Company News

TCEH Corp., Parent Company for Luminant and TXU Energy, Emerges from Chapter 11 as a Competitive, Well-Capitalized Company


News Release

 

TCEH Corp., Parent Company for Luminant and TXU Energy, Emerges from Chapter 11 as a Competitive, Well-Capitalized Company

 

 

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Energy Industry Veteran Curt Morgan Formally Named CEO

 

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Restructuring Eliminates More Than $33 Billion in Debt

 

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Benefits from Low Leverage Relative to Peer Group

 

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Company Closes on $4.25 Billion Exit Financing Facility

 

DALLAS – October 4, 2016 –TCEH Corp. today announced that it and certain of its subsidiaries, including operating businesses Luminant and TXU Energy, have emerged from Chapter 11 as a standalone company effected through a tax-free spinoff from Energy Future Holdings Corp. The emergence follows satisfaction of all necessary conditions, including regulatory approvals required by EFH’s Third Amended Plan of Reorganization, which was approved by the U.S. Bankruptcy Court for the District of Delaware on August 29, 2016.

 

EFH and Energy Future Intermediate Holding Company LLC, which own an indirect 80 percent equity interest in Oncor, remain in Chapter 11 and are proceeding toward confirmation and emergence on a separate, standalone schedule.

 

Concurrent with emergence, TCEH Corp. has issued 427.5 million shares of its common stock, as well as other proceeds, to the pre-emergence first-lien creditors of Texas Competitive Electric Holdings Company LLC (“Former TCEH”). Beginning today, this common stock is publicly traded on the OTCQX market under the ticker symbol THHH.

New, Experienced Leadership

TCEH Corp. has also appointed a new board of directors consisting of Gavin Baiera, Jennifer Box, Jeff Hunter, Michael Liebelson, Cyrus Madon, Curt Morgan and Geoffrey Strong. Curt Morgan will assume responsibilities as chief executive officer of TCEH Corp., effective immediately. During his 35-year career, Mr. Morgan has held leadership responsibilities in nearly every major U.S. power market. Most recently, he had been serving as a consultant for Former TCEH’s first-lien creditors. Prior to that, he was an operating partner at Energy Capital Partners, a private equity firm focused on investing in North America’s energy infrastructure. Earlier in his career, Mr. Morgan served as the president and CEO of both EquiPower Resources Corp. and FirstLight Power Resources, Inc. He recently served as a director of Summit Midstream Partners and has held leadership positions at NRG Energy, Mirant Corporation, Reliant Energy and BP Amoco.

 

“TCEH Corp. emerges from the restructuring process with a superb integrated business,” said Mr. Morgan. “This includes TXU Energy and Luminant – both of which are competitive, well-resourced and positioned for continued operational excellence in the growing Texas market with a strong balance sheet and the potential for stable earnings and significant cash generation. This outcome would not have been possible without the support of key stakeholders, including the company’s valued people, customers and business partners. So while industry conditions remain challenging – and we must continue to adapt accordingly – the long-term potential of our integrated business, combining an innovative, customer-focused retail business with a safe, reliable, cost-effective generation company, is extremely powerful.”

A Well-Capitalized, Stronger Company

TCEH Corp. consists of Texas’ largest electric power generator, Luminant, and TXU Energy, a competitive retail electricity provider, with almost 17,000 megawatts of generation and 1.7 million retail customers, respectively. TCEH Corp. believes this robust operating platform is now complemented by a strong balance sheet and liquidity position, as the company has eliminated more than $33 billion of debt and other obligations through the Chapter 11 restructuring process. TCEH Corp. further benefits from very low leverage relative to its peer group at 2.3 times of gross secured debt-to-EBITDA and 1.5 times on a net basis (secured debt less cash on hand), based on the projected 2016 EBITDA as disclosed to the Bankruptcy Court in connection with the reorganization proceedings.

 

At emergence, the company’s available liquidity position is estimated to be approximately $1.65 billion, including $750 million of undrawn net borrowings available under the company’s new $4.25 billion exit financing facility.

 

 

About TCEH Corp.
TCEH Corp. is a premier Texas-based energy company focused on the competitive energy and power generation markets through operation as the largest generator and retailer of electricity in the growing Texas market. Our integrated portfolio of competitive businesses consists primarily of Luminant and TXU Energy. Luminant generates and sells electricity and related products from our diverse fleet of generation facilities totaling approximately 17,000 MW of generation in Texas, including 2,300 MW fueled by nuclear power, 8,000 MW fueled by coal and 6,000 MW fueled by natural gas, and it is a large purchaser of wind-generated electricity, as well. TXU Energy sells retail electricity and value-added services (primarily through our market-leading TXU Energy™ brand) to approximately 1.7 million residential and business customers in Texas.

