Flash: TXU Residential Churn 33,000 for Quarter, Cites "Unsustainable" Pricing in Market

TXU Energy saw improvement in its net residential churn during the three months ended December 31, 2011, but net residential churn was still 33,000 customers.

Residential customers as of December 31, 2011 were 1.625 million, versus 1.658 million as of September 30, 2011, and 1.771 million as of December 31, 2010.

The net loss of 33,000 residential customers compares favorably to the net loss 48,000 customers seen from June 30, 2011 to September 30, 2011, and is in line with the net residential churn experienced for the latter half of 2010 and first half of 2011.

TXU's small business (< 1 MW) customer count stood at 185,000 meters as of December 31, 2011, versus 190,000 meters as of September 30, 2011 and 217,000 meters as of December 31, 2010. The net loss of 5,000 small business meters was an improvement versus the loss of about 9,000 small business meters seen during each of the first three quarters of the year.

TXU's large business customer count as of December 31, 2011 was 19,000 meters, versus 20,000 meters as of September 30, 2011 as well as a year ago.

Total retail customer count was 1.829 million meters as of December 31, 2011, versus 1.868 million meters as of September 30, 2011 and 2.008 million a year ago.

During an earnings call, executives said that the churn continues to reflect TXU's margin discipline and "intense competition." Executives further called retail pricing for new customers from certain competitors "unsustainable."

Jim Burke, CEO of TXU Energy, said that pricing for new customers has been lowered beyond what wholesale market conditions support, noting that this lower retail pricing for new customers has continued in 2012 in January and through February.