What changed in this filing

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Item 9A. Controls and Procedures

2024-02-28 compared with 2023-02-23 · 1162 added, 804 removed, 2066 unchanged (49% of the section changed)

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Changes in Internal Control over Financial Reporting

There were no changes in NRG’s internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) that occurred in the fourth quarter of 2022 that materially affected, or are reasonably likely to materially affect, NRG’s internal control over financial reporting.

During the year ended December 31, 2023, the Company completed its acquisition of Vivint Smart Home, Inc.

As part of integration, the Company designed and implemented a control structure over Vivint Smart Home's operations.

Other than the Vivint Smart Home acquisition, there were no changes in NRG’s internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) that occurred in the fourth quarter of 2023 that materially affected, or are reasonably likely to materially affect, NRG’s internal control over financial reporting.

Inherent Limitations over Internal Controls

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Based on the Company's evaluation under the framework in Internal Control — Integrated Framework (2013) , the Company's management concluded that its internal control over financial reporting was effective as of December 31, 2023.

On March 10, 2023, NRG acquired Vivint Smart Home, Inc., and management excluded from its assessment of the effectiveness of the Company's internal control over financial reporting as of December 31, 2023, Vivint Smart Home, Inc.'s internal control over financial reporting associated with total assets (excluding acquired goodwill and intangible assets) of 5% and total revenues of 5% included in the consolidated financial statements of the Company as of and for the year ended December 31, 2023.

The effectiveness of the Company's internal control over financial reporting as of December 31, 2023 has been audited by KPMG LLP, the Company's independent registered public accounting firm, as stated in its report which is included in this Annual Report on Form 10-K.

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In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2022, and the related notes and financial statement schedule II (collectively, the consolidated financial statements), and our report dated February 23, 2023 expressed an unqualified opinion on those consolidated financial statements.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive (loss)/income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes and financial statement schedule II (collectively, the consolidated financial statements), and our report dated February 28, 2024 expressed an unqualified opinion on those consolidated financial statements.

The Company acquired Vivint Smart Home, Inc.

during 2023, and management excluded from its assessment of the effectiveness of the Company's internal control over financial reporting as of December 31, 2023, Vivint Smart Home, Inc.'s internal control over financial reporting associated with total assets (excluding acquired goodwill and intangible assets) of 5% and total revenues of 5% included in the consolidated financial statements of the Company as of and for the year ended December 31, 2023.

Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of Vivint Smart Home, Inc.

Basis for Opinion

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Item 9B — Other Information

Director and Officer Trading Arrangements

During the three months ended December 31, 2023, the following directors or officers of the Company adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement,' as each term is defined in Item 408(a) of Regulation S-K, as described in the table below:

Name Title Date Adopted Character of Trading Arrangement Aggregate Number of Shares of Common Stock to be Purchased or Sold Pursuant to Trading Arrangement (a)

Duration Date Terminated

Elizabeth Killinger Executive Vice President 12/15/2023 Rule 10b5-1 Trading Arrangement 65,583 shares to be Sold (b)

3/15/2024-1/31/2025 N/A

Rasesh Patel Executive Vice President, Smart Home 12/15/2023 Rule 10b5-1 Trading Arrangement Up to 73,638 shares to be Sold

3/14/2024-11/01/2024 N/A

(a) Potential sales may be subject to certain price limitations set forth in the 10b5-1 plans and therefore actual number of shares sold could vary if certain minimum stock prices are not met

(b) Represents approximate number of shares to be sold based on outstanding awards expected to vest during the period, where any underlying performance share awards are being calculated at target.

Actual number of shares to be sold will depend on actual vesting, the number of shares withheld by NRG to satisfy tax withholding obligations and vesting of dividend equivalent rights

Item 9C — Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

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Outstanding Options,

Warrants and Rights

Warrants and Rights (b)

Weighted-Average Exercise

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2,997,640 (1) $ — 14,419,264

Equity compensation plans not approved by security holders

3,970,872 (2) $ — 12,749,736

Total 6,968,512 $ — 27,169,000 (3)

(1) Consists of shares issuable under the NRG LTIP and the ESPP.

The NRG LTIP became effective upon the Company's emergence from bankruptcy.

On April 27, 2017, the NRG LTIP was amended and restated to increase the number of shares available for issuance to 25,000,000.

The ESPP, as amended and restated, was approved by the Company's stockholders on April 27, 2017, and became effective April 28, 2017.

On April 27, 2023, NRG stockholders approved an increase of 4,400,000 shares available for issuance under the ESPP.

As of December 31, 2023, there were 6,702,125 shares reserved from the Company's treasury shares for the ESPP

(2) Consists of 8,179,771 shares of common stock under NRG's LTIP and 2,493,374 shares of treasury stock reserved for issuance under the ESPP

NRG LTIP currently provides for grants of restricted stock units, relative performance stock units, deferred stock units and dividend equivalent rights.

NRG's directors, officers and employees, as well as other individuals performing services for, or to whom an offer of employment has been extended by the Company, are eligible to receive grants under the NRG LTIP.

The purpose of the NRG LTIP is to promote the Company's long-term growth and profitability by providing these individuals with incentives to maximize stockholder value and otherwise contribute to the Company's success and to enable the Company to attract, retain and reward the best available persons for positions of responsibility.

The Compensation Committee of the Board of Directors administers the NRG LTIP.

(2) Consists of shares issuable under the Vivint LTIP.

On March 10, 2023, in connection with the Acquisition, NRG assumed the Vivint Smart Home, Inc.

2020 Omnibus Incentive Plan.

While the Vivint Smart Home, Inc.

2020 Omnibus Incentive Plan was previously approved by stockholders of Vivint Smart Home, Inc., the plan is listed as "not approved" because it was assumed as part of the Acquisition and not subject to approval by NRG stockholders.

The Company intends to make subsequent grants under the Vivint LTIP.

See Note 21, Stock-Based Compensation for a discussion of the Vivint LTIP

(3) Consists of 7,717,139 shares of common stock under the NRG LTIP, 12,749,736 shares of common stock under the Vivint LTIP and 6,702,125 shares of treasury stock reserved for issuance under the ESPP

The NRG LTIP currently provides for grants of restricted stock units, relative performance stock units, deferred stock units and dividend equivalent rights.

The Vivint LTIP currently provides for grants of restricted stock units and performance stock units.

The Company's directors, officers and employees, as well as other individuals performing services for, or to whom an offer of employment has been extended by the Company, are eligible to receive grants under the LTIPs.

The purpose of the LTIPs is to promote the Company's long-term growth and profitability by providing these individuals with incentives to maximize stockholder value and otherwise contribute to the Company's success and to enable the Company to attract, retain and reward the best available persons for positions of responsibility.

The Compensation Committee of the Board of Directors administers the LTIPs.

Other information required by this Item is incorporated by reference to the similarly named section of NRG's Definitive Proxy Statement for its 2024 Annual Meeting of Stockholders.

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Consolidated Statements of Operations — Years ended December 31, 2023, 2022, and 2021

Consolidated Statements of Comprehensive Income — Years ended December 31, 2022, 2021, and 2020

Consolidated Statements of Comprehensive (Loss)/Income — Years ended December 31, 2023, 2022, and 2021

Consolidated Balance Sheets — As of December 31, 2023 and 2022

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We have audited the accompanying consolidated balance sheets of NRG Energy, Inc.

and subsidiaries (the Company) as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive income, stockholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2022, and the related notes and financial statement schedule II (collectively, the consolidated financial statements).

and subsidiaries (the Company) as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive (loss)/income, stockholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes and financial statement schedule II (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2023, in conformity with U.S.

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Evaluation of the sufficiency of audit evidence over revenues

As discussed in Note 3 to the consolidated financial statements, the Company had $ 31.543 billion of revenues.

As discussed in Note 3 to the consolidated financial statements, the Company had $ 28,823 million of revenues.

Revenue is derived from various revenue streams in different geographic markets and the Company’s processes and related information technology (IT) systems used to record revenue differ for each of these revenue streams.

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We, with the assistance of IT professionals, applied auditor judgment to determine the revenue streams over which procedures were performed as well as the nature and extent of such procedures.

For each revenue stream over which procedures were performed, we

evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s revenue recognition processes;

involved IT professionals, who assisted in testing certain IT applications used by the Company in its revenue recognition processes;

and assessed recorded revenue for a selection of transactions by comparing the amounts recognized to underlying documentation, including contracts with customers.

For certain revenue streams over which procedures were performed,

we evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s revenue recognition processes.

For certain revenue streams, we involved IT professionals, who assisted in testing certain IT applications used by the Company in its revenue recognition processes.

In addition, we assessed recorded revenue for a selection of transactions by comparing the amounts recognized to underlying documentation, including contracts with customers, and for certain revenue streams, we performed a software-assisted data analysis to assess certain relationships among revenue transactions.

In addition, we evaluated the sufficiency of audit evidence obtained over revenues by assessing the results of procedures performed, including the appropriateness of such evidence.

Fair value of certain acquired intangible assets

As discussed in Note 4 to the consolidated financial statements, the Company acquired Vivint Smart Home, Inc.

on March 10, 2023 for total consideration of $ 2,623 million.

In connection with the business combination, the Company recorded various intangible assets, which included customer relationships and technology intangible assets with an acquisition-date fair value of $ 1,740 million and $ 860 million, respectively.

We identified the evaluation of the acquisition-date fair value of the customer relationships and technology intangible assets as a critical audit matter.

A high degree of subjective and complex auditor judgment was required to evaluate key assumptions used to value these acquired intangible assets.

We performed sensitivity analyses to determine the key assumptions used to value the intangible assets acquired which required challenging auditor judgment.

Specifically, key assumptions included the customer attrition for the customer relationships intangible asset and the discount rate for the customer relationships and technology intangible assets.

Changes to these assumptions could have had a significant impact on the fair value of such assets.

In addition, valuation professionals with specialized skills and knowledge were needed to assist in the evaluation of the discount rate.

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s acquisition-date valuation process, including controls related to the selection of the customer attrition used in the customer relationships intangible asset and the discount rate used in the customer relationships and technology intangible assets.

We evaluated the customer attrition used by the Company by comparing it to historical attrition experienced by the acquired company and comparable company attrition.

We involved valuation professionals with specialized skills and knowledge, who assisted in evaluating the discount rate by assessing the relative risk profile of the customer relationships and technology intangible assets compared to the required rate of return of all acquired assets in the business combination.

We have served as the Company's auditor since 2004.

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(In millions, except per share amounts) 2023 2022 2021

Total revenues $ 31,543 $ 26,989 $ 9,093

Revenue $ 28,823 $ 31,543 $ 26,989

Operating Costs and Expenses

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Other income, net 47 56 63

Loss on debt extinguishment — ( 77 ) ( 9 )

Gain/(Loss) on debt extinguishment 109 — ( 77 )

Interest expense ( 667 ) ( 417 ) ( 485 )

Total other expense ( 597 ) ( 355 ) ( 482 )

Income Before Income Taxes 1,663 2,859 761

Income tax expense 442 672 251

Net Income $ 1,221 $ 2,187 $ 510

Income Per Share

Weighted average number of common shares outstanding — basic 236 245 245

Income per Weighted Average Common Share — Basic $ 5.17 $ 8.93 $ 2.08

Weighted average number of common shares outstanding — diluted 236 245 246

Income per Weighted Average Common Share — Diluted $ 5.17 $ 8.93 $ 2.07

(Loss)/Income Before Income Taxes ( 213 ) 1,663 2,859

Income tax (benefit)/expense ( 11 ) 442 672

Net (Loss)/Income ( 202 ) 1,221 2,187

Cumulative dividends attributable to Series A Preferred Stock 54 — —

Net (Loss)/Income Available for Common Stockholders $ ( 256 ) $ 1,221 $ 2,187

(Loss)/Income Per Share

Weighted average number of common shares outstanding — basic and diluted 228 236 245

(Loss)/Income per Weighted Average Common Share — Basic and Diluted $ ( 1.12 ) $ 5.17 $ 8.93

See notes to Consolidated Financial Statements

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AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS)/INCOME

For the Year Ended December 31,

(In millions) 2023 2022 2021

Net Income $ 1,221 $ 2,187 $ 510

Other Comprehensive (Loss)/Income, net of tax

Net (Loss)/Income $ ( 202 ) $ 1,221 $ 2,187

Other Comprehensive Income/(Loss), net of tax

Foreign currency translation adjustments

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Defined benefit plans 30 ( 16 ) 85

Other comprehensive (loss)/income ( 51 ) 80 ( 14 )

Comprehensive Income $ 1,170 $ 2,267 $ 496

Other comprehensive income/(loss) 39 ( 51 ) 80

Comprehensive (Loss)/Income $ ( 163 ) $ 1,170 $ 2,267

See notes to Consolidated Financial Statements

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Accounts receivable, net 3,542 4,773

Uplift securitization proceeds receivable from ERCOT — 689

Inventory 607 751

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Total current assets

16,231 10,841

Property, plant and equipment, net 1,763 1,692

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Goodwill 5,079 1,650

Intangible assets, net 2,132 2,511

Customer relationships, net 2,164 943

Other intangible assets, net 1,763 1,189

Nuclear decommissioning trust fund — 838

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Cash collateral received in support of energy risk management activities 84 1,708

Deferred revenue current 720 176

Accrued expenses and other current liabilities 1,642 1,114

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Deferred income taxes 22 134

Deferred revenue non-current 914 10

Other non-current liabilities 947 973

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Stockholders' Equity

Preferred stock;

10,000,000 shares authorized;

650,000 Series A shares issued and outstanding at December 31, 2023 (aggregate liquidation preference $ 650 );

0 shares issued and outstanding at December 31, 2022

Common stock;

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Cash Flows from Operating Activities

Net income $ 1,221 $ 2,187 $ 510

Net (loss)/income $ ( 202 ) $ 1,221 $ 2,187

Adjustments to reconcile net income to net cash provided by operating activities:

Distributions from and equity in earnings of unconsolidated affiliates 7 20 45

Equity in and distributions from (earnings)/losses of unconsolidated affiliates ( 6 ) 7 20

Depreciation and amortization 1,127 634 785

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Amortization of financing costs and debt discounts 52 23 39

Loss on debt extinguishment — 77 9

Amortization of in-the-money contracts and emission allowances 158 106 70

(Gain)/Loss on debt extinguishment ( 109 ) — 77

Amortization of in-the-money contracts and emissions allowances 137 158 106

Amortization of unearned equity compensation 101 28 21

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Changes in nuclear decommissioning trust liability — 9 40

Oil lower of cost or market adjustment — — 29

Uplift securitization proceeds received/(receivable) from ERCOT — 689 ( 689 )

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Other assets and liabilities ( 473 ) ( 161 ) ( 89 )

Cash provided by operating activities $ 360 $ 493 $ 1,837

Cash (used)/provided by operating activities $ ( 221 ) $ 360 $ 493

Cash Flows from Investing Activities

Payments for acquisitions of assets, businesses and leases $ ( 62 ) $ ( 3,559 ) $ ( 284 )

Payments for acquisitions of businesses and assets, net of cash acquired $ ( 2,523 ) $ ( 62 ) $ ( 3,559 )

Capital expenditures ( 598 ) ( 367 ) ( 269 )

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Proceeds from sales of nuclear decommissioning trust fund securities 355 448 710

Proceeds from sale of assets, net of cash disposed and fees 109 830 81

Changes in investments in unconsolidated affiliates — — 2

Proceeds from sale of assets, net of cash disposed 2,007 109 830

Proceeds from insurance recoveries for property, plant and equipment, net 240 — —

Cash used by investing activities $ ( 910 ) $ ( 332 ) $ ( 3,039 )

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Cash Flows from Financing Activities

Net receipts/(payments) from settlement of acquired derivatives that include financing elements $ 1,995 $ 938 $ ( 7 )

Payments for share repurchase activity ( 606 ) ( 48 ) ( 229 )

Payments of dividends to common stockholders ( 332 ) ( 319 ) ( 295 )

Proceeds from issuance of preferred stock, net of fees $ 635 $ — $ —

Net receipts from settlement of acquired derivatives that include financing elements 342 1,995 938

Payments for share repurchase activity (a)

( 1,172 ) ( 606 ) ( 48 )

Payments of dividends to preferred and common stockholders ( 381 ) ( 332 ) ( 319 )

Proceeds from issuance of long-term debt 731 — 1,100

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Payments of debt issuance costs ( 32 ) ( 9 ) ( 18 )

Repayments of Revolving Credit Facility — — ( 83 )

Proceeds from issuance of common stock — — 1

Purchase of and distributions to noncontrolling interests from subsidiaries — — ( 2 )

Cash provided/(used) by financing activities $ 1,043 $ ( 272 ) $ 2,204

Proceeds from credit facilities 3,020 — 1,415

Repayments to credit facilities ( 3,020 ) — ( 1,415 )

Cash (used)/provided by financing activities $ ( 400 ) $ 1,043 $ ( 272 )

Effect of exchange rate changes on cash and cash equivalents 2 ( 3 ) ( 2 )

Net Increase/(Decrease) in Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash 1,068 ( 2,820 ) 3,545

Net (Decrease)/Increase in Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash ( 1,529 ) 1,068 ( 2,820 )

Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash at Beginning of Period 2,178 1,110 3,930

Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash at End of Period $ 649 $ 2,178 $ 1,110

(a) Includes $( 22 ) million, $( 6 ) million and $( 9 ) million of equivalent shares purchased in lieu of tax withholdings on equity compensation issuances for the years ended December 31, 2023, 2022 and 2021, respectively

For further discussion of supplemental cash flow information see Note 26, Cash Flow Information

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(In millions) Common

(In millions) Preferred Stock Common

Stock Additional

Capital Retained Earnings/ (Accumulated Deficit) Treasury

Capital (Accumulated Deficit)/Retained Earnings Treasury

Stock Accumulated

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Balance at December 31, 2020 $ — $ 4 $ 8,517 $ ( 1,403 ) $ ( 5,232 ) $ ( 206 ) $ 1,680

Other comprehensive loss ( 14 ) ( 14 )

Repurchase of partners' equity interest in VIE 18 18

Other comprehensive income 80 80

Shares reissuance for ESPP 1 3 4

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Balance at December 31, 2021 $ — $ 4 $ 8,531 $ 464 $ ( 5,273 ) $ ( 126 ) $ 3,600

Other comprehensive income 80 80

Other comprehensive loss ( 51 ) ( 51 )

Shares reissuance for ESPP 2 4 6

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Equity-based awards activity, net (a)

Issuance of common stock

Common stock dividends and dividend equivalents declared (b)

( 334 ) ( 334 )

Adoption of ASU 2020-06

$ ( 100 ) 57 ( 43 )

Balance at December 31, 2022 $ — $ 4 $ 8,457 $ 1,408 $ ( 5,864 ) $ ( 177 ) $ 3,828

Other comprehensive loss ( 51 ) ( 51 )

( 202 ) ( 202 )

Issuance of Series A Preferred Stock 650 ( 15 ) 635

Other comprehensive income 39 39

Shares reissuance for ESPP 2 6 8

Share repurchases

Share repurchases (c)

( 117 ) ( 1,043 ) ( 1,160 )

Retirement of treasury stock ( 1 ) ( 5,008 ) 5,009 —

Equity-based awards activity, net (a)

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( 352 ) ( 352 )

Adoption of ASU 2020-06 ( 100 ) 57 ( 43 )

Series A Preferred Stock dividends (d)

( 34 ) ( 34 )

Sale of the 44 % equity interest in STP

Balance at December 31, 2023 $ 650 $ 3 $ 3,416 $ 820 $ ( 1,892 ) $ ( 91 ) $ 2,906

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(b) Dividends per common share were $ 1.51 , $ 1.40 and $ 1.30 for each of the years ended December 31, 2023, 2022 and 2021, respectively

(d) Dividend per Series A Preferred Stock was $ 52.96

See notes to Consolidated Financial Statements

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Note 1 — Nature of Business

NRG Energy, Inc., or NRG or the Company, is a consumer services company built on dynamic retail brands.

NRG brings the power of energy to customers by producing and selling energy and related products and services, nation-wide in the U.S.

and Canada in a manner that delivers value to all of NRG's stakeholders.

