Flash: Residential Churn at TXU Energy Nears 50,000 for Quarter

Residential churn accelerated at TXU Energy for the three months ending September 30, 2011, versus both the sequential quarter and the year-ago quarter.

From June 30, 2011 to September 30, 2011, TXU Energy lost a net of 48,000 residential customers.

That appears to be the highest residential churn rate for a sequential three months at TXU since before the expiration of the Price to Beat (during 2008, TXU reclassified about 19,000 meters from residential to small business, making quick comparisons during this period more challenging).

Residential customers as of September 30, 2011 were 1.658 million, versus 1.706 million as of June 30, 2011 and 1.800 million as of September 30, 2010.

The net loss of 48,000 compares to a net loss of 33,000 residential customers from March 31, 2011 through June 30, 2011. Although churn may be seasonal and historically higher during the summer, the net loss from June 30, 2010 to September 30, 2010 was only 30,000.

During an earnings call, TXU Energy CEO Jim Burke said that, as in recent quarters, the net churn represents lower customer acquisitions as TXU has been unwilling to chase low margins associated with current retail pricing, and does not reflect a decrease in TXU's retention rate (which Burke said has actually improved).

TXU's small business (< 1 MW) customer count stood at 190,000 meters as of September 30, 2011, versus 199,000 as of June 30, 2011 and 228,000 a year ago. The net loss of 9,000 small business meters was flat versus the churn seen during the first two quarters of the year.

TXU's large business customer count as of September 30, 2011 was 20,000 meters, flat versus June 30, 2011. The year-ago large business customer count was 22,000 meters.

Total TXU customer count was 1.868 million meters as of September 30, 2011, versus 1.925 million as of June 30, 2011 and 2.050 million a year ago.