SECURITIES AND EXCHANGE COMMISSION

                    Washington, D.C.  20549



                           FORM 10-Q


  (x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934



         FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001



                              - OR -



 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934



              Commission File Number  001 - 15709


                      TXU Europe Limited


Incorporated under the                 I.R.S. Employer Identification
Laws of England and Wales                   No. 98-0188080




     The Adelphi, 1-11 John Adam Street, London, England WC2N 6HT
                        011-44-207-879-8081



Indicate by check mark whether the registrant (1) has filed all
reports  required to be filed by Section 13  or  15(d)  of  the
Securities Exchange Act of 1934 during the preceding 12  months
(or for such shorter period that the registrant was required to
file  such  reports), and (2) has been subject to  such  filing
requirements for the past 90 days.

 Yes _x__   No___


Common  Stock  outstanding  at May  11,  2001  -  2,455,705,299
shares, at US$1 par value, and 100 deferred shares, at pounds 1
par value.


<PAGE>

                       TABLE OF CONTENTS

Part I. Financial information                                      Page


       Item 1.  Financial Statements

            Condensed Statements of Consolidated Income -
            Three Months Ended March 31, 2001 and 2000 .............  2

            Condensed  Statements of Consolidated Comprehensive
            Income - Three Months Ended March 31, 2001 and 2000 ....  3

            Condensed Statements of Consolidated Cash Flows -
            Three Months Ended March 31, 2001 and 2000 .............  4

            Condensed Consolidated Balance Sheets -
            March 31, 2001 and December 31, 2000 ...................  5

            Notes to Financial Statements ..........................  6

            Independent Accountant's Report ........................ 16


       Item 2. Management's  Discussion  and  Analysis   of
               Financial Condition and Results of Operations ....... 17


       Item 3. Quantitative and Qualitative Disclosures  About
               Market Risk ......................................... 25

Part II. Other Information

       Item 1. Legal Proceedings ................................... 25

       Item 6. Exhibits  and  Reports  on  Form  8-K................ 25

Signatures ......................................................... 26



<PAGE>

                    PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements
<TABLE>
<CAPTION>

                   TXU EUROPE LIMITED AND SUBSIDIARIES
              CONDENSED STATEMENTS OF CONSOLIDATED INCOME
                                (Unaudited)



                                                    Three Months Ended March 31,
                                                   -----------------------------
                                                      2001               2000
                                                   ----------         ----------
                                                         (pounds  million)
<S>                                                   <C>                <C>
Operating Revenues .................................   2,305              1,151
                                                     -------            -------
Operating Expenses
  Energy purchased for resale and fuel consumed ....   1,837                763
  Operation and maintenance ........................     214                177
  Depreciation and other amortization ..............      45                 38
  Goodwill amortization ............................      31                 22
                                                     -------            -------
    Total operating expenses .......................   2,127              1,000
                                                     -------            -------
Operating Income ...................................     178                151
Other Income  - Net ................................       7                  1
                                                     -------            -------
Income Before Interest, Income Taxes, Distributions
  and Minority Interest ............................     185                152
Interest Income ....................................      12                 16
Interest Expense ...................................     105                 89
                                                     -------            -------
Income Before Income Taxes, Cumulative Effect of
 Change in Accounting, Distributions and
 Minority Interest .................................      92                 79

Income Tax Expense .................................      38                 34
                                                     -------            -------
Income Before Cumulative Effect of Change in
 Accounting,Distributions and Minority Interest.....      54                 45

Cumulative Effect on Prior Years (to December 31,
 1999) of Change in Depreciation Method (Net of
 pounds 3 million tax effect) ......................       -                  7

Distributions on Preferred Securities of
Subsidiary Perpetual Trust .........................      (3)                (1)

Minority Interest ..................................     (10)                (5)
                                                     -------            -------
Net Income .........................................      41                 46
                                                     =======            =======

<FN>
See Notes to Financial Statements.
</FN>
</TABLE>
                                  2

<PAGE>
              TXU EUROPE LIMITED AND SUBSIDIARIES
   CONDENSED STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME
                          (Unaudited)


<TABLE>
<CAPTION>

                                                    Three Months
                                                       Ended
                                                     March 31,
                                              ---------------------
                                                 2001        2000
                                               -------     -------
                                                 (pounds million)
<S>                                               <C>        <C>
Net Income .................................      41         46
                                               ------      -----
Other Comprehensive Income (Loss)
  Net change during period, net of tax
    effects:
    Unrealized holding gains on investments
      classified as available for sale .....      38         34

    Cumulative currency translation
      adjustment ...........................       1         (1)

    Cash flow hedges (Changes due to
      adoption of SFAS No. 133):
      Cumulative transition adjustment as
        of January 1, 2001 .................     (72)         -
      Net change in fair value of
        derivative gains (losses) ..........     (15)         -
      Amount realized in earnings during
        the period .........................       6          -
                                               ------      -----
      Total ................................     (42)        33
                                               ------      -----
Comprehensive Income (Loss) ................      (1)        79
                                               ======      =====



<FN>
See Notes to Financial Statements.
</FN>
</TABLE>

                                3

<PAGE>

              TXU EUROPE LIMITED AND SUBSIDIARIES
        CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
                          (Unaudited)

<TABLE>
<CAPTION>
                                                              Three Months
                                                            Ended March 31,
                                                           -----------------
                                                             2001      2000
                                                           -------   -------
                                                            (pounds million)
<S>                                                           <C>       <C>
Cash Flows - Operating Activities
  Net income .............................................     41        46
  Adjustments to reconcile net income to
    cash provided by operating activities:
    Cumulative effect of change in
      accounting principle ...............................      -       (10)
    Less - Gain on sale of assets ........................     (7)        -
    Depreciation and amortization ........................     76        60
    Deferred income taxes ................................     28        16
    Minority interest ....................................     10         5
    Changes in operating assets and liabilities ..........   (141)       65
    Other ................................................     21       (11)
                                                           -------    ------
      Cash provided by operating activities ..............     28        171
                                                           -------    ------
Cash Flows - Investing Activities
  Capital expenditures ...................................    (45)      (46)
  Acquisition of business ................................   (145)        -
  Proceeds from sale of assets ...........................     97         -
  Investments ............................................     (9)       (3)
                                                           -------    ------
      Cash used in investing activities ..................   (102)      (49)
                                                           -------    ------

Cash Flows - Financing Activities
  Net borrowings under the:
    Sterling credit facility - Tranche B .................     34        26
    EMTN Note ............................................      -       225
    Other long-term debt .................................      6        29
  Issuance of preferred securities of
    subsidiary perpetual trust ...........................      -        95
  Retirements of:
    Sterling credit facility - Tranche B .................     (4)     (105)
    Other long-term debt .................................   (370)     (142)
  Change in notes payable - banks ........................    (30)        7
  Change in other short-term loans .......................      1       (46)
  Other...................................................      -        (4)
  Debt financing costs ...................................     (1)       (5)
                                                           -------    ------
      Cash provided by (used in)
         financing activities ............................   (364)       80
                                                           -------    ------
Effect Of Exchange Rates On Cash And Cash
  Equivalents ............................................     (1)        -
                                                           -------    ------
Net Change In Cash And Cash Equivalents ..................   (439)      202

Cash And Cash Equivalents - Beginning Balance ............    663       285
                                                           -------    ------
Cash And Cash Equivalents - Ending Balance ...............    224       487
                                                           =======    ======

<FN>
See Notes to Financial Statements.
</FN>
</TABLE>
                                  4

<PAGE>
              TXU EUROPE LIMITED AND SUBSIDIARIES
             CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                    March 31,
                                                      2001      December31,
                                                   (Unaudited)     2000
                                                  ------------  -----------
                                                       (pounds million)
<S>                                                 <C>         <C>
ASSETS
Current Assets
  Cash and cash equivalents ....................       224          663
  Accounts receivable ..........................       882          743
  Inventories - at average cost ................        64           72
  Merchant energy trading assets ...............       503          585
  Prepayments and other current assets .........        95           97
                                                   -------      -------
    Total current assets .......................     1,768        2,160
                                                   -------      -------
Investments
  Restricted cash ..............................       698          672
  Other.........................................       742          695
                                                   -------      -------
    Total investments ..........................     1,440        1,367
                                                   -------      -------
Property, Plant and Equipment - Net ............     2,867        2,781
Goodwill .......................................     4,017        3,945
Merchant Energy Trading Assets .................       297          121
Derivative Assets ..............................       274            -
Deferred Debits and Other Assets ...............       460          670
                                                   -------      -------
        Total                                       11,123       11,044
                                                   =======      =======

LIABILITIES AND SHAREHOLDER'S EQUITY
Current Liabilities
  Notes payable - banks ........................       484          525
  Long-term debt due currently .................       509          862
  Short-term loans on accounts receivable ......         5            5
  Accounts payable:
    Trade ......................................       740          712
    Affiliates .................................        52           52
  Merchant energy trading liabilities ..........       428          571
  Interest and taxes accrued ...................       103           78
  Other current liabilities ....................       192          166
                                                   -------      -------
    Total current liabilities ..................     2,513        2,971
                                                   -------      -------
Accumulated Deferred Income Taxes ..............       505          467
Provision for Unfavorable Contracts ............       541          573
Merchant Energy Trading Liabilities ............       287           81
Derivative Liabilities .........................       171            -
Other Deferred Credits and Noncurrent
  Liabilities ..................................       240          320
Long-term Debt, Less Amounts due
  Currently ....................................     4,670        4,480
Preferred Securities of Subsidiary
  Perpetual Trust ..............................        95           95
Minority Interest ..............................       303          258
Contingencies (Note 9 )
Shareholder's Equity
  Common stock (authorized  - 3,000,000,000
    shares at US$1 par and 100 deferred
    shares at pounds 1 par; issued and
    outstanding -  2,455,705,299 shares and
    100 deferred shares)........................     1,467        1,467
  Retained earnings ............................       374          333
  Accumulated other comprehensive income (loss).       (43)          (1)
                                                   -------      -------
    Total shareholder's equity .................     1,798        1,799
                                                   -------      -------
        Total ..................................    11,123       11,044
                                                   =======      =======
<FN>
See Notes to Financial Statements.
</FN>
</TABLE>
                                     5

