Print Page  |  Close Window

SEC Filing Details

10-K
NRG ENERGY, INC. filed this Form 10-K on 03/01/2018
Entire Document
 

 
Year Ended December 31, 2015
 
Energy
Revenues
 
Capacity
Revenues
 
Retail
Revenues(f)
 
Mark-to-
Market
Activities
 
Contract Amortization
 
Other
Revenues(e)
 
Total
Operating
Revenues(f)
 
(In millions)
Generation
$
4,072

 
$
1,027

 
$

 
$
(142
)
 
$
15

 
$
207

 
$
5,179

Retail

 

 
6,910

 
4

 
(1
)
 

 
6,913

Renewables
356

 

 

 
(3
)
 

 
30

 
383

NRG Yield
495

 
341

 

 
(2
)
 
(54
)
 
188

 
968

Corporate and Eliminations(f)
(1,056
)
 
(7
)
 
(43
)
 
9

 

 
(18
)
 
(1,115
)
Total
$
3,867

 
$
1,361

 
$
6,867

 
$
(134
)
 
$
(40
)
 
$
407

 
$
12,328

(e)
Primarily consists of revenues generated by the Thermal business (NRG Yield segment), operation and maintenance revenues and unrealized trading activities, primarily at BETM (Generation segment).
(f)
Energy revenues include inter-segment sales primarily between Generation and Retail.
Seasonality and Price Volatility
Annual and quarterly operating results of the Company's wholesale power generation segments can be significantly affected by weather, including wind resource availability, and energy commodity price volatility. Significant other events, such as the demand for natural gas, interruptions in fuel supply infrastructure and relative levels of hydroelectric capacity can increase seasonal fuel and power price volatility. The preceding factors related to seasonality and price volatility are fairly uniform across the Company's wholesale generation business segments.
The sale of electric power to retail customers is also a seasonal business with the demand for power generally peaking during the summer months. As a result, net working capital requirements for the Company's retail operations generally increase during summer months along with the higher revenues, and then decline during off-peak months. Weather may impact operating results and extreme weather conditions could materially affect results of operations. The rates charged to retail customers may be impacted by fluctuations in total power prices and market dynamics like the price of natural gas, transmission constraints, competitor actions, and changes in market heat rates.
Market Framework
Organized Energy Markets in CAISO, ERCOT, ISO-NE, MISO, NYISO and PJM
The majority of NRG's fleet operates in one of the organized energy markets, known as RTOs or ISOs. Each organized market administers day-ahead and real-time centralized bid-based energy and ancillary services markets pursuant to tariffs approved by FERC, or in the case of ERCOT, market rules approved by the PUCT. These tariffs and rules dictate how the energy markets operate, how market participants make bilateral sales with one another, and how entities with market-based rates are compensated. Established prices reflect the value of energy at the specific location and time it is delivered, which is known as the Locational Marginal Price, or LMP. Each market is subject to market mitigation measures designed to limit the exercise of locational market power. These market structures facilitate NRG's sale of power and capacity products at market-based rates.
Other than ERCOT, each of the ISO regions also operates a capacity or resource adequacy market that provides an opportunity for generating and demand response resources to earn revenues to offset their fixed costs that are not recovered in the energy and ancillary services markets. The ISOs are also responsible for transmission planning and operations.
Gulf Coast
NRG's Gulf Coast wholesale power generation business is located in the ERCOT and MISO markets.  The ERCOT market is one of the nation's largest and historically fastest growing power markets.  ERCOT is an energy only market, and has implemented market rule changes to provide pricing more reflective of higher energy value when operating reserves are scarce or constrained.  NRG also operates generation assets that are located within MISO, participating in the MISO day-ahead and real-time energy and ancillary services markets. Additionally, MISO employs a one-year forward resource adequacy construct, in which capacity resources can compete for fixed cost recovery in the capacity auction.  NRG continues to provide full requirements service to LSEs, including cooperatives and municipalities in the MISO region.


23