NRG sells power, natural gas, home and power services, and develops innovative, sustainable solutions, predominately under the brand names NRG, Reliant, Direct Energy, Green Mountain Energy, Stream, and XOOM Energy.

The Company has a customer base that includes approximately 5.4 million Home customers as well as commercial, industrial, and wholesale customers, supported by approximately 16 GW of generation.

On December 6, 2022, NRG and Vivint Smart Home, Inc.

announced the entry into a definitive agreement under which the Company will acquire Vivint, a smart home platform company, in an all-cash transaction.

The acquisition will accelerate the realization of NRG’s consumer-focused growth strategy and create a leading essential home services platform fueled by market-leading brands, unparalleled insights, proprietary technologies and complementary sales channels.

Close of the acquisition is targeted for the first quarter of 2023 and is subject to customary closing conditions.

The Company manages its operations based on the combined results of the retail and wholesale generation businesses with a geographical focus.

NRG Energy, Inc., or NRG or the Company, sits at the intersection of energy and home services.

NRG is a leading energy and home services company fueled by market-leading brands, proprietary technologies, and complementary sales channels.

Across the United States and Canada, NRG delivers innovative, sustainable solutions, predominately under the brand names such as NRG, Reliant, Direct Energy, Green Mountain Energy and Vivint, while also advocating for competitive energy markets and customer choice.

The Company has a customer base that includes approximately 8 million residential consumers in addition to commercial, industrial, and wholesale customers, supported by approximately 13 GW of generation.

The Company's business is segmented as follows:

• Texas, which includes all activity related to customer, plant and market operations in Texas;

• Texas, which includes all activity related to customer, plant and market operations in Texas, other than Cottonwood;

• East, which includes all activity related to customer, plant and market operations in the East;

• West/Services/Other, which includes the following assets and activities:

(i) all activity related to customer, plant and market operations in the West and Canada, (ii) the Services businesses (iii) activity related to the Cottonwood facility, (iv) the remaining renewables activity, including the Company’s equity method investment in Ivanpah Master Holdings, LLC, and (v) activity related to the Company’s equity method investment for the Gladstone power plant in Australia;

(i) all activity related to customer, plant and market operations in the West and Canada, (ii) the Services businesses (iii) activity related to the Cottonwood facility and other investments;

• Vivint Smart Home;

• Corporate activities.

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As such, NRG applies the guidance of ASC 810, Consolidations, or ASC 810, to determine when an entity that is insufficiently capitalized or not controlled through its voting interests, referred to as a VIE, should be consolidated.

The Company identified an error in the previously issued consolidated financial statements for the year ended December 31, 2021 related to the presentation of cash flows associated with certain borrowings and repayments related to the Revolving Credit Facility.

The statement of cash flows for the year ended December 31, 2021 has been adjusted to present on a gross basis the borrowings from the Revolving Credit Facility of $ 1.4 billion and the related repayments of $ 1.4 billion.

The change had no impact to the total cash used by financing activities for the year ended December 31, 2021.

We evaluated the materiality of this error both qualitatively and quantitatively and have concluded it is immaterial to the impacted period.

Winter Storm Uri Uplift Securitization Proceeds

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Measurement of Credit Losses on Financial Instruments , or ASU No.

2016-13, retail trade receivables are reported on the balance sheet net of the allowance for credit losses.

2016-13, retail trade receivables are reported on the balance sheet net of the allowance for credit losses within accounts receivables, net.

Long-term receivables are recorded net in other non-current assets on the consolidated balance sheet.

The Company accrues an allowance for current expected credit losses based on (i) estimates of uncollectible revenues by analyzing accounts receivable aging and current and reasonable forecasts of expected economic factors including, but not limited to, unemployment rates and weather-related events, (ii) historical collections and delinquencies, and (iii) counterparty credit ratings for commercial and industrial customers.

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Beginning balance $ 133 $ 683 $ 67

Acquired balance from Vivint Smart Home 22 — —

Acquired balance from Direct Energy — — 112

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Funds Deposited by Counterparties

Funds deposited by counterparties consist of cash held by the Company as a result of collateral posting obligations from its counterparties.

Funds deposited by counterparties consist of cash held by the Company as a result of collateral posting obligations from its counterparties related to NRG's hedging program.

The decrease in funds deposited by counterparties is driven by the significant decrease in forward positions as a result of decreases in natural gas and power prices compared to December 31, 2022.

Though some amounts are segregated into separate accounts, not all funds are contractually restricted.

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The Company removes fuel oil and coal inventories as they are used in the production of electricity.

Spare parts inventory is valued at weighted average cost.

The Company removes these inventories when they are used for repairs, maintenance or capital projects.

The Company removes spare parts inventories when they are used for repairs, maintenance or capital projects.

The Company expects to recover the natural gas, fuel oil, coal and spare parts costs in the ordinary course of business.

Inventory is valued at the lower of cost or net realizable value with cost being determined on a first in first out basis for finished goods and weighted average cost method for all other inventories.

The Company removes these inventories as they are sold to customers.

The Company removes finished goods inventories as they are sold to customers.

Inventories sold to customers as part of a smart home system are generally capitalized as contract costs.

Sales of inventory are classified as an operating activity in the consolidated statements of cash flows.

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however, impairment adjustments are recorded whenever events or changes in circumstances indicate that their carrying values may not be recoverable.

NRG also classifies nuclear fuel related to the Company's 44 % ownership interest in STP as part of the Company's property, plant, and equipment.

Significant additions or improvements extending asset lives are capitalized as incurred, while repairs and maintenance that do not improve or extend the life of the respective asset are charged to expense as incurred.

Depreciation, other than nuclear fuel, is computed using the straight-line method, while nuclear fuel is amortized based on units of production over the estimated useful lives.

Depreciation, other than nuclear fuel, is computed using the straight-line method, while nuclear fuel was amortized based on units of production over the estimated useful lives.

Certain assets and their related accumulated depreciation amounts are adjusted for asset retirements and disposals with the resulting gain or loss included in cost of operations in the consolidated statements of operations.

For further discussion, see Note 9, Property, Plant and Equipment .

Business Interruption Insurance

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As a result of damage at the Limestone 1 and W.A.

Parish 8 units, the Company recorded business interruption insurance settlements of $ 81 million during the year ended December 31, 2022.

Parish 8 units, the Company recorded business interruption insurance settlements of $ 7 million and $ 81 million during the year ended December 31, 2023 and December 31, 2022, respectively.

Business interruption insurance is recorded to cost of operations in the consolidated statements of operations and cash provided by operating activities in the consolidated statement of cash flows.

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Intangible assets represent contractual rights held by the Company.

The Company recognizes specifically identifiable intangible assets including emission allowances, customer and supply contracts, customer relationships, marketing partnerships, trade names and fuel contracts when specific rights and contracts are acquired.

The Company recognizes specifically identifiable intangible assets including emissions allowances, customer and supply contracts, customer relationships, marketing partnerships, technologies, trade names and fuel contracts when specific rights and contracts are acquired.

These intangible assets are amortized based on expected volumes, expected delivery, expected discounted future net cash flows, straight line or units of production basis.

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they are carried at the lower of cost or fair value and reviewed for impairment in accordance with ASC 360.

For further discussion, see Note 12, Goodwill and Other Intangibles .

In accordance with ASC 350, Intangibles-Goodwill and Other , or ASC 350, the Company recognizes goodwill for the excess cost of an acquired entity over the net value assigned to assets acquired and liabilities assumed.

NRG performs goodwill impairment tests annually, during the fourth quarter, and when events or changes in circumstances indicate that the carrying value may not be recoverable.

The Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

The Company may first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

The more-likely-than-not threshold is defined as having a likelihood of more than 50 percent.

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For further discussion of goodwill impairment losses recognized refer to Note 11, Asset Impairments .

Capitalized Contract Costs

Capitalized contract costs represent the costs directly related and incremental to the origination of new contracts, modification of existing contracts or to the fulfillment of the related subscriber contracts.

These costs include installed products, commissions, other compensation and the cost of installation of new or upgraded customer contracts.

The Company calculates amortization by accumulating all deferred contract costs into separate portfolios based on the initial month of service and amortizes those deferred contract costs on a straight-line basis over the expected period of benefit, consistent with the pattern in which the Company provides services to its customers.

The expected period of benefit for customers is approximately five years .

The Company updates its estimate of the expected period of benefit periodically and whenever events or circumstances indicate that the expected period of benefit could change significantly.

Such changes, if any, are accounted for prospectively as a change in estimate.

Amortization of capitalized contract costs related to fulfillment are included in cost of operations and amortization of capitalized contract costs related to customer acquisition are included in selling, general and administrative costs in the consolidated statements of operations.

Contract costs not directly related and incremental to the origination of new contracts, modification of existing contracts or to the fulfillment of the related subscriber contracts are expensed as incurred.

The Company accounts for income taxes using the liability method in accordance with ASC 740, Income Taxes, or ASC 740, which requires that the Company use the asset and liability method of accounting for deferred income taxes and provide deferred income taxes for all significant temporary differences.

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Cost of fuel is primarily the costs associated with procurement, transportation and storage of natural gas, nuclear fuel, oil and coal to operate the generation portfolio, which is expensed as the fuel is consumed.

Purchased energy primarily relates to purchases to supply the Company's customer base, which includes spot market purchases, as well as contracts of various quantities and durations, including Renewable PPAs with third-party developers, which are accounted for as NPNS (see further discussion in Derivative Instruments below).

Purchased energy primarily relates to purchases to supply the Company's customer base, which includes spot market purchases, as well as contracts of various quantities and durations, including Renewable PPAs with third-party developers, which are primarily accounted for as NPNS (see further discussion in Derivative Instruments below).

Other cost of sales primarily consists of TDSP expenses.

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Transmission and distribution delivery fees are estimated using the same method used for electricity sales and services to retail customers.

In addition, ISO fees are estimated based on historical trends, estimated supply volumes and initial ERCOT ISO settlements.

In addition, ISO fees are estimated based on historical trends, estimated supply volumes and initial ISO settlements.

Volume estimates are then multiplied by the supply rate and recorded as cost of operations in the applicable reporting period.

Vivint Smart Home Flex Pay

Under the Flex Pay plan (“Flex Pay”), offered by Vivint Smart Home, subscribers pay separately for smart home products and services (smart home and security).

The subscriber has the ability to pay for Vivint Smart Home products in the following three ways:

(i) qualified subscribers may finance the purchase through third-party financing providers ("Consumer Financing Program" or “CFP”), (ii) Vivint Smart Home generally offers a limited number of subscribers not eligible for the CFP, but who qualify under Vivint Smart Home underwriting criteria, the option to enter into a retail installment contract directly with Vivint Smart Home or (iii) subscribers may conduct purchases by check, automatic clearing house payments, credit or debit card or by obtaining short term financing (generally no more than six-month installment terms) through Vivint Smart Home.

Although subscribers pay separately for products and services under Flex Pay, the Company has determined that the sale of products and services are one single performance obligation resulting in deferred revenue for the gross amount of products sold.

For products financed through the CFP, gross deferred revenues are reduced by (i) any fees the third-party financing provider (“Financing Provider”) is contractually entitled to receive at the time of loan origination, and (ii) the present value of expected future payments due to the Financing Providers .

Loans are issued on either an installment or revolving basis with repayment terms ranging from 6 to 60 months.

For certain Financing Provider loans:

• Vivint Smart Home pays a monthly fee based on either the average daily outstanding balance of the installment loans, or the number of outstanding loans.

• Vivint Smart Home incurs fees at the time of the loan origination and receives proceeds that are net of these fees.

• Vivint Smart Home also shares liability for credit losses, with Vivint Smart Home being responsible for between 2.6 % and 100 % of lost principal balances.

Due to the nature of these provisions, the Company records a derivative liability ("CFP Derivative") at its fair value when the Financing Provider originates loans to subscribers, which reduces the amount of estimated revenue recognized on the provision of the services.

The derivative liability is reduced as payments are made by Vivint Smart Home to the Financing Provider.

Subsequent changes to the fair value of the derivative liability are realized through other income, net in the consolidated statements of operations.

For further discussion, see Note 6, Accounting for Derivative Instruments and Hedging Activities .

Derivative Instruments

The Company accounts for derivative instruments under ASC 815, which requires the Company to record all derivatives on the balance sheet at fair value and changes in fair value in earnings, unless they qualify for the NPNS exception.

The Company's primary derivative instruments are power and natural gas purchase or sales contracts, fuels purchase contracts and other energy related commodities used to mitigate variability in earnings due to fluctuation in market prices.

The Company's primary derivative instruments are power and natural gas purchase or sales contracts, fuels purchase contracts, the CFP and other energy related commodities used to mitigate variability in earnings due to fluctuation in market prices.

In order to mitigate interest rate risk associated with the issuance of the Company's variable rate debt, NRG enters into interest rate swap agreements.

In addition, in order to mitigate foreign exchange risk associated with the purchase of USD denominated natural gas for the Company's Canadian business, NRG enters into foreign exchange contract agreements.

As of December 31, 2022 and 2021 the Company did not have derivative instruments that were designated as cash flow or fair value hedge.

As of December 31, 2023 and 2022 the Company did not have derivative instruments that were designated as cash flow or fair value hedges.

Revenues and expenses on contracts that qualify for the NPNS exception are recognized when the underlying physical transaction is delivered.

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Operations and Maintenance and Other Cost of Operations

Operations and maintenance costs include major and other routine preventative (planned outage) and corrective (forced outage) maintenance activities to ensure the safe and reliable operation of the Company's generation portfolio in compliance with all local, state and federal requirements.

with all local, state and federal requirements.

Operations and maintenance costs are also costs associated with retaining and maintaining the Company's customer base, such as call center support, portfolio maintenance and data analytics.

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Revenues, expenses, and cash flows are translated at the weighted-average rates of exchange for the period.

The resulting currency translation adjustments are not included in the Company's consolidated statements of operations for the period, but are accumulated and reported as a separate component of

stockholders' equity until sale or complete or substantially complete liquidation of the net investment in the foreign entity takes place.

Foreign currency transaction gains or losses are reported within other income/(expense) in the Company's consolidated statements of operations.

For the years ended December 31, 2022, amounts recognized as foreign currency transaction losses were $( 7 ) million.

The resulting currency translation adjustments are not included in the Company's consolidated statements of operations for the period, but are accumulated and reported as a separate component of stockholders' equity until sale or complete or substantially complete liquidation of the net investment in the foreign entity takes place.

Foreign currency transaction gains or losses are reported within other income, net in the Company's consolidated statements of operations.

For the years ended December 31, 2023, 2022 and 2021, amounts recognized as foreign currency transaction gains/(losses) were immaterial.

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See Note 5, Fair Value of Financial Instruments, for a further discussion of derivative concentrations.

Fair Value of Financial Instruments

The carrying amount of cash and cash equivalents, funds deposited by counterparties, receivables, accounts payable, and accrued liabilities approximate fair value because of the short-term maturity of these instruments.

See Note 5, Fair Value of Financial Instruments, for a further discussion of fair value of financial instruments.

Asset Retirement Obligations

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The Company measures the fair value of its pension assets in accordance with ASC 820, Fair Value Measurements and Disclosures, or ASC 820.

For further discussion, see Note 15, Benefit Plans and Other Postretirement Benefits .

Stock-Based Compensation

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NRG uses the Company's common stock price on the date of grant as the fair value of the Company's deferred stock units.

The fair value of the Company's restricted stock units is derived from the closing price of NRG's common stock at the grant date.

Forfeiture rates are estimated based on an analysis of the Company's historical forfeitures, employment turnover, and expected future behavior.

The Company recognizes compensation expense for both graded and cliff vesting awards on a straight-line basis over the requisite service period for the entire award.

The Company recognizes compensation expense for both graded and cliff

vesting awards on a straight-line basis over the requisite service period for the entire award.

For further discussion, see Note 21, Stock-Based Compensation .

Investments Accounted for by the Equity Method

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Distributions from equity method investments that represent earnings on the Company's investment are included within cash flows from operating activities and distributions from equity method investments that represent a return of the Company's investment are included within cash flows from investing activities.

Tax Equity Arrangements

The Company’s redeemable noncontrolling interest in subsidiaries represented third-party interests in the net assets under certain tax equity arrangements, which were consolidated by the Company, that had been entered into to finance the cost of solar energy systems under operating leases.

The amounts reported as redeemable noncontrolling interests represented the amounts the investors that were party to the tax equity arrangements would hypothetically receive at each balance sheet date under the liquidation provisions of the contractual agreements, assuming the net assets of the funding structures were liquidated at their recorded amounts.

During the first quarter of 2020, the Company repurchased its partners' equity interest, which was the Company's last remaining tax equity arrangement.

For further discussion, see Note 17, Investments Accounted for by the Equity Method and Variable Interest Entities .

Sale-Leaseback Arrangements

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These arrangements are classified as operating leases on the Company's consolidated balance sheets.

See Note 10, Leases, for further discussion.

Marketing and Advertising Costs

The Company expenses its marketing and advertising costs as incurred and includes them within selling, general and administrative expenses.

The Company expenses its marketing and advertising costs as incurred and includes them within selling, general and administrative costs.

The costs of tangible assets used in advertising campaigns are recorded as fixed assets or deferred advertising costs and amortized as advertising costs over the shorter of the useful life of the asset or the advertising campaign.

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Recent Accounting Developments - Guidance Adopted in 2023

ASU 2020-06 — In August 2020, the FASB issued ASU No.

2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) , or ASU 2020-06.

The guidance in ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock.

In addition, ASU 2020-06 improves and amends the related earnings per share guidance.

The Company adopted this standard on January 1, 2022 using the modified retrospective approach.

As a result of the provisions of the amended guidance, the Company recorded a $ 100 million decrease to additional paid-in capital, a $ 57 million decrease to debt discount, a $ 57 million increase to retained earnings, and a $ 14 million decrease to long-term deferred tax liabilities.

The adoption of ASU 2020-06 did not have a material impact on the Company's statements of operations, statements of cash flows or earnings per share amounts.

Recent Accounting Developments - Guidance Not Yet Adopted

ASU 2021-08 — In October 2021, the FASB issued ASU No.

2021-08, Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , or ASU 2021-08.

Under current GAAP, an acquirer generally recognizes assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers and other similar contracts that are accounted for in accordance with ASC 606, Revenue from Contracts with Customers , or ASC 606, at fair value on the acquisition date.

ASU 2021-08 requires that an entity recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606.

At the acquisition date, an acquirer should account for the related revenue contracts in accordance with ASC 606 as if it had originated the contracts, which should generally result in an acquirer recognizing and measuring the acquired contract assets and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements.

This update also provides certain practical expedients for acquirers when recognizing and measuring acquired contract assets and contract liabilities from revenue contracts in a business combination.

The amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years and should be applied prospectively to business combinations occurring on or after the effective date of the amendments.

The Company will evaluate the impacts of the amendments for business combinations occurring after the effective date.

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , or ASU 2021-08, which requires that an entity recognize and measure contract assets and contract liabilities acquired in a business combination as if it had originated the contracts in accordance with ASC 606, Revenue from Contracts with Customers .

As a result, an acquirer should recognize and measuring the acquired contract assets and contract liabilities consistently with how they were recognized and measured in the

acquiree’s financial statements.

The amendments per ASU 2021-08 apply only to contract assets and contract liabilities from contracts with customers, as defined in Topic 606, such as refund liabilities and upfront payments to customers.

Assets and liabilities under related Topics, such as deferred costs under Subtopic 340-40, Other Assets and Deferred Costs — Contracts with Customers, are not within the scope of amendments per ASU 2021-08.

The Company adopted ASU 2021-08 prospectively effective January 1, 2023 and applied the amended requirements to the acquisition of Vivint Smart Home.

Recent Accounting Developments - Guidance Not Yet Adopted

ASU 2023-07 – In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures , or ASU 2023-07.

The guidance in ASU 2023-07 enhances reportable segment disclosure requirements by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit and loss, an amount and description of its composition for other segment items and interim disclosures of a reportable segment’s profit or loss and assets.

The amendments of ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and should be applied retrospectively for all prior periods presented in the financial statements.

The Company is currently evaluating the impact of adopting ASU 2023-07 on its disclosures.

ASU 2023-09 – In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures , or ASU 2023-09.

