TXU - News Release

News Release

11.06.06

TXU Corp. Outlines Vision to Displace Older Power Generation With Advanced Technologies
DALLAS, TX -

Progress on Texas Projects; Expansion of Plans Outside of Texas; Update of Financial Outlook; Board Declaration of Increased Dividend, Authorization of Share Repurchases

Highlights

TXU outlines its vision for displacing older power generation with new advanced power plant technologies in various markets across the nation at the Edison Electric Institute (EEI) Annual Financial Conference.
New technologies can meet needs for reliable power supply, increase efficiency, lower prices, cut emissions, and lessen dependence on foreign energy sources.
TXU’s power generation strategy has progressed substantially, and now includes line of sight on the development of 16 to 23 gigawatts (GW) of new capacity, including identification of new opportunities outside of Texas. These include 9.1 GW of capacity under development in Texas, sites for the development of two to four GW of power generation facilities identified or secured in the PJM market, and ongoing negotiations in other regions to develop five to 10 GW of additional capacity, including 2.5 GW of capacity for which letters of intent have been signed or are in the customer approval process.
Letters of intent are signed or are in the approval process for the sale of 600 MW of equity ownership in the Oak Grove facilities and 50 percent of the equity of another facility in development in Texas.
TXU has engineered its reference plant design to be the most advanced supercritical coal technology of any plant under construction in the U.S. today and to meet carbon capture and storage ready criteria.
To ensure that TXU’s customers have access to new, more efficient technologies as they become available, TXU invests in ventures focused on innovation in power generation and initiates a $200 million fund to identify and invest in the next generation of energy technology.
Outlook for operational earnings[1] for 2006 remains $5.50 to $5.75 per share of common stock. The outlook for 2007 operational earnings is revised to $5.25 to $5.55 per share of common stock, primarily reflecting the company’s growth investments and the expected success of TXU Energy’s “Pick Your Plan” initiative that enables its customers to save up to 10 to 15 percent and TXU Energy’s Demand-Side Management Program, which provide opportunities for further savings through lower consumption or changes in consumption by time of day. The outlook is discussed further on page 7.
Reflecting the expected impact of the Texas plant development program, TXU Corp. estimates a five-year compound annual growth rate for operational earnings per share of eight to 10 percent. Relative to prior estimates, this five-year growth rate reflects the impact of commodity price changes, the allocation of capital to growth investments, and the expected impact of equity sell-downs in the power generation program.
TXU Corp.’s board of directors increased the regular quarterly common stock dividend by five percent, authorized the repurchase of an additional 20 million shares of common stock through the end of 2007, and extended the expiration date of the remaining 3.4 million shares in the 2006 plan to the end of 2007, all in line with the company’s capital allocation philosophy.

TXU Corp. (NYSE:TXU) today announced the company’s vision to see the nation’s older, less efficient power plants upgraded or displaced with new power generation technologies to meet the nation’s growing need for reliable, affordable and cleaner electric power.

The company is challenging the industry to drive further improvements in air quality by accelerating this replacement, and has taken the next step in its power generation development program of potentially 16 to 23 GW of baseload generation capacity, including the 9.1 GW under development in Texas, sites identified or secured in the PJM region, and negotiations in progress to develop facilities to meet specific utility, municipal, cooperative, and large industrial customer needs.

The company also provided an update on its financial outlook and strategy, establishing its outlook for 2007 operational earnings at $5.25 to $5.55 per share of common stock. TXU Corp.’s long-term growth trajectory for the core business in Texas reflects the company’s focus on reinvesting to meet the nation’s power needs while providing appropriate returns for investors. The company’s expected five-year compound annual growth rate is eight to 10 percent, including the previously announced generation development program in Texas, based on current forward commodity prices and expectations for the new build program. In addition, the board of directors authorized the repurchase of up to 20 million shares of the common stock of the company through the end of 2007, and extended the expiration date of the remaining 3.4 million shares of the 2006 program to the end of 2007. Management will apply its capital allocation philosophy in determining the timing and amount of these repurchases over the next 14 months. The increased share repurchase authorization and the board of directors’ authorization of a five percent increase in the regular quarterly dividend are consistent with the results of company performance in 2006 and the company’s disciplined capital allocation philosophy. The financial outlook is discussed in more detail beginning on page 7.

