Reliant Energy, Inc.: Delivering the Benefits of Competitive Energy Markets

OUR BUSINESS AT A GLANCE
Reliant Energy Inc. is a leading, non-utility, retail, and wholesale electricity provider dedicated to delivering the benefits of competitive energy markets throughout select regions of the United States. Reliant ranks as one of the nation’s largest competitive retail electricity providers with approximately 1.9 million customers ranging from residences and small businesses to many of the nation’s largest commercial, industrial, institutional and governmental consumers. Reliant is also one of the largest independent power producers in the U.S., with roughly 16,000 megawatts of generation capacity. Reliant participates at the wholesale level not only in selling electricity, but also in market-based procurement of generation fuel supplies, providing wholesale power supply products and maintaining a power supply portfolio for its retail customers. Based in Houston and publicly traded on the NYSE under the symbol “RRI,” Reliant’s core retail markets are currently in Texas, New Jersey, Maryland, Pennsylvania and the District of Columbia. It owns power generation in those areas and other selected regions. The company is also continually evaluating new opportunities offered by the evolution of competitive markets in the U.S. and is actively investing and participating in helping new markets to develop.

FINANCIAL INFORMATION
(AS OF DECEMBER 31, 2005)
Annual Revenue: $9.7 Billion
Assets: $13.5 Billion
Employees: 3,675

RETAIL ENERGY
Reliant provides innovative electric supply products to the full range of end-use customers, primarily in Texas. The company is also actively involved in the expansion of competitive energy markets in the United States, working with other stakeholders to develop rules and regulations that promote competition.

Residential and Small Business
Reliant provides full-service, competitive electricity supply to 1.7 million residential and 203,000 small business customers as of December 31, 2005. From its core customer base in the Houston area, Reliant has aggressively expanded statewide and operates full-time sales offices throughout the state.

As a retail electricity provider, Reliant is responsible for arranging for the transmission and delivery of electricity, billing customers, and collecting payments for electricity sold. To provide the best service, the company is committed to delivering the benefit of competitive markets through distinctive product development, marketing, supply, billing and customer care services. A prominent feature of Reliant’s value-added approach to the retail market is its dedication to high-quality customer service through 24-hour, Texas-based call centers.

Commercial, Industrial, Institutional and Governmental Reliant’s Commercial & Industrial Group works with large and midsize commercial, industrial, institutional and governmental customers to optimize the value of their energy spending by managing costs, reducing price risk and providing the optimal product structure to meet their operating needs with innovative, competitively priced energy supply products that are enhanced by Web-based account access, energy market information, and energy monitoring and cost management tools.

Ranked as the largest business provider in Texas and second-largest competitive business provider nationwide, Reliant takes a hands-on approach to meeting customer needs by applying its unique combination of knowledge, innovation, service and reliability.

POWER GENERATION & WHOLESALE SUPPLY
Reliant is one of the largest independent power producers in the United States, producing about 16,000 megawatts of electricity in nine states located in five different regions. The company made its first acquisition of power generation facilities in 1998 and has increased its aggregate net generating capacity through a combination of acquisitions, development of new generating projects and contracted capacity.

Plant Operations
Reliant manages its generation assets with best-in-class operational and maintenance practices to ensure the generation of safe, reliable, economical and environmentally sensitive electricity. The company operates a diverse fleet with a range of dispatch types and fuel capabilities, well-equipped to meet the variety of demand requirements of the market as part of its commitment to serving customers.
The Reliant fleet includes a range of technology types, from the more conventional pulverized coal units to the latest Circulating Fluidized Bed (CFB) coal technology used in its Seward waste coal facility, named 2004 Plant of the Year by Platt’s POWER magazine and recipient of the Pennsylvania Governor’s Award for Environmental Excellence. Gas technology ranges from new combined-cycle units to more mature steam and combustion turbines.

Safety and Environmental
Reliant is committed both to the safety of its employees and to caring for the environment. Through a number of initiatives and programs, Reliant is implementing leading safety and environmental practices in its plants. The company estimates that it will spend between $50 million and $70 million on environmental capitalized-maintenance projects and plant modifications.

Commercial Operations and Origination
Reliant’s Commercial Operations and Origination group optimizes the value of the company’s power generation and related assets by working closely with the Plant Operations personnel to economically dispatch Reliant’s generation fleet and effectively manage economic risk by selling energy and purchasing fuel on a forward basis. Reliant sells wholesale electric energy, generation capacity and ancillary services products to a variety of customers, including independent power producers, power grids/ Independent System Operators (ISOs), investor-owned utilities and municipalities.

Because Reliant's facilities are not subject to traditional cost-based regulation, the company can generally sell electricity at market-determined prices. We sell power in hour-ahead, day-ahead, forward bilateral and ISO markets.

The origination group also identifies opportunities to purchase or sell nonstandard energy products and services and tailors custom solutions to create value for our wholesale customers.

Reliant Energy is Equal Employment Opportunity company.