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SEC Filing Details

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

Retail gross margin and economic gross margin
The following is a discussion of gross margin and economic gross margin for Retail.
 
Years ended December 31,
(In millions except otherwise noted)
2016
 
2015
Retail revenue
$
6,100

 
$
6,629

Supply management revenue
154

 
165

Capacity revenues
82

 
116

Customer mark-to-market

 
4

Contract amortization
(1
)
 
(1
)
Other

 

Operating revenue (a)
6,335

 
6,913

Cost of sales (b)
(4,687
)
 
(5,245
)
Mark-to-market for economic hedging activities
365

 
(4
)
  Contract amortization
(6
)
 
(6
)
Gross margin
$
2,007

 
$
1,658

Less: Mark-to-market for economic hedging activities, net
365

 

Less: Contract and emission credit amortization
(7
)
 
(7
)
Economic gross margin
$
1,649

 
$
1,665

Business Metrics
 
 
 
Mass electricity sales volume (GWh) - Gulf Coast
25,102

 
34,600

Mass electricity sales volume (GWh) - All other regions
6,674

 
8,090

C&I electricity sales volume (GWh) All regions
18,906

 
19,342

 Natural gas sales volumes (MDth)
2,199

 
1,901

Average Retail Mass customer count (in thousands)
2,778

 
2,775

Ending Retail Mass customer count (in thousands)
2,818

 
2,755

(a)
Includes intercompany sales of $4 million and $3 million in 2016 and 2015, respectively, representing sales from Retail to the Gulf Coast region.
(b)
Includes intercompany purchases of $850 million and $895 million in 2016 and 2015, respectively.
Retail gross margin increased $350 million and economic gross margin decreased $15 million for the year ended December 31, 2016, compared to the same period in 2015, due to:
 
(In millions)
Higher gross margin due to lower supply costs of $452 million or approximately $7.00 per MWh driven by a decrease in natural gas prices, partially offset by lower rates to customers of $431 million or approximately $6.50 per MWh
$
21

Lower gross margin of $19 million due to the unfavorable impact of selling back excess supply and $3 million in lower margin from a reduction in load of 86,000 MWhs due to milder weather conditions in 2016 as compared to 2015
(22
)
Lower gross margin due to lower volumes driven by lower average customer usage and mix
(14
)
Decrease in economic gross margin
$
(15
)
Increase in mark-to-market for economic hedging primarily due to net unrealized gains/losses on open positions related to economic hedges
365

Increase in gross margin
$
350



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