A Message From Our
Chairman
Statement of
Environmental Principles
Compliance
(Air, Land, Water)
Minimization of Impacts
Comparison of Air Emission
Rates
Climate Change
Renewable Energy
Stakeholder Dialogue
Environmental Management
Systems
Public Reporting
Research
2002 Special Recognition
TXU Australia
TXU Sources of Energy


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ENVIRONMENTAL REPORTING
One of our more important stakeholder dialogues began in the late 1980s with members of the Benedictine Resource Center in San Antonio, Texas. It was as a consequence of those early discussions that TXU began publishing an annual environmental report of our activities and accomplishments. As a result, we have the distinction of being one of the first large companies in the United States to publicly report on our environmental activities, a process that we continue today. We have continued to dialogue with the Benedictine Resource Center and others on various topics and shareholder resolutions. Our annual environmental report and our commitment to stakeholder dialogue are tangible benefits of these relationships.

DIALOGUE
Our Environmental Principles call for maintaining effective dialogue with the full range of our stakeholders. We do this in a variety of ways. We produce and make available written materials, such as our annual environmental reports and brochures on renewable energy and air quality. We include information on environmental topics in our corporate annual report and in our reports filed with the Securities and Exchange Commission. We also provide environmental information on the Internet

(www.txucorp.com), including our environmental reports.

Each year, we respond to hundreds of requests for environmental information from a wide variety of stakeholders, including shareholders, customers, environmental organizations, schools and students and governmental agencies.

In 2002, we worked with the Texas Council on Environmental Technology and supported the formation of the Governor’s Clean Coal Technology Council. On a local basis, we worked with several organizations on topics to address air quality in the Dallas/Fort Worth Metroplex, including the Texas Clean Air Working Group, which consisted of representatives from Dallas, Fort Worth and neighboring communities along with county officials, businesses and regulatory officials. In addition, we worked with the Northeast Texas Air Care group to address air-quality concerns in that part of the state.

We continued a productive relationship with The Nature Conservancy in 2002. We joined the International Leadership Council of The Nature Conservancy to ensure that our environmental perspective was enhanced by association with international environmental leaders. We were able to donate surplus

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