TXU Electric Delivery

1. 30% 99-03: DFW area increased imports by 2600 MW TXU Electric Delivery Has A Strong Competitive Position… …Focused On Providing The Lowest Cost… Large customer base 03; Millions of customers Large infrastructure 03; Thousands of miles of primary distribution lines • T&D O&M expense/distribution customer • 03-04; $ per customer Monthly wires charges 04; Dollars1 143 5.2 5.2 00-03: 25GW of new generation capacity in ERCOT 4.1 4.1 TXU $24.01 86 85 3.1 2.9 2.8 73 69 2.6 67 Previously planned projects New projects 62 2.2 2.2 57 53 39 AEP Central $24.27 • 03 top quartile • 03 top • decile • TXU 03 performance • TXU 04E performance EXC PCG TXU SO PGN ETR D DUK FPL ED TXU Source: FERC Source: Proprietary benchmarking study TNMP $25.89 • T&D O&M expense per MWh delivered • 03-04; $/MWh delivered High growth 03-12E; Percent annual demand growth Top quartile safety record 03; Lost time incidents per 200,000 hours Center- point $27.97 2.5 2.5 2.3 2.2 2.1 1.9 1.8 1.8 1.8 1.4 AEP North $34.03 • 03 top quartile • 03 top • decile • TXU 03 performance • TXU 04E performance ERCOT SERC WECC MAAC MAIN TXU 1 Assumes 1000 KWH monthly customer; Electric Delivery’s average residential consumption for 2003 was about 1300 kWh. Other non-operating charges, including system benefit fund, nuclear decommissioning charge, excess mitigation credit, retail clawback credit, transition charge on securitized regulatory assets and merger savings/rate reduction riders have not been included. FRCC ECAR MAPP SPP NPCC 1 2 Source: NERC Source: PA Consulting …While Investing To Achieve Excellence In Reliability Transmission Grid Enhancements Will Reduce Grid Congestion And Support Grid Reliability Transmission capital investment 03-06; $ millions Distribution capital investment 03-06; $ millions Increased demand in DFW is being served by new generation located outside the Metroplex causing ~$100 million in congestion costs… …TXU is undertaking an aggressive plan to enhance the grid and relieve the congestion… • 11% SAIDI1 benchmarks (non-storm) 98-06E; Minutes • 13% 78 77 74 68 • TXU plans to spend $400 million in 04 and 05 on transmission systemupgrades across North Texas 03 top quartile TXU 04E per-formance TXU 05Etarget TXU 06Etarget 3 4 1 System Average Interruption Duration Index TXU Electric Delivery

2. Billing/CIS Mainframe Client Workstation (PC) Mainframe Oracle UTILITY ENTERPRISE NETWORK (WAN/LAN) Distribution Automation Will Enhance Customer Service And Increase Operational Efficiency Automated Meter Reading Will Improve ProductivityAnd Safety Network Client Communication Front SCADA, EMS, OMS, etc End Processors (FEPs) Workstations (PCs) IT Network Platform Distribution Substation Voice Grade Communication Dispatcher notifies field technician who has to inspect entire feeder; average restoration time of 30-45 minutes 3 Automated electric Meter Substation Control Equipment Power Lines Old Way Load Control Transponder 1 2 ServiceTo Home Cell Tower Disruption occurs on delivery system causing an outage… Operations Center gets notified of outage Gas Meter Water Meter DOC Switch & CellularModem New Way Distribution automation technology immediately identifies location of disruption and reconfigures system to restore service to majority of customers, typically within minutes. 3 • Enhanced customer service through remote and on demand meter reading without accessing premise • Technology will allow for automatic outage notification, power quality monitoring and real time customer access to consumption data Where deployed, automation technology enhances customer serviceby reducing restoration time up to 80% 5 6 Storm Restoration: Our Commitment to Customer Service • June 1, 2004 storm • Worst storm in 100 year history of TXU (Category 1 hurricane winds) • 500,000 lightning strikes across TXU Electric Delivery system • More than 11,000 device outages affecting approximately 1.3 million customers • 90% of customer power restored within 60 hours 7 8 TXU Electric Delivery These Initiatives Are Improving Electric Delivery’sFinancial Performance • Operational EPS03-05; $ per share • EBITDA103-05; $ millions 90% 25% • 03 • 04E • 05E • 03 • 04E • 05E 1Results are from continuing operations excluding special items