<PAGE>
                           TXU EUROPE LIMITED
                        Notes to Financial Statements

1.  BUSINESS, ACQUISITIONS AND DISPOSITIONS

   TXU  Europe  Limited  (TXU Europe) is an  indirect,  wholly-
owned  subsidiary of TXU Corp., a Texas corporation.  TXU Corp.
is  a global energy services holding company that is engaged in
the  generation, purchase, transmission, distribution and  sale
of  electricity;  the purchase, transmission, distribution  and
sale  of  natural  gas;  and merchant  energy  trading,  energy
services, telecommunications and other businesses, primarily in
the United States (US), Europe and Australia.  TXU Europe is  a
holding  company for TXU Corp.'s United Kingdom (UK) and  other
European  operations.  Almost all  of  TXU  Europe's  operating
income  is derived from, and consolidated assets are  held  by,
TXU  Europe Group plc (TXU Europe Group) and TXU Europe Group's
subsidiaries.

   Beginning   in  the  first  quarter  of  2001,  TXU   Europe
undertook  an  internal reorganization  of  its  businesses  to
reflect a single energy business concept for the management  of
its  energy activities in a consistent manner in its  different
geographical areas.  As a result, there are only two  reporting
operating segments for TXU Europe:

   ENERGY   -  which  consists  of  the  former  energy  retail
      business  and  the  former portfolio  trading  and  power
      business   segments.  The  new  single  energy   business
      manages  the  integrated portfolio of  generation  assets
      and  contracts  and retail customer base within  separate
      geographical  areas   -  the UK and  continental  Europe,
      which  comprises  Central Europe, the Nordic  region  and
      Germany; and

   NETWORKS  -  which owns, manages and, through  its  networks
      management   joint   venture  (24seven),   operates   its
      electricity distribution system in the UK.

   UK  energy  operations are carried out  principally  through
TXU   Europe  Group's  subsidiaries,  Eastern  Electricity  plc
(Eastern Electricity) (which also owns the networks electricity
distribution system), Eastern Energy Limited (which, along with
Norweb  Energi, supplies customers in areas outside of  Eastern
Electricity's  traditional service area), Eastern  Natural  Gas
(Retail)  Limited, TXU Europe Power Ltd (and its  subsidiaries)
and TXU Europe Energy Trading Ltd.

   Merchant  energy  trading  in Central  European  markets  is
carried  out  through  TXU Europe Energy Trading  BV  (and  its
subsidiaries),   primarily   in   Germany,   the   Netherlands,
Switzerland and Spain.

   Nordic  operations are carried out through TXU Nordic Energy
Oy  (a  joint  venture with Pohjolan Voima Oy (PVO),  Finland's
second  largest electricity generator) which trades  energy  on
Nordic markets, has access to hydro generation at Svartisen and
Kobbelv  in Norway and participates in distribution and  retail
markets  through  joint ventures, especially  Savon  Voima  Oyj
(SVO).

   Operations  in Germany were further expanded when Stadtwerke
Kiel AG (Kiel AG), a German municipal utility, was acquired.

   On  January 8, 2001, TXU Europe completed the acquisition of
51%  of Kiel AG for pounds 145 million. The acquisition of Kiel
AG was accounted for as a purchase business combination. At the
date of acquisition, Kiel AG had sterling equivalent assets  of
pounds  121 million and liabilities of pounds 82 million.   The
process of determining the fair value of assets and liabilities
of Kiel AG continues but is expected to be completed within one
year  of the acquisition date. TXU Europe's latest estimate  of
goodwill  is pounds 106 million, which is being amortized  over
40  years.  This  amount  is subject  to  further  revision  as
additional  information  becomes  available.  The  results   of
operations  of  Kiel  AG  are  reflected  in  the  consolidated
financial statements from the January 8, 2001 acquisition date.
Pro forma information for the three months ended March 31, 2001
and  2000, reflecting the acquisition of Kiel AG, would not  be
significantly different from reported amounts.

   Under  the  terms of the purchase agreement, TXU Europe  has
the  unilateral  right to make further capital  investments  in
                                6

<PAGE>
Kiel AG for specified business development purposes and may, in
the process, acquire additional shares, in a new share offering
that  is made to all shareholders.  If the City of Kiel chooses
not to participate in such an offering, its current holdings of
49%  of Kiel AG could be diluted down to a residual holding  of
25.1%.

   The   purchase  agreement  further  provides  that  if   the
holdings of the City of Kiel exceed 25.1% on the later date  of
January  8, 2006 or five years after participation by the  City
of  Kiel  in a new capital issue, the City of Kiel may  require
TXU  Europe  to purchase all, but not less than all,  of  those
holdings in excess of 25.1%.  The City of Kiel's option may  be
exercised   during  the  two  year  period  after  it   becomes
exercisable  at  a  price per share equal  to  the  fair  value
(commercial value) of a Kiel AG share on the exercise date,  as
independently assessed by an investment bank.

   On  May  1, 2001, Kiel AG acquired all of the share  capital
of  Ares  Energie  GmbH  (Ares) for  approximately  24  million
Deutsche marks (pounds 8 million).

   In  January  2001, TXU Europe entered into a  commitment  to
sell  its  19.2% interest in Hidroelectrica del Cantabrico,  SA
(Hidrocantabrico)  to  a  consortium led  by  Electricidade  de
Portugal  S.A.,  a  Portuguese  utility  company,  and  Spanish
savings bank Caja de Ahorro de Asturias (Cajastur) for euros 24
per share. TXU Europe waived the pre-emption rights it had over
4.9%  of  the  stock in Hidrocantabrico held by  Electrabel  SA
(Electrabel), an electricity company in Belgium.  On April  20,
2001,  TXU Europe received net proceeds from the sale of  euros
522 million (pounds 320 million), realizing a pre-tax profit of
pounds 50 million.

   In  February  2001, TXU Europe finalized  the  sale  of  its
interest in the North Sea gas fields for  pounds 138 million as
a result of its ongoing review of its program to reposition its
energy  portfolio.  TXU Europe received net  cash  proceeds  of
pounds  97 million and recognized a net pre-tax gain of  pounds
7 million, which has been recorded in Other Income - Net.

   On  August  3,  2000, TXU Europe purchased United  Utilities
plc's  retail energy supply business, Norweb Energi (a division
of Norweb plc), for total consideration, including direct costs
of the acquisition, of pounds 340 million. The transaction also
included   the   assumption  of  certain  of  Norweb   Energi's
obligations,  including  its power purchase  agreements,  which
have been integrated into TXU Europe's energy portfolio.

   The  acquisition  of Norweb Energi was accounted  for  as  a
purchase business combination.  The process of determining  the
fair  value of assets and liabilities of Norweb Energi has  not
been completed.  The latest estimate of goodwill is pounds  622
million which is being amortized over 20 years.  This amount is
subject  to further revision as additional information  becomes
available,   primarily  relating  to  exit  costs   and   other
liabilities assumed at acquisition. The final determination  of
the   purchase   accounting  adjustments  requires   additional
information  and analysis, which is ongoing and is expected  to
be completed within one year of the acquisition date.

                                7

<PAGE>

   The results of operations of Norweb Energi are reflected  in
the  consolidated financial statements of TXU Europe  from  the
August  3,  2000  effective  date  of  the  acquisition.    The
following  summary of unaudited pro forma consolidated  results
of  TXU  Europe's operations reflect the acquisition of  Norweb
Energi  as  though  it  had occurred at the  beginning  of  the
comparable period of 2000.

                                               Pro Forma
                                              Three Months
                                                 Ended
                                               March 31,
                                                  2000
                                             -------------
                                             (pounds million)

        Operating Revenues ..................    1,478
        Operating Income ....................      177
        Net Income...........................       56

   The  pro  forma results above are not necessarily indicative
of  what the actual results would have been had the acquisition
actually occurred at the beginning of the period.  Further, the
pro forma amounts are not intended to be a projection of future
results  of  the combined companies. In particular,  the  above
amounts  do  not take into account the expected  impact  Norweb
Energi  would  have  on  the timing of  earnings  from  the  UK
electricity portfolio across the year such that profits in  the
first  and  fourth  quarters  are reduced,  with  a  more  than
offsetting  increase  in the second and third  quarters.   This
arises from constant retail customer prices throughout the year
compared  with  more  seasonal  wholesale  contracts  and  spot
prices.