Cautionary Note Regarding Forward-Looking Statements
This press release includes forward-looking statements, which are subject to risks and uncertainties. All statements, other than statements of historical facts, are forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements. Any such forward-looking statement involves uncertainties and is qualified in its entirety by reference to the discussion of risk factors under “Risk Factors” and the discussion under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q filed by Energy Future Competitive Holdings Company LLC and other important factors that could cause actual results to differ materially from those implied by such forward-looking statements, including any effects or changes resulting from the emergence of the Company from Chapter 11 and any strategies TCEH employs to address its cost structure, liquidity and capital resources or pursue growth opportunities in any particular market.

Any forward-looking statement speaks only at the date on which it is made, and except as may be required by law, TCEH undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible to predict all of them; nor can TCEH assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. As such, you should not unduly rely on such forward-looking statements.

 

Media

Allan Koenig

214-812-8080

Allan.Koenig@energyfutureholdings.com                  

 

Analysts

Chris Burls

214-812-8425

Chris.Burls@energyfutureholdings.com

A Soaring Success

Luminant Completes Eagle Nest Relocation Effort


An abundance of wildlife, including numerous bald eagles, call Luminant’s sites and reclaimed land home. When Liberty Mine’s resident bald eagle pair returns this fall, they’ll find a few home renovations – most notably, a new nest location.

The eagles’ nest was recently moved away from mining activities to a new location on company property near Martin Creek Lake in Rusk County. The relocation was a collaborative effort between Luminant’s environmental team, the U.S. Fish and Wildlife Service and avian experts at Stephen F. Austin State University’s Arthur Temple College of Forestry and Agriculture.

“The eagles built their nest in 2015 near the company’s lignite coal mining operations. Although no longer listed as endangered, eagles are still protected and Luminant is required to maintain a 660-foot buffer with no mining activity around their nests,” said Pete Okonski, Luminant environmental specialist. “We want this eagle pair to thrive, so we began working with the U.S. Fish and Wildlife Service and SFA several months ago to determine the new nest location and the best structure design to support the nest.”

Following permit approval by the federal agency, Luminant’s environmental team then began a 10-day monitoring period of the nest to ensure there was no eagle activity. With no eagles in sight, it was time for movingEagle Nest Relocation_rotator day.

“The nest was integrated into the top branching system of a 70-foot loblolly pine tree, which meant we needed to find a way to keep the nest intact,” said Sid Stroud, Luminant environmental manager. “After cutting away the extra limbs, we removed and transported the section of the tree with the nest and secured it on top of a platform made out of repurposed utility poles. This new vantage point provides the eagles with excellent visibility for locating fish and other prey.”

The nest, which is nearly four feet in diameter or approximately the size of semi-truck tire, is now located over 1,000 feet from the old nest site and is far removed from mining activities. According to Okonski, the relocation effort took innovation and teamwork to new heights.

“The entire project was extremely impressive. To see the way our teams and employees worked together, you would think we performed nest relocations on a regular basis,” Okonski said. “We take great pride in our reclamation practices, including our wildlife recovery, enhancement and management programs. We’re hopeful that the eagles will decide to make this new location their permanent home.”

Environmental employees will monitor the nest for eagle activity this fall and for eaglets in the spring.
“We’re respectful of the eagles and other wildlife that live at our facilities and reclaimed land,” Stroud said. “Over the years, we’ve seen an increase in eagle numbers across several of our sites. They truly are a majestic bird.”

Bald Eagle Highpoints: According to the National Eagle Center, the average bald eagle nest is four to five feet in diameter. Each year, the adult pair will add up to two feet of new material to the nest. The largest recorded nest, located in St. Petersburg, Fla., was nearly 10 feet in diameter, 20 feet deep and weighed nearly three tons.

Luminant-Sponsored Robocats Bring Home the Gold

Invaluable lessons in teamwork and the sciences


Robocats - August 2016 - 1The Woodrow Wilson High School robotics team, the Robocats, recently battled their way to the top during the inaugural UIL Robotics State Championship. With help from a $1,000 Luminant sponsorship donation, the Dallas ISD team won first place and took home a gold medal for their best-in-class robot performance.

The competition, titled Stronghold, challenged participants to form alliances and build robots capable of breaching their opponents’ fortifications, weakening their tower with boulders and scaling the opposing tower. In addition to the Robocats, the winning alliance included the Clear Creek ISD Robonauts, the Greenville ISD Robowranglers and the Harlandale ISD Rhumbots.

“The teamwork, expertise and engineering knowledge demonstrated by the Robocats and their alliance teams was awe-inspiring,” said Tony Rylander, Luminant principal engineer and Robocats mentor. “Countless hours go into designing and constructing these robots. We had an incredible journey and I’m thrilled to see the Robocats accomplish their first championship win.”

