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This case records the events leading up to the collapse of TXU Europe (TXUE). TXUE was a major vertically integrated UK electricity retail, trading and generation company with subsidiaries across mainland Europe. TXUE was wholly owned by TXU Corporation (formerly Texas Utilities). The case summarises the major events in the life of TXUE over the period from 1990 to 2002. By studying these events, students and instructors can develop an understanding of: (1) the value chain, dynamics and business models of the regulated electricity industry; (2) the impact of regulatory regimes - in particular, how sources of risk changes under different regulatory regimes; (3) how changing industry dynamics affect the profitability and risk of different parts of the value chain; and so (4) the importance of successfully foreseeing and managing those transitions. The case also provides for discussion of the commercial logic behind the strategy and key decisions of TXUE and the strengths and weaknesses of the strategy pursued by TXUE; and the challenges of trans-Atlantic supervision of subsidiaries and governance and horizontal expansion across European borders.