S&P: Reliant unaffected

Standard & Poor's said Friday that the pending sale of Texas Genco has no immediate affect on Reliant Energy Inc.'s (B/negative/--) rating or outlook.

It is S&P's understanding that Reliant will continue to implement its current hedging strategy for its price-to-beat retail load in Texas. While Reliant's major counterparty has changed from Texas Genco to a consortium of financial buyers, S&P said it does not view this ownership change as having a direct affect on the pricing of power in Ercot (Electric Reliability Council of Texas).

S&P said it does not yet know who will operate the plants for the new owner, but, since Reliant purchases the bulk of its power under liquidated damages contracts, there should be no incremental operating risk to Reliant.

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