Robocats team members, ranging from freshman to seniors, learn critical Science Technology Engineering and Mathematics (STEM) skills, including electrical, mechanical and programming concepts. This fall, the team will gear back up to compete in the Boosting Engineering, Science and Technology (BEST) Regional Robotics Championship.

Learn more about the Robocats’ journey throughout the years.

Robocats - August 2016 - 2

As Peak Demand Keeps Rising in ERCOT, Records Fall

Powering Texas through the hot summer season


Lamar Power Plant, Luminant’s Combined-Cycle Natural Gas Plant

Lamar Power Plant, Luminant’s Combined-Cycle Natural Gas Plant

With the August heat above 100 degrees and covering much of Texas this week, the Electric Reliability Council of Texas set another record for peak power demand on Thursday between 4-5 p.m. of 71,197 megawatts. The previous record of 71,043 megawatts had just been set one hour earlier (between 3-4 p.m.). The new peaks set on Thursday blew past 71,000 megawatts for the first time and beyond the records set on Wednesday and Monday of this week.

To give you an idea of how much generation that is, one megawatt can power 200 homes in periods of high demand.

On these hot days when demand is at its highest, where does all that power come from?

ERCOT manages the flow of electric power to 24 million Texas customers, representing 90 percent of the state’s electric load. Luminant is the largest power generator in ERCOT.

The ERCOT grid relies on a diverse mix of energy sources that when all pulling together provide the power for this growing state. Here’s a breakout from ERCOT of which energy sources provided the power when Texans needed it most when Monday’s record was set:

  • 57% natural gas (includes combined cycle as well as traditional steam and combustion turbines)
  • 27% coal
  • 8% wind
  • 7% nuclear
  • 1% other (hydro, renewables, diesel)
    Note: Percentages are rounded
Forney Power Plant – Luminant’s Combined-Cycle Natural Gas Plant

Forney Power Plant – Luminant’s Combined-Cycle Natural Gas Plant

These numbers also underscore the importance of dependable power generation from natural gas, coal and nuclear energy.

Over the record peak hour on Monday, Luminant’s coal and gas plants and Comanche Peak Nuclear Power Plant helped supply nearly 15,000 megawatts to the grid.

“We strive for operational excellence, and on days like we’ve had this week, we’re reminded why it’s so important to work as a team to maintain safe and reliable operations,” said Steve Horn, Luminant chief fossil officer. “Our employees deserve immense credit for safely working in these extreme temperatures to help their fellow Texans stay safe and cool.”

With more hot days ahead, Luminant’s people, plants and mines are doing their part for safely powering Texas.

TXU Energy Program Equips New Employees for Success

Newest class in Analyst Momentum Program starts its 30-month run


Members of the 2016 Analyst Momentum Program get training in their first weeks on the job.

Members of the 2016 Analyst Momentum Program get training in their first weeks on the job.

TXU Energy operates in the country’s most competitive retail electricity market and the race to hire and keep great people is no less competitive. That’s why the company continues to invest in its Analyst Momentum Program, which immerses participants in a 30-month introduction to the market and the company.

The program is just one of the ways TXU Energy finds, develops and keeps great people – and it doesn’t operate in a vacuum. Participants fill real jobs across the company and department leaders expect them to bring new ideas and enthusiasm to their various assignments.

“Over the next two-and-a-half years, each class member will rotate through several positions in different areas of the company,” said Laura Campos, a manager in TXU Energy’s customer contact group and the program manager. “That’s in addition to classroom-style trainings, tours of related facilities and projects that stretch their analytical and presentation skills.”

Successful participants have the opportunity to continue as regular TXU Energy employees when they finish their rotational assignments.

“While it’s a significant challenge to move around and jump into new areas, the program gives the participants exceptional insights and points of contact across the business,” Laura said. “Those things are invaluable when it comes to the work that they take on after completing the program.”

TXU Energy revamped and broadened the program in 2013.

“At the end of the program, we’ll have well-prepared, well-rounded individuals who will have a greater understanding of the Texas electric market and what TXU Energy is all about,” Laura said.

The 2016 class includes an Illinois native with a STEM MBA from Texas Tech; four Texans with bachelor’s degrees from Texas universities; and two master’s candidates from Texas.

Silence the Growl of Summer Hunger

A healthy summer is a happy summer for Dallas area children


SilenceTheGrowl - 05.31.16What could have been a difficult summer for so many Dallas area children turned out to be a summer full of fun, festivities and filled bellies. Through our involvement with the United Way of Metropolitan Dallas and the Silence the Growl campaign, we volunteered more than 375 hours and contributed more than $43,000 to support summer meal programs across the Dallas area and raise awareness of summer hunger. Through our company’s contributions, along with support from other corporate sponsors and the United Way, Silence the Growl is helping serve 100,000 additional meals at participating summer meal sites.