The guidance in ASU 2023-09 enhances income tax disclosures by requiring disclosure of specific categories in the effective tax rate reconciliation and additional information for reconciling items that meet a quantitative threshold.

Further the amendments of ASU 2023-09 require certain disclosures on income tax expense and income taxes paid.

ASU 2023-09 is effective for annual periods beginning after December 15, 2024, with early adoption permitted.

The amendments of ASU 2023-09 may be applied on a prospective or retrospective basis.

The Company is currently evaluating the impact of adopting ASU 2023-09 on its disclosures.

Note 3 — Revenue Recognition

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Gross revenues for energy sales and services to retail customers are recognized as the Company transfers the promised goods and services to the customer.

Payment terms are generally 15 to 60 days.

For the majority of its electricity and natural gas contracts, the Company’s performance obligation with the customer is satisfied over time and performance obligations for its electricity and natural gas products are recognized as the customer takes possession of the product.

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For the fixed price contracts, the amount of any unsatisfied performance obligations will vary based on customer usage, which will depend on factors such as weather and customer activity and therefore it is not practicable to estimate such amounts.

Vivint Smart Home Retail Revenue

Vivint Smart Home offers its subscribers combinations of smart home products and services, which together create an integrated smart home system that allows the Company's subscribers to monitor, control and protect their homes.

As the products and services included in the subscriber's contract are integrated and highly interdependent, and because the products (including installation) and services must work together to deliver the monitoring, controlling and protection of their home, the Company has concluded that the products and services contracted for by the subscriber are generally not distinct within the context of the contract and, therefore, constitute a single, combined performance obligation.

Revenues for this single, combined performance obligation are recognized on a straight-line basis over the subscriber's contract term, which is the period in which the parties to the contract have enforceable rights and obligations.

The Company has determined that certain contracts that do not require a long-term commitment for monitoring services by the subscriber contain a material right to renew the contract,

because the subscriber does not have to purchase the products upon renewal.

Proceeds allocated to the material right are recognized over the expected period of benefit.

The majority of Vivint Smart Home's subscription contracts are five years and are generally non-cancelable.

These contracts generally convert into month-to-month agreements at the end of the initial term, while some subscribers are month-to-month from inception.

Payment for Vivint Smart Home services is generally due in advance on a monthly basis, with payment terms up to 30 days.

Product sales and other one-time fees are invoiced to subscribers at time of sale.

Revenues for any products or services that are considered separate performance obligations are recognized upon delivery.

Payments received or billed in advance are reported as deferred revenues.

Energy Revenue

Both physical and financial transactions consist of revenues billed to a third-party at either market or negotiated contract terms to optimize the financial performance of the Company's generating facilities.

Payment terms vary from 5 to 55 days.

Electric energy revenue is recognized upon transmission to the customer over time, using the output method for measuring progress of satisfaction of performance obligations.

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The Company applies the invoicing practical expedient in recognizing energy revenue.

Under the practical expedient, revenue is recognized based on the invoiced amount which is equal to the value

to the customer of NRG’s performance obligation completed to date.

Under the practical expedient, revenue is recognized based on the invoiced amount which is equal to the value to the customer of NRG’s performance obligation completed to date.

Financial transactions used to hedge the sale of electricity are recorded net within revenues in the consolidated statements of operations in accordance with ASC 815.

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Capacity Revenue

The Company's largest sources of capacity revenues are capacity auctions in PJM, ISO-NE and NYISO.

The Company's largest sources of capacity revenues are capacity auctions in PJM and NYISO.

Capacity revenues also include revenues billed to a third-party at either market or negotiated contract terms for making installed generation and demand response capacity available in order to satisfy system integrity and reliability requirements.

Payment terms vary from 15 to 55 days.

Capacity revenues are recognized over time, using the output method for measuring progress of satisfaction of performance obligations.

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Performance Obligations

As of December 31, 2022, estimated future fixed fee performance obligations are $ 77 million, $ 23 million, and $ 2 million for fiscal years 2023, 2024, and 2025, respectively.

These performance obligations are for cleared auction MWs in the PJM, NYISO and MISO capacity auctions and are subject to penalties for non-performance.

As of December 31, 2023, estimated future fixed fee performance obligations are $ 1.4 billion, $ 1.0 billion, $ 756 million, $ 468 million and $ 176 million for fiscal years 2024, 2025, 2026, 2027 and 2028, respectively.

These performance obligations include Vivint Smart Home products and services as well as cleared auction MWs in the PJM, NYISO and MISO capacity auctions.

The cleared auction MWs are subject to penalties for non-performance.

Disaggregated Revenue

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(In millions)

Texas East West/Services/Other Corporate/Eliminations Total

Texas East West/Services/Other Vivint Smart Home (a)

Corporate/Eliminations Total

Retail revenue

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10,030 11,946 3,943 1,549 ( 1 ) 27,467

Energy revenue (b)

Energy revenue (c)

77 291 185 — — 553

Capacity revenue (b)

Capacity revenue (c)

— 197 2 — ( 2 ) 197

Mark-to-market for economic hedging activities (c)

Mark-to-market for economic hedging activities (d)

— 57 103 — ( 16 ) 144

Contract amortization — ( 32 ) — — — ( 32 )

Other revenue (b)

Other revenue (c)

369 88 48 — ( 11 ) 494

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Total revenue from contracts with customers $ 10,447 $ 12,166 $ 4,108 $ 1,549 $ ( 14 ) $ 28,256

(a) Home includes Services

(b) The following amounts of retail, energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:

(a) Includes results of operations following the acquisition date of March 10, 2023

(b) Home includes Services and Vivint Smart Home

(c) The following amounts of retail, energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:

(In millions)

Texas East West/Services/Other Corporate/Eliminations Total

Texas East West/Services/Other Vivint Smart Home Corporate/Eliminations Total

Retail revenue $ — $ 74 $ — $ — $ — $ 74

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Other revenue 29 ( 2 ) 22 — ( 1 ) 48

(d) Revenue relates entirely to unrealized gains and losses on derivative instruments accounted for under ASC 815

For the Year Ended December 31, 2022

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Business 3,229 13,768 1,964 — 18,961

Total retail revenue 8,404 11,862 3,296 ( 1 ) 23,561

Energy revenue (c)

Total retail revenue (b)

9,617 15,856 4,250 ( 1 ) 29,722

Capacity revenue (c)

Energy revenue (b)

111 641 466 32 1,250

Mark-to-market for economic hedging activities (d)

Capacity revenue (b)

— 232 40 — 272

Mark-to-market for economic hedging activities (c)

2 ( 30 ) ( 56 ) 1 ( 83 )

Contract amortization — ( 40 ) 1 — ( 39 )

Other revenue (b)(c)

Other revenue (b)

327 104 5 ( 15 ) 421

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(a) Home includes Services

(b) Other Revenue in Texas includes ancillary revenues of $ 1.3 billion driven by high pricing during Winter Storm Uri

(c) The following amounts of energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:

(b) The following amounts of energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:

(In millions)

Texas East West/Services/Other Corporate/Eliminations Total

Retail revenue $ — $ 110 $ — $ — $ 110

Energy revenue — ( 31 ) ( 8 ) 31 ( 8 )

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Other revenue ( 4 ) 2 ( 29 ) ( 1 ) ( 32 )

(d) Revenue relates entirely to unrealized gains and losses on derivative instruments accounted for under ASC 815

For the Year Ended December 31, 2021

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Total retail revenue 8,404 11,862 3,296 ( 1 ) 23,561

Energy revenue (b)

Energy revenue (c)

329 508 371 7 1,215

Capacity revenue (b)

Capacity revenue (c)

— 718 57 — 775

Mark-to-market for economic hedging activities (c)

Mark-to-market for economic hedging activities (d)

( 3 ) ( 88 ) ( 86 ) 13 ( 164 )

Contract amortization — ( 26 ) ( 4 ) — ( 30 )

Other revenue (b)

Other revenue (b)(c)

1,565 51 25 ( 9 ) 1,632

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(a) Home includes Services

(b) The following amounts of energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:

(b) Other Revenue in Texas includes ancillary revenues of $ 1.3 billion driven by high pricing during Winter Storm Uri

(c) The following amounts of energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:

(In millions)

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Other revenue 133 ( 8 ) ( 12 ) — 113

(d) Revenue relates entirely to unrealized gains and losses on derivative instruments accounted for under ASC 815

Contract Balances

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(In millions) December 31, 2023 December 31, 2022

Deferred customer acquisition costs $ 126 $ 133

Capitalized contract costs (a)

Accounts receivable, net - Contracts with customers 3,395 4,704

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Unbilled revenues (included within Accounts receivable, net - Contracts with customers) $ 1,493 $ 1,952

Deferred revenues (a)

(a) Deferred revenues from contracts with customers for the years ended December 31, 2022 and 2021 were approximately $ 175 million and $ 224 million, respectively

Deferred revenues (b)

$ 1,634 $ 186

(a) Amortization of capitalized contract costs for the years ended December 31, 2023, 2022 and 2021 were $ 168 million, $ 86 million and $ 95 million, respectively

(b) Deferred revenues from contracts with customers for the years ended December 31, 2023 and 2022 were approximately $ 1.6 billion and $ 175 million, respectively.

The increase in deferred revenue balances from December 31, 2023 to 2022 was primarily due to the acquisition of Vivint Smart Home

The revenue recognized from contracts with customers during the years ended December 31, 2023 and 2022 relating to the deferred revenue balance at the beginning of each period was $ 168 million and $ 184 million, respectively.

The change in deferred revenue balances during the years ended December 31, 2022 and 2021 was primarily due to the usage of customer bill credits by certain C&I customers, which were as a result of power pricing during Winter Storm Uri.

The Company's customer acquisition costs consist of broker fees, commission payments and other costs that represent incremental costs of obtaining the contract with customers for which the Company expects to recover.

The Company amortizes these amounts over the estimated life of the customer contract.

The change in the revenue recognized from contracts with customers relating to the deferred revenue balances at the beginning of the years ended December 31, 2023 and 2022 was primarily due to the timing difference of when consideration was received and when the performance obligation was transferred.

The Company's capitalized contract costs consist of commission payments, broker fees and other costs that represent incremental costs of obtaining the contract with customers for which the Company expects to recover.

Capitalized contract costs are amortized on a straight-line basis over the expected period of benefit of five years .

As a practical expedient, the Company expenses the incremental costs of obtaining a contract if the amortization period of the asset would have been one year or less.

When the Company receives consideration from the customer that is in excess of the amount due, such consideration is reclassified to deferred revenue, which represents a contract liability.

Generally, the Company will recognize revenue from contract liabilities in the next period as the Company satisfies its performance obligations.

Smart home products and services performance obligations are recognized over the customer's contract term, which is generally three to five years .

Energy contract liabilities are generally recognized to revenue in the next period as the Company satisfies its performance obligations.

Note 4 — Acquisitions and Dispositions

2023 Anticipated Acquisition

2023 Acquisitions

Vivint Smart Home Acquisition

On December 6, 2022, the NRG and Vivint Smart Home, Inc.

announced the entry into a definitive merger agreement under which the Company will acquire Vivint, a smart home platform company, in an all-cash transaction.

The acquisition will accelerate the realization of NRG's consumer-focused growth strategy and create a leading essential home services platform fueled by market-leading brands, unparalleled insights, proprietary technologies and complementary sales channels.

Close of the acquisition is targeted for the first quarter of 2023 and is subject to customary closing conditions.

The Company will pay $ 12 per share, or approximately $ 2.8 billion in cash, and expects to fund the acquisition using proceeds from newly issued debt and preferred equity, drawing on its Revolving Credit Facility and Receivables Securitization Facilities, and through cash on hand.

Additionally, in the first quarter of 2023, NRG increased its Revolving Credit Facility by $ 600 million to meet the additional liquidity requirements related to the acquisition.

On March 10, 2023 (the "Acquisition Closing Date"), the Company completed the acquisition of Vivint Smart Home, Inc., pursuant to the Agreement and Plan of Merger, dated as of December 6, 2022, by and among the Company, Vivint Smart Home, Inc.

and Jetson Merger Sub, Inc., a wholly-owned subsidiary of the Company (“Merger Sub”) pursuant to which Merger Sub merged with and into Vivint Smart Home, Inc., with Vivint Smart Home, Inc.

surviving the merger as a wholly-owned subsidiary of the Company.

Dedicated to redefining the home experience with intelligent products and services, Vivint Smart Home brought approximately two million subscribers to NRG.

Vivint Smart Home's single, expandable platform incorporates artificial intelligence and machine learning into its operating system and its vertically integrated business model includes hardware, software, sales, installation, customer service and technical support and professional monitoring, enabling superior subscriber experiences and a complete end-to-end smart home experience.

The acquisition accelerated the realization of NRG's consumer-focused growth strategy and creates a leading essential home services platform fueled by market-leading brands, unparalleled insights, proprietary technologies and complementary sales channels.

NRG paid $ 12 per share, or approximately $ 2.6 billion in cash.

The Company funded the acquisition using:

• proceeds of $ 724 million from newly issued $ 740 million 7.000 % Senior Secured First Lien Notes due 2033, net of issuance costs and discount;

• proceeds of $ 635 million from newly issued $ 650 million 10.25 % Series A Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock, net of issuance costs;

• proceeds of approximately $ 900 million drawn from its Revolving Credit Facility and Receivables Securitization Facilities;

• cash on hand.

In February 2023, the Company increased its Revolving Credit Facility by $ 600 million to meet the additional liquidity requirements related to the acquisition.

For further discussion, see Note 13, Long-term Debt and Finance Leases.

In connection with the merger agreement, NRG entered into a commitment letter for a senior secured 364-day bridge term loan facility in a principal amount not to exceed $ 2.1 billion for the purposes of financing the Vivint acquisition, paying fees and expenses in connection with the acquisition, and certain other third-party payments in respect of arrangements of Vivint.

Acquisition costs of $ 17 million for the year ended December 31, 2022 are included in acquisition-related transaction and integration costs in the Company's Consolidated Statement of operations.

Acquisition costs of $ 38 million and $ 17 million for the years ended December 31, 2023 and 2022, respectively, are included in acquisition-related transaction and integration costs in the Company's consolidated statement of operations.

The acquisition has been recorded as a business combination under ASC 805, with identifiable assets and liabilities acquired recorded at their estimated Acquisition Closing Date fair value.

The total consideration of $ 2.623 billion includes:

(In millions)

Vivint Smart Home, Inc.

common shares outstanding as of March 10, 2023 of 216,901,639 at $ 12.00 per share

Other Vivint Smart Home, Inc.

equity instruments (Cash out RSUs and PSUs, Stock Appreciation Rights, Private Placement Warrants) 6

Total Cash Consideration $ 2,609

Fair value of acquired Vivint Smart Home, Inc.

equity awards attributable to pre-combination service 14

Total Consideration $ 2,623

The purchase price was allocated as follows as of December 31, 2023:

(In millions)

Current Assets

Cash and cash equivalents $ 120

Accounts receivable, net 60

Inventory 113

Prepayments and other current assets 37

Total current assets 330

Property, plant and equipment, net 49

Operating lease right-of-use assets, net 35

Intangible assets, net (b) :

Customer relationships 1,740

Technology 860

Trade names 160

Sales channel contract 10

Intangible assets, net 2,770

Deferred income taxes 382

Other non-current assets 14

Total other assets 6,695

Total Assets $ 7,074

Current Liabilities

Current portion of long-term debt and finance leases $ 14

Current portion of operating lease liabilities 13

Accounts payable 109

Derivative instruments 80

Deferred revenue current 518

Accrued expenses and other current liabilities 207

Total current liabilities 941

Other Liabilities

Long-term debt and finance leases 2,572

Non-current operating lease liabilities 28

Derivative instruments 32

Deferred income taxes 18

Deferred revenue non-current 837

Other non-current liabilities 23

Total other liabilities 3,510

Total Liabilities $ 4,451

Vivint Smart Home Purchase Price $ 2,623

(a) Goodwill arising from the acquisition is attributed to the value of the platform acquired, cross-selling opportunities, subscriber growth and the synergies expected from combining the operations of Vivint Smart Home with NRG's existing businesses.

None of the goodwill recorded will be deductible for tax purposes

(b) The weighted average amortization period for total amortizable intangible assets is approximately ten years

Fair Value Measurement of Intangible Assets

The fair values of intangible assets as of the Acquisition Closing Date were measured primarily based on significant inputs that are observable and unobservable in the market and thus represent Level 2 and Level 3 measurements, respectively.

Significant inputs were as follows:

Customer relationships – Customer relationships, reflective of Vivint Smart Home’s subscriber base, were valued using an excess earning method of the income approach, and is classified as Level 3.

Under this approach, the Company estimated the present value of expected future cash flows resulting from existing subscriber relationships, considering attrition and charges for contributory assets (such as net working capital, fixed assets, workforce, trade names and technology) utilized in the business, discounted based on the required rate of return on the acquired intangible asset.

The subscriber relationships are amortized to depreciation and amortization, ratably based on discounted future cash flows.

The weighted average amortization period is twelve years .

Technology – Developed technology was valued using a "relief from royalty" method of the income approach, and is classified as Level 3.

Under this approach, the fair value was estimated to be the present value of royalties saved which assumed the value of the asset based on discounted cash flows of the amount that would be paid by a hypothetical market participant had they not owned the asset and instead licensed the asset from another company.

The estimated cash flows from the developed technology considered the obsolescence factor and was discounted based on the required rate of return on the acquired intangible asset.

The developed technology is amortized to depreciation and amortization, ratably based on discounted future cash flows.

The weighted average amortization period is five years .

Trade names – Trade names were valued using a "relief from royalty" method of the income approach, and is classified as Level 3.

Under this approach, the fair value is estimated to be the present value of royalties saved which assumed the value of the asset based on discounted cash flows of the amount that would be paid by a hypothetical market participant had they not owned the asset and instead licensed the asset from another company.

The estimated cash flows from the trade names considered the expected probable use of the asset and was discounted based on the required rate of return on the acquired intangible asset.

The trade names are amortized to depreciation and amortization, on a straight line basis, over an amortization period of ten years .

Fair Value Measurement of Acquired Vivint Smart Home Debt

The Company acquired $ 2.7 billion in aggregate principal of Vivint Smart Home’s 2027 Senior Secured Notes, 2029 Senior notes and 2028 Senior Secured Term Loan (together, the "Acquired Vivint Smart Home Debt") which were recorded at fair value as of the Acquisition Closing Date.

The difference between the fair value at the Acquisition Closing Date and the principal outstanding of the Acquired Vivint Smart Home Debt, of $ 152 million, is being amortized through interest expense over the remaining term of the debt.

The Acquired Vivint Smart Home Debt is classified as Level 2 and were measured at fair value using observable market inputs based on interest rates at the Acquisition Closing Date.

For additional discussion, see Note 13, Long-term Debt and Finance Leases.

Fair Value Measurement of Derivatives Liabilities

The derivative liabilities are recorded in connection with the contractual future payment obligations with the financing providers under Vivint Smart Home’s Consumer Financing Program.

The fair values of the derivatives liabilities as of the Acquisition Closing Date were valued using a discounted cash flow model, with inputs consisting of available market data, such as market yield discount rates, as well as unobservable internally derived assumptions, such as collateral prepayment rates, collateral default rates and credit loss rates.

These derivatives are classified as Level 3 and changes to the fair value are recorded through other income, net in the consolidated statement of operations.

For additional discussion, see Note 6, Accounting for Derivative Instruments and Hedging Activities.

Supplemental Pro Forma Financial Information

The following table provides unaudited pro forma combined financial information of NRG and Vivint Smart Home, after giving effect to the Vivint Smart Home acquisition and related financing transactions as if they had occurred on January 1, 2021.

The pro forma financial information has been prepared for illustrative and informational purposes only, and is not intended to project future operating results or be indicative of what the Company's financial performance would have been had the transactions occurred on the date indicated.

No effect has been given to prospective operating synergies.

For the Year Ended December 31,

(In millions) 2023 2022 2021

Total operating revenues $ 29,109 $ 33,225 $ 28,468

Net (loss)/income ( 3 ) 1,136 1,574

Amounts above reflect certain pro forma adjustments that were directly attributable to the Vivint Smart Home acquisition.

