Court OKs PG&E; Payment to Calpine

Calpine Corp. said Monday that a U.S. Bankruptcy Court approved PG&E; Corp.’s agreement to pay it $265 million in power bills outstanding.

PG&E;, the owner of California’s largest utility, agreed to pay for electricity supplied by Calpine from Dec. 1, 2000, to April 6. On Friday, the U.S. Bankruptcy Court for the Northern District of California approved a plan that calls for PG&E; to make monthly payments of principal and interest starting Monday through November, Calpine said. Pacific Gas & Electric, PG&E; Corp.’s utility unit, filed for Chapter 11 bankruptcy protection in April after accruing more than $9billion in debt paying record wholesale prices for power. Under California law, PG&E; was not allowed to pass all its power-buying costs to customers.

Calpine, based in San Jose, said it agreed to sell the PG&E; receivable to an unnamed buyer. Calpine, which has power plants in 29 states, Britain and Canada, expects to get cash from the sale this year.

Shares of Calpine rose 50 cents to close at $15.51 on the New York Stock Exchange; they have fallen 66% this year, largely on investor worries about diminished demand for electric power. PG&E; fell 4 cents to $19.41, also on the NYSE.