2005 was a good year for TXU and its stakeholders on a number of dimensions. We made substantial progress in driving our financial and operational turnaround and began to pursue our growth strategy. We also improved on an already-stellar record of corporate social responsibility. We had major successes in the areas of environment, safety, community, and diversity. On environmental issues, we once again met or went beyond all environmental requirements while generating more electricity from our coal plants than ever before. Always a priority, our 2005 safety record was the best in company history. We also continued our commitment to our communities as the Texas energy market leader in low-income social advocacy and energy efficiency. Our employees were more generous than ever, increasing their contributions to United Way by more than 20 percent. For the seventh year in a row, we were recognized as one of the top companies in America that buy products and services from women-owned businesses. Finally, we helped our state and our neighbors across the Gulf Coast recover from the devastation of Hurricanes Katrina, Rita, and Wilma.
For all our accomplishments in 2005, we have plenty of room for improvement. Corporate social responsibility is an important benchmark that complements our financial and operational performance. We believe this annual citizenship report, which is also our 15th year of reviewing our environmental results, serves, along with our corporate financial reports, as an important way for stakeholders to measure TXU's complete company performance.
Let me say a word about our plans for the future because they will affect our role in the communities we serve as well as our business efforts. Texas has one of the fastest-growing economies in the nation and is projected to add nearly 6 million residents within a decade. Without new power capacity, the state's power reserves are expected to fall below reliable levels by 2010. To help meet the electric power needs of the expanding Texas economy, we have proposed a bold investment of $10 billion in the state's power infrastructure to provide lower-cost, secure, and stable electricity generation. We are also investing in innovative programs to help customers save money and give them real choice and control.
With this plan, TXU will set a new environmental standard in Texas. We will more than offset emissions of sulfur dioxide, nitrogen oxides, and mercury from the proposed 11 new coal power units by making reductions at existing plants and by using the best available control technology. While doubling our solid-fuel generation capacity, we will improve air quality and lower key emissions with what we believe is the largest voluntary emissions reduction program of its type in the nation.
Moreover, the net effect of TXU's capital investment will be a substantial boost to the state's economy. For Texas communities, our program translates into thousands of new jobs. For the latest information about our plan to Power the Future of Texas, please visit us online at www.reliabletexaspower.com. We are excited to be a leader in powering Texas' energy future and growth.
I hope you find this report helpful as you assess TXU's social responsibility efforts. We look forward to even better results in 2006 and beyond.
Sincerely,
C. John Wilder
Chairman and CEO