These adjustments include the following:

(i) Income statement effects of fair value adjustments based on the purchase price allocation including amortization of intangible assets, reversal of historical Vivint Smart Home amortization of capitalized contract costs and reversal of historical Vivint Smart Home other income recorded for the change in fair value of warrant derivative liabilities, as the warrants are assumed to be cashed out upon the Acquisition Closing Date.

(ii) One-time expenses directly related to the acquisition.

(iii) Adjustments to reflect all acquisition and related transactions costs in the year ended December 31, 2021.

(iv) Interest expense assumes the financing transactions directly attributable to the Vivint Smart Home acquisition occurred on January 1, 2021.

(v) Adjustments related to recording Vivint Smart Home's historical debt at Acquisition Closing Date fair value.

(vi) Adjustments to reflect the write-off of short-term deferred financing costs related to the bridge facility put in place for the acquisition prior to securing permanent financing during the year ended December 31, 2021 instead of the year ended December 31, 2023.

(vii) Income tax effect of the acquisition accounting adjustments and financing adjustments (adjusted for permanent book/tax differences) based on combined blended federal/state tax rate for all periods presented.

2021 Acquisitions

Direct Energy Acquisition

On January 5, 2021, the Company acquired all of the issued and outstanding common shares of Direct Energy, which had been a North American subsidiary of Centrica.

On January 5, 2021, the Company acquired all of the issued and outstanding common shares of Direct Energy, which had been a North American subsidiary of Centrica plc.

Direct Energy is a leading retail provider of electricity, natural gas, and home and business energy related products and services in North America, with operations in all 50 U.S.

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The Company paid an aggregate purchase price of $ 3.625 billion in cash and total purchase price adjustment of $ 99 million, resulting in an adjusted purchase price of $ 3.724 billion.

Acquisition costs of $ 25 million and $ 17 million for the years ended December 31, 2021 and 2020, respectively, are included in acquisition-related transaction and integration costs in the Company's consolidated statement of operations.

Acquisition costs of $ 25 million for the year ended December 31, 2021 are included in acquisition-related transaction and integration costs in the Company's consolidated statement of operations.

The acquisition has been recorded as a business combination under ASC 805 with identifiable assets acquired and liabilities assumed recorded at their estimated fair values on the acquisition date.

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Total current assets 3,510

(In millions)

Property, plant and equipment, net 151

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(b) As of January 5, 2021, the weighted average amortization period for total amortizable intangible assets was 12 years

2020 Acquisitions

Midwest Generation Lease Purchase

On September 29, 2020, Midwest Generation acquired all of the ownership interests in the Powerton facility and Units 7 and 8 of the Joliet facility, which were being leased through 2034 and 2030, respectively, for approximately $ 260 million.

The purchase was funded with cash-on-hand.

Upon closing, lease expense related to these facilities, which totaled approximately $ 14 million in 2019, and the operating lease liability of $ 148 million were eliminated.

2023 Dispositions

Sale of the 44 % equity interest in STP

On November 1, 2023, the Company closed on the sale of its 44 % equity interest in STP to Constellation Energy Generation ("Constellation").

Proceeds of $ 1.75 billion were reduced by working capital and other adjustments of $ 96 million, resulting in net proceeds of $ 1.654 billion.

The Company recorded a gain on the sale of $ 1.2 billion within the Texas region of operations.

For discussion of the litigation matter related to the transaction, see Note 23, Commitments and Contingencies.

The Company recorded income before income taxes from its 44 % equity interest in STP as follows:

For the Year Ended December 31,

(In millions) 2023 2022 2021

Income before income taxes (a)

$ 206 $ 362 $ 829

(a) Excludes the impact of the Company's hedges at the portfolio level

Sale of Gregory

On October 2, 2023, the Company closed on the sale of its 100 % ownership in the Gregory natural gas generating facility in Texas for $ 102 million.

The Company recorded a gain on the sale of $ 82 million .

Sale of Astoria

On January 6, 2023, the Company closed on the sale of land and related assets from the Astoria site, within the East region of operations, for initial proceeds of $ 212 million, subject to transaction fees of $ 3 million and certain indemnifications.

As part of the transaction, NRG entered into an agreement to lease the land back for the purpose of operating the Astoria gas turbines through the planned April 30, 2023 retirement date.

The operating lease agreement is expected to end six months after the facility's actual retirement date.

On January 6, 2023, the Company closed on the sale of land and related generation assets from the Astoria site, within the East region of operations, for proceeds of $ 212 million, subject to transaction fees of $ 3 million and certain indemnifications, resulting in a $ 199 million gain.

As part of the transaction, NRG entered into an agreement to lease the land back for the purpose of operating the Astoria gas turbines.

Decommissioning was completed in December 2023 and the lease agreement has been terminated.

2022 Dispositions

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NRG recognized a gain on the sale of $ 17 million, including cash disposed of $ 7 million.

2020 Dispositions

Sale of Home Solar

In the third quarter of 2020, the Company concluded its Home Solar business was held for sale and recorded an impairment loss of $ 29 million, as further discussed in Note 11, Asset Impairments .

On November 13, 2020, the Company completed the sale of the Home Solar business for cash proceeds of $ 66 million, resulting in a $ 2 million loss on the sale.

In connection with the sale, the Company extinguished debt of $ 27 million and recognized a $ 5 million loss on the extinguishment.

Note 5 — Fair Value of Financial Instruments

For cash and cash equivalents, funds deposited by counterparties, restricted cash, accounts and other receivables, accounts payable, restricted cash, and cash collateral paid and received in support of energy risk management activities, the carrying amount approximates fair value because of the short-term maturity of those instruments and are classified as Level 1 within the fair value hierarchy.

For cash and cash equivalents, funds deposited by counterparties, restricted cash, accounts and other receivables, accounts payable and cash collateral paid and received in support of energy risk management activities, the carrying amount approximates fair value because of the short-term maturity of those instruments and are classified as Level 1 within the fair value hierarchy.

The estimated carrying value and fair value of the Company's long-term debt, including current portion, is as follows:

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(a) Excludes deferred financing costs, which are recorded as a reduction to long-term debt on the Company's consolidated balance sheets

The fair value of the Company's long-term debt is based on quoted market prices and is classified as Level 2 within the fair value hierarchy.

The fair value of the Company's publicly-traded long-term debt and the Vivint Smart Home Senior Secured Term Loan are based on quoted market prices and are classified as Level 2 within the fair value hierarchy.

Fair Value Accounting under ASC 820

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Recurring Fair Value Measurements

Debt securities, equity securities, and trust fund investments, which are comprised of various U.S.

debt and equity securities, and derivative assets and liabilities, are carried at fair market value.

Derivative assets and liabilities, debt securities, equity securities and trust fund investments, which were comprised of various U.S.

debt and equity securities, are carried at fair market value.

The following tables present assets and liabilities measured and recorded at fair value on the Company's consolidated balance sheets on a recurring basis and their level within the fair value hierarchy:

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$ 21 $ — $ 21 $ —

Nuclear trust fund investments:

Cash and cash equivalents 15 15 — —

government and federal agency obligations 86 84 2 —

Federal agency mortgage-backed securities 101 — 101 —

Commercial mortgage-backed securities 35 — 35 —

Corporate debt securities 114 — 114 —

Equity securities 403 403 — —

Foreign government fixed income securities 1 — 1 —

Other trust fund investments (classified within other non-current assets):

government and federal agency obligations 1 1 — —

Derivative assets:

Interest rate contracts 12 — 12 —

Foreign exchange contracts 5 — 5 —

Commodity contracts 6,138 1,334 4,470 334

Measured using net asset value practical expedient:

Equity securities - nuclear trust fund investments 83

Equity securities (classified within other non-current assets) 6

Equity securities measured using net asset value practical expedient (classified within other non-current assets) 6

$ 6,182 $ 1,334 $ 4,508 $ 334

Derivative liabilities:

Interest rate contracts $ 8 $ — $ 8 $ —

Foreign exchange contracts 9 — 9 —

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5,356 1,413 3,728 215

Consumer Financing Program 134 — — 134

Total liabilities $ 5,507 $ 1,413 $ 3,745 $ 349

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(In millions) Total Level 1 Level 2 Level 3

Investments in securities (classified within other current or non-current assets) $ 32 $ 15 $ 17 $ —

Investments in securities (classified within other current and non-current assets) $ 19 $ — $ 19 $ —

Nuclear trust fund investments:

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Total liabilities $ 8,441 $ 1,244 $ 6,451 $ 746

The following table reconciles, for the years ended December 31, 2022 and 2021, the beginning and ending balances for financial instruments that are recognized at fair value in the consolidated financial statements using significant unobservable inputs:

The following table reconciles, for the years ended December 31, 2023 and 2022, the beginning and ending balances for financial instruments that are recognized at fair value in the consolidated financial statements using significant unobservable inputs, for commodity derivatives:

Fair Value Measurement Using Significant Unobservable Inputs (Level 3)

Derivatives (a)

Commodity Derivatives (a)

For the Year Ended December 31,

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Beginning balance $ 505 $ 293

Contracts added from Direct Energy acquisition

Total gains realized/unrealized included in earnings

Total (losses)/gains realized/unrealized included in earnings

Purchases 42 ( 110 )

Transfers into Level 3 (b)

Transfers out of Level 3 (b)

Transfers out of Level 3 (b)(c)

Ending balance $ 119 $ 505

Gains for the period included in earnings attributable to the change in unrealized gains or losses relating to assets or liabilities still held as of year-end $ 204 $ 120

(a) Consists of derivatives assets and liabilities, net

(b) Transfers into/out of Level 3 are related to the availability of external broker quotes, and are valued as of the end of the reporting period.

(Losses)/gains for the period included in earnings attributable to the change in unrealized gains or losses relating to assets or liabilities still held as of year-end $ ( 46 ) $ 204

(a) Consists of derivatives assets and liabilities, net, excluding derivative liabilities from Consumer Financing Program, which are presented in a separate table below

(b) Transfers into/out of Level 3 are related to the availability of consensus pricing and external broker quotes, and are valued as of the end of the reporting period.

All transfers into/out of Level 3 are from/to Level 2

Realized and unrealized gains and losses included in earnings that are related to the energy derivatives are recorded in revenues and cost of operations.

(c) For the year ended December 31, 2023, due to the change to use consensus pricing, there was a decrease in the number of contracts valued with prices provided by models and other valuation techniques, which resulted in a large transfer out of Level 3

Realized and unrealized gains and losses included in earnings that are related to the commodity derivatives are recorded in revenues and cost of operations.

The following table reconciles, for the year ended December 31, 2023, the beginning and ending balances of the contractual obligations from the Consumer Financing Program that are recognized at fair value in the condensed consolidated financial statements, using significant unobservable inputs:

Fair Value Measurement Using Significant Unobservable Inputs (Level 3)

Consumer Financing Program

(In millions) For the Year Ended December 31, 2023

Beginning balance $ —

Contractual obligations added from the acquisition of Vivint Smart Home

New contractual obligations ( 68 )

Settlements 62

Total losses included in earnings ( 16 )

Ending balance $ ( 134 )

Gains and losses that are related to the Consumer Financing Program derivative are recorded in other income, net.

Non-derivative fair value measurements

The trust fund investments are held primarily to satisfy NRG's nuclear decommissioning obligations.

These trust fund investments hold debt and equity securities directly and equity securities indirectly through commingled funds.

The fair values of equity securities held directly by the trust funds are based on quoted prices in active markets and are categorized in Level 1.

For the year ended December 31, 2022 and through the sale of STP on November 1, 2023, the trust fund investments were held primarily to satisfy NRG's nuclear decommissioning obligations.

These trust fund investments held debt and equity securities directly and equity securities indirectly through commingled funds.

The fair values of equity securities held directly by the trust funds were based on quoted prices in active markets and were categorized in Level 1.

In addition, U.S.

government and federal agency obligations are categorized as Level 1 because they trade in a highly liquid and transparent market.

The fair values of corporate debt securities are based on evaluated prices that reflect observable market information, such as actual trade information of similar securities, adjusted for observable differences and are categorized in Level 2.

Certain equity securities, classified as commingled funds, are analogous to mutual funds, are maintained by investment companies, and hold certain investments in accordance with a stated set of fund objectives.

The fair value of the equity securities classified as commingled funds are based on net asset values per fund share (the unit of account), derived from the quoted prices in active markets of the underlying equity securities.

However, because the shares in the commingled funds are not publicly quoted and not traded in an active market, the commingled funds are measured using net asset value practical expedient.

government and federal agency obligations were categorized as Level 1 because they traded in a highly liquid and transparent market.

The fair values of corporate debt securities were based on evaluated prices that reflected observable market information, such as actual trade information of similar securities, adjusted for observable differences and were categorized in Level 2.

Certain equity securities, classified as commingled funds, were analogous to mutual funds, were maintained by investment companies, and held certain investments in accordance with a stated set of fund objectives.

The fair value of the equity securities classified as commingled funds were based on net asset values per fund share (the unit of account), derived from the quoted prices in active markets of the underlying equity securities.

However, because the shares in the commingled funds were not publicly quoted and not traded in an active market, the commingled funds were measured using net asset value practical expedient.

See also Note 7, Nuclear Decommissioning Trust Fund.

Derivative fair value measurements

A portion of the Company's contracts are exchange-traded contracts with readily available quoted market prices.

A majority of NRG's contracts are non-exchange-traded contracts valued using prices provided by external sources, primarily price quotations available through brokers or over-the-counter and on-line exchanges.

For the majority of NRG markets, the Company receives quotes from multiple sources.

To the extent that NRG receives multiple quotes, the Company's prices reflect the average of the bid-ask mid-point prices obtained from all sources that NRG believes provide the most liquid market for the commodity.

If the Company receives one quote, then the mid-point of the bid-ask spread for that quote is used.

The Company's contracts consist of non-exchange-traded contracts valued using prices provided by external sources and exchange-traded contracts with readily available quoted market prices.

Beginning in of the fourth quarter of 2023 and as of December 31, 2023, the fair value of non-exchange traded contracts were based on consensus pricing provided by independent pricing services.

The pricing data was compiled from market makers with longer dated tenors as compared to broker quotes, enhancing reliability and increasing transparency.

Prior to the fourth quarter of 2023, the Company valued derivatives based on price quotes from brokers in active markets who regularly facilitate those transactions.

For the majority of markets that NRG participates in, the Company would receive broker quotes from multiple sources and reflected the average of the bid-ask mid-point prices.

The terms for which such price information is available vary by commodity, region and product.

A significant portion of the fair value of the Company's derivative portfolio is based on price quotes from brokers in active markets who regularly facilitate those transactions and the Company believes such price quotes are executable.

The Company does not use third-party sources that derive price based on proprietary models or market surveys.

The Company believes both sources of price quotes are executable.

The remainder of the assets and liabilities represents contracts for which external sources or observable market quotes are not available.

These contracts are valued based on various valuation techniques including but not limited to internal models based on a fundamental analysis of the market and extrapolation of observable market data with similar characteristics.

Contracts valued with prices provided by models and other valuation techniques make up 10 % of derivative assets and 9 % of derivative liabilities.

As of December 31, 2023, contracts valued with prices provided by models and other valuation techniques make up 5 % of derivative assets and 6 % of derivative liabilities.

As a result of NRG switching to consensus pricing as of December 31, 2023, there was a significant decrease in the number of contracts valued with prices provided by models and other valuation techniques.

The fair value of each contract is discounted using a risk free interest rate.

In addition, the Company applies a credit reserve to reflect credit risk, which for foreign exchange contracts is calculated utilizing the bilateral method based on published default probabilities.

In addition, the Company applies a credit reserve to reflect credit risk, which for foreign exchange contracts and interest rate swaps is calculated utilizing the bilateral method based on published default probabilities.

For commodities, to the extent that NRG's net exposure under a specific master agreement is an asset, the Company uses the counterparty's default swap rate.

If the exposure under a specific master agreement is a liability, the Company uses NRG's default swap rate.

For foreign exchange contracts and commodities, the credit reserve is added to the discounted fair value to reflect the exit price that a market participant would be willing to receive to assume NRG's liabilities or that a market participant would be willing to pay for NRG's assets.

For foreign exchange contracts, interest rate swaps, and commodities, the credit reserve is added to the discounted fair value to reflect the exit price that a market participant would be willing to receive to assume NRG's liabilities or that a market participant would be willing to pay for NRG's assets.

As of December 31, 2023, the credit reserve resulted in a $ 18 million decrease primarily within cost of operations.

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Management uses its best estimates to determine the fair value of commodity and derivative contracts NRG holds and sells.

These estimates consider various factors including closing exchange and over-the-counter price quotations, time value, volatility factors and credit exposure.

These estimates consider various factors including closing exchange, consensus and over-the-counter price quotations, time value, volatility factors and credit exposure.

It is possible, however, that future market prices could vary from those used in recording assets and liabilities from energy marketing and trading activities and such variations could be material.

NRG's significant positions classified as Level 3 include physical and financial natural gas and power contracts executed in illiquid markets as well as financial transmission rights, or FTRs.

NRG's significant positions classified as Level 3 include physical and financial natural gas, power, capacity contracts and renewable energy certificates executed in illiquid markets as well as financial transmission rights ("FTRs").

The significant unobservable inputs used in developing fair value include illiquid natural gas and power location pricing, which is derived as a basis to liquid locations.

The basis spread is based on observable market data when available or derived from historic prices and forward market prices from similar observable markets when not available.

Forward capacity prices are based on market information, forecasted future electricity demand and supply, past auctions and internally developed pricing models.

Renewable energy certificate prices are based on market information and internally developed pricing models.

For FTRs, NRG uses the most recent auction prices to derive the fair value.

The Consumer Financing Program derivatives are valued using a discounted cash flow model, with inputs consisting of available market data, such as market yield discount rates, as well as unobservable internally derived assumptions, such as collateral prepayment rates, collateral default rates and credit loss rates.

The following tables quantify the significant unobservable inputs used in developing the fair value of the Company's Level 3 positions as of December 31, 2023 and 2022:

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Fair Value Input/Range

(In millions) Assets Liabilities Valuation Technique Significant Unobservable Input Low High Weighted Average

(in millions, except as noted) Assets Liabilities Valuation Technique Significant Unobservable Input Low High Weighted Average

Natural Gas Contracts $ 39 $ 65 Discounted Cash Flow Forward Market Price ($ per MMBtu) $ 1 $ 15 $ 3

Power Contracts 197 66 Discounted Cash Flow Forward Market Price ($ per MWh) 1 210 47

Capacity Contracts 21 33 Discounted Cash Flow Forward Market Price ($ per MW/Day) 49 658 285

Renewable Energy Certificates 58 14 Discounted Cash Flow Forward Market Price ($ per Certificate) 2 320 15

FTRs 19 37 Discounted Cash Flow Auction Prices ($ per MWh) ( 58 ) 252 0

$ 1,251 $ 746

Consumer Financing Program — 134 Discounted Cash Flow Collateral Default Rates 0.43 % 93.30 % 8.12 %

Discounted Cash Flow Collateral Prepayment Rates 2.00 % 3.00 % 2.95 %

Discounted Cash Flow Credit Loss Rates 6.00 % 60.00 % 12.57 %

Significant Unobservable Inputs

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Fair Value Input/Range

(In millions) Assets Liabilities Valuation Technique Significant Unobservable Input Low High Weighted Average

(in millions, except as noted) Assets Liabilities Valuation Technique Significant Unobservable Input Low High Weighted Average

Natural Gas Contracts $ 340 $ 448 Discounted Cash Flow Forward Market Price ($ per MMBtu) $ 2 $ 48 $ 6

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FTRs 68 82 Discounted Cash Flow Auction Prices ($ per MWh) ( 32 ) 610 0

$ 1,251 $ 746

The following table provides sensitivity of fair value measurements to increases/(decreases) in significant unobservable inputs as of December 31, 2023 and 2022:

Significant Unobservable Input Position Change In Input Impact on Fair Value Measurement

Forward Market Price Natural Gas/ Power Buy Increase/(Decrease) Higher/(Lower)

Forward Market Price Natural Gas/Power Sell Increase/(Decrease) Lower/(Higher)

Forward Market Price Natural Gas/Power/Capacity/Renewable Energy Certificates Buy Increase/(Decrease) Higher/(Lower)

Forward Market Price Natural Gas/Power/Capacity/Renewable Energy Certificates Sell Increase/(Decrease) Lower/(Higher)

FTR Prices Buy Increase/(Decrease) Higher/(Lower)

FTR Prices Sell Increase/(Decrease) Lower/(Higher)

Collateral Default Rates n/a Increase/(Decrease) Higher/(Lower)

Collateral Prepayment Rates n/a Increase/(Decrease) Lower/(Higher)

Credit Loss Rates n/a Increase/(Decrease) Higher/(Lower)

Under the guidance of ASC 815, entities may choose to offset cash collateral posted or received against the fair value of derivative positions executed with the same counterparties under the same master netting agreements.

