Washington (Platts)--2Mar2009

The shrinking field of retail marketers is not an indictment against
restructured power markets but an expected result of the credit crisis and its
impact on retailers, Jim Burke, CEO of TXU Energy said Monday morning.

Burke's comments at the KEMA Executive Forum in Houston came after NRG
announced plans Monday to buy Reliant Energy's retail business in Texas for
$287.5 million. Integrys Energy Services' parent last week said it would wind
down or sell IES, which is one of the larger retail marketers operating in
competitive retail markets.

In the current credit crunch, many retail marketers have encountered
difficulties and higher costs to maintain credit in order to trade natural gas
and power supplies, resulting in a "significant erosion of financial health"
among marketers, said Taff Tschamler, director of retail energy for KEMA.

The number of retail marketers may decline as the credit crisis lasts,
but the companies left will be stronger and more focused on customers and
market innovations, Burke said. Integration of generation assets and retail
market assets, as evidenced in the NRG-Reliant deal and in the business
strategy of marketers such as TXU and others, also makes sense and may be a
future trend, Burke added.

Some larger retailers that did not manage their credit well will break up
and sell assets, and smaller companies may join forces to grow within retail
markets, said Michael Kagan, president of Constellation NewEnergy.

Direct Energy, which bought Strategic Energy last year, sees additional
opportunities to grow through acquisitions and sales to new customers, said
Phil Tonge, president of Direct Energy. Compared with other companies that are
in no position to find credit to make any acquisitions, Direct Energy parent
Centrica has a stable credit rating and strong balance sheet, Tonge said.