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Protest of Calpine’s Application to Export Power

By Tyson Slocum

On November 22, 2024, Calpine Energy Solutions LLC applied for renewal of its authorization to export electricity from the United States to Mexico as a power marketer.[1] The application is deficient, as it fails to identify “[t]he exact legal name of all partners” as required by 10 CFR § 205.302(b), including its affiliate partners Energy Capital Partners and Bridgepoint Group, as well as dozens of its affiliate power generation partners. Calpine Energy Solutions LLC is incapable of operating as a power marketer independent from its power plant affiliates, as it features executives and directors that serve simultaneous roles for dozens of power plants. The operation of Calpine Energy Solutions LLC-affiliated power plants have an impact on “the sufficiency of electric supply within the U.S.”, and therefore requires more analysis than is included in the application. The Department of Energy must either reject the application, or set the matter for hearing, per 16 USC § 824a(e).

Page 1 of the application states that “Calpine [Energy] Solutions is … an indirect, wholly owned subsidiary of Calpine Corporation.”[2] This description of Calpine Energy Solutions’ upstream ownership is incomplete, as it conceals that Calpine Corporation is a wholly-owned subsidiary of the private equity firm Energy Capital Partners, which in turn is affiliated with the UK financial holding company Bridgepoint Group.[3] The failure of the application to correctly identify that it is ultimately controlled by Energy Capital Partners and Bridgepoint Group is a fatal error.[4]

Page 5 of the application claims: “Calpine [Energy] Solutions does not own or control any electrical generation, transmission facilities, or distribution facilities”.[5] This statement is demonstrably false, as Calpine Energy Solutions LLC is directly affiliated and shares personnel and management with dozens of electrical generation units in the United States. Its parent company Energy Capital Partners is one of the largest owners of merchant power generation in America, with its Calpine subsidiary alone controlling over 27,000 MW of power generation capacity in the United States.[6]

Modern corporations such as Energy Capital Partners/Bridgepoint Group are organized as a series of hundreds of limited liability companies (LLCs) that are under common control and centrally managed, where the LLCs segregate various assets and activities for a variety of purposes, including shielding investors from certain types of (mostly tax) liability. This sprawling array of LLCs are under centralized control and management, and financially interact with each other as affiliates. Evidence of this is found in the Form 561 2023 Annual Report of Interlocking Positions of Calpine Corporation filed with the Federal Energy Regulatory Commission on April 30, 2024.[7] Attached as Exhibit A are the interlocking positions of 13 Calpine executives who serve as officers or directors of Calpine Energy Solutions LLC simultaneously while serving officer or director roles for dozens of other Calpine affiliates, including dozens of power plants.

Highlighting but one of the 13 executives, Caleb Stephenson’s 2023 Interlocking Positions report lists his role as a Vice President of Calpine Energy Solutions LLC, while simultaneously serving as Vice-President of at least 25 other LLCs that control power plants in the United States. Calpine Energy Solutions LLC cannot be classified as a stand-alone power marketer when its executives concurrently serve as managers for affiliated power generation facilities.

On December 31, 2024, Calpine Energy Solutions LLC filed a joint Triennial Market Power Analysis with FERC along with 24 of its affiliated generation units—because under FERC rules, power marketers such as Calpine Energy Solutions LLC must file market power analysis reports that include power sales of all affiliates, including power generation assets.[8]

The North American Electric Reliability Corporation’s 2024 Long-Term Reliability Assessment issues a dire warning for the reliability of America’s bulk power market, with a majority of the United States subject to risk of power shortfalls.[9] The application is silent on how Energy Capital Partners’ planned exports of electricity will not contribute to the risk of domestic power shortages, given its control over such significant power generation resources.

Conclusion

Calpine Energy Solutions LLC’s November 22, 2024 application to export electricity is clearly incomplete for failing to list its affiliated partners as required by 10 CFR § 205.302(b), and contains material omissions. The Department of Energy must either reject the application, or set the matter for hearing, per 16 USC § 824a(e).

read the full filing here: Calpine Energy Solutions

[1] www.govinfo.gov/content/pkg/FR-2024-12-19/pdf/2024-30221.pdf

[2] www.energy.gov/sites/default/files/2024-12/EA-284-G%20Calpine%20Energy%20Solutions%2C%20LLC%20Export%20Authorization%20Application.pdf

[3] https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20240805-3070

[4] Last week, Energy Capital Partners announced it was selling its Calpine subsidiary to Constellation Energy for $26.6 billion (including cash and debt), which we assume will include Calpine Energy Solutions LLC. The transaction likely won’t close until the 4th quarter of 2025. www.wsj.com/business/deals/constellation-energy-agrees-to-buy-calpine-in-26-6-billion-deal-dea42906

[5] www.energy.gov/sites/default/files/2024-12/EA-284-G%20Calpine%20Energy%20Solutions%2C%20LLC%20Export%20Authorization%20Application.pdf

[6] www.calpine.com/powering-america/

[7] https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20240430-5446

[8] https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20241231-5471

[9]www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/NERC_Long%20Term%20Reliability%20Assessment_2024.pdf