TEXT-S&P release on Calpine, NRG Energy

(The following statement was released by the rating agency)

May 22 - Standard & Poor's Ratings Services today placed its 'B+' corporate
credit rating on NRG Energy Inc. (NRG.N: Quote, Profile, Research) on CreditWatch with negative
implications and its 'B' corporate credit rating on Calpine Corp. (CPN.N: Quote, Profile, Research) on
CreditWatch with positive implications. These rating actions follow the
disclosure yesterday that NRG's board, via a private letter to the Calpine
board, made an all-stock offer to purchase 100% of the outstanding shares of
Calpine at an exchange ratio of 0.534 shares of NRG for each share of Calpine.
It is not clear how long it would take before a formal transaction is agreed
upon, if at all. However, NRG's letter to Calpine's board says that NRG
anticipates it will be able to conduct its further necessary confirmatory due
diligence within a three-week period.

"Although formal discussions between the two companies are just
commencing and the terms of the deal could change, based on the current
all-stock proposal, we think that NRG's acquisition of a much less hedged and
more leveraged Calpine would likely result in the combined company being rated
either 'B+' or 'B'," said Standard & Poor's credit analyst Swami
Venkataraman. "However, the transaction has both strengths and weaknesses that
may potentially drive ratings outside this range, although we consider that an
unlikely outcome at this stage."

The most important determinant of the final rating outcome is the deal's
final financing structure and our view of the financial performance of the
combined company. The all-stock transaction structure currently proposed is
clearly the least detrimental to NRG's credit quality, but the final
transaction structure is uncertain. In its press release, Harbinger Capital
called the offer a "good starting point." If NRG agrees to a significantly
higher valuation for Calpine, the dilution implied by an all-stock transaction
may be unacceptable to NRG's shareholders and a final deal may potentially
involve incremental debt.

Under the terms of Calpine's exit financing, change of control is an
event of default. Thus, an acquisition by NRG could require refinancing or
repricing of Calpine's debt, which was committed before the credit crunch and
carries attractive pricing compared to current market conditions. An increased
cost of borrowing of about $6 billion of Calpine's emergence financing would
be a credit negative.

Complete ratings information is available to subscribers of
RatingsDirect, the real-time Web-based source for Standard & Poor's credit
ratings, research, and risk analysis, at www.ratingsdirect.com. All ratings
affected by this rating action can be found on Standard & Poor's public Web
site at www.standardandpoors.com; select your preferred country or region,
then Ratings in the left navigation bar, followed by Credit Ratings Search.
(New York Ratings Team)