The Company has chosen not to offset positions as defined in ASC 815.

As of December 31, 2022, the Company recorded $ 260 million of cash collateral posted and $ 1.7 billion of cash collateral received on its balance sheet.

As of December 31, 2023, the Company recorded $ 441 million of cash collateral posted and $ 84 million of cash collateral received on its balance sheet.

Concentration of Credit Risk

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The Company seeks to mitigate counterparty risk by having a diversified portfolio of counterparties.

Company also has credit protection within various agreements to call on additional collateral support if and when necessary.

The Company also has credit protection within various agreements to call on additional collateral support if and when necessary.

Cash margin is collected and held at the Company to cover the credit risk of the counterparty until positions settle.

Counterparty Credit Risk

As of December 31, 2022, counterparty credit exposure, excluding credit exposure from RTOs, ISOs, and registered commodity exchanges and certain long-term agreements, was $ 2.7 billion and NRG held collateral (cash and letters of credit) against those positions of $ 1.0 billion, resulting in a net exposure of $ 1.7 billion.

As of December 31, 2023, counterparty credit exposure, excluding credit exposure from RTOs, ISOs, and registered commodity exchanges and certain long-term agreements, was $ 1.6 billion and NRG held collateral (cash and letters of credit) against those positions of $ 426 million, resulting in a net exposure of $ 1.2 billion.

NRG periodically receives collateral from counterparties in excess of their exposure.

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Non-Investment grade/Non-Rated 56

(a) Counterparty credit exposure excludes uranium and coal transportation contracts because of the unavailability of market prices

(a) Counterparty credit exposure excludes coal transportation contracts because of the unavailability of market prices

(b) The figures in the tables above exclude potential counterparty credit exposure related to RTOs, ISOs, registered commodity exchanges and certain long term contracts

The Company currently has no exposure to wholesale counterparties in excess of 10 % of the total net exposure discussed above as of December 31, 2022.

The Company currently has exposure to one wholesale counterparty in excess of 10 % of the total net exposure discussed above as of December 31, 2023.

Changes in hedge positions and market prices will affect credit exposure and counterparty concentration.

During Winter Storm Uri, in February 2021, the Company experienced nonperformance by a counterparty in one of its bilateral financial hedging transactions, resulting in exposure of $ 403 million.

During December 2022, the Company received $ 70 million as part of the Company's loss mitigation efforts related to this exposure.

RTOs and ISOs

The Company participates in the organized markets of CAISO, ERCOT, AESO, IESO, ISO-NE, MISO, NYISO and PJM, known as RTOs or ISOs.

Trading in the majority of these markets is approved by FERC, whereas in the case of ERCOT, it is approved by the PUCT, and whereas in the case of AESO and IESO, both exist provincially with AESO primarily subject to Alberta Utilities Commission and the IESO to the Ontario Energy Board.

These ISOs may include credit policies that, under certain circumstances, require that losses arising from the default of one member on spot market transactions be shared by the remaining participants.

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As external sources or observable market quotes are not always available to estimate such exposure, the Company values these contracts based on various techniques including, but not limited to, internal models based on a fundamental analysis of the market and extrapolation of observable market data with similar characteristics.

Based on these valuation techniques, as of December 31, 2022, aggregate credit risk exposure managed by NRG to these counterparties was approximately $ 1.1 billion for the next five years.

Based on these valuation techniques, as of December 31, 2023, aggregate credit risk exposure managed by NRG to these counterparties was approximately $ 882 million for the next five years.

Retail Customer Credit Risk

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Current economic conditions may affect the Company's customers' ability to pay bills in a timely manner, which could increase customer delinquencies and may lead to an increase in credit losses.

The Company's provision for credit losses was $ 11 million, $ 698 million, and $ 108 million for the years ending December 31, 2022, 2021, and 2020, respectively.

The Company's provision for credit losses was $ 251 million, $ 11 million, and $ 698 million for the years ended December 31, 2023, 2022, and 2021, respectively.

During the year ended December 31, 2022, the provision for credit losses included the Company's loss mitigation efforts recognized as income of $ 126 million related to Winter Storm Uri.

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Certain derivative instruments may qualify for the NPNS exception and are therefore exempt from fair value accounting treatment.

ASC 815 applies to NRG's energy related commodity contracts and foreign exchange contracts.

ASC 815 applies to NRG's energy related commodity contracts, foreign exchange contracts, interest rate swaps and Consumer Financing Program.

As the Company engages principally in the trading and marketing of its generation assets and retail operations, some of NRG's commercial activities qualify for NPNS accounting.

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In order to mitigate foreign exchange risk primarily associated with the purchase of USD denominated natural gas for the Company's Canadian business, NRG enters into foreign exchange contract agreements through 2027.

Interest Rate Swaps

NRG is exposed to changes in interest rate through the Company's issuance of variable rate debt.

To manage the Company's interest rate risk, NRG enters into interest rate swap agreements.

In the first quarter of 2023, the Company entered into $ 1.0 billion of interest rate swaps through 2027 to hedge the floating rate on the Term Loan acquired with the Vivint Smart Home acquisition.

Additionally, in the first quarter of 2023, the Company had entered into interest rate swaps to hedge the floating rate on the Revolving Credit Facility extending through 2024, which was fully terminated in conjunction with the pay down of the Revolving Credit Facility.

Consumer Financing Program

Under the Consumer Financing Program, Vivint Smart Home pays a monthly fee to Financing Providers based on either the average daily outstanding balance of the loans or the number of outstanding loans.

For certain loans, Vivint Smart Home incurs fees at the time of the loan origination and receives proceeds that are net of these fees.

Vivint Smart Home also shares the liability for credit losses, depending on the credit quality of the subscriber.

Due to the nature of certain provisions under the Consumer Financing Program, the Company records a derivative liability that is not designated as a hedging instrument and is adjusted to fair value, measured using the present value of the estimated future payments.

Changes to the fair value are recorded through other income, net in the consolidated statement of operations.

The following represent the contractual future payment obligations with the Financing Providers under the Consumer Financing Program that are components of the derivative:

• Vivint Smart Home pays either a monthly fee based on the average daily outstanding balance of the loans, or the number of outstanding loans, depending on the Financing Provider;

• Vivint Smart Home shares the liability for credit losses depending on the credit quality of the subscriber;

• Vivint Smart Home pays transactional fees associated with subscriber payment processing.

The derivative is classified as a Level 3 instrument.

The derivative positions are valued using a discounted cash flow model, with inputs consisting of available market data, such as market yield discount rates, as well as unobservable internally derived assumptions, such as collateral prepayment rates, collateral default rates and credit loss rates.

In summary, the fair value represents an estimate of the present value of the cash flows Vivint Smart Home will be obligated to pay to the Financing Provider for each component of the derivative.

Volumetric Underlying Derivative Transactions

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Delta volume equals the notional volume of an option adjusted for the probability that the option will be in-the-money at its expiration date.

(In millions) Total Volume

Commodity Units December 31, 2022 December 31, 2021

Total Volume (In millions)

Category Units December 31, 2023 December 31, 2022

Emissions Short Ton — 1

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Power MWh 201 192

Interest Dollars 1,000 —

Foreign Exchange Dollars 548 569

Consumer Financing Program Dollars 1,116 —

Fair Value of Derivative Instruments

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Derivatives Not Designated as Cash Flow or Fair Value Hedges :

Interest rate contracts - current $ 12 $ — $ — $ —

Interest rate contracts - long-term — — 8 —

Foreign exchange contracts - current 3 11 4 1

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Commodity contracts- long-term 2,291 4,101 1,434 2,245

Consumer Financing Program - current — — 93 —

Consumer Financing Program - long-term — — 41 —

Total Derivatives Not Designated as Cash Flow or Fair Value Hedges

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As of December 31, 2023

Interest rate contracts:

Derivative assets $ 12 $ ( 8 ) $ — $ 4

Derivative liabilities ( 8 ) 8 — —

Total interest rate contracts 4 — — 4

Foreign exchange contracts:

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Total commodity contracts $ 782 $ — $ 71 $ 853

Consumer Financing Program:

Derivative liabilities $ ( 134 ) $ — $ — $ ( 134 )

Total derivative instruments $ 648 $ — $ 71 $ 719

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The effect of foreign exchange and commodity hedges is included within revenues and cost of operations.

The effect of the interest rate contracts are included within interest expense.

The effect of the Consumer Financing Program is included in other income, net.

Year Ended December 31,

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Reversal of acquired loss positions related to economic hedges

Net unrealized gains/(losses) on open positions related to economic hedges

Net unrealized (losses)/gains on open positions related to economic hedges

( 1,149 ) 2,478 2,501

Total unrealized mark-to-market gains/(losses) for economic hedging activities

Total unrealized mark-to-market (losses)/gains for economic hedging activities

( 2,863 ) 1,248 2,716

Reversal of previously recognized unrealized losses/(gains) on settled positions related to trading activity

13 ( 18 ) ( 20 )

Reversal of acquired (gain) positions related to trading activity

Net unrealized (losses)/gains on open positions related to trading activity

Net unrealized gains/(losses) on open positions related to trading activity

25 ( 17 ) ( 13 )

Total unrealized mark-to-market (losses) for trading activity ( 4 ) ( 32 ) ( 5 )

Total unrealized gains/(losses) $ 1,244 $ 2,684 $ ( 124 )

Total unrealized mark-to-market gains/(losses) for trading activity 38 ( 4 ) ( 32 )

Total unrealized (losses)/gains - commodities and foreign exchange $ ( 2,825 ) $ 1,244 $ 2,684

Year Ended December 31,

(In millions) 2023 2022 2021

Unrealized (losses)/gains included in operating - commodities

Total impact to statement of operations - interest rate contracts $ 4 $ — $ —

Unrealized gains/(losses) included in revenues - commodities

$ 182 $ ( 87 ) $ ( 196 )

Unrealized gains/(losses) included in cost of operations - commodities 1,315 2,880 ( 214 )

Unrealized gains included in cost of operations - foreign exchange 16 — —

Total impact to statement of operations

Unrealized (losses)/gains included in cost of operations - commodities ( 2,988 ) 1,315 2,880

Unrealized (losses)/gains included in cost of operations - foreign exchange ( 19 ) 16 —

Total impact to statement of operations - commodities and foreign exchange

$ ( 2,825 ) $ 1,244 $ 2,684

Total impact to statement of operations - Consumer Financing Program

$ ( 16 ) $ — $ —

The reversals of acquired loss/(gain) positions were valued based upon the forward prices on the acquisition date.

The roll-off amounts were offset by realized gains or losses at the settled prices and are reflected in revenue or cost of operations during the same period.

The loss from open economic hedge positions of $ 1.1 billion for the year ended December 31, 2023 was primarily the result of a decrease in the value of forward positions as a result of decreases in natural gas and power prices in the East and West.

The gains from open economic hedge positions of $ 2.5 billion for the years ended December 31, 2022 and 2021 were primarily the result of an increase in value of forward positions as a result of increases in natural gas and power prices.

The loss from open economic hedge positions of $ 68 million for the year ended December 31, 2020 was primarily the result of a decrease in the value of forward positions as a result of decreases in ERCOT power prices and heat rate contraction, partially offset by an increase in value of forward positions as a result of decreases in New York capacity prices.

Credit Risk Related Contingent Features

Certain of the Company's hedging and trading agreements contain provisions that entitle the counterparty to demand that the Company post additional collateral if the counterparty determines that there has been deterioration in the Company's credit quality, generally termed “adequate assurance” under the agreements, or require the Company to post additional collateral if there were a downgrade in the Company's credit rating.

The collateral potentially required for contracts with adequate assurance clauses that are in net liability positions as of December 31, 2022 was $ 1.5 billion.

The collateral potentially required for contracts with adequate assurance clauses that are in net liability positions as of December 31, 2023 was $ 600 million.

The Company is also a party to certain marginable agreements under which it has a net liability position, but the counterparty has not called for the collateral due, which was approximately $ 80 million as of December 31, 2023.

In the event of a downgrade in the Company's credit rating and if called for by the counterparty, $ 30 million of additional collateral would be required for all contracts with credit rating contingent features as of December 31, 2022.

In the event of a downgrade in the Company's credit rating and

if called for by the counterparty, $ 8 million of additional collateral would be required for all contracts with credit rating contingent features as of December 31, 2023.

See Note 5, Fair Value of Financial Instruments, for discussion regarding concentration of credit risk.

Note 7— Nuclear Decommissioning Trust Fund

NRG's Nuclear Decommissioning Trust Fund assets, which are for the decommissioning of STP, are comprised of securities classified as available-for-sale and recorded at fair value based on actively quoted market prices.

Although NRG is responsible for managing the decommissioning of its 44 % interest in STP, the predecessor utilities that owned STP are authorized by the PUCT to collect decommissioning funds from their ratepayers to cover decommissioning costs on behalf of NRG.

NRC requirements determine the decommissioning cost estimate, which is the minimum required level of funding.

In the event that funds from the ratepayers that accumulate in the nuclear decommissioning trust are ultimately determined to be inadequate to decommission the STP facilities, the utilities will be required to collect through rates charged to rate payers all additional amounts, with no obligation from NRG, provided that NRG has complied with PUCT rules and regulations regarding decommissioning trusts.

Following completion of the decommissioning, if surplus funds remain in the decommissioning trusts, any excess will be refunded to the respective ratepayers of the utilities.

NRG accounts for the Nuclear Decommissioning Trust Fund in accordance with ASC 980, Regulated Operations , or ASC 980, because the Company's nuclear decommissioning activities are subject to approval by the PUCT, with regulated rates that are designed to recover all decommissioning costs and that can be charged to and collected from the ratepayers per PUCT mandate.

Since the Company is in compliance with PUCT rules and regulations regarding decommissioning trusts and the cost of decommissioning is the responsibility of the Texas ratepayers, not NRG, all realized and unrealized gains or losses (including other-than-temporary impairments) related to the Nuclear Decommissioning Trust Fund are recorded to the Nuclear Decommissioning Trust liability and are not included in net income or accumulated other comprehensive income, consistent with regulatory treatment.

The following table summarizes the aggregate fair values and unrealized gains and losses for the securities held in the trust funds, as well as information about the contractual maturities of those securities.

As of December 31, 2022 As of December 31, 2021

Through the sale of the Company's 44 % equity interest in STP on November 1, 2023, NRG's Nuclear Decommissioning Trust Fund assets, which were for the decommissioning of STP, were comprised of securities classified as available-for-sale and recorded at fair value based on actively quoted market prices.

NRG accounted for the Nuclear Decommissioning Trust Fund in accordance with ASC 980, Regulated Operations , or ASC 980, because the Company's nuclear decommissioning activities were subject to approval by the PUCT, with regulated rates that are designed to recover all decommissioning costs and that can be charged to and collected from the ratepayers per PUCT mandate.

Since the Company was in compliance with PUCT rules and regulations regarding decommissioning trusts and the cost of decommissioning was the responsibility of the Texas ratepayers, not NRG, all realized and unrealized gains or losses (including other-than-temporary impairments) related to the Nuclear Decommissioning Trust Fund were recorded to the Nuclear Decommissioning Trust liability and were not included in net income or accumulated other comprehensive income, consistent with regulatory treatment.

Following the sale of the Company's 44 % equity interest in STP on November 1, 2023, the Company is no longer responsible for the decommissioning of STP and no longer holds the Nuclear Decommissioning Trust Fund assets.

For further discussion of the sale, see Note 4, Acquisitions and Dispositions.

The following table summarizes the aggregate fair values and unrealized gains and losses for the securities held in the trust funds as of December 31, 2022, as well as information about the contractual maturities of those securities as of that date.

As of December 31, 2022

(In millions, except otherwise noted) Fair

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government and federal agency obligations

86 — 5 11 112 5 1 10

Federal agency mortgage-backed securities

101 — 11 26 100 2 — 25

Commercial mortgage-backed securities

35 — 4 30 44 1 — 27

Corporate debt securities 114 — 13 12

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Foreign government fixed income securities

1 — — 17 4 — — 13

Total $ 838 $ 346 $ 36

The following table summarizes proceeds from sales of available-for-sale securities and the related realized gains and losses from these sales.

The cost of securities sold is determined using the specific identification method.

Year Ended December 31,

The following table summarizes proceeds from sales of available-for-sale securities and the related realized gains and losses from these sales for the ten months ended October 31, 2023, and for the years ended December 31, 2022 and 2021.

The cost of securities sold was determined using the specific identification method.

(In millions) 2023 2022 2021

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Natural gas 189 385

Spare parts and finished goods 244 201

Spare parts 68 136

Finished goods 164 108

Total Inventory $ 607 $ 751

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Net property, plant, and equipment $ 1,763 $ 1,692

The Company recorded long-lived asset impairments during the years ended December 31, 2022 and 2021, as further described in Note 11, Asset Impairments.

Depreciation expense of property, plant and equipment recorded during the years ended December 31, 2023, 2022 and 2021 was $ 257 million, $ 291 million and $ 384 million, respectively.

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Finance lease cost $ 8 $ 4 $ 4

Amortization of right-of-use assets 7 4 4

Interest on lease liabilities 1 — —

Operating lease cost 93 85 91

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Weighted average discount rate 6.00 % 5.37 %

As of December 31, 2022, annual payments based on the maturities of NRG's operating leases are expected to be as follows:

As of December 31, 2023, annual payments based on the maturities of the Company's operating leases are expected to be as follows:

Thereafter 32

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2023 Impairment Losses

During the fourth quarter of 2023, the Company completed its annual budget and analyzed the corresponding impact on estimated cash flows associated with its long-lived assets.

The fair value of the assets was determined using an income approach by applying a discounted cash flow methodology to the long-term budget for each facility.

The income approach utilized estimates of after-tax cash flows, which were Level 3 fair value measurements, and included key inputs such as forecasted power prices, fuel costs, operating and maintenance costs, plant investment capital expenditures and discount rates.

Gladstone — The Company recorded impairment losses of $ 102 million on its equity method investment in Gladstone within the West/Services/Other segment as a result of changes in the long-term outlook of the Gladstone facility, prompted by evolving energy policy conditions in Australia and an assessment of the long-term operational landscape of the facility, which concluded with the annual budget process.

For further discussion of the Gladstone investment, see Note 17, Investments Accounted for by the Equity Method and Variable Interest Entities.

Other Impairments — The Company additionally recorded impairment losses related to property plant and equipment and leases of $ 2 million, $ 4 million and $ 20 million in the Texas, East and West/Services/Other segments, respectively.

2022 Impairment Losses

Astoria Redevelopment Impairment — During the third quarter of 2022, the Company entered into a purchase and sale agreement for the sale of the land and related assets at the Astoria generating site and the planned withdrawal and cancellation of its proposed Astoria redevelopment project.

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Impairment losses of $ 271 million and $ 35 million were recorded in the East segment on the PJM generating assets and Midwest Generation goodwill, respectively.

2020 Impairment Losses

During the fourth quarter of 2020, the Company completed its annual budget and revised its view of long-term power and fuel prices and the corresponding impact on estimated cash flows associated with its long-lives assets.

The Cottonwood facility had estimated cash flows that were lower than its carrying amount and the assets were considered impaired.

The fair value of the assets was determined using an income approach by applying a discounted cash flow methodology to the long-term budget for the facility.

The Cottonwood facility is being leased through 2025 and the Company recognized an impairment loss of $ 32 million in 2020 in the West/Services/Other segment associated with the Company's long-term services agreement and related lease payments, as the carrying amounts of the assets from the contract were higher than the estimated operating cash flow though the remaining lease period.

