Shell Energy Services Co. LLC, a unit of Shell Oil Co., and Calpine Corp. Wednesday reported signing an energy agreement under which Calpine will provide up to 3,000 Mw of electricity to Shell, a retail electricity provider participating in the Texas electric choice pilot program.

A pilot delayed since June 1 is presently scheduled to begin July 31.

The contract begins Jan. 1, 2002, when full competition is scheduled to start in Texas. The 5-year agreement is a full requirements contract under which Calpine will provide capacity, energy, and ancillary services to Shell.

Calpine will also provide services to Shell Energy during the retail pilot program from now through the end of the year.

With the recent announcement of other long-term contracts, Calpine has sold 85% of its generating capacity in the Electric Reliability Council of Texas for the next few years. The largest independent power producer in Texas, Calpine has 2,700 Mw of gas-fired generation in operation.

Calpine’s systems approach allows operations data from all its plants in the ERCOT market to be viewed real-time. This means that plants can be dispatched or cycled-down as necessary for the most efficient operations, the company said.

Using modern technology that is 40% more efficient than older power plants in Texas, Calpine can provide reliable energy to Shell Energy at the most competitive prices, said Carey Johnson, Calpine marketing vice president.

In 1998, Shell Energy was certified to market natural gas to consumers in Georgia, the nation’s first state to deregulate the marketing of natural gas. Since that time, Shell Energy has expanded its services to Ohio and Texas and to date, serves 500,000 customers.