Apr. 26--AUSTIN -- As politics delayed a House vote on legislation meant to force the state's largest power generation companies to shrink, the investors that wish to buy TXU Corp. said they still expect their deal to close.

The House was scheduled to vote on a bill Wednesday that would limit the amount of power generation capacity each company may own. The bill's sponsor, Rep. Phil King, R-Weatherford, had worked out amendments that would limit power companies to serving 35 percent of the market in each region of the state, which would force TXU and NRG Energy to sell plants in some areas. His amendments also would include a new compromise to lift the limits once the Texas grid switches to a new market model in 2009. Mr. King said he thinks he has the votes lined up to pass the bill, and he thinks TXU is on board.

The vote is probably del yed until Friday. Texas Pacific Group and Kohlberg Kravis Roberts & Co. have offered to buy TXU for $45 billion, but the buyers could walk away from the deal without penalty if new laws force TXU to shed a material amount of power generation capacity. A spokesman for the buyers said Wednesday that he still expects the deal to happen. "At this point we anticipate the transaction moving forward," said Jeff Eller, chief executive of Public Strategies Inc., which represents the buyers. The buyers on Wednesday filed merger documents for state regulators to review before the sale closes late this year.

Technically, the buyers could have waited until 30 days after they finish the deal to make the filing. "What we want to do is take a look at what the Legislature does, ultimately what gets passed into law, and we'll evaluate that for the transaction," Mr. Eller said. "We're over there every day talking to legislators. We're going to continue doing that u til there are bills for the governor to sign or the session is over." The amendments to the bill would allow a company to breach the 35 percent limit if it works out a mitigation plan with the Public Utility Commission. TXU serves more than 40 percent of the North and West zones, while NRG Energy serves about 86 percent o the Houston zone.

Amendments that Mr. King helped write would also exclude new nuclear plants and coal gasification plants from the 35 percent cap. "I told them that's the best we can do," Mr. King said of his discussions about the amendments with TXU lobbyists. Early Wednesday, Mr. King said he expected the vote to go smoothly. But then Rep. Robert Talton, R-Pasadena, called a point of order on the legislation, complaining that some wording was left out of a document relating to the bill. Mr. Talton has stalle a number of bills on various topics this session. Mr. Talton's point of order sent the bill back to the Regulated Industries Committee, which Mr.

King chairs. The committee quickly met, corrected the wording, and gave the bill to the Calendars Committee to reschedule the vote. The earliest the bill cou d return to the House floor is Friday. Without the amendments written during the past week, the bill would only tweak existing law that limits power generators to serve 20 percent of the entire Texas grid. With the 35 percent-per-region addition, the House bill is closer to the Senate version, which would limit power companies to serving 25 percent of the wholesale market in each zone of the state. Sen. Troy Fraser, R-Horseshoe Bay, who sponsored the Senate bill, is gearing up for a compromise in a conference committee once the House votes.

"Twenty-five percent was a number to start discussion. There's no magic to 25, but there has to be some number," he said Tuesday. Mr. Fraser and others want to cut the amount of power capacity each company may own to reduce a market player's ability to unduly influence wholesale market prices. While power companies may serve only 20 percent of the entire Texas grid, the companies ould manipulate prices if they concentrate operations in one zone of the state. Currently the Texas grid is a zonal market, meaning the market has several congestion zones. If transmission line congestion makes it difficult to import power from outside a zone, power plants within that zone can raise their price.

Mr. King's idea to lace limits on the market until the market structure changes could allay such concerns. The Electric Reliability Council of Texas will switch to a nodal market in January 2009. Rather than having four congestion zones, the market would have 4,000 nodes. One congested node might boost prices in that location but wouldn't affect prices or tr nsmission elsewhere. "It's hard to manipulate, and it's totally transparent," Mr. King said of the new grid operating model. The House on Wednesday did approve a bill to reinstate the System Benefit Fund, a fee paid by utility customers that's supposed to go toward electricity discounts for low-income residents.

The fees had been diverted to the general fund, but the new legi lation would devote that money to helping the poor. Also Wednesday, the TXU buyout group and TXU's Oncor unit, which operates power lines, filed buyout documents with the PUC. In the 3-inch-thick binder of paper, TXU restates its commitments to create a separate board for the regulated power line business and a separate headquarters, not to pile any buyout debt onto the regulated company, yet to continue spending billions of ollars to upgrade power line equipment. Oncor and the buyers said the buyout won't cause an increase in the rate customers must pay for power line services.

The filing includes a proposed timeline for the PUC to review the buyout. Company lawyers said the PUC doesn't have the right to block the deal, but regulators could block Oncor from passing along some costs to consumers in the next rate case, which is ikely to begin this year. The lawyers for Oncor and the buyers would like the commission to hold the buyout review in August and make a final decision in September. The company asked commissioners to hear the case themselves, rather than passing it on to the State Office of Admi istrative Hearings, to keep the process speedy. TXU also filed buyout documents with the Nuclear Regulatory Commission last week and will file with the Federal Energy Regulatory Commission in coming weeks.

The deal requires approval from those agencies, a process that could take months. It also requi es shareholder approval.