The Company also recorded the following impairments in 2020 based on specific triggering events that occurred:

Home Solar — In the third quarter of 2020, the Company concluded its Home Solar business was held for sale and recorded an impairment loss of $ 29 million in the West/Services/Other segment to adjust the carrying amount of the assets and liabilities to fair market value based on indicative sale prices.

Petra Nova Parish Holdings — During the first quarter of 2020, due to the decline in oil prices, NRG determined that the carrying amount of the Company’s equity method investment exceeded the fair value of the investment and that the decline is considered to be other-than-temporary.

In determining the fair value, the Company utilized an income approach to estimate future project cash flows.

The Company recorded $ 18 million impairment losses on investments in the Texas segment, which included the anticipated drawdown of the $ 12 million letter of credit posted in September 2019 to cover certain project debt reserve requirements.

Other Impairments — For the year ended December 31, 2020, the Company recorded $ 14 million of impairment losses related to intangible assets in the Texas segment.

Note 12 — Goodwill and Other Intangibles

The table below presents the changes of goodwill for the years ended December 31, 2023 and 2022 based on the Company's reportable segments.

(in millions) Texas East West/Services/Other Total

(in millions) Texas East West/Services/Other Vivint Smart Home Total

Balance as of January 1, 2022

Goodwill resulted from the acquisition of Direct Energy 427 648 175 1,250

$ 716 $ 853 $ 226 $ — $ 1,795

Impairment losses — ( 130 ) — — ( 130 )

Asset sales ( 6 ) — — — ( 6 )

Foreign currency translation — — ( 9 ) — ( 9 )

Balance as of December 31, 2022

Impairment losses — ( 130 ) — ( 130 )

$ 710 $ 723 $ 217 $ — $ 1,650

Goodwill resulted from the acquisition of Vivint — — — 3,494 3,494

Asset sales ( 67 ) ( 2 ) — — ( 69 )

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Balance as of December 31, 2023

$ 643 $ 721 $ 221 $ 3,494 $ 5,079

Intangible Assets

The Company's intangible assets as of December 31, 2022, primarily reflect intangible assets established with the acquisitions of various companies, including Direct Energy, Stream Energy, other retail acquisitions and Texas Genco.

The Company's intangible assets as of December 31, 2023, primarily reflect intangible assets established with the acquisitions of various companies, including Vivint Smart Home, Direct Energy, Stream Energy, other retail acquisitions and Texas Genco.

Intangible assets are comprised of the following:

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• Customer and supply contracts — These intangibles include the fair value at the acquisition date of in-market and out-of-market customer and supply contracts from the acquisition of Direct Energy and are amortized to revenue and cost of operations, respectively, based upon the fair market value, as of the acquisition date, for each delivery month.

It also included energy supply contracts acquired with Stream Energy that represent the fair value at the acquisition date of in-market contracts for the purchase of energy to serve retail electric customers and are amortized based on the expected delivery under the respective contracts.

• Customer relationships — These intangibles represent the fair value at the acquisition date of acquired businesses' customer base from the acquisition of Direct Energy and other acquisitions.

The customer relationships are amortized to depreciation and amortization expense based on the expected discounted future net cash flows by year.

• Customer relationships — These intangibles represent the fair value at the acquisition date of acquired businesses' customer base from the acquisition of Vivint, Direct Energy and other acquisitions.

Customer relationships are amortized to depreciation and amortization expense based on the expected discounted future net cash flows by year.

• Marketing partnerships — These intangibles represent the fair value at the acquisition date of existing agreements with marketing vendors and loyalty and affinity partners for customer acquisition.

The marketing partnerships are amortized to depreciation and amortization expense based on the expected discounted future net cash flows by year.

Marketing partnerships are amortized to depreciation and amortization expense based on the expected discounted future net cash flows by year.

• Technology — These intangibles represent the fair value at the acquisition date of developed technology for Vivint Smart Home integrated software and products.

Technology is amortized to depreciation and amortization expense, ratably based on the expected discounted future net cash flows by year.

• Trade names — These intangibles are amortized to depreciation and amortization expense on a straight-line basis.

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RECs are retired, as required, for the applicable compliance period.

They are expensed to cost of operations based on NRG’s customer usage.

It also includes in-market nuclear fuel contracts established from the Texas Genco acquisition in 2006 which are amortized to

cost of operations over expected volumes over the life of each contract, costs to extend the operating license for STP Units 1 and 2 and intellectual property related to Goal Zero, which are amortized to depreciation and amortization expense.

RECs are expensed to cost of operations based on NRG’s customer usage.

Other also included in-market nuclear fuel contracts established from the Texas Genco acquisition in 2006 which were amortized to cost of operations over expected volumes over the life of each contract, costs to extend the operating license for STP Units 1 and 2 and intellectual property related to Goal Zero, which is amortized to depreciation and amortization expense.

The following tables summarize the components of NRG's intangible assets:

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Relationships

Marketing Partnerships Trade

Marketing Partnerships Technology Trade

January 1, 2023 $ 624 $ 635 $ 1,730 $ 284 $ — $ 679 $ 292 $ 4,244

Purchases 10 — — — — — 465 475

Acquisition of businesses (a)

Acquisition of businesses (b)

— — 1,773 10 860 160 — 2,803

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Write-off of fully amortized balances ( 1 ) ( 28 ) ( 43 ) — — — — ( 72 )

Sale of STP (c)

— — — — — — ( 59 ) ( 59 )

Other ( 5 ) 2 4 1 — 2 — 4

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Net carrying amount $ 95 $ 281 $ 2,164 $ 125 $ 630 $ 440 $ 192 $ 3,927

(a) The weighted average life of acquired amortizable intangibles was six years for customer relationships

(b) RECs are not subject to amortization and had a carrying value of $ 186 million

(a) RECs are not subject to amortization and had a carrying value of $ 177 million

(b) The weighted average amortization period for total amortizable intangible assets is approximately 10 years.

See Note 4, Acquisitions and Dispositions , for weighted average life of acquired amortizable intangibles for each intangible asset type

(In millions)

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Purchases 26 — — — — 404 430

Acquisition of businesses (a)

Acquisition of businesses (b)

— — 55 — — — 55

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Net carrying amount $ 96 $ 400 $ 943 $ 138 $ 338 $ 217 $ 2,132

(a) The weighted average life of total acquired amortizable intangibles from the Direct Energy acquisition was 12 years

(b) RECs are not subject to amortization and had a carrying value of $ 123 million

(a) RECs are not subject to amortization and had a carrying value of $ 186 million

(b) The weighted average life of acquired amortizable intangibles was six years for customer relationships

The following table presents NRG's amortization of intangible assets for each of the past three years:

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Marketing partnerships 24 23 24

Technology 230 — —

Trade names 60 47 47

Total amortization $ 1,001 $ 490 $ 495

(a) For the years ended December 31, 2022, 2021 and 2020, other intangibles were amortized to depreciation and amortization expense for $ 4 million, $ 3 million and $ 3 million, respectively

(a) For the year ended December 31, 2023, 2022 and 2021, other intangibles amortized to depreciation and amortization expense were de minimis, $ 4 million and $ 3 million, respectively

The following table presents estimated amortization of NRG's intangible assets as of December 31, 2023 for each of the next five years:

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Relationships

Marketing Partnerships Trade

Marketing Partnerships Technology Trade

2024 $ 17 $ 73 $ 478 $ 24 $ 227 $ 54 $ 3 $ 876

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Once transferred to held-for-sale, these emission allowances are prohibited from moving back to held-for-use.

Note 14 — Asset Retirement Obligations

The Company's AROs are primarily related to the environmental obligations for nuclear decommissioning, mine reclamation, ash disposal, site closures, fuel storage facilities and future dismantlement of equipment on leased property.

In addition, the Company has also identified conditional AROs for asbestos removal and disposal, which are specific to certain power generation operations.

See Note 7, Nuclear Decommissioning Trust Fund, for a further discussion of the Company's nuclear decommissioning obligations.

Accretion for the nuclear decommissioning ARO and amortization of the related ARO asset are recorded to the Nuclear Decommissioning Trust Liability to the ratepayers and are not included in net income, consistent with treatment per ASC 980, Regulated Operations .

The following table represents the balance of ARO obligations as of December 31, 2022 and 2021, along with the additions, reductions and accretion related to the Company's ARO obligations for the year ended December 31, 2022:

(In millions) Nuclear Decommission Other (a)

Balance as of December 31, 2021 $ 321 $ 399 $ 720

Revisions in estimates for current obligations — 38 38

Additions — 1 1

Spending for current obligations — ( 33 ) ( 33 )

Accretion 19 19 38

Other — ( 6 ) ( 6 )

Balance as of December 31, 2022 $ 340 $ 418 $ 758

(a) Total accretion expense related to asset retirement obligations included in the consolidated statement of cash flows includes accretion and revisions in estimates for asset retirement liabilities on non-operating plants

Note 13 — Long-term Debt and Finance Leases

Long-term debt and finance leases consisted of the following:

(In millions, except rates) December 31, 2022 December 31, 2021 Interest rate %

As of December 31,

(In millions, except rates) 2023 2022 Interest rate %

Recourse debt:

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Senior Secured First Lien Notes, due 2029 500 500 4.450

Senior Secured First Lien Notes, due 2033 740 — 7.000

Tax-exempt bonds 466 466 1.250 - 4.750

Subtotal recourse debt 8,220 8,100

Non-recourse debt:

Vivint Smart Home Senior Notes, due 2029 800 — 5.750

Vivint Smart Home Senior Secured Notes, due 2027 600 — 6.750

Vivint Smart Home Senior Secured Term Loan, due 2028 1,320 — SOFR + 3.51

Subtotal all non-recourse debt 2,720 —

Subtotal long-term debt (including current maturities)

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Senior Secured First Lien Notes, due 2024, 2025, 2027, 2029 and 2033 $ ( 10 ) $ ( 2 )

Convertible Senior Notes, due 2048 — ( 58 )

Vivint Smart Home Senior Notes, due 2029 ( 103 ) —

Vivint Smart Home Senior Secured Notes, due 2027 ( 12 ) —

Vivint Smart Home Senior Secured Term Loan, due 2028 ( 21 ) —

Total discounts

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Total $ 10,959

Recourse Debt

Revolving Credit Facility

On February 14, 2023 (the “Revolving Credit Facility Amendment Effective Date”), the Company amended its Revolving Credit Facility to:

(i) increase the existing revolving commitments thereunder by $ 600 million (the “Incremental Commitment”), (ii) extend the maturity date of a portion of the revolving commitments thereunder to February 14, 2028, (iii) transition the benchmark rate applicable to revolving loans from LIBOR to SOFR and (iv) make certain other amendments to the terms of the Revolving Credit Facility for purposes of, among other things, providing additional flexibility.

After giving effect to the Incremental Commitment on the Revolving Credit Facility Amendment Effective Date, the Company will have a total of $ 4.275 billion of revolving commitments under the Revolving Credit Facility.

The full amount of the Incremental Commitment was made available from and after the Revolving Credit Facility Amendment Effective Date but will be reduced by $ 500 million if the Vivint acquisition is not consummated.

A portion of the non-extended revolving commitments will terminate on July 5, 2023, with the remaining portion terminating on May 28, 2024, in each case, unless otherwise extended.

On February 14, 2023 (the “Revolving Credit Facility Sixth Amendment Effective Date”), the Company amended its Revolving Credit Facility to:

(i) increase the existing revolving commitments thereunder by $ 600 million (the “Initial Incremental Commitment”), (ii) extend the maturity date of a portion of the revolving commitments thereunder to February 14, 2028, (iii) transition the benchmark rate applicable to revolving loans from LIBOR to SOFR and (iv) make certain other amendments to the terms of the Revolving Credit Facility for purposes of, among other things, providing additional flexibility.

On March 13, 2023 (the “Revolving Credit Facility Seventh Amendment Effective Date”), the Company further amended its Revolving Credit Facility to increase the existing revolving commitments by an additional $ 45 million (together with the Initial Incremental Commitment, the "Incremental Commitment").

After giving effect to the Incremental Commitment, the Company had a total of $ 4.305 billion of revolving commitments available under the Revolving Credit Facility.

The full amount of the Initial Incremental Commitment was made available from and after the Revolving Credit Facility Sixth Amendment Effective Date and the full amount of the Incremental Commitment was made available from and after the Revolving Credit Facility Seventh Amendment Effective Date.

A portion of the non-extended revolving commitments terminated on July 5, 2023, with the remaining portion thereof terminating on May 28, 2024, unless otherwise extended.

The Revolving Credit Facility is guaranteed by NRG’s existing and future direct and indirect subsidiaries, with customary and agreed-upon exceptions for, among other exceptions, unrestricted subsidiaries, foreign subsidiaries, project subsidiaries, immaterial subsidiaries, captive insurance subsidiaries and securitization vehicles.

The Revolving Credit Facility is also secured by a first priority perfected security interest in a substantial portion of the property and assets owned by NRG and its subsidiaries that are guarantors under the Revolving Credit Facility, subject to certain exceptions that include, among other things, the capital stock of certain specified subsidiaries, including unrestricted subsidiaries and certain excluded subsidiaries, equity interests in excess of 66 % of the total outstanding voting equity interests of certain foreign subsidiaries, equity interests the pledge of which is prohibited by applicable agreements binding on such subsidiaries and other assets that may be designated by NRG as excluded from the collateral that, when taken together with all other assets so designated since the Revolving Credit Facility Amendment Effective Date, have an aggregate fair market value not exceeding $ 750 million.

The Revolving Credit Facility is secured on a pari passu basis with certain interest rate, foreign currency and commodity hedging obligations of NRG, the Senior Secured Notes and certain other indebtedness.

The Revolving Credit Facility contains customary covenants, which, among other things, require NRG to maintain a minimum interest coverage ratio and a maximum first lien leverage ratio on a consolidated basis and limit NRG’s ability to:

The Revolving Credit Facility is also secured by a first priority (subject to certain customary permitted liens) perfected security interest in a substantial portion of the property and assets owned by NRG and its subsidiaries that are guarantors under the Revolving Credit Facility, subject to certain exceptions that include, among other things, the capital stock of certain specified subsidiaries, including unrestricted subsidiaries and certain excluded subsidiaries, equity interests in excess of 66 % of the total outstanding voting equity interests of certain foreign subsidiaries, equity interests the pledge of which is prohibited by applicable agreements binding on such subsidiaries and other assets that may be designated by NRG as excluded from the collateral that, when taken together with all other assets so designated since the Revolving Credit Facility Sixth Amendment Effective Date, have an aggregate fair market value not exceeding $ 750 million.

The Revolving Credit Facility is secured on a pari passu basis with certain interest rate, foreign currency and commodity hedging obligations of NRG, the Senior Secured First Lien Notes and certain other indebtedness.

The collateral securing the Revolving Credit Facility will be released at the Company's request if both the senior unsecured long-term debt securities of the Company and the revolving loans under the Revolving Credit Facility are rated investment grade by any two of the three rating agencies and the satisfaction of certain other conditions, subject to reversion if such rating agencies withdraw such investment grade rating or downgrade such rating below investment grade (or, with respect to the revolving loans, crease to publish a rating).

The Revolving Credit Facility contains customary covenants, which, among other things, require NRG to maintain a maximum first lien leverage ratio on a consolidated basis when amounts outstanding under the Revolving Credit Facility (subject to certain exceptions) exceed a certain threshold and limit, subject to certain exceptions, NRG’s ability to:

• incur indebtedness and liens and enter into sale and lease-back transactions;

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• return capital to shareholders;

• repay subordinated indebtedness;

• repay material subordinated indebtedness;

• consummate mergers, consolidations and asset sales;

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• change its fiscal year-end.

As of December 31, 2022, there were no outstanding borrowings and there were $ 1.6 billion in letters of credit issued under the Revolving Credit Facility.

Issuance of 2032 Senior Notes

On August 23, 2021, the Company issued $ 1.1 billion of aggregate principal amount of 3.875 % senior notes due 2032.

The 2032 Senior Notes are senior unsecured obligations of NRG and are guaranteed by certain of its subsidiaries.

Interest is paid semi-annually beginning on February 15, 2022 until the maturity date of February 15, 2032.

The 2032 Senior Notes were issued under NRG's Sustainability-Linked Bond Framework, which sets out certain sustainability targets, including reducing greenhouse gas emissions.

Failure to meet such sustainability targets will result in a 25 basis point increase to the interest rate payable on the 2032 Senior Notes from and including August 15, 2026.

The proceeds of the 2032 Senior Notes, along with cash on hand, were used to fund the redemption of $ 1.0 billion aggregate principal amount of the 7.250 % Senior Notes due 2026 and $ 355 million aggregate principal amounts of the 6.625 % Senior Notes due 2027.

As of December 31, 2023, there were no outstanding borrowings and there were $ 883 million in letters of credit issued under the Revolving Credit Facility.

Issuance of 2033 Senior Secured First Lien Notes

On March 9, 2023, the Company issued $ 740 million of aggregate principal amount of 7.000 % senior secured first lien notes due 2033 (the "2033 Senior Secured First Lien Notes").

The 2033 Senior Secured First Lien Notes are senior secured obligations of NRG and are guaranteed by certain of its subsidiaries that guarantee indebtedness under the Revolving Credit Facility.

The 2033 Senior Secured First Lien Notes are secured by a first priority security interest in the same collateral that is pledged for the benefit of the lenders under the Revolving Credit Facility, which collateral consists of a substantial portion of the property and assets owned by the Company and the guarantors.

The collateral securing the 2033 Senior Secured First Lien Notes will be released at the Company’s request if the senior unsecured long-term debt securities of the Company are rated investment grade by any two of the three rating agencies and the satisfaction of certain other conditions, subject to reversion if such rating agencies withdraw such investment grade rating or downgrade such rating below investment grade.

Interest is paid semi-annually beginning on September 15, 2023 until the maturity date of March 15, 2033.

The proceeds of the 2033 Senior Secured First Lien Notes, along with cash on hand and proceeds from certain other financings, were used to fund the acquisition of Vivint Smart Home.

Senior Note Redemptions

During the year ended December 31, 2023, the Company redeemed $ 620 million in aggregate principal amount of its 3.875 % Senior Notes, due 2032, for $ 509 million, which included the payment of $ 7 million of accrued interest, using cash on hand at an average early redemption percentage of 81 %.

In connection with the redemption, a $ 109 million gain on debt extinguishment was recorded, which included the write-off of previously deferred financing costs and other fees of $ 9 million.

During the year ended December 31, 2021, the Company redeemed approximately $ 1.9 billion in aggregate principal amount of its Senior Notes for $ 1.9 billion using the proceeds of the 2032 Senior Notes and cash on hand, as detailed in the table below.

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For more information on the adoption of ASU 2020-06, refer to Note 2, Summary of Significant Accounting Policies.

Modification to Convertible Senior Notes — On February 22, 2022, the Company irrevocably elected to eliminate the right to settle conversions only in shares of the Company's common stock, such that any conversion after such date, the Company will pay cash per $1,000 principal amount and will settle in cash or a combination of cash and the Company's common stock for the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount.

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The Convertible Senior Notes are convertible at the option of the holders under certain circumstances.

Prior to the close of business on the business day immediately preceding December 1, 2024, the Convertible Senior Notes will be convertible only upon the occurrence of certain events and during certain periods, including, among others, during any calendar quarter (and only during such calendar quarter) if the last reported sales price per share of the Company's common stock exceeds 130 % of the conversion price for each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter.

Thereafter during specified periods as follows:

• from December 1, 2024 until the close of business on the second scheduled trading day immediately before June 1, 2025;

• from December 1, 2047 until the close of business on the second scheduled trading day immediately before the maturity date

All conversions with a conversion date that occurs within the specific periods above will be settled after such period pursuant to the terms of the indenture.

The following table details the interest expense recorded in connection with the Convertible Senior Notes, due 2048:

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3.875 % senior notes, issued August 23, 2021 and due February 15, 2032, or the 2032 Senior Notes.

The Company periodically enters into supplemental indentures for the purpose of adding entities under the Senior Notes as guarantors.

The indentures and the forms of notes provide, among other things, that the Senior Notes will be senior unsecured obligations of NRG.

The indentures and the forms of notes provide, among other things, that the Senior Notes will be senior unsecured obligations of the Company.

