The plant, which entered operations in May
1987, produces steam for an adjacent chemical processing facility and
generates electricity for the Texas power market.S. is an Environmental Energy Technology Company with
Gasification Technology expertise.

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About Calpine
A major power company, Calpine Corporation supplies customers and
communities with electricity from clean, efficient, natural gas-fired and
geothermal power plants.

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"The PSM LEC-III(R) system has consistently met or exceeded our
expectations," said Tom Mason, Calpine executive vice president and president
of Calpine Power Company. The retrofit involved the
installation of PSM's LEC-III (R) system in a 501D5 combustion turbine
generator designed by Siemens Westinghouse and manufactured by Mitsubishi.S.calpine.
The Lima Energy IGCC is the most advanced IGCC in the U. The primary drivers for IGCC
are top environmental and economic performance.

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, Calpine Corporation's
(NYSE: CPN) parts and manufacturing subsidiary Power Systems Mfg. For more information,
visit http://www . CINCINNATI, Lima Energy Company, an operating
company of Cincinnati based Global Energy, Inc . The Company has 7 Projects representing 378 billion
SCF/yr of SNG, 160 million SCF/day of Hydrogen and 1400 MW of power in
development, construction or operation in the US and UK.

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, LLC, a wholly owned subsidiary of Calpine Corporation,
is an industry leader in gas turbine component engineering design and
production.com. It is included in the S+P 500 Index and is publicly traded
on the New York Stock Exchange under the symbol CPN.

If the base-
load coal fleet were converted to IGCC, the U.

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Calpine expects to complete the installation on the
two remaining gas turbines in 2006 . Calpine was
founded in 1984.

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Results in 80% Reduction in NOx Emissions and $36 Million of Capital Cost
Savings

SAN JOSE, Calif. The Jupiter, Fla. Visit PSM's web site at http://www.powermfg. states and three Canadian provinces.; leading a wave
of expected IGCC development and construction activity accelerated by National
Energy Policy and National Security interests.

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About Global Energy, Inc.

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The combustion system is in use in more than
a dozen General Electric-manufactured gas turbines for customers in the United
States, Europe and the Middle East. The system utilizes advanced gasification technology
whereby the solid fuel is converted in a closed system to low cost clean
synthetic gas.

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Tom Churbuck, president of PSM , stated, "The Texas City project
strengthens PSM's record of success in providing customers with the industry's
lowest guaranteed NOx combustion system available for D- and E-class gas
turbines , including the GE frame 6, 7 and 9 engines and now the Siemens
Westinghouse and Mitsubishi 501D5 .

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PSM's proprietary low emissions combustion systems and state-of-the-art hot
gas path components continue to help Calpine lower power plant emissions,
improve fuel efficiency and enhance reliability .

About Power Systems Mfg. The synthetic gas is produced at less than half of today's
market prices for gas, thus enabling the combined cycle power plant in the
IGCC to produce low cost, clean and efficient electric power.

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, LLC (PSM)
successfully converted one of three planned combustion turbine generators at
Calpine's Texas City Cogeneration Power Plant to PSM's patented, low-emissions
combustion system, LEC-III(R). "This technology extends the economic life of
Calpine's existing power generation , dramatically reduces NOx emissions and
reduces operating costs. Calpine's Texas City installation
represents the first conversion of a Siemens turbine. Its customized
products and services include wholesale and retail electricity, natural gas,
gas turbine components and services, energy management , and a wide range of
power plant engineering, construction and operations services.
Global Energy, Inc.

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As a result, Calpine will reduce nitrogen
oxide (NOx) emissions at its Texas City power plant by approximately 80% while
simultaneously maintaining very low, single-digit carbon monoxide emission
levels -- without disrupting its steam host's operations or sacrificing the
plant's fuel -efficiency. Calpine owns, leases and operates integrated systems
of plants in 21 U. The project is currently in construction with concrete foundation work
being carried out at this time.S.

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"
Texas City is a 457-megawatt, natural gas-fired, cogeneration power plant,
owned and operated by Calpine.

Lima Energy IGCC Moves Up To 600MW

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The installation of PSM's LEC-III(R) system on all
three turbines is expected to save Calpine approximately $36 million, when
compared to the capital cost of replacing heat recovery boilers, adding
alternative selective catalytic emission reduction technology and purchasing
costly emission credits.

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Gasification Technology provides an
environmentally superior and low cost method for producing Power, Gas,
Transportation Fuel, and Hydrogen.

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"
PSM's proprietary dry low NOx combustion system achieves NOx emissions of
less than five parts per million without the use of the more costly selective
catalytic reduction technology. The Company has optimized operating
techniques and is able to produce synthetic gas at a cost well below market
prices for pipeline gas.

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Calpine Installs PSM's Low Emissions Combustion System at Its Texas City Cogeneration Power Plant

would benefit from up to 20%
more power and 10 times cleaner emissions from the same annual coal
consumption.

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The increase in power output is a
result of engineering optimization work and will enhance the project economic
value.

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The Ultra Clean High Tech
IGCC is the cleanest and most efficient solid fuel (coal or petcoke) based
power generation system.

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, LLC
Power Systems Mfg.-based company offers a wide range of low
emissions combustion systems and advanced airfoils compatible with
retrofitting or replacing existing combustion systems and hot gas path
components in General Electric and Siemens Westinghouse turbines, including
F-class machines . today announced an upgrade of
the Lima Energy IGCC (Integrated Gasification Combined Cycle) power generation
facility to 600MW (megawatts) from 540MW. The Company plans to
build, own, and operate a worldwide portfolio of IGCC and SNG facilities.

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com.

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