The ratings on Calpine Corp. reflect the company's reliance on asset sales and contract monetizations to meet its interest payments and other fixed obligations in 2005 and 2006. In addition, the uncertain prospects for improvements in power markets make it unlikely that Calpine will be able to meet these obligations with internal cash flow generation. The San Jose, Calif.-based company, which develops, acquires, owns, and operates power generation facilities, has about $18.7 billion of total debt outstanding. Although Calpine alleviated many of its liquidity issues regarding its 2003-2005 debt maturities through successful refinancing, asset sales, and monetizations, liquidity will remain a credit concern because Calpine's new debt instruments restrict its ability to issue debt and sell assets. Furthermore, overall business