The indentures also provide for customary events of default, which include, among others:

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defaults in failure to pay certain other indebtedness;

the rendering of judgments to pay certain amounts of money against NRG and its subsidiaries;

the rendering of judgments to pay certain amounts of money against the Company and its subsidiaries;

the failure of certain guarantees to be enforceable;

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Generally, if an event of default occurs, the trustee or the holders of at least 25 % or 30 % (depending on the series of Senior Notes) in principal amount of the then outstanding series of Senior Notes may declare all of the Senior Notes of such series to be due and payable immediately.

The terms of the indentures, among other things, limit NRG's ability and certain of its subsidiaries' ability to return capital to stockholders, grant liens on assets to lenders and incur additional debt.

The terms of the indentures, among other things, limit the Company's ability and certain of its subsidiaries' ability to return capital to stockholders, grant liens on assets to lenders and incur additional debt.

Interest is payable semi-annually on the Senior Notes until their maturity dates.

2027 Senior Notes

NRG may redeem some or all of the 2027 Senior Notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

The Company may redeem some or all of the 2027 Senior Notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

Redemption Period Redemption

July 15, 2023 to July 14, 2024 101.104 %

July 15, 2024 and thereafter 100.000 %

2028 Senior Notes

NRG may redeem some or all of the 2028 Senior Notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

The Company may redeem some or all of the 2028 Senior Notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

Redemption Period Redemption

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January 15, 2025 to January 14, 2026 100.958 %

January 15, 2026 and thereafter 100.000 %

5.250 % 2029 Senior Notes

At any time prior to June 15, 2024, NRG may redeem all or a part of the 2029 Senior Notes, at a redemption price equal to 100 % of the principal amount of the notes redeemed, plus accrued and unpaid interest to the redemption date, plus a premium.

At any time prior to June 15, 2024, the Company may redeem all or a part of the 5.250 % 2029 Senior Notes, at a redemption price equal to 100 % of the principal amount of the notes redeemed, plus accrued and unpaid interest to the redemption date, plus a premium.

The premium is the greater of:

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or (ii) the excess of the principal amount of the note over the following:

the present value of 102.625 % of the note, plus interest payments due on the note through June 15, 2024 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 0.50 %.

In addition, on or after June 15, 2024, NRG may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

In addition, on or after June 15, 2024, the Company may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

Redemption Period Redemption Percentage

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3.375 % 2029 Senior Notes

At any time prior to February 15, 2024, NRG may redeem up to 40 % of the aggregate principal amount of the 2029 Senior Notes, at a redemption price equal to 103.375 % of the principal amount of the notes redeemed, plus accrued and unpaid interest, with an amount equal to the net cash proceeds of certain equity offerings, provided that at least 50 % of the aggregate principal amount remains outstanding immediately after the occurrence of such redemption.

At any time prior to February 15, 2024, NRG may redeem all or a part of the 2029 Senior Notes, at a redemption price equal to 100 % of the principal amount of the notes redeemed, plus accrued and unpaid interest to the redemption date, plus a premium.

The premium is the greater of:

(i) 1 % of the principal amount of the notes;

or (ii) the excess of the principal amount of the note over the following:

the present value of 101.688 % of the note, plus interest payments due on the note through February 15, 2024 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 0.50 %.

In addition, on or after February 15, 2024, NRG may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

On or after February 15, 2024, the Company may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

Redemption Period Redemption Percentage

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2031 Senior Notes

At any time prior to February 15, 2026, NRG may redeem up to 40 % of the aggregate principal amount of the 2031 Senior Notes, at a redemption price equal to 103.625 % of the principal amount of the notes redeemed, plus accrued and unpaid interest, with an amount equal to the net cash proceeds of certain equity offerings, provided that at least 50 % of the aggregate principal amount remains outstanding immediately after the occurrence of such redemption.

At any time prior to February 15, 2026, NRG may redeem all or a part of the 2031 Senior Notes, at a redemption price equal to 100 % of the principal amount of the notes redeemed, plus accrued and unpaid interest to the redemption date, plus a premium.

At any time prior to February 15, 2026, the Company may redeem all or a part of the 2031 Senior Notes, at a redemption price equal to 100 % of the principal amount of the notes redeemed, plus accrued and unpaid interest to the redemption date, plus a premium.

The premium is the greater of:

(i) 1 % of the principal amount of the notes;

or (ii) the excess of the principal amount of the note over the following:

the present value of 101.813 % of the note, plus interest payments due on the note through February 15, 2026 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 0.50 %.

In addition, on or after February 15, 2026, NRG may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

(i) 1 % of the principal amount of the note;

or (ii) the excess of the present value of 101.813 % of the note, plus interest payments due on the note through February 15, 2026 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 0.50 % over the principal amount of the note.

In addition, on or after February 15, 2026, the Company may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

Redemption Period Redemption Percentage

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2032 Senior Notes

At any time prior to August 15, 2024, NRG may redeem up to 40 % of the aggregate principal amount of the 2032 Senior Notes, at a redemption price equal to 103.875 % of the principal amount of the notes redeemed, plus accrued and unpaid interest, with an amount equal to the net cash proceeds of certain equity offerings, provided that at least 50 % of the aggregate principal amount remains outstanding immediately after the occurrence of such redemption.

At any time prior to February 15, 2027, NRG may redeem all or a part of the 2032 Senior Notes, at a redemption price equal to 100 % of the principal amount of the notes redeemed, plus accrued and unpaid interest to the redemption date, plus a premium.

At any time prior to August 15, 2024, the Company may redeem up to 40 % of the aggregate principal amount of the 2032 Senior Notes, at a redemption price equal to 103.875 % of the principal amount of the notes redeemed, plus accrued and unpaid interest, with an amount equal to the net cash proceeds of certain equity offerings, provided that at least 50 % of the aggregate principal amount remains outstanding immediately after the occurrence of such redemption.

At any time prior to February 15, 2027, the Company may redeem all or a part of the 2032 Senior Notes, at a redemption price equal to 100 % of the principal amount of the notes redeemed, plus accrued and unpaid interest to the redemption date, plus a premium.

The premium is the greater of:

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or (ii) the excess of (A) the present value of (1) the redemption price of the note at February 15, 2027 (such redemption price being set forth in the table appearing below in the column “Redemption Percentage (If Sustainability Performance Target has not been satisfied and/or confirmed by External Verifier)” unless the Sustainability Performance Target has been satisfied in respect of the year ended December 31, 2025 and the Company has provided confirmation thereof to the trustee together with a related confirmation by the External Verifier by the date that is at least 15 days prior to August 15, 2026 in which case the redemption price shall be as set forth in the column “Redemption Percentage (If Sustainability Performance Target has been satisfied and confirmed by External Verifier)”) plus (2) interest payments due on the note through February 15, 2027 (excluding accrued but unpaid interest to the redemption date) computed using a discount rate equal to the Treasury Rate as of such redemption date plus 0.50 %, over (B) the principal amount of the note.

In addition, on or after February 15, 2027, NRG may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table during the twelve-month period beginning on February 15 of the years indicated below, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

In addition, on or after February 15, 2027, the Company may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table during the twelve-month period beginning on February 15 of the years indicated below, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

Year Redemption Percentage

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Receivables Facility

In 2020, NRG Receivables LLC, a bankruptcy remote, special purpose, indirect wholly owned subsidiary, entered into the Receivables Facility for an amount up to $ 750 million, subject to adjustments on a seasonal basis, with issuers of asset-backed commercial paper and commercial banks (the "Lenders".) The assets of NRG Receivables LLC are first available to satisfy the claims of the Lenders before making payments on the subordinated note and equity issued by NRG Receivables LLC.

The assets of NRG Receivables LLC are not available to the Company and its subsidiaries or creditors unless and until distributed by NRG Receivables LLC.

Under the Receivables Facility, certain indirect subsidiaries of the Company sell their accounts receivables to NRG Receivables LLC, subject to certain terms and conditions.

In turn, NRG Receivables LLC grants a security

interest in the purchased receivables to the Lenders as collateral for cash borrowings and issuances of letters of credit.

In 2020, NRG Receivables LLC, a bankruptcy remote, special purpose, indirect wholly owned subsidiary, ("NRG Receivables") entered into the Receivables Facility, subject to adjustments on a seasonal basis, with issuers of asset-backed commercial paper and commercial banks (the "Lenders").

The assets of NRG Receivables are first available to satisfy the claims of the Lenders before making payments on the subordinated note and equity issued by NRG Receivables.

The assets of NRG Receivables are not available to the Company and its subsidiaries or creditors unless and until distributed by NRG Receivables.

Under the Receivables Facility, certain indirect subsidiaries of the Company sell their accounts receivables to NRG Receivables, subject to certain terms and conditions.

In turn, NRG Receivables grants a security interest in the purchased receivables to the Lenders as collateral for cash borrowings and issuances of letters of credit.

Pursuant to the Performance Guaranty, the Company has guaranteed, for the benefit of NRG Receivables and the Lenders, the payment and performance by each indirect subsidiary of its respective obligations under the Receivables Facility.

The accounts receivables remain on the Company's consolidated balance sheet and any amounts funded by the Lenders to NRG Receivables LLC will be reflected as short-term borrowings.

The accounts receivables remain on the

Company's consolidated balance sheet and any amounts funded by the Lenders to NRG Receivables will be reflected as short-term borrowings.

Cash flows from the Receivables Facility are reflected as financing activities in the Company's consolidated statements of cash flows.

The Company will continue to service the accounts receivables sold in exchange for a servicing fee.

On July 26, 2022, NRG Receivables LLC, a wholly-owned indirect subsidiary of the Company, entered into an amendment to its Receivables Facility dated September 22, 2020 with a group of conduit lenders and banks and Royal Bank of Canada, as Administrative Agent to, among other things, (i) extend the scheduled termination date by one year , (ii) increase the aggregate commitments from $ 800 million to $ 1.0 billion, (iii) increase the letter of credit sublimit to equal the aggregate commitments, (iv) replace LIBOR with Term SOFR as the benchmark for borrowings and (v) add new originators.

Borrowings by NRG Receivables LLC under the Receivables Facility bear interest as defined under the Receivables Financing Agreement.

The Company continues to service the accounts receivables sold in exchange for a servicing fee.

On June 22, 2023, NRG Receivables amended its existing Receivables Facility to, among other things, (i) extend the scheduled termination date to June 21, 2024, (ii) increase the aggregate commitments from $ 1.0 billion to $ 1.4 billion (adjusted seasonally) and (iii) add a new originator.

On October 6, 2023, the Receivables Facility was further amended to replace the benchmark interest rate of the Receivable Facility's subordinated note from LIBOR to SOFR.

The weighted average interest rate related to usage under the Receivables Facility as of December 31, 2023 was 0.841 %.

As of December 31, 2022, there were no outstanding borrowings and there were $ 721 million in letters of credit issued under the Receivables Facility.

As of December 31, 2023, there were no outstanding borrowings and there were $ 1.0 billion in letters of credit issued under the Receivables Facility.

Repurchase Facility

In 2020, the Company entered into the Repurchase Facility related to the Receivables Facility.

Under the Repurchase Facility, the Company can borrow up to $ 75 million, collateralized by a subordinated note issued by NRG Receivables LLC to NRG Retail LLC in favor of the originating entities representing a portion of the balance of receivables sold to NRG Receivables LLC under the Receivables Facility.

On February 9, 2022, the Company entered into amendments to its existing Repurchase Facility to, among other things, (i) increase the size of the facility from $ 75 million to $ 150 million and (ii) replace LIBOR with term SOFR as the benchmark for the pricing rate.

On July 26, 2022, the Company renewed its existing Repurchase Facility to, among other things, extend the maturity date to July 26, 2023.

Under the Repurchase Facility, the Company can currently borrow up to $ 150 million, collateralized by a subordinated note issued by NRG Receivables to NRG Retail LLC in favor of the originating entities representing a portion of the balance of receivables sold to NRG Receivables under the Receivables Facility.

In addition, in connection with the amendments to the Receivables Facility, on June 22, 2023, the Company and the originators thereunder renewed the existing uncommitted Repurchase Facility.

Such renewal, among other things, extended the maturity date to June 21, 2024 and joined an additional originator to the Repurchase Facility.

On October 6, 2023, the Repurchase Facility was further amended to reflect the concurrent amendment to the Receivables Facility's subordinated note.

The Repurchase Facility has no commitment fee and borrowings will be drawn at SOFR + 1.55 %.

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Bilateral Letter of Credit Facilities

On April 29, 2022, May 27, 2022 and October 13, 2022, the Company increased the size of the facilities by $ 100 million, $ 50 million and $ 50 million respectively, to provide additional liquidity, allowing for the issuance of up to $ 675 million of letters of credit.

On May 19, 2023, May 30, 2023 and October 17, 2023 the Company increased the size of its bilateral letter of credit facilities by $ 25 million, $ 100 million and $ 50 million, respectively, to provide additional liquidity and to allow for the issuance of up to $ 850 million of letters of credit.

These facilities are uncommitted.

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Total $ 466 $ 466

Dunkirk Bonds

On April 3, 2023, NRG remarketed $ 59 million in aggregate principal amount of 4.25 % tax-exempt refinancing bonds of the Chautauqua County Capital Resource Corporation (the "Dunkirk Bonds").

The Dunkirk Bonds are guaranteed on a first-priority basis by each of NRG's current and future subsidiaries that guarantee indebtedness under the Revolving Credit Facility.

The Dunkirk Bonds are secured by a first priority security interest in the same collateral that is pledged for the benefit of the lenders under the Revolving Credit Facility, which consists of a substantial portion of the property and assets owned by NRG and the guarantors.

The collateral securing the Dunkirk Bonds will, at the request of NRG, be released if NRG satisfies certain conditions, including receipt of an investment grade rating on its senior, unsecured debt securities from two out of the three rating agencies, subject to reversion if those rating agencies withdraw their investment grade rating of the Dunkirk Bonds or any of NRG's senior, unsecured debt securities or downgrade such ratings below investment grade.

The Dunkirk Bonds are subject to mandatory tender and purchase on April 3, 2028 and have a final maturity date of April 1, 2042.

Pre-Capitalized Trust Securities Facility

On August 29, 2023, the Company entered into a Facility Agreement (as defined below) with Alexander Funding Trust II, a newly-formed Delaware statutory trust (the “Trust”), in connection with the sale by the Trust of $ 500 million pre-capitalized trust securities redeemable July 31, 2028 (the “P-Caps”).

The Trust invested the proceeds from the sale of the P-Caps in a portfolio of principal and interest strips of U.S.

Treasury securities (the “Eligible Treasury Assets”).

The P-Caps replaced the Company’s existing pre-capitalized trust securities redeemable 2023 issued by Alexander Funding Trust, which matured on November 15, 2023.

In connection with the sale of the P-Caps, the Company and the guarantors named therein entered into a facility agreement, dated August 29, 2023 (the “Facility Agreement”), with the Trust and Deutsche Bank Trust Company Americas, as notes trustee (the “Notes Trustee”).

Under the Facility Agreement, the Company has the right, from time to time, to issue to the Trust, and to require the Trust to purchase from the Company, on one or more occasions (the “Issuance Right”), up to $ 500 million aggregate principal amount of the Company’s 7.467 % Senior Secured First Lien Notes due 2028 (the “P-Caps Secured Notes”) in exchange for all or a portion of the Eligible Treasury Assets corresponding to the portion of the Issuance Right under the Facility Agreement being exercised at such time.

The Company pays to the Trust a facility fee equal to 3.13427 % applied to the unexercised portion of the Issuance Right on a semi-annual basis.

The P-Caps are to be redeemed by the Trust on July 31, 2028 or earlier upon an early redemption of the P-Caps Secured Notes.

Following any distribution of P-Caps Secured Notes to the holders of the P-Caps, the Company may similarly redeem such P-Caps Secured Notes, in whole or in part, at the redemption price described in the P-Caps Indenture (as defined below), plus accrued but unpaid interest to, but excluding, the date of redemption.

Any P-Caps Secured Notes outstanding and held by the Trust as a result of the exercise of the Issuance Right that remain outstanding will also mature on July 31, 2028.

The Issuance Right will be exercised automatically in full if (i) the Company fails to pay the facility fee when due or any amount due and owing under the trust expense reimbursement agreement or fails to purchase and pay for any Eligible Treasury Assets that are due and not paid on their payment date and such failure is not cured within 30 days or (ii) upon certain bankruptcy events of the Company.

The Company will be required to mandatorily exercise the Issuance Right if certain mandatory exercise events occur upon the terms and conditions set forth in the Facility Agreement.

The P-Caps Secured Notes that may be sold to the Trust from time to time will be governed by the base indenture, dated August 29, 2023 (the “Base Indenture”), between the Company and the Notes Trustee, as supplemented by the supplemental indenture, dated August 29, 2023 (the “Supplemental Indenture” and, together with the Base Indenture, the “P-Caps Indenture”), among the Company, the guarantors named therein and the Notes Trustee.

The P-Caps Secured Notes will, if sold to the Trust, be guaranteed on a first-priority basis by each of the Company’s subsidiaries that guarantee indebtedness under the Revolving Credit Facility.

The P-Caps Secured Notes will, if sold to the Trust, be secured by a first priority security interest in the same collateral that is pledged for the benefit of the lenders under the Revolving Credit Facility, which consists of a substantial portion of the property and assets owned by the Company and the guarantors.

The collateral securing the P-Caps Secured Notes will be released at the Company’s request if the senior unsecured long-term debt securities of the Company are rated investment grade by any two of the three rating agencies, subject to reversion if such rating agencies downgrade such rating below investment grade or withdraw such investment grade rating.

In connection with the issuance of the P-Caps, on August 29, 2023, the Company entered into a letter of credit facility agreement (the “LC Agreement”) with Deutsche Bank Trust Company Americas, as collateral agent (the “Collateral Agent”) and administrative agent, and certain financial institutions (the “LC Issuers”) for the issuance of letters of credit in an aggregate amount not to exceed $ 485 million.

The LC Agreement replaced the Company’s existing letter of credit facility agreement, effective August 29, 2023.

In addition, on August 29, 2023, the Trust entered into a pledge and control agreement (the “Pledge Agreement”), among the Company, the Trust and the Collateral Agent, under which the Company and the Trust agreed to grant a security interest over the Eligible Treasury Assets in favor of the Collateral Agent for the benefit of the LC Issuers.

Pursuant to the LC Agreement and the Pledge Agreement, the Collateral Agent is entitled to withdraw Eligible Treasury Assets in the amount of any drawn letters of credit issued pursuant to the LC Agreement from the Company's and the Trust’s pledged accounts, following notice to the Company, in the event the Company has failed to reimburse such drawn amounts and the LC Issuers have the right to instruct the Collateral Agent to enforce the pledge over the Eligible Treasury Assets upon the occurrence of any event of default under the LC Agreement.

Non-recourse Debt

The following are descriptions of certain indebtedness of NRG's subsidiaries.

All of NRG's non-recourse debt is secured by the assets in the subsidiaries as further described below.

Acquired Vivint Smart Home Debt

On March 10, 2023, in connection with the Vivint Smart Home acquisition, Vivint Smart Home's indirect wholly owned subsidiary, APX Group, Inc.

("APX"), retained its 6.750 % senior secured notes due 2027, 5.750 % senior notes due 2029, senior secured term loan credit agreement and senior secured revolving credit facility.

Vivint Smart Home 2027 Senior Secured Notes

Vivint Smart Home has outstanding $ 600 million aggregate principal amount of 6.750 % senior secured notes due 2027 (the "Vivint Smart Home 2027 Senior Secured Notes").

The Vivint Smart Home 2027 Senior Secured Notes are senior secured obligations of APX and are guaranteed by APX Group Holdings, Inc., each of APX's existing and future wholly owned U.S.

restricted subsidiaries (subject to customary exclusions and qualifications) and Vivint Smart Home.

Interest on the Vivint Smart Home 2027 Senior Secured Notes is paid semi-annually in arrears on February 15 and August 15 until the maturity date of February 15, 2027.

Vivint Smart Home 2029 Senior Notes

Vivint Smart Home has outstanding $ 800 million aggregate principal amount of 5.750 % senior notes due 2029 (the "Vivint Smart Home 2029 Senior Notes").

The Vivint Smart Home 2029 Senior Notes are senior unsecured obligations of APX and are guaranteed by APX Group Holdings, Inc., each of APX's existing and future wholly owned U.S.

restricted subsidiaries (subject to customary exclusions and qualifications) and Vivint Smart Home.