2.   SIGNIFICANT ACCOUNTING POLICIES

   The  condensed  consolidated  financial  statements  of  TXU
Europe  and  its subsidiaries have been prepared in  accordance
with  accounting principles generally accepted  in  the  United
States  of  America  (US GAAP) and, except for the adoption  of
the  new accounting standard discussed below, on the same basis
as the audited financial statements included in its 2000 Annual
Report   on  Form  10-K.   In  the  opinion  of  TXU   Europe's
management,  all  adjustments, consisting of  normal  recurring
accruals,  necessary for a fair presentation of the results  of
operations  and financial position have been included  therein.
Certain  information and footnote disclosures normally included
in   annual  consolidated  financial  statements  prepared   in
accordance with US GAAP have been omitted pursuant to the rules
and  regulations of the US Securities and Exchange  Commission.
The results of operations for an interim period may not give  a
true  indication of results for a full year. Certain previously
reported  amounts have been reclassified to conform to  current
classifications.

   Unless otherwise indicated, all amounts in the financial
statements and notes to financial statements are stated in
millions of UK pounds sterling.

3.   NEW ACCOUNTING STANDARDS

Change in Accounting - SFAS No. 133 Implementation

   On   January  1,  2001,  TXU  Europe  adopted  Statement  of
Financial Accounting Standards (SFAS) No. 133, "Accounting  for
Derivative Instruments and Hedging Activities", as extended  by
SFAS  No.  137  (June 1999) and amended by SFAS No.  138  (June
2000).  All derivatives held by TXU Europe have been  accounted
for  pursuant  to SFAS No. 133 requirements. TXU Europe  enters
into derivative transactions within its merchant energy trading
activities,  which  are  accounted for  on  the  mark-to-market
accounting  method. These derivatives have  been  entered  into
with  the  objective of generating profits on, or from exposure
to,  shifts or changes in market prices. TXU Europe also enters
into  derivative transaction to hedge market risks  related  to
changes in interest rates, foreign currency exchange rates  and
commodity  prices.  TXU Europe has designated,  documented  and
assessed  those derivative hedging relationships, the  majority
                                8

<PAGE>

of which are cash-flow hedges that require TXU Europe to record
the derivative assets or liabilities at their fair value on its
balance sheet with an offset in other comprehensive income  for
the  portion  of  the hedge that is effective, according  to  a
method prescribed by SFAS No. 133 in offsetting changes in fair
value  of  the  hedge  item.  Ineffectiveness  is  recorded  in
earnings.

   Interest  Rate  Risk  Management - TXU  Europe  enters  into
derivatives to manage exposures to the market risk inherent  in
fixed  rate debt securities and the cash flow risk inherent  in
variable rate securities.  Derivative instruments that are used
as part of TXU Europe 's interest-rate risk-management strategy
include  interest-rate  swaps,  forward  rate  agreements,  and
options  contracts. TXU Europe uses derivatives  to  convert  a
portion of its variable-rate debt to fixed rates. The resulting
cost  of  funds is lower than it would have been had fixed-rate
borrowings  been issued directly.  Substantially all  of  these
derivatives are designated as cash-flow hedges.

   Foreign  Currency Risk Management - TXU Europe has  exposure
to  foreign  currency risks, primarily with the US  dollar  and
other  foreign  currency  (non-UK pound  sterling)  denominated
transactions.  TXU Europe has accessed the US  capital  markets
and issued US dollar denominated obligations. TXU Europe enters
into  currency swaps, options and forwards, where  appropriate,
to  manage  foreign  currency exposures  on  foreign  currency-
denominated   transactions.    Substantially   all   of   these
derivatives are designated as cash flow hedges.

   TXU    Europe   has   numerous   investments   in    foreign
subsidiaries,  and  the  net  assets  and  earnings  of   these
subsidiaries are exposed to currency exchange-rate  volatility.
Through  March  31,  2001,  TXU Europe  has  not  entered  into
derivative transactions to hedge its material net investment in
foreign  operations,  but has used foreign currency-denominated
debt  as the hedge.  On April 30, 2001, TXU Europe entered into
a foreign currency swap which has been designated as a hedge of
the net investment in a foreign company.

   Energy Price Risk Management - TXU Europe's electricity  and
gas  operations  expose  it to market  risk  related  to  those
commodities.   TXU Europe's hedging activities for  its  energy
business are concentrated in the UK.  Operations in continental
Europe  are mainly associated with its merchant energy  trading
activity, but TXU Europe also trades in the UK market.

   Prior  to the implementation of the New Electricity  Trading
Arrangements  (NETA) on March 27, 2001, almost all  electricity
generated  in England and Wales had to be sold to the wholesale
trading market for electricity, commonly known as the Pool.  In
turn,  electricity suppliers generally had to  buy  electricity
from the Pool for resale to their customers.  Even groups which
are both generators and licensed suppliers, like TXU Europe, in
most circumstances, had to act through the Pool to sell all the
electricity they generate and to purchase all electricity  they
sold to customers.  Prices for electricity were set by the Pool
for  each  half hour based on bids of generators and a  complex
set of calculations designed to match supply and demand.

   Since  the price of electricity purchased from the Pool  was
volatile, TXU Europe was therefore exposed to the risk  arising
from  the differences between the fixed price at which it  sold
electricity  to customers and the variable prices at  which  it
bought  electricity from the Pool. TXU Europe's  objective  for
hedging  its  UK  energy portfolio was to limit  to  acceptable
levels, the exposure of TXU Europe to fluctuations in wholesale
energy  prices,  so  far as this affected the  sale  to  retail
customers  of  electricity  from  generating  assets  and   the
purchase of electricity (and gas) for resale to such customers.

   TXU  Europe's generation business provided a physical  hedge
to  this risk as it was exposed to Pool price fluctuations from
selling  electricity  into  the  Pool.   TXU  Europe's  overall
exposure  to  those  risks was managed by the  merchant  energy
trading  business  which maintained energy price  exposures  to
within  a  limit set by the TXU Europe Board and  also  entered
into  derivatives to hedge the portfolio.  The derivatives used
were  mainly contracts for differences and electricity  forward
agreements  but  also involved other contractual  arrangements,
which were all principally variable for fixed swaps.
                                9

<PAGE>

   Impact  of NETA -  NETA was implemented in the UK  on  March
27,  2001.   NETA provides those companies wishing to  buy  and
sell  electricity the freedom to enter into directly negotiated
contracts  instead of having to trade through the Pool.   Under
the new arrangements, bulk electricity will be traded on one or
more  exchanges and through a variety of bilateral and physical
contracts.  Market participants include not only generators and
suppliers  but  also traders, such as energy wholesalers,  with
physical  positions.  Accordingly, implementation of  NETA  has
eliminated the Pool.  Some of the derivative contracts used  to
hedge  exposure  to  changes  in  the  Pool  prices  have  been
renegotiated into bilateral contracts and are now considered to
be  "normal purchase" contracts, thus removing them  from  SFAS
No. 133 classification as cash-flow hedges.  As a result, these
contracts  have  been  removed from designation  as  cash  flow
hedges and have been removed from other comprehensive income.

   TXU  Europe's strategy to manage its energy commodity  price
risk  is  to balance the retail load profile with physical  and
financial  commodity contracts in a designated order  up  to  a
desired  amount  of  forecasted  purchases  and  sales  and  to
designate  them  as  cash-flow  hedges.   TXU  Europe  uses   a
combination of physical and financial contracts including short-
and long-term power purchase and sale agreements, contracts for
differences,  electricity  forward  agreements,   fuel   supply
contracts and other contracts in managing these risks.

   Financial  Impact  -  TXU  Europe  formally  documents   all
relationships between hedging instruments and hedged items,  as
well   as  its  risk-management  objective  and  strategy   for
undertaking  various hedge transactions. This process  includes
linking all derivatives that are designated as fair-value, cash-
flow   or  foreign-currency  hedges  to  specific  assets   and
liabilities   on  the  balance  sheet  or  to   specific   firm
commitments or forecasted transactions. The maximum  term  over
which  TXU  Europe  hedges its exposure to the  variability  of
future  cash flows (for all forecasted transactions,  excluding
interest  payments on variable-rate debt) is 26 years.  Amounts
are  removed from other comprehensive income as the  underlying
transactions occur.

   In  accordance with the transition provisions  of  SFAS  No.
133,  TXU  Europe recorded, as of January 1, 2001, a cumulative
effect  of pounds 72 million after-tax as a decrease  to  other
comprehensive  income  to  recognize  the  fair  value  of  all
derivatives effective as cash-flow hedging instruments.

   Essentially  all  of  the terms of TXU Europe's  derivatives
match the terms of the underlying hedged item.  As a result TXU
Europe experienced minimal hedge ineffectiveness of pounds  0.4
million  (reported as Interest Expense), which represented  the
total  ineffectiveness  of all cash-flow  hedges,  mainly  from
treasury hedges.  There was no ineffectiveness on the cash flow
hedges of the energy derivatives.  Also, pounds 0.5 million  of
net  derivatives gains/losses were realized in interest expense
as  a  result of the discontinuance of cash-flow hedges related
to certain forecasted treasury transactions that are not likely
to occur.

   As  of  March  31, 2001, pounds 120 million  of  net  losses
included  within the net gains/losses on derivative instruments
accumulated  in other comprehensive income are expected  to  be
reclassified into earnings during the next twelve  months.  The
amounts  expected  to  be  reclassified  are  affected   by   a
deterioration   of   near-term  prices   resulting   from   the
uncertainty  that  NETA has brought to  the  industry  and  its
market  place.  This amount represents the projected  value  of
the hedge over the next twelve months relative to what would be
recorded  had the hedge transaction not been entered into.  The
amount   is  not  a  forecasted  loss  incremental  to   normal
operations,  but  rather it demonstrates the  extent  to  which
volatility  in  earnings  (which  would  otherwise  exist)   is
mitigated through the presence of cash-flow hedges.

