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9 April 2007 -- Michael McCall, CEO of TXU Wholesale, apologized Friday for "creating any perception of threatening to shut down power plants in Texas."
McCall and CEO John Wilder said in a joint statement that TXU is not permitted to unilaterally shut down power plants. Such a step can only be done after a review by ERCOT, they acknowledged. "There is no intention to shut down plants, especially those needed to ensure reliability," the statement said.
Power Engineering reported last Thursday that TXU Corp. said it could be forced to shut down some power plants if it couldn't settle charges by state regulators that it manipulated the state's wholesale electric market.
Earlier this month, the Texas Public Utility Commission proposed a $210 million penalty against TXU over charges that during the summer of 2005 it sold power at inflated prices. TXU said it would contest the charges.
Mike McCall, chief executive of TXU's power-generation division, wrote to the commission last week to say that the $210 million penalty raises questions about whether the Dallas-based utility can profitably operate older natural gas. In reversing their threat to close plants, McCall and Wilder said on Friday they were asking the PUC to disregard the filing. "We will resubmit a more appropriate document after consulting with the investors," the executives said. "Again, we apologize for our actions."
TXU's threat met with a rebuke from the investment group that is seeking to buy the company for around $45 billion. KKR and Texas Pacific Group said they had no intention to shut down plants unilaterally and would file documents with state regulators to back up the pledge.
Wilder said "We will start over, consult with the investor group and get it right the next time."
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