Fitch Upgrades Reliant Energy; Assigns Final Ratings to New Offerings.

NEW YORK -- Reliant Energy, Inc.'s credit ratings have been upgraded by Fitch Ratings as follows:

-- $1.1 billion outstanding senior secured notes to 'BB-' from 'B+';

-- Senior unsecured debt (indicative) to 'B+' from 'B';

-- $275 million outstanding convertible senior subordinated notes to 'B' from 'B-'.

At the same time, Fitch has assigned a final 'BB-' rating to the following new RRI debt issuances:

-- $1.3 billion secured term loan B due 2010;

-- $1.7 billion secured revolving credit facility due 2009;

-- $750 million 6.75% senior secured notes due 2014;

Fitch also assigns a 'BB-' rating to the following issue for Pennsylvania Economic Development Financing Authority (PEDFA):

-- $500 million 6.75% exempt Facilities Revenues Bonds due Dec. 1, 2036.

The bonds relate to RRI's Reliant Energy Seward, LLC (Seward) project, a newly constructed 520 megawatt waste coal generating facility. Principal and interest on the PEDFA bonds will be payable from, and secured by, a pledge of installment payments under a separate loan agreement with Seward which in turn is guarantee by RRI. The RRI guarantee is secured by substantially the same collateral package supporting RRI's corporate senior secured notes and secured credit facilities. The PEDFA bonds consist of the following issuances:

-- $150 million series 2001A;

-- $75 million series 2002A;

-- $75 million series 2002 B;

-- $100 million series 2003A;

-- $100 million series 2004A

The Series 2001A, 2002A , 2002B and 2003A bonds, previously issued in the variable-rate mode, have been re-issued in the long-term interest rate mode and will no longer be supported by letters of credit. Accordingly, Fitch has simultaneously withdrawn the 'AAA/F1+' rating previously assigned to the Series 2001A, 2002A and 2002B bonds that had been based on the letters of credit issued by Westdeutsche Landesbank Girozentrale, as well as the 'AA+/F1+' rating assigned to the series 2003A bonds, previously based on the Barclays Bank PLC letter of credit.

The rating action referenced above reflects the successful conclusion of RRI's global refinancing program and is consistent with Fitch's expected ratings outlined in a press release dated Nov. 29, 2004. The Positive Rating Outlook reflects the expectation that RRI's ongoing cost-saving and balance sheet deleveraging initiatives will result in gradual improvement in consolidated credit measures through 2006, even under a scenario that assumes limited recovery in current wholesale power market conditions and lower levels of retail energy cash flow performance.

For additional information, please refer to the press release dated Nov. 29, 2004, ('Fitch Places Reliant Energy on Rating Watch Positive'), available on the Fitch Ratings website at 'www.fitchratings.com'.