   Ongoing  implementation  issues  being  addressed   by   the
Derivatives   Implementation  Group  (DIG)   may   affect   the
application of SFAS No. 133.  In its normal course of business,
TXU Europe enters into commodity contracts that include options
to buy or sell certain volumes of the underlying commodity. TXU
Europe and its customers use these contracts to provide some of
their  commodity  requirements.   TXU  Europe  evaluated  these
contracts  and  determined that they qualified for  the  normal
purchases  and sales exception provided by SFAS  No.  133.   In
October  2000,  the  DIG  reached a tentative  conclusion  that
option  contracts do not qualify for such exception.  In  April
2001,  the  Financial Accounting Standards Board approved  this
                                10

<PAGE>

tentative  conclusion, and these contracts will be required  to
be  accounted for as derivatives commencing July 1,  2001.  TXU
Europe is evaluating the impact of this decision.

   There  are  a number of issues pending before the  DIG  that
may  have  an  impact  on  the application  of  SFAS  No.  133.
Management is unable to predict the ultimate outcome  of  these
issues.

   The  effect  on net income for the three months ended  March
31,   2001  from  implementing  SFAS  No.  133  has  not   been
significant.  The majority of derivative contracts are merchant
energy  trading  derivatives and already were being  marked-to-
market.   The  remaining derivatives identified are  designated
as, and are effective as, cash flow hedges, with changes in the
fair  value  of  derivatives reflected in  other  comprehensive
income.

     SFAS  No.  140 Implementation - SFAS No. 140,  "Accounting
for   Transfer   and   Servicing  of   Financial   Assets   and
Extinguishments of Liabilities", is effective  for  TXU  Europe
for transfers on or after April 1, 2001.  SFAS No. 140 replaces
SFAS  No.  125.   SFAS  No.  140  revises  the  standards   for
accounting for securitizations and other transfers of financial
assets  and  collateral and required disclosures,  but  carries
over most of SFAS No. 125's provisions without reconsideration.
TXU Europe's sale of receivables program has been determined to
be  compliant  with  the  requirements  of  SFAS  No.  140  and
therefore  will  not  be  impacted  by  the  adoption  of  this
standard.

4.   CHANGE IN ACCOUNTING PRINCIPLE - DEPRECIATION

   In   the  quarter  ended  September  30,  2000,  TXU  Europe
implemented  a  change  in  the  depreciation  method  for  its
distribution   system   assets  as  of   December   31,   1999.
Previously,  distribution system assets were depreciated  at  a
rate of 3% per annum for 20 years and then 2% per annum for the
remaining  20 years.  A straight line depreciation  method  has
been  implemented to better recognize the cost  of  the  assets
over the anticipated useful life of the assets.  The cumulative
effect of this change in accounting principle on periods  prior
to December 31, 1999 was an increase in net income of pounds  7
million (net of pounds 3 million in deferred taxes).

   Results  for  the  first quarter of 2000  were  restated  to
reflect  the increase in net income resulting from the adoption
of  the new accounting method. The effect of the change for the
quarter  ended  March 31, 2000 was to increase  net  income  by
pounds  4 million (after a reduction for income taxes of pounds
2 million).

5.   RESTRUCTURING CHARGES AND OTHER COSTS

   During  the three months ended March 31, 2001 and 2000,  TXU
Europe  recorded  restructuring  charges  and  other  costs  of
approximately  pounds 16 million and pounds 43 million  pre-tax
(pounds   11   million   and  pounds  32  million   after-tax),
respectively.   Included in the costs for  2000  was  pounds  6
million of costs associated with the offer for Hidrocantabrico,
recorded  in Other Income - Net.  The majority of the remaining
costs  consisted  of  asset  writedowns  and  other  exit   and
redundancy  costs  (severance  benefits  paid  to  staff  under
voluntary  retirement programs and related  pension  benefits),
primarily a result of contracting TXU Europe's customer service
operations to Vertex Data Science Limited, the creation of  the
24seven joint venture and certain other staff reorganizations.

   For   the   three  months  ended  March  31,  2001,  pre-tax
restructuring   charges  consisted  of  redundancy   costs   of
approximately pounds 4 million related to termination  benefits
for  31  employees  that had accepted the benefits,   pounds  8
million of asset writedowns and pounds 4 million of other  exit
costs.    For  the three months ended March 31,  2000,  pre-tax
restructuring   costs   consisted  of   redundancy   costs   of
approximately   pounds   15  million   related   to   voluntary
termination  benefits for 296 employees that have accepted  the
benefits,  pounds 7 million for asset writedowns and pounds  15
million  of  other exit costs.  All of these costs, except  the
asset  writedowns  which were charged to depreciation  expense,
have been recorded in operation and maintenance expense.
                                11

<PAGE>

   During  the  three months ended March 31,  2001,   pounds  4
million of redundancy costs and pounds 2 million of other  exit
costs  charged  during the three months then  ended  have  been
paid.   There  were  no payments made during the  three  months
ended March 31, 2000.

6.   SHORT-TERM FINANCING

   Short-term   Facilities  -  In  January  2001,  TXU   Europe
borrowed  an additional euros 182 million (pounds 115  million)
at  5.54%  per  annum  under  its pounds  300  million  364-day
revolving credit facility, as part of the financing to  acquire
Kiel  AG.  Also in January 2001, the pounds 150 million Eastern
Electricity revolving credit balance was repaid.  As  of  March
31,  2001, short-term borrowings aggregated pounds 489  million
with a weighted average annual interest rate of 5.4%.

   On  April 30, 2001, TXU Europe repaid the 1.3 billion  Czech
Koruna  (CzK) (pounds 23 million) outstanding under the  short-
term  CzK  facility and the facility expired.  This  short-term
borrowing had been used to hedge the net investment in a CzK  -
denominated company (Teplarney Brno).   TXU Europe then entered
into  a foreign currency derivative to serve as the replacement
hedge of this investment.

   Accounts   Receivable  Securitization  -  TXU   Europe   has
facilities with a commercial bank to provide financing  through
trade accounts receivable whereby Eastern Electricity may  sell
up to pounds 300 million of its electricity receivables and TXU
Finance  may  borrow up to an aggregate of pounds 275  million,
collateralized  by  future receivables of Eastern  Electricity,
through  a short-term note issue arrangement.  The program  has
an overall limit of pounds 550 million.

   Eastern    Electricity    continually    sells    additional
receivables to replace those collected. During the three months
ended  March  31,  2001, Eastern Electricity  sold  pounds  612
million  in receivables under the program.  Such sales resulted
in  no gain or loss. Under the program, Eastern Electricity has
a  receivables  servicing  obligation  but  does  not  incur  a
measurable  asset  or liability.  At March 31,  2001,  accounts
receivable  of Eastern Electricity were reduced by  pounds  204
million  under  the  program and pounds  5  million  of  future
receivables  sold were reflected as other short-term  loans  on
the  balance sheet. These borrowings bear interest at an annual
rate,  which  was 5.60% at March 31, 2001, based on  commercial
paper rates plus a margin.

7.   LONG-TERM DEBT

   Lines  of  Credit - At March 31, 2001, TXU  Europe  and  TXU
Finance  (No.  2)  Limited (TXU Finance) had a joint  sterling-
denominated line of credit with a group of banking institutions
under  a credit facility agreement (Sterling Credit Agreement).
As  of  March 31, 2001, the Sterling Credit Agreement  provided
for  borrowings  of  up to pounds 1.075  billion  and  had  two
facilities: a pounds 750 million term facility and a pounds 325
million  revolving credit facility (Tranche B), both  of  which
terminate  on  March  2, 2003.  The Sterling  Credit  Agreement
allows for borrowings in various currencies with interest rates
based  on  the  prevailing rates in effect in the countries  in
which the borrowings originate.  In January 2001, in connection
with  the  acquisition  of  Kiel AG,  TXU  Europe  borrowed  an
additional  euros 47 million (pounds 30 million) under  Tranche
B.  As of March 31, 2001, pounds 750 million of borrowings were
outstanding under the term facility at an interest rate of 6.4%
per  annum,  and outstanding Tranche B borrowings consisted  of
700  million Norwegian kroner (NOK) (pounds 54 million) at 8.1%
per  annum and euros 314 million (pounds 193 million)  at  5.4%
per annum.

   TXU  Europe  has a euros 2.0 billion Euro Medium  Term  Note
(EMTN)  program.  Under the EMTN program, TXU Europe  may  from
time  to time issue notes on a continuing basis to one or  more
dealers  in an aggregate principal amount outstanding of  euros
2.0  billion.  At March 31, 2001, there were pounds 676 million
of  various borrowings outstanding under this program  with  an
aggregate weighted average interest rate of 7.1% per annum.

   In  January  2001,  the outstanding balance  of  pounds  190
million of the rent factoring loans due to banks was repaid.
                                12

<PAGE>

8. CONTINGENCIES

   Legal   Proceedings  -  In  February  1997,   the   official
government  representative of pensioners  (Pensions  Ombudsman)
made  a  final determination against the National Grid  Company
plc  (National  Grid) and its group trustees  with  respect  to
complaints by two pensioners in National Grid's section of  the
Electricity  Supply Pension Scheme (ESPS).   The  determination
related  to the use of the pension fund surplus resulting  from
the  March  31,  1992 actuarial valuation of the National  Grid
section  to  meet  certain costs arising from  the  payment  of
pensions on early retirement upon reorganization or downsizing.
This determination was set aside by the High Court on June  10,
1997,  and the arrangements made by National Grid and its group
trustees  in dealing with the surplus were confirmed.  The  two
pensioners  appealed this decision to the Court of Appeal,  and
judgment  was received which endorsed the Pensions  Ombudsman's
determination  that  the  corporation  was  not   entitled   to
unilaterally deal with any surplus. National Grid appealed  the
decision  to  the  House of Lords and, on April  4,  2001,  the
appeal  was  allowed.  The House of Lords found  that  National
Grid  was  entitled to use the surplus funds as they had  done.
As  a  result of the decision of the House of Lords, TXU Europe
considers  that the likelihood of a claim of this nature  being
made against it to be remote.

