Calpine to Trim Jobs, Shed Businesses to Reduce Costs

Calpine Corp., which is operating under Bankruptcy Court protection, said Wednesday that it would cut 300 jobs and shed businesses to focus on electricity generation to reduce annual operating costs by $50 million.

As part of the cost-cutting program, San Jose-based Calpine said it would complete construction projects that have long-term sales deals and also look to sell its construction unit and other operations and offices. The job cuts represent about 9% of Calpine’s workforce of 3,300 employees.

Calpine Chief Executive Robert May said in a statement that the company would focus “on what Calpine does best -- power generation.”

Calpine has more than 90 power plants around the United States with a generating capacity of about 27,000 megawatts, enough to serve more than 20 million average homes.

Calpine didn’t give a timetable to carry out the job cuts and other steps, but spokeswoman Katherine Potter said that May was “focused on emerging from Chapter 11 as soon as possible and would like to achieve a reorganization plan by the end of this year.”

Calpine filed for bankruptcy protection in New York in December, listing more than $22 billion in liabilities.

Calpine will look at all its power stations for possible sales and also decide whether it will withdraw from certain regional electricity markets where it sells power, Potter said.

Separately, Calpine has appealed a judge’s ruling that the company must seek permission from the Federal Energy Regulatory Commission to drop eight money-losing power contracts.

Calpine, which wants the issue decided in court, argues that as a company in bankruptcy it has the right to shed contracts on which it says it’s losing about $1.1 million a day.