EEI Annual Financial Conference – Presentation Webcast on Tuesday

Senior executives of the company will meet today and tomorrow with investors and financial analysts at the EEI Annual Financial Conference in Las Vegas, Nevada. On Tuesday, C. John Wilder, TXU Corp. chairman and CEO, will present an update on TXU’s growth strategies and financial outlook at this event. A live webcast of the presentation will be available in the Investor Resources section of TXU Corp.’s web site at www.txucorp.com beginning at approximately 8:15 a.m. Pacific (11:15 a.m. Eastern and 10:15 a.m. Central). The presentation and related materials are available in the Investor Resources section of the TXU Corp. Website.

Click here for the complete news release.

TXU Corp., a Dallas-based energy company, manages a portfolio of competitive and regulated energy businesses primarily in Texas. In the competitive TXU Energy Holdings segment (electricity generation, wholesale marketing and retailing), TXU Energy provides electricity and related services to more than 2.2 million competitive electricity customers in Texas, more customers than any other retail electric provider in the state. TXU Power has over 18,300 megawatts of generation in Texas, including 2,300 MW of nuclear and 5,800 MW of coal-fired generation capacity. TXU Wholesale optimizes the purchases and sales of energy for TXU Energy and TXU Power and provides related services to other market participants. TXU Wholesale and its affiliate, TXU Renew, are the largest purchasers of wind-generated electricity in Texas and fifth largest in the United States. TXU Corp.’s regulated segment, TXU Electric Delivery, is an electric distribution and transmission business that complements the competitive operations, using superior asset management skills to provide reliable electricity delivery to consumers. TXU Electric Delivery operates the largest distribution and transmission system in Texas, providing power to three million electric delivery points over more than 100,000 miles of distribution and 14,000 miles of transmission lines. Visit www.txucorp.com for more information about TXU Corp.

This release contains forward-looking statements, which are subject to various risks and uncertainties. Discussion of risks and uncertainties that could cause actual results to differ materially from management's current projections, forecasts, estimates and expectations is contained in the company's SEC filings. Specifically, the company makes reference to the section entitled “Risk Factors” in its annual and quarterly reports, particularly the risk factor relating to its power generation development program in Texas. In addition to the risks and uncertainties set forth in the company's SEC filings, the forward-looking statements in this release could be affected by actions of rating agencies, the ability of the company to attract and retain profitable customers, changes in demand for electricity, the impact of weather, changes in wholesale electricity prices or energy commodity prices, the company’s ability to hedge against changes in commodity prices and market heat rates, the company’s ability to fund certain investments described herein, delays in approval of, or failure to obtain, air and other environmental permits and the ability of the company to resolve the consent decree issue regarding the new Sandow 5 unit, changes in competitive market rules, changes in environmental laws or regulations, changes in electric generation and emissions control technologies, changes in projected demand for electricity, the ability of the company and its contractors to attract and retain skilled labor, at projected rates, for planning and building new generating units, changes in the cost and availability of materials necessary for the planned new generation units, the ability of the company to negotiate and finalize engineering, procurement and construction contracts for its reference plants in a timely manner and at projected costs, the ability of the company to manage the significant construction program to a timely conclusion with limited cost overruns, the ability of the company to implement the initiatives that are part of its performance improvement program and growth strategy and the terms under which the company executes those initiatives, and the decisions made and actions taken as a result of the company’s financial and growth strategies, and with respect to the InfrastruX Energy joint venture, the amount of time the PUC takes to review the transaction and the results of the review.

[1]Operational Earnings Per Share (a non-GAAP measure) is defined as per share (diluted) income from continuing operations, excluding special items. See page 7 in full news release for more detail.

Media
Lisa Singleton
214-812-5049

Investor Relations
Tim Hogan
214-812-4641

Bill Huber
214-812-2480

Steve Oakley
214-812-2220

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