   On  January  25, 1999, the Hindustan Development Corporation
(HDC)  issued arbitration proceedings in the Arbitral  Tribunal
in  Delhi, India against The Energy Group PLC (TEG) (now Energy
Holdings  (No.3)  Limited),  claiming  damages  of  pounds  255
million for breach of contract following the termination  of  a
Joint  Development Agreement dated March 20, 1997  relating  to
the  construction, development and operation of a lignite based
thermal power plant at Barsingsar, Rajasthan.  On November  21,
2000, the Arbitrators issued their decision and dismissed HDC's
claim  in full, and TEG was liable only for its own legal costs
involved  in  the  case,  an estimated  pounds  1  million.  On
December 21, 2000, HDC filed a Request for Clarification of the
Arbitrators'  decision  (Request)  under  Section  33  of   the
Arbitration  and Conciliation Act, the purpose of which  is  to
entitle  a  party  to  arbitration  to  seek  clarification  of
language  used  in the Arbitrators' decision.   TEG  filed  its
response to the Request on January 15, 2001 asserting that  the
Request  was  untimely made and that the language used  by  the
Arbitrators  needed no clarification. TXU Europe believes  that
the  Arbitrators will have no alternative but  to  dismiss  the
Request.   The effect of filing the Request, however, has  been
to  stay the time HDC has to file an appeal of the Arbitrators'
decision.

   In   August   2000,  the  Spanish  Stock  Market  Commission
announced  it  was opening an investigation as to  whether  TXU
Europe and Electrabel acted in concert over share purchases  of
Hidrocantabrico in order to avoid making a formal takeover bid.
TXU  Corp.  was originally named as a party but is seeking  its
removal   from  these  proceedings.  Philip  Turberville,   the
principal executive officer of TXU Europe, was also named as  a
party in the investigation.  If the two utilities are found  to
be  in  violation of Spanish securities law, they could face  a
substantial  fine  and other restrictions.   The  investigation
could  last  until  February 2002.  TXU  Europe  is  unable  to
determine what impact there may be, if any, as a result of  the
investigation.  TXU Europe and TXU Corp. believe there has been
no   violation  of  Spanish  securities  laws  and  are   fully
cooperating with the investigation.

   General - In addition to the above, TXU Europe and its
subsidiaries are involved in various other legal and
administrative proceedings which, in the opinion of management,
should not have a material effect on its financial position,
results of operations or cash flows.

   Financial guarantees - TEG has guaranteed up to US$110
million (pounds 78 million) at March 31, 2001 of certain
liabilities that may be incurred and payable by the purchasers
of TEG's US and Australian coal businesses and US energy
marketing operations sold in 1998 prior to acquisition of TEG
by TXU Corp.  These guarantees are with respect to the Peabody
Holding Company Retirement Plan for Salaried Employees, the
                                13

<PAGE>
Powder River Coal Company Retirement Plan and the Peabody Coal
UMWA Retirement Plan and are subject to certain specified
conditions.

   TEG entered into various guarantees of obligations of
affiliates of its former subsidiary, Citizens Power LLC,
arising under power purchase agreements and note purchase
agreements in connection with various Citizens Power energy
restructuring projects, as well as various indemnity agreements
in connection with such projects.  TXU Europe and TEG continue
to be either the guarantor or the indemnifying party, as the
case may be, under these various agreements.

9.   SEGMENT INFORMATION

   TXU  Europe has two reportable operating business  segments,
Energy  and Networks. Beginning in the first quarter  of  2001,
TXU   Europe  undertook  an  internal  reorganization  of   its
businesses to reflect a single energy business concept for  the
management of its energy activities in a consistent  manner  in
its  different geographical areas. Amounts for the three months
ended  March 31, 2000 have been reclassified to conform to  the
new presentation.

<TABLE>
<CAPTION>
                                            Three Months Ended March 31,
                                    ------------------------------------------------
                                           2001                      2000
                                    ----------------------    ----------------------
                                    Revenues  Contribution    Revenues  Contribution
                                    --------  ------------    --------  ------------
                                                  (pounds  million)

<S>                                   <C>           <C>         <C>         <C>
UK ...............................    1,930         121         1,044        99
Continental Europe ...............      337          25            50         4
                                     ------       -----        ------      ----
    Total Energy .................    2,267         146         1,094       103
                                     ------       -----        ------      ----
Networks .........................       89          42           123        68
Other.............................        3           6            11         1
Inter-segment eliminations .......      (54)          -           (77)        -
                                     ------       -----        ------      ----
        Total ....................    2,305         194         1,151       172
                                     ======       -----        ======      ----
Cost of capital elimination.......                   36                      38
Unallocated corporate costs ......                  (45)                    (58)
                                                  -----                    ----
Income before interest, income
  taxes, distributions and
  minority interest...............                  185                     152
                                                  =====                    ====

</TABLE>

10.  SUPPLEMENTARY FINANCIAL INFORMATION
   Accounts  Receivable  - At March 31, 2001 and  December  31,
2000,  accounts  receivable were stated  net  of  uncollectible
accounts   of   pounds  29  million  and  pounds  31   million,
respectively.

   Property,  Plant  and  Equipment - At  March  31,  2001  and
December  31, 2000, property, plant and equipment  were  stated
net  of  accumulated  depreciation of pounds  395  million  and
pounds 398 million, respectively.

   Goodwill  -  At  March  31,  2001  and  December  31,  2000,
goodwill  was stated net of accumulated amortization of  pounds
271 million and pounds 240 million, respectively.

   Credit  Risk - Credit risk relates to the risk of loss  that
TXU  Europe  would  incur  as  a result  of  nonperformance  by
                                14

<PAGE>
counterparties.  TXU  Europe  maintains  credit  policies  with
regard   to   its   counterparties  that  management   believes
significantly  minimize overall credit  risk.   These  policies
include  an  evaluation of potential counterparties'  financial
condition  (including credit rating), guarantees and collateral
requirements  under  certain  circumstances  and  the  use   of
standardized agreements that allow for the netting of  positive
and negative exposures associated with a single counterparty.

   Concentration  of  Credit  Risk - During  the  three  months
ended  March  31,  2001, TXU Europe's merchant  energy  trading
activity and retail operations has grown substantially. As  TXU
Europe grows in various regions throughout Europe, systems  and
procedures   are   implemented  to  continually   monitor   the
counterparty risk exposure across its various trading  regions.
Price   and   credit  risk  are  evaluated  daily  within   the
established  trading  policies and limits established  for  TXU
Europe.  TXU Europe has also established bilateral counterparty
agreements  that  provide  for  the  netting  of  positive  and
negative  exposures  with  a single  counterparty  to  minimize
credit exposure.

     TXU  Europe's  gross exposure to credit risk  (before  any
netting  agreements or reserves) in Continental Europe and  the
UK as of March 31, 2001 was pounds 2.0 billion.  These regional
concentrations  have  the  potential  to  impact  TXU  Europe's
overall   exposure  to  credit  risk,  either   positively   or
negatively, in that the customer base and counterparties may be
similarly   affected   by  changes  in  economic,   regulatory,
industry, weather or other conditions.

   One  customers' exposure to TXU Europe represented 9% of the
gross  fair value of TXU Europe's accounts receivable, merchant
energy trading assets and derivative assets at March 31,  2001.
The  majority of the counterparties that TXU Europe deals  with
are  major  energy companies and financial institutions,  which
are  considered  to  be of investment grade,  determined  using
publicly  available information including a Standard  &  Poor's
rating  of  at  least  BBB-.  The risk of loss  to  TXU  Europe
arising   from  non-performance  by  these  counterparties   is
considered  unlikely.   In  the event a  counterparty's  credit
rating  declines,  TXU  Europe may apply certain  remedies,  if
considered necessary.

   Based  on  TXU  Europe's  policies, its  exposures  and  its
credit  and  other reserves, TXU Europe does not  anticipate  a
materially  adverse effect on financial position or results  of
operations as a result of counterparty nonperformance.




                                15

<PAGE>


INDEPENDENT ACCOUNTANTS' REPORT



TXU Europe Limited:

We   have  reviewed  the  accompanying  condensed  consolidated
balance  sheet  of  TXU  Europe Limited and  subsidiaries  (TXU
Europe)  as  of  March  31,  2001, and  the  related  condensed
statements  of  consolidated income, comprehensive  income  and
cash  flows for the three-months ended March 31, 2001 and 2000.
These  financial  statements  are  the  responsibility  of  TXU
Europe's management.

We   conducted   our  review  in  accordance   with   standards
established  by  the  American Institute  of  Certified  Public
Accountants.    A  review  of  interim  financial   information
consists  principally  of  applying  analytical  procedures  to
financial data and making inquiries of persons responsible  for
financial and accounting matters.  It is substantially less  in
scope  than  an  audit  in accordance with  auditing  standards
generally  accepted  in  the  United  States  of  America,  the
objective  of  which is the expression of an opinion  regarding
the financial statements taken as a whole.  Accordingly, we  do
not express such an opinion.

