March 2, 2004

CALPINE

HARVARD ELECTRICITY POLICY GROUP

Natural Gas and Electricity

Ron WalterExecutive Vice President

R020415 2

CALPINE

March 2, 2004

CALPINE CORPORATION —THE FIRST 20 YEARS

Largest Independent Power Company in North America

Most Modern, Efficient Fleet of Power Generation Assets

87 Plants, 22,130 mw in Operation Today

Growing to Over 30,000 mw in 2006

Proved Gas Reserves – 1 tcf

Assets Managed by Calpine Energy Services

3.4% of U.S. Electrical Consumption

3% of U.S. Natural Gas Supply

R020415 3

CALPINE

March 2, 2004

CALPINE’S GROWING PORTFOLIO

Net Megawatts

Assumes No New Projects

3,3555,849

11,130

19,05022,130

25,680 27,09029,720

4,400

13,400

15,200

9,7507,860

4,040 2,630

1999 2000 2001 2002 2003 2004 2005 2006

In Operation In Construction

R020415 4

CALPINE

March 2, 2004

CALPINE’S POWER PORTFOLIO

In Operation

3

1

1

11

1

1

1

1

39

1

1

1

1

10

2

2

1

1

2

1

3

1

3

1

3

4

2

1

1

3

1

87

Under Construction

13

2

11

12 - New Projects1 - Expansion Projects

R020415 5

CALPINE

March 2, 2004

MOST EFFICIENT NORTH AMERICAN POWER GENERATION FLEET

Combined-Cycle Megawatts By Company

Operation Construction

0

5,000

10,000

15,000

20,000

25,000

30,000

FPL(1)

FPL(2)

Southern(2)

Xcel(2)

Southern(1)

Progress(1)

Exelon(2)

Calpine Duke(2)

Megawatts

(1) Regulated (2) Non-Regulated

Source: Company Data

R020415 6

CALPINE

March 2, 2004

Natural Gas Will Remainthe Fuel of Choice

for Power Generation

Natural Gas Will Remainthe Fuel of Choice

for Power Generation

R020415 7

CALPINE

March 2, 2004

THE PRICE OF NATURAL GASWILL BE REASONABLE

Responds Well to Market Forces

Spot Prices vs. Long-Term Prices

Expected Range of Prices

< $2.50/mmbtu – No New Investment

> $5.00/mmbtu – New Supply

Calpine Strategy to Manage Price Risk

R020415 8

CALPINE

March 2, 2004

THE SUPPLY OF NATURAL GASWILL REMAIN SUFFICIENT

Proven Reserves Don’t Tell the Whole Story

2003 Report of Potential Gas Committee 1,311 Trillion Cubic Feet 65X Annual Production Rate 3.3% Increase in Supply From 2000

New Supply Eastern Canada Deep Gulf MacKenzie Delta Alaska LNG

LNG Large World Resource Base U.S. Deliverability

1 bcf 2003 4 bcf 2004 9 bcf 2007

R020415 9

CALPINE

March 2, 2004

NATURAL GAS CONSUMPTION FOR POWER GENERATION GROWING MODESTLY

New Natural Gas-Fired Plants are 40% More Efficient

During the Height of the New Power Plant AdditionsJanuary 2002 – January 2003

Megawatt-Hours Increased by 8%

Gas Consumption Increased by 2%

Less Efficient Plants are Being Displaced / Retired

R020415 10

CALPINE

March 2, 2004

ENVIRONMENTAL BENEFITS OF NATURAL GAS

Lower Air Emissions 98.7% Less NOx Than Coal 99.9% Less SO2

65% Less CO2

100% Less Mercury

Lower Land Use

40% – 60% Lower Water Consumption

Reduces Global Warming

R020415 11

CALPINE

March 2, 2004

MARKET FORCES ARE BEST DRIVER FOR CHOICES ON FUEL USE

Government Intervention Has Not Been Successful

Nuclear Energy

Fuel Use Act

Clean Coal

Renewable Standards

Economics and Environmental ConsiderationsShould Shape Fuel Use

Supply and Price of Natural Gas Will Best beModerated by Market Forces