Summer Kickoff with UWD - 06.08.16When the school year ends, the summer break can mean summer hunger for thousands of children who qualify for free or reduced-priced meals. To help ensure that underserved children get the nutrition they need all summer long, employees at EFH, Luminant and TXU Energy took part in a variety of activities to create a positive and memorable summer.

Orange BallAt events like the Summer Meals Kickoff event, the Silence the Growl Summer Meals Block Party and Saldivar Elementary School’s Field Day, we engaged Dallas-area children in a variety of outdoor activities and games (water balloon tosses, hula hoop, basketball and arts & crafts) and provided a nutritious lunch to fuel their bodies and minds. We also hosted a Kid’s Kit Drive to collect items like puzzles, coloring books and jump ropes to encourage fun and educational games to keep their minds active and learning throughout the summer.

Ready to help - editedChris Samson, TXU Energy Marketing Associate, says, “By far the best part of volunteering with the Silence the Growl campaign was seeing the bright smiles on the children’s AND volunteers’ faces! I’m so proud that we were able to make such a positive impact on the children’s lives.”

The Silence the Growl campaign is designed to raise awareness and support summer meal programs to ensure that children who rely on subsidized meal programs throughout the year continue to get nutritious meals during the summer. Click here to learn more about how you can get involved to Silence the Growl, because a healthy summer is a happy summer!

Staying Hydrated Means Staying Safe

Watch New Eye on Luminant Video


 

As summer temperatures continue to rise, so do the dangers of heat-related illnesses – which means hydration is more important than ever to beat the heat.

Find out how to keep your cool:  Watch the latest Eye on Luminant video to see why hydration is critical to achieve Safety Zero throughout the summer months of high power demand.

Energy Interns: Back-to-Back Summers with Luminant

Learning what it means to power Texas


Midway through the fall semester, aspiring college students begin looking ahead to the summer – not for a long vacation, but for internship opportunities to further their education. How do students find a company that is the best fit and aligns with their career goals? Just ask these three Energy Interns who have returned for back-to-back summer internships with Luminant.

 

Troy RakestrawTroy Rakestraw, mechanical engineering major at Texas A&M University, four-time Luminant intern

  • Why did you choose Luminant for your internship? Returning to Luminant for multiple internships has exposed me to larger portion of the business. I have been able to work at a gas plant, a coal plant and a central engineering support office.
  • The different challenges and projects at each of these workplaces has allowed me to grow as an engineer (and helped me academically). My experience working for Luminant has provided me insight to the variety of work available to an engineer. Above all else, I have enjoyed the people I have been fortunate enough to work with throughout my internships.
  • Why did you pick engineering as your major? I was drawn to engineering because of my curiosity to understand how things work. Power plants contain some of the largest and most powerful equipment across many industries. I am particularly interested in combustion turbines and combined cycle plants.

 

HineshRathodHinesh Rathod, electrical engineering major at Texas A&M University, two-time Luminant intern

  • Why did you choose Luminant for your internship? I came back to Luminant because of the company culture. Everyone is open to answering questions and there’s value to the work I do because the site needs the projects that I work on.
  • Going into my first internship last summer at Sandow, I didn’t know what to expect. This summer I am at Oak Grove, and the best part about being on site is that I can put my eyes and hands on the equipment that I am working on. This helps me put things into perspective to learn about what that piece of equipment is actually doing. The hands-on experience I have gained is the best part of this company’s internship program.
  • Why did you pick engineering as your major? Growing up, I always took apart radios, TVs and computers to fix them, so by the time I applied for college, I knew what I wanted to do.


Aaron Weittenhiller2Aaron Weittenhiller
, electrical engineering major at the University of Texas at Dallas, two-time Luminant intern

  • Why did you choose Luminant for your internship? After working at the Energy Resource Center last summer, I was offered another internship at the Martin Lake Power Plant. Knowing that working at a power plant would provide me with a new experience, one that allows me to witness large electrical systems and gain a first-hand understanding of how they work, I was eager to get out there and see it for myself.
  • It is an honorable thing to be responsible for powering Texas. Additionally, from an electrical standpoint, it is amazing to watch how principles like Faraday’s law of electromagnetic induction can be mastered on such a large scale. The power plant is truly an engineer’s playground.
  • Why did you pick engineering as your major? I’ve always thought in terms of ones and zeros, so circuit boards just seem to speak my language. This industry provides the foundation for so many other industries to be successful.

 

Instagram_App_Large_May2016Visit EFH on Instagram to find out what our interns have been up to this summer by searching for “#EnergyInterns.”