Based  on  our  review,  we  are  not  aware  of  any  material
modifications   that   should  be  made   to   such   condensed
consolidated financial statements for them to be in  conformity
with  accounting principles generally accepted  in  the  United
States of America.

We   have  previously  audited,  in  accordance  with  auditing
standards  generally accepted in the United States of  America,
the consolidated balance sheet of TXU Europe as of December 31,
2000,  and  the  related  consolidated  statements  of  income,
comprehensive income, cash flows and shareholder's  equity  for
the  year then ended (not presented herein); and in our  report
dated February 1, 2001, we expressed an unqualified opinion  on
those  consolidated financial statements.  In our opinion,  the
information   set   forth   in   the   accompanying   condensed
consolidated balance sheet as of December 31, 2000,  is  fairly
stated in all material respects in relation to the consolidated
balance sheet from which it has been derived.




DELOITTE & TOUCHE
London, England
May 10, 2001



                                16

<PAGE>

                        TXU EUROPE LIMITED
Item 2. Management's Discussin and Analysis of Financial Condition and
                        Results of operations


BUSINESS, ACQUISITIONS AND DISPOSALS

   TXU  Europe  Limited  (TXU Europe) is an  indirect,  wholly-
owned  subsidiary of TXU Corp., a Texas corporation.  TXU Corp.
is  a global energy services holding company that is engaged in
the  generation, purchase, transmission, distribution and  sale
of  electricity;  the purchase, transmission, distribution  and
sale  of  natural  gas;  and merchant  energy  trading,  energy
services, telecommunications and other businesses, primarily in
the United States (US), Europe and Australia.  TXU Europe is  a
holding  company for TXU Corp.'s United Kingdom (UK) and  other
European  operations.  Almost all  of  TXU  Europe's  operating
income  is derived from, and consolidated assets are  held  by,
TXU  Europe Group plc (TXU Europe Group) and TXU Europe Group's
subsidiaries.

   Beginning   in  the  first  quarter  of  2001,  TXU   Europe
undertook  an  internal reorganization  of  its  businesses  to
reflect a single energy business concept for the management  of
its  energy activities in a consistent manner in its  different
geographical areas.  As a result, there are only two  reporting
operating segments for TXU Europe:

   ENERGY   -  which  consists  of  the  former  energy  retail
      business  and  the  former portfolio  trading  and  power
      business   segments.  The  new  single  energy   business
      manages  the  integrated portfolio of  generation  assets
      and  contracts  and retail customer base within  separate
      geographical  areas  -  the UK  and  continental  Europe,
      which  comprises  Central Europe, the Nordic  region  and
      Germany; and

   NETWORKS  -  which owns, manages and, through  its  networks
      management   joint   venture  (24seven),   operates   its
      electricity distribution system in the UK.

   Operations  in Germany were further expanded when Stadtwerke
Kiel AG (Kiel AG), a German municipal utility, was acquired.

   On  January 8, 2001, TXU Europe completed the acquisition of
51%  of Kiel AG for pounds 145 million. The acquisition of Kiel
AG was accounted for as a purchase business combination. At the
date of acquisition, Kiel AG had sterling equivalent assets  of
pounds  121 million and liabilities of pounds 82 million.   The
process of determining the fair value of assets and liabilities
of Kiel AG continues but is expected to be completed within one
year  of the acquisition date. TXU Europe's latest estimate  of
goodwill  is pounds 106 million, which is being amortized  over
40  years.  This  amount  is subject  to  further  revision  as
additional  information  becomes  available.  The  results   of
operations  of  Kiel  AG  are  reflected  in  the  consolidated
financial statements from the January 8, 2001 acquisition date.
Pro forma information for the three months ended March 31, 2001
and  2000, reflecting the acquisition of Kiel AG, would not  be
significantly different from reported amounts.

   In  January  2001, TXU Europe entered into a  commitment  to
sell  its  19.2% interest in Hidroelectrica del Cantabrico,  SA
(Hidrocantabrico)  to  a  consortium led  by  Electricidade  de
Portugal  S.A.,  a  Portuguese  utility  company,  and  Spanish
savings bank Caja de Ahorro de Asturias (Cajastur) for euros 24
per share. TXU Europe waived the pre-emption rights it had over
4.9%  of  the  stock in Hidrocantabrico held by  Electrabel  SA
(Electrabel), an electricity company in Belgium.  On April  20,
2001,  TXU Europe received net proceeds from the sale of  euros
522 million (pounds 320 million), realizing a pre-tax profit of
pounds 50 million.

   In  February  2001, TXU Europe finalized  the  sale  of  its
interest in the North Sea gas fields for  pounds 138 million as
a result of its ongoing review of its program to reposition its
energy  portfolio.  TXU Europe received net  cash  proceeds  of
pounds  97 million and recognized a net pre-tax gain of  pounds
7 million, which has been recorded in Other Income - Net.

                                17

<PAGE>

   On  August  3,  2000, TXU Europe purchased United  Utilities
plc's  retail energy supply business, Norweb Energi (a division
of Norweb plc), for total consideration, including direct costs
of the acquisition, of pounds 340 million. The transaction also
included   the   assumption  of  certain  of  Norweb   Energi's
obligations,  including  its power purchase  agreements,  which
have been integrated into TXU Europe's energy portfolio.

   TXU  Europe will pursue investment opportunities  from  time
to time when it concludes they are consistent with its business
strategies  and  will  dispose  of  certain  assets  to   allow
redeployment of resources to opportunities for faster growth in
an effort to enhance its long-term return. TXU Europe continues
to  review its energy portfolio within the UK.  TXU Europe  has
also  announced that it will seek bids for its UK power assets,
in  order  to determine whether their value would be  maximized
through retention or disposal of these assets.  There has  been
no  indication of an impairment of these assets.  No  decisions
have  been  made  as  to whether disposals will  actually  take
place.


RESULTS OF OPERATIONS

   Results  for the three-month periods presented  herein  are
not  necessarily indicative of expectations for a full  year's
operations  because  of seasonal and other factors,  including
variations   in   maintenance  and  other  operating   expense
patterns. No significant changes or events which might  affect
the financial condition of TXU Europe have occurred subsequent
to  year-end other than as disclosed in other reports  of  TXU
Europe or included herein.
Three Months Ended March 31, 2001 Compared With Three Months
Ended March 31, 2000

     Overview - Net income for the three months ended March 31,
2001 was pounds 41 million compared with pounds 46 million  for
the  same  period in 2000. Included in net income for the  2000
period  is pounds 7 million (net of deferred taxes of pounds  3
million) for the cumulative effect on periods prior to December
31, 1999 of a change in the method of depreciating distribution
system  assets  from an accelerated method to a  straight  line
method.   The previously reported quarter ended March 31,  2000
has been changed to reflect the new method from January 1, 2000
as  well as the restatement in calculating minority interest as
described in Note 5 to Financial Statements. The improvement in
net  income  reflected a strong performance in merchant  energy
trading activities, operating costs savings and lower levels of
restructuring  costs, offsetting the effect of  lower  networks
revenues and higher interest and related charges. Income before
interest,  income  taxes, distributions and  minority  interest
(income  before interest) was pounds 185 million for the  three
months  ended March 31, 2001 compared with pounds  152  million
for  the  same period of 2000.  Revenues of pounds 2.3  billion
for the three months 2001 were up almost 100% compared with the
pounds 1.2 billion for the three months of 2000.

     The  increase in revenues resulted from increased merchant
energy trading volumes, particularly in UK energy trading,  and
the inclusion of the results of Norweb Energi and Kiel AG since
their  acquisition  on  August 3, 2000  and  January  8,  2001,
respectively.   For  the  first three months  of  2001,  Norweb
Energi and Kiel AG contributed pounds 268 million and pounds 61
million  in  revenues, respectively.  These  revenue  increases
were  offset  by  decreased revenues in  the  networks  segment
resulting  from price reductions following the  April  1,  2000
OFGEM distribution price review. Within the Energy segment,  in
addition  to the effect of the inclusion of Norweb  Energi  and
Kiel,  high and volatile UK gas prices improved the results  of
the   merchant  energy  trading  business  and  North  Sea  gas
production assets (until their sale in February, resulting in a
gain  in  other income of pounds 7 million).  Firmer prices  in
the Nordic region contributed to strong merchant energy trading
results  in  continental  Europe. The expected  effect  of  the
Norweb Energi acquisition on income before interest is to alter
the timing of earnings from the UK electricity portfolio across
the year such that profits in the first and fourth quarters are
reduced with a more than offsetting increase in the second  and
third  quarters.   This  arises from constant  retail  customer
prices   throughout  the  year  compared  with  more   seasonal
wholesale contracts and spot prices.
                                18

<PAGE>

   During  the three months ended March 31, 2001 and 2000,  TXU
Europe  recorded  restructuring  charges  and  other  costs  of
approximately  pounds 16 million and pounds 43 million  pre-tax
(pounds   11   million   and  pounds  32  million   after-tax),
respectively.   Included in the costs for  2000  was  pounds  6
million of costs associated with the offer for Hidrocantabrico,
recorded  in Other Income - Net.  The majority of the remaining
costs  consisted  of  asset  writedowns  and  other  exit   and
redundancy  costs  (severance  benefits  paid  to  staff  under
voluntary  retirement programs and related  pension  benefits),
primarily a result of contracting TXU Europe's customer service
operations to Vertex Data Science Limited, the creation of  the
24seven joint venture and certain other staff reorganizations.

