds a put option whereby they can require us to purchase the power plant, if certain plant performance criteria are met by 2025. We determined that we are not the primary beneficiary of the Inland Empire power plant, and we do not consolidate it due to the fact that GE directs the most significant activities of the power plant including operations and maintenance. |