   For   the   three  months  ended  March  31,  2001,  pre-tax
restructuring   charges  consisted  of  redundancy   costs   of
approximately pounds 4 million related to termination  benefits
for  31  employees  that had accepted the benefits,   pounds  8
million of asset writedowns and pounds 4 million of other  exit
costs.    For  the three months ended March 31,  2000,  pre-tax
restructuring   costs   consisted  of   redundancy   costs   of
approximately   pounds   15  million   related   to   voluntary
termination  benefits for 296 employees that have accepted  the
benefits,  pounds 7 million for asset writedowns and pounds  15
million  of  other exit costs.  All of these costs, except  the
asset  writedowns  which were charged to depreciation  expense,
have been recorded in operation and maintenance expense.

   During  the  three months ended March 31,  2001,   pounds  4
million of redundancy costs and pounds 2 million of other  exit
costs  charged  during the three months then  ended  have  been
paid.   There  were  no payments made during the  three  months
ended March 31, 2000.

   Energy purchased for resale and fuel consumed for the  three
months  ended  March 31, 2001 of pounds 1.8  billion  was  140%
higher than the pounds 763 million for the same period of 2000,
primarily  as  a  result  of the increase  in  merchant  energy
trading activity together with the impact of Norweb Energi  and
Kiel  AG since their acquisition. Other operating expenses were
higher compared with the three month period of 2000, mainly due
to the inclusion of Norweb Energi and Kiel AG, partially offset
by continued cost reduction efforts.

   Depreciation  expense for the three months ended  March  31,
2001 was pounds 45 million compared with pounds 38 million  for
the same period of 2000, which has been restated to reflect the
change in depreciable lives as described in Note 4 to Financial
Statements.  The increase is primarily due to the inclusion  of
Norweb Energi and Kiel AG.

   Net  interest expense for the three months ended  March  31,
2001 was pounds 93 million compared with pounds 73 million  for
the same period 2000, primarily due to increased borrowings  to
fund the Norweb Energi and Kiel AG acquisitions and accelerated
amortization of debt issue costs following the early  repayment
of the rent factoring debt.

   Total  income tax expense for the three months  ended  March
31,  2001 was pounds 38 million compared with pounds 34 million
for  the  same period of 2000.  The effective tax rate in  both
periods is affected by amortization of goodwill and other  non-
deductible  expenses primarily related to a capital lease.  The
effective  tax  rate  in  the 2000  period  is  also  adversely
impacted   by   non-deductible   expenses   related   to    the
Hidrocantabrico offer.

   Minority  interest  in  the  three-month  2001  period   has
increased  in  comparison with the 2000 period primarily  as  a
result of including the 49% minority ownership in Kiel AG.

   See  Note  9  to  Financial Statements  for  information  on
revenues  and  contributions (operating  income)  by  operating
segment.

                                19

<PAGE>


<TABLE>
<CAPTION>


   OPERATING STATISTICS

                                                Three Months
                                              Ended March 31,
                                           ---------------------
                                             2001        2000
                                           --------    -------
 <S>                                        <C>         <C>
 SALES VOLUMES
 Electricity (gigawatt-hours)- (GWh):

   Industrial and commercial                 6,324       3,589
   Residential                               6,705       4,574
                                           -------     -------
     Total electricity                      13,029       8,163
                                           =======     =======

 Gas (billion cubic feet) - (Bcf):
   Industrial and commercial                    23          19
   Residential                                  41          19
                                           -------     -------
     Total gas                                  64          38
                                           =======     =======
 Wholesale energy sales:
   Electricity (GWh)                        43,750      24,435
                                           =======     =======
   Gas (Bcf)                                   379         186
                                           =======     =======

 Electricity units distributed (GWh)         9,904       9,204
                                           =======     =======


 CUSTOMERS (end of period & in thousands)
   Electricity (retail)                      4,484       2,835
   Gas                                       1,224         768

</TABLE>

Results by Segment

   Energy  -  The  Energy  business segment  is  managed  on  a
geographical  basis  -  in the UK and  in  continental  Europe,
comprising  the Central European, Nordic and German  (Kiel  AG)
operations.

   UK  -  Revenues  for the three months ended March  31,  2001
were  pounds  1.9 billion compared with pounds 1.0 billion  for
the  three months ended March 31, 2000. The increase in revenue
is  partly  associated with results from Norweb Energi  (pounds
268  million), included since acquisition in August 2000,  with
the  remainder  reflecting  the  significant  increase  in   UK
merchant energy trading activities.

   Income before interest for the three months ended March  31,
2001 was pounds 121 million compared with pounds 99 million for
the  three  months  ended  March 31, 2000.   This  reflects  an
increase  in margins of pounds 45 million partly offset  by  an
increase  in  operating expenses of pounds 23  million,  almost
entirely  attributable  to  the  inclusion  of  Norweb  Energi.
Excluding  Norweb  Energi, margins for the three  months  ended
March  31,  2001, compared with those for the  same  period  of
2000, were flat, reflecting a decrease of pounds 52 million for
electricity as a consequence of low and stable prices, with  an
increase of pounds 53 million in gas as prices were both higher
and  more  volatile.  These results also include operations  of
the North Sea gas assets until their sale in February 2001.
                                20

<PAGE>
   Continental   Europe   -  Revenues  in  continental   Europe
operations  increased  from pounds 50  million  for  the  three
months ended March 31, 2000 to pounds 337 million for the three
months ended March 31, 2001.  This increase is due to increased
merchant  energy trading volumes (pounds 192 million)  and  the
inclusion  of  Kiel AG for the first time (pounds 61  million).
TXU  Europe  has  established itself as  a  leading  player  in
Central  European electricity and gas trading markets since  it
first  opened its Geneva base of operations in September  1999.
Volumes  and  turnover have increased steadily in  all  markets
since  the relatively small values in the three months to March
31,  2000.   Total settled volumes in 2001 were 18.7  terrawatt
hours  (TWh) compared with 1.7 TWh for the same period of 2000.
Traded   volumes   in   the   Nordic  region   also   increased
substantially.

   Income before interest for the three months ended March  31,
2001  was  pounds 25 million, compared with pounds 4million  in
the three months ended March 31, 2000.    The increase reflects
the inclusion of Kiel AG (pounds 12 million), firmer prices  in
the  Nordic  region (pounds 11 million), savings  in  operating
costs  and a softening of power prices in some central European
markets during the quarter.

   Networks  -  Revenues for the three months ended  March  31,
2001  were  pounds 89 million compared with pounds 123  million
for  the  three  months ended March 31, 2000. The  decrease  in
revenues is largely due to the impact of the OFGEM Distribution
Price  Review  (pounds 29 million) which was  effective  as  of
April  1, 2000. The balance of the reduction is mainly  due  to
adverse movements in tariffs.

   Income before interest for the three months ended March  31,
2001 was pounds 42 million compared with pounds 68 million  for
the  three months ended March 31, 2000. The decrease in  income
before  interest is due to the impact of the OFGEM Distribution
Price Review partly offset by reductions in operating expenses.
Operating  cost  savings are mainly due to increased  operating
efficiencies resulting from the 24seven joint venture.

   Other   - Income before interest for the three months  ended
March  31,  2001 was pounds 6 million compared  with  pounds  1
million  for the same period of 2000.  Included in the  results
for 2001 is the pre-tax profit on disposal of the North Sea gas
assets of pounds 7 million.

Comprehensive Income

   The  unrealized holding gains on investments  are  primarily
related  to market changes in the value of the 19.2% investment
in Hidrocantabrico.

   The  implementation  of  Statement of  Financial  Accounting
Standards (SFAS) No. 133 "Accounting for Derivative Instruments
and   Hedging  Activities"  resulted  in  a  cumulative  effect
reduction   of   pounds  72  million  net  of  tax   in   other
comprehensive income as of January 1, 2001.  During the quarter
ended  March  31, 2001, the change in fair value  of  cash-flow
hedges  was a reduction of  pounds 15 million after  tax  while
pounds  6  million  after  tax  of  the  deferred  amount   was
recognized in earnings.  See Note 3 to Financial Statements for
additional information.

   The  implementation of SFAS No. 133 has had  minimal  effect
on  TXU  Europe's  results of operations.  The merchant  energy
trading businesses in the UK and continental Europe use mark-to-
market  accounting  for  their  trading  activities.   Merchant
energy  trading transactions which are derivatives pursuant  to
SFAS  No. 133 also are required to be accounted for using mark-
to-market accounting.  Therefore SFAS No. 133 has not  affected
merchant energy trading operating results.

   TXU  Europe has historically used, and will continue to use,
other  derivatives  which  are highly effective  in  offsetting
future   cash  flow  volatility  in  interest  rates,  currency
exchange  rates and energy commodities, essentially  converting
variable arrangements to fixed arrangements.  The fair value of
derivatives that are effective as cash-flow hedges are recorded
as  derivative  assets or liabilities with an offset  in  other
comprehensive  income.  Accordingly, the  principal  impact  of
SFAS No. 133 has been on the balance sheet.
                                21

<PAGE>

   The  balance  sheet  value  of these  derivative  assets  or
liabilities  can change significantly from quarter  to  quarter
based  on  changes  in market expectations of economic  events,
such as the recent drop in interest rates and changes in actual
and  expected  natural gas and electricity  prices.   The  fair
value  of these cash-flow-hedge derivatives is determined  each
quarter based on actual and forecasted interest rates, currency
rates  and  commodity prices. Consistent with  the  above,  the
effect  of changes in fair value is reflected in the derivative
asset or liability and in other comprehensive income.

   The  amounts  included  within  other  comprehensive  income
reflect  the  value of the cash-flow hedges  based  on  current
market conditions and therefore the amount for which the  hedge
will  be  used in the future to offset the impact  of  expected
changes  in variable prices.   Consistent with hedge accounting
prior  to  SFAS No. 133, the effects of the hedged  transaction
will  be  recorded in the statement of income  as  the  related
transaction is actually settled.

   The  disclosure in Note 3 to the Financial Statements of the
amount  of derivative gains and losses "expected to be realized
in  earnings  during  the  next twelve months"  represents  the
projected  value  of  the  hedge over the  next  twelve  months
relative  to  what would be recorded had the hedge  transaction
not  been  entered into.  The amount is not a  forecasted  loss
incremental  to  normal operations, but rather it  demonstrates
the  extent  to  which  volatility  in  earnings  (which  would
otherwise exist) is mitigated through the presence of cash-flow
hedges.

Credit  Risk  -  See  Note  10  to  Financial  Statements   for
information on Credit Risk.


LIQUIDITY AND CAPITAL RESOURCES

Three  Months  Ended March 31, 2001 Compared with Three  Months
Ended March 31, 2000

   For    information   concerning   liquidity   and   capital
resources, see Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations in TXU  Europe's
2000 Form 10-K.  Results for the three-month periods presented
herein  are not necessarily indicative of expectations  for  a
full  year's operations because of seasonal and other factors,
including   variations  in  maintenance  and  other  operating
expense patterns. No significant changes or events which might
affect  the  financial condition of TXU Europe  have  occurred
subsequent to year-end other than as disclosed herein.

   Cash  generated  by  operating  activities  was  pounds   28
million for the three months ended March 31, 2001 compared with
pounds  171  million for the same period of 2000.   Cash  flows
provided  by  operating activities before changes in  operating
assets  and  liabilities were pounds 169 million for  the  2001
period  and pounds 106 million for the 2000 period. Changes  in
operating  assets and liabilities used pounds 141  million  for
the  three  months  ended  March 31, 2001  compared  with  cash
provided of pounds 65 million for the same period of 2000.  The
decline  in  cash flow from operating activities  is  primarily
attributable   to   lower  levels  of   receivables   sold   or
collateralized under the receivable securitization program  and
to reduced cash flows from UK operations.

   Cash  used  in investing activities was pounds  102  million
for  the three months ended March 31, 2001 compared with pounds
49  million  for the same period of 2000.  Capital expenditures
were  virtually  the  same  for both periods  at  approximately
pounds  45  million.  In the 2001 period, TXU  Europe  acquired
Kiel  AG  for pounds 145 million and received a net  pounds  97
million from the sale of the North Sea gas assets.

   Cash  used  for  financing activities for the  three  months
ended March 31, 2001 was pounds 364 million compared with  cash
provided of pounds 80 million for the same period of 2000.  For
the  first three months of 2001, long-term debt borrowings were
pounds  40  million  while repayments of  long-term  debt  were
pounds  374 million, primarily for the early repayment  of  the
rent  factoring arrangement (pounds 190 million) and  scheduled
                                22

<PAGE>
payments on certain capital leases. For the three months  ended
March  31,  2000, borrowings of long-term debt were pounds  280
million and repayments were pounds 247 million. There also  was
pounds  95  million  of Preferred Securities  of  a  subsidiary
perpetual trust issued in March 2000.

Financing Arrangements

   See   Notes  6  and  7  to  Financial  Statements  for  more
information concerning available sources of short-term and long-
term financing.

Effect of Inflation

   Because   of   the   relatively  low  level   of   inflation
experienced in the UK, inflation did not have a material impact
on results of operations for the periods presented.

Regulation and Rates

   New   Electricity  Trading  Arrangements  (NETA)  -NETA  was
implemented in the UK on March 27, 2001, replacing the  Pooling
and  Settlement Agreement (the Pool) arrangements for wholesale
electricity trading in England and Wales.  NETA provides  those
companies  wishing to buy and sell electricity the  freedom  to
enter  into directly negotiated contracts instead of having  to
trade  through  the  Pool.  Under the  new  arrangements,  bulk
electricity  is  traded  through a  variety  of  bilateral  and
physical  contracts.   Market  participants  include  not  only
generators  and  suppliers but also  traders,  such  as  energy
wholesalers,    with    physical    positions.     Accordingly,
implementation  of  NETA  has  eliminated  the  Pool.  The  new
arrangements provide mechanisms for near real-time clearing and
settlement  of  differences between  contractual  and  physical
positions  of  those buying, selling, producing  and  consuming
electricity.  A balancing mechanism enables the system operator
(National  Grid  Company) to change levels  of  generation  and
demand  to  near  real-time;  and  a  mechanism  for  imbalance
settlement provides for the settling of the differences between
net  physical  and net contractual position  of  parties.   TXU
Europe  is  currently evaluating what impact the implementation
of  NETA  will  have  on  its financial  position,  results  of
operations or cash flows.


FORWARD-LOOKING STATEMENTS

   This  report  and  other presentations made  by  TXU  Europe
contain  forward-looking  statements  within  the  meaning   of
Section 21E of the Securities Exchange Act of 1934, as amended.
Although  TXU Europe believes that in making any such statement
its  expectations are based on reasonable assumptions, any such
statement  involves  uncertainties  and  is  qualified  in  its
entirety  by  reference to factors contained  in  the  Forward-
Looking  Statements section of Item 7. Management's  Discussion
and  Analysis of Financial Condition and Results of  Operations
in  the 2000 Form 10-K as well as general economic and business
conditions  in  the  UK  and in the service  area  for  Eastern
Electricity which has been opened to competition; unanticipated
changes in interest rates, in rates of inflation, or in foreign
exchange  rates; prevailing governmental, statutory, regulatory
or   administrative  policies  and  initiatives  affecting  TXU
Europe, its subsidiaries or the UK or European electric and gas
utility industries; general industry trends; regulation issues;
power  costs  and  availability; changes in business  strategy,
development  plans  or  vendor relationships;  availability  of
qualified personnel; changes in, or the failure or inability to
comply   with,  governmental  regulations,  including,  without
limitation, environmental regulations; changes in tax laws; and
access  to  adequate transmission facilities to  meet  changing
demands,  among others, that could cause the actual results  of
TXU  Europe to differ materially from those projected  in  such
forward-looking statements.

   Any forward-looking statement speaks only as of the date  on
which such statement is made, and TXU Europe does not undertake
any  obligation  to  update  any forward-looking  statement  to
reflect  events or circumstances after the date on  which  such
statement is made or to reflect the occurrence of unanticipated
                                23

<PAGE>
events.   New factors emerge from time to time and  it  is  not
possible for TXU Europe to predict all of such factors, nor can
it assess the impact of each such factor or the extent to which
any  factor,  or combination of factors, may cause  results  to
differ  materially from those contained in any  forward-looking
statement.
                                24

<PAGE>


Item  3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK

   The  information  required hereunder  is  not  significantly
different  from  the  information as  set  forth  in  Item  7A.
Quantitative  and  Qualitative Disclosures  About  Market  Risk
included  in the 2000 Form 10-K and is therefore not  presented
herein.



PART II.  OTHER INFORMATION


Item 1.    LEGAL PROCEEDINGS

   Legal  Proceedings -  In  February  1997,  the official
government  representative  of  pensioners  (Pensions
Ombudsman) made a final determination against the National Grid
Company plc (National Grid) and its group trustees with respect
to  complaints by two pensioners in National Grid's section  of
the    Electricity   Supply   Pension   Scheme   (ESPS).    The
determination  related to the use of the pension  fund  surplus
resulting  from the March 31, 1992 actuarial valuation  of  the
National  Grid section to meet certain costs arising  from  the
payment of pensions on early retirement upon reorganization  or
downsizing.  This determination was set aside by the High Court
on  June  10, 1997, and the arrangements made by National  Grid
and  its  group  trustees  in dealing  with  the  surplus  were
confirmed.  The  two pensioners appealed this decision  to  the
Court  of Appeal, and judgment was received which endorsed  the
Pensions Ombudsman's determination that the corporation was not
entitled  to unilaterally deal with any surplus. National  Grid
appealed  the decision to the House of Lords and, on  April  4,
2001,  the  appeal was allowed.  The House of Lords found  that
National Grid was entitled to use the surplus funds as they had
done.   As a result of the decision of the House of Lords,  TXU
Europe  considers that the likelihood of a claim of this nature
being made against it to be remote.




Item 6.   EXHIBITS AND REPORTS ON FORM 8-K


 (a)Exhibits filed as a part of Part II are:


 (b)  Reports on Form 8-K filed since December 31, 2000, are as
     follows:


          Date of Report           Item Reported
          --------------           --------------
          None


                                25

<PAGE>





                           SIGNATURES


    Pursuant  to the requirements of the Securities Exchange  Act
of  1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.





                                        TXU EUROPE LIMITED


                                       By   /s/  Paul C. Marsh
                                           ----------------------
                                                 Paul C. Marsh
                                       Principal Financial Officer



                                       By  /s/  Scott R.J. Longhurst
                                          ---------------------------
                                                Scott R.J. Longhurst
                                       Principal Accounting Officer




Date:  May 14, 2001