Interest on the Vivint Smart Home 2029 Senior Notes is paid semi-annually in arrears on January 15 and July 15 until the maturity date of July 15, 2029.

Vivint Smart Home Senior Secured Credit Facilities

The Vivint Smart Home senior secured credit agreement (the “Vivint Smart Home Credit Agreement”) provides for (i) a term loan facility in an initial aggregate principal amount of $ 1.4 billion (the “Vivint Smart Home Term Loan Facility”, and the loans thereunder, the “Vivint Smart Home Term Loans”) and (ii) a revolving credit facility in an initial aggregate principal amount of $ 370 million (the “Vivint Smart Home Revolving Credit Facility,” and the loans thereunder, the “Vivint Smart Home Revolving Loans”).

All of APX’s obligations under the Vivint Smart Home Credit Agreement are guaranteed by APX Group Holdings, Inc.

and each of APX’s existing and future wholly-owned U.S.

restricted subsidiaries (subject to customary exclusions and qualifications).

The obligations under the Vivint Smart Home Credit Agreement are secured by a first priority (subject to certain customary permitted liens) perfected security interest in (i) substantially all of the present and future tangible and intangible assets of APX, and the guarantors, including without limitation equipment, subscriber contracts and communication paths, intellectual property, general intangibles, investment property, material intercompany notes and proceeds of the foregoing, subject to permitted liens and other customary exceptions, (ii) substantially all personal property of APX and the guarantors consisting of accounts receivable arising from the sale of inventory and other goods and services (including related contracts and contract rights, inventory, cash, deposit accounts, other bank accounts and securities accounts), inventory and intangible assets to the extent attached to the foregoing books and records of APX and the guarantors, and the proceeds thereof, subject to permitted liens and other customary exceptions, in each case held by APX and the guarantors and (iii) a pledge of all of the capital stock of APX, each of its subsidiary guarantors and each restricted subsidiary of APX and its subsidiary guarantors (subject to customary exclusions and qualifications), in each case other than certain excluded assets and subject to the limitations and exclusions provided in the applicable collateral documents.

The Vivint Smart Home Credit Agreement contains customary covenants, which, among other things, require APX to maintain a maximum first lien net leverage ratio when amounts outstanding under the Vivint Smart Home Revolving Facility exceed a certain threshold and restrict, subject to certain exceptions, APX and its restricted subsidiaries’ ability to:

• incur or guarantee additional debt or issue disqualified stock or preferred stock;

• pay dividends and make other distributions on, or redeem or repurchase, capital stock;

• make certain investments;

• incur certain liens;

• enter into transactions with affiliates;

• merge or consolidate;

• materially change the nature of their business;

• enter into agreements that restrict the ability of restricted subsidiaries to make dividends or other payments to APX or grant liens on their assets;

• designate restricted subsidiaries as unrestricted subsidiaries;

• amend, prepay, redeem or purchase certain material contractually subordinated debt;

• transfer or sell certain assets.

On June 9, 2023, Vivint Smart Home entered into an amendment to the Vivint Smart Home Credit Agreement which transitioned the benchmark rate applicable to the Vivint Smart Home Term Loans and the Vivint Smart Home Revolving Loans from LIBOR to SOFR.

As of December 31, 2023, the aggregate outstanding principal amount of the Vivint Term Loans was $ 1.3 billion.

As of December 31, 2023, Vivint Smart Home had no outstanding borrowings under the Vivint Smart Home Revolving Credit Facility.

Vivint Smart Home Notes Early Redemption

2027 Senior Secured Notes

APX may redeem some or all of the 2027 Senior Secured Notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

Redemption Period Redemption Percentage

February 15, 2024 to February 14, 2025 101.688 %

February 15, 2025 and thereafter 100.000 %

2029 Senior Notes

At any time prior to July 15, 2024 and from time to time, APX may redeem the notes in whole or in part, at a redemption price equal to 100 % of the principal amount of the notes redeemed, plus accrued and unpaid interest to the redemption date, plus a premium.

The premium is the greater of:

(i) 1 % of the principal amount of the note;

and (ii) the excess , if any, of (a) the present value at such redemption date of (i) the redemption price of such note at July 15, 2024, plus (ii) interest payments due on the note through July 15, 2024 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 0.50 % over the then outstanding principal amount of such note.

In addition, on or after July 15, 2024, APX may redeem some or all of the notes at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption date:

Redemption Period Redemption Percentage

July 15, 2024 to July 14, 2025 102.875 %

July 15, 2025 to July 14, 2026 101.438 %

July 15, 2026 and thereafter 100.100 %

Note 14 — Asset Retirement Obligations

The Company's AROs are primarily related to the environmental obligations for mine reclamation, ash disposal, site closures, fuel storage facilities and future dismantlement of equipment on leased property.

In addition, the Company has also identified conditional AROs for asbestos removal and disposal, which are specific to certain power generation operations.

Following the sale of the Company's 44 % equity interest in STP on November 1, 2023, the Company no longer has asset retirement obligations related to nuclear decommissioning.

Prior to the sale, accretion for the nuclear decommissioning ARO and amortization of the related ARO asset were recorded to the Nuclear Decommissioning Trust Liability and were not included in net income, consistent with regulatory treatment per ASC 980, Regulated Operations .

The following table represents the balance of ARO obligations as of December 31, 2023 and 2022, along with the activity related to the Company's ARO obligations for the year ended December 31, 2023:

(In millions) Nuclear Decommission Other (a)

Balance as of December 31, 2022 $ 340 $ 418 $ 758

Revisions in estimates for current obligations ( 13 ) 3 ( 10 )

Additions — 13 13

Spending for current obligations — ( 42 ) ( 42 )

Accretion 16 23 39

Dispositions ( 343 ) ( 8 ) ( 351 )

Balance as of December 31, 2023 $ — $ 407 $ 407

Note 15 — Benefit Plans and Other Postretirement Benefits

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Participation in the NRG Pension Plan for Bargained Employees depends upon whether an employee is covered by a bargaining agreement.

The NRG Pension

plan was frozen for non-union employees on December 31, 2018.

The NRG Pension plan was frozen for non-union employees on December 31, 2018.

The Pension Plan for Employees of DEML is closed to new participants.

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Amortization of unrecognized net loss 6 3 1

Settlement/curtailment expense 14 2 —

Curtailment and special termination benefits (income)/expense ( 1 ) 14 2

Net periodic benefit cost/(credit) $ 21 $ 18 $ ( 27 )

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Amortization of unrecognized net loss 1 2 1

Curtailment loss — 1 —

Curtailment expense — — 1

Net periodic benefit credit $ ( 3 ) $ ( 4 ) $ ( 6 )

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Benefit obligation at January 1 $ 1,036 $ 1,452 $ 84 $ 105

Acquired benefit obligation from Direct Energy — 74 — 19

Service cost 5 7 — —

Interest cost 50 41 4 2

Actuarial gain ( 289 ) ( 55 ) ( 11 ) —

Actuarial loss/(gain) 22 ( 289 ) ( 5 ) ( 11 )

Employee and retiree contributions — — 4 3

Curtailment loss — — — 1

Curtailment and special termination benefit loss ( 2 ) — ( 1 ) —

Benefit payments ( 89 ) ( 171 ) ( 11 ) ( 15 )

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Fair value of plan assets at January 1 844 1,336 — —

Acquired fair value of plan assets from Direct Energy — 64 — —

Actual return on plan assets 93 ( 317 ) — —

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$ ( 172 ) $ ( 192 ) $ ( 75 ) $ ( 84 )

During the year ended December 31, 2023, the actuarial loss of $ 22 million on pension benefits was primarily driven by decreasing discount rates.

During the year ended December 31, 2022, the actuarial gain of $ 289 million on pension benefits was primarily driven by increasing discount rates.

During the year ended December 31, 2021, the actuarial gain of $ 55 million on pension benefits was primarily driven by increasing discount rates and changes in demographic assumptions.

Amounts recognized in NRG's balance sheets were as follows:

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(In millions) 2023 2022 2023 2022

Net actuarial loss/(gain) $ 74 $ ( 72 ) $ ( 11 ) $ —

Net actuarial (gain)/loss $ ( 31 ) $ 74 $ ( 5 ) $ ( 11 )

Amortization of net actuarial loss ( 6 ) ( 3 ) ( 1 ) ( 2 )

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21 18 ( 3 ) ( 4 )

Net recognized in net periodic pension cost/(credit) and OCI

Net recognized in net periodic pension (credit)/cost and OCI

$ ( 17 ) $ 75 $ ( 2 ) $ ( 9 )

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STP Defined Benefit Plans

NRG has a 44 % undivided ownership interest in STP, as discussed further in Note 28, Jointly Owned Plants .

STPNOC, which operates and maintains STP, provides its employees a defined benefit pension plan, as well as postretirement health and welfare benefits.

Although NRG does not sponsor the STP plan, it reimburses STPNOC for 44 % of the contributions made towards its retirement plan obligations.

The STPNOC defined benefit pension plan was frozen to all employees during 2021.

Although NRG did not sponsor the STP plan, it reimbursed STPNOC for 44 % of the contributions made towards its retirement plan obligations.

For the years ended December 31, 2023 and December 31, 2022, NRG reimbursed STPNOC $ 3 million and $ 18 million, respectively, for its contribution to the plans.

In 2023, NRG expects to reimburse STPNOC $ 10 million for its contribution to the plan.

The Company has recognized the following in its statement of financial position, statement of operations and accumulated OCI related to its 44 % interest in STP:

On November 1, 2023, the Company closed on the sale of its 44 % equity interest in STP.

Following the sale, the Company is no longer responsible for further reimbursements to the STP pension plan.

The Company recognized the following in its statement of financial position, statement of operations and accumulated OCI related to its former 44 % interest in STP:

As of December 31,

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Other changes in plan assets and benefit obligations recognized in other comprehensive income

( 27 ) ( 51 ) 1 4

Defined Contribution Plans

NRG's employees are also eligible to participate in defined contribution 401(k) plans.

The Company's contributions to these plans were as follows:

The Company's costs related to these plans were as follows:

Year Ended December 31,

(In millions) 2023 2022 2021

Company contributions to defined contribution plans $ 26 $ 25 $ 22

Cost recognized for defined contribution plans $ 61 $ 37 $ 35

The Company's costs, which are primarily related to employer matching of a portion of employee contributions to defined contribution plans, increased during 2023 primarily due to an increase in retirement saving plan match and the Vivint acquisition.

Note 16 — Capital Structure

For the period from December 31, 2020 to December 31, 2023, the Company had 10,000,000 shares of preferred stock authorized and 500,000,000 shares of common stock authorized.

The following table reflects the changes in NRG's common shares issued and outstanding for each period presented:

Common Shares

Issued Treasury Outstanding

The following table reflects the changes in NRG's preferred and common shares issued and outstanding for each period presented:

Preferred Shares Common Shares

Issued and Outstanding Issued Treasury Outstanding

Balance as of December 31, 2020 — 423,057,848 ( 178,825,915 ) 244,231,933

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Balance as of December 31, 2022 — 423,897,001 ( 194,335,971 ) 229,561,030

Issuance of Series A Preferred Stock 650,000 — — —

Shares issued under ESPP — — 191,249 191,249

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Share repurchases — — ( 22,730,940 ) ( 22,730,940 )

Retirement of treasury stock — ( 157,676,142 ) 157,676,142 —

Balance as of December 31, 2023 650,000 267,330,470 ( 59,199,520 ) 208,130,950

Shares issued under LTIPs — 660,267 — 660,267

Share repurchases — — ( 770,205 ) ( 770,205 )

Retirement of treasury stock — ( 770,205 ) 770,205 —

Balance as of February 1, 2024 650,000 267,220,532 ( 59,199,520 ) 208,021,012

As of December 31, 2023, NRG had 27,362,083 shares of common stock reserved for the maximum number of shares potentially issuable based on the conversion and redemption features of the long-term incentive plans.

Common stock dividends — The Company declared and paid $ 0.350 , $ 0.325 and $ 0.30 quarterly dividend per common share, or $ 1.40 , $ 1.30 and $ 1.20 per share on an annualized basis for 2022, 2021 and 2020 respectively.

In the first quarter of 2020, NRG increased the annual dividend to $ 1.20 from $ 0.12 per share, as part of a long-term capital allocation policy adopted in the fourth quarter of 2019.

In 2021, 2022 and 2023, NRG increased the annual dividend to $ 1.30 , $ 1.40 and $ 1.51 per share, respectively, representing an 8 % increase each year.

Common Stock Dividends

The Company declared and paid $ 0.3775 , $ 0.350 and $ 0.325 quarterly dividend per common share, or $ 1.51 , $ 1.40 and $ 1.30 per share on an annualized basis for 2023, 2022 and 2021 respectively.

In 2021, 2022 and 2023, NRG increased the annual dividend on its common stock to $ 1.30 , $ 1.40 and $ 1.51 per share, respectively, representing an 8 % increase each year.

The long-term capital allocation policy targets an annual dividend growth rate of 7 %- 9 % per share in subsequent years.

Beginning in the first quarter of 2024, NRG will increase the annual dividend by 8 % to $ 1.63 per share.

The Company's common stock dividends are subject to available capital, market conditions, and compliance with associated laws, regulations and other contractual obligations.

On January 19, 2024, NRG declared a quarterly dividend on the Company's common stock of $ 0.4075 per share, or $ 1.63 per share on an annualized basis, payable on February 15, 2024, to stockholders of record as of February 1, 2024.

Employee Stock Purchase Plan — The Company offers participation in the ESPP, which allows eligible employees to elect to withhold between 1 % and 10 % of their eligible compensation to purchase shares of NRG common stock at the lesser of 95 % of its market value on the offering date or 95 % of the fair market value on the exercise date.

An offering date will occur each April 1 and October 1.

An exercise date will occur each September 30 and March 31.

Employee Stock Purchase Plan

The Company offers participation in the ESPP which allows eligible employees to elect to withhold between 1 % and 10 % of their eligible compensation to purchase shares of NRG common stock at the lesser of 90 % of its market value on the offering date or 90 % of the fair market value on the exercise date.

An offering date occurs each April 1 and October 1.

An exercise date occurs each September 30 and March 31.

On April 27, 2023, NRG stockholders approved the adoption of the Amended and Restated Employee Stock Purchase Plan, effective April 1, 2023, which included a reduction in the price at which eligible employees may purchase shares of NRG common stock from 95 % to 90 % of the fair market value of the shares on the applicable date.

NRG stockholders also approved an increase of 4,400,000 shares available for the issuance under the ESPP.

As of December 31, 2023, there remained 6,702,125 shares of treasury stock reserved for issuance under the ESPP.

Share Repurchases

In December 2021, the Company announced that the Board of Directors authorized $ 1 billion for share repurchases as part of NRG’s Capital Allocation policy.

The program began with $ 44 million of repurchases in December 2021, and an incremental $ 601 million was repurchased in 2022.

The balance of $ 355 million under the current program is expected to be repurchased in 2023, subject to the availability of excess cash and full visibility of the achievement of the Company's 2023 targeted credit metrics.

In October 2022, the Company announced its 2023 capital allocation plan which, consistent with NRG's stated strategy of returning 50 % of cash available for allocation to shareholders, included $ 600 million incremental share repurchases to be completed in 2023.

In connection with the anticipated Vivint acquisition, the Company updated its 2023 capital allocation plan by reallocating 2023 capital primarily to fund the Vivint acquisition, dividend payments and debt reduction.

Following the completion of the Vivint acquisition, the Company plans to further update its 2023 capital allocation plan.

The following table summarizes the shares repurchases made during the years ended December 31, 2020, 2021 and 2022:

Total number of shares and share equivalents purchased Average price paid per share and share equivalent Amounts paid for shares and share equivalents purchased (in millions)

Share repurchases in 2021 and 2022 were made under the December 6, 2021 $ 1 billion authorization, as part of NRG’s capital allocation policy.

On June 22, 2023, following the acquisition of Vivint Smart Home, NRG revised its long-term capital allocation policy to target allocating approximately 80 % of cash available for allocation, after debt reduction, to be returned to shareholders.

As part of the revised capital allocation framework, the Company announced an increase to its share repurchase authorization to $ 2.7 billion, to be executed through 2025.

On November 6, 2023, the Company executed Accelerated Share Repurchase agreements to repurchase a total of $ 950 million of NRG's outstanding common stock.

Under the ASR agreements, the Company paid a total of $ 950 million and will receive shares of NRG's common stock on specified settlement dates.

The total number of shares purchased pursuant to the ASR agreements will generally be based on the volume-weighted average prices of NRG's common stock during the term of each ASR agreement, less a discount.

The Company received initial shares of 4,494,224 on November 8, 2023 and an additional 13,181,918 shares on December 27, 2023, which were recorded in treasury stock at fair value based on the volume-weighted average closing prices of $ 833 million, with the remaining $ 117 million recorded in additional paid in capital, representing the value of the forward contracts to purchase additional shares.

On January 30, 2024, an additional 770,205 shares were delivered.

The ASR period will end in March of 2024 and additional shares may be delivered upon final settlement of the remaining agreements.

The total number of shares delivered and the average price paid for all of the shares delivered under the ASR agreements will be determined at the end of the ASR period.

During the year ended December 31, 2023, the Company completed $ 1.2 billion of share repurchases under the $ 2.7 billion authorization, including $ 950 million through the ASR and $ 200 million through open market repurchases at an average price of $ 39.56 .

As of February 1, 2024, $ 1.5 billion is remaining under the $ 2.7 billion authorization.

The following table summarizes the share repurchases made from 2021 through February 1, 2024:

Total number of shares purchased Average price paid per share Amounts paid for shares purchased (in millions)

2021 Repurchases:

Open market repurchases (a)

1,084,752 $ 40.85 $ 44

Equivalent shares purchased in lieu of tax withholdings on equity compensation issuances (a)

Total Share Repurchases during 2020 6,774,031 $ 33.05 $ 224

2022 Repurchases:

Repurchases (b)

Equivalent shares purchased in lieu of tax withholdings on equity compensation issuances (a)

Total Share Repurchases during 2021 1,333,765 $ 40.22 $ 53

Open market repurchases

14,685,521 40.48 595

2023 Repurchases:

Open market repurchases

5,054,798 200

Equivalent shares purchased in lieu of tax withholdings on equity compensation issuances (a)

Total Share Repurchases during 2022 14,836,762 $ 40.50 $ 601

(a) NRG elected to pay cash for tax withholding on equity awards instead of issuing actual shares to management.

The average price per equivalent shares withheld was $ 42.74 , $ 37.50 and $ 38.23 in 2022, 2021 and 2020, respectively.

See Note 21, Stock-Based Compensation, for further discussion of the equity awards

(b) Includes $ 5 million accrued as of December 31, 2021

Repurchases made under the accelerated share repurchase agreements (b)

17,676,142 950

Total Share Repurchases during 2023 22,730,940 (e) $ 1,150 (c)

Repurchases made subsequent to December 31, 2023 under the accelerated share repurchase agreements (d)

Total Share Repurchases January 1, 2023 through February 1, 2024 23,501,145 (e) $ 1,150

(a) Includes $ 5 million accrued as of December 31, 2021

(b) Initial and interim shares delivered under the November 6, 2023 accelerated share repurchase agreements

(d) Additional shares delivered under the November 6, 2023 accelerated share repurchase agreements

(e) The total number of shares delivered and the average price per share under the ASR agreements will be determined at the end of the ASR period

Retirement of Treasury Stock

In the fourth quarter of 2023, the Company retired 157,676,142 shares of treasury stock.

These retired shares are now included in NRG's pool of authorized but unissued shares.

The retired stock had a carrying value of approximately $ 5.0 billion.

The Company's accounting policy upon the formal retirement of treasury stock is to deduct its par value from common stock and to reflect any excess of cost over par value as a deduction from additional paid-in capital.

Preferred Stock

Series A Preferred Stock

On March 9, 2023 ("Series A Issuance Date"), the Company issued 650,000 shares of 10.25 % Series A Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock.

The net proceeds of $ 635 million, net of issuance costs, were used to partially fund the Vivint Smart Home acquisition.

The Series A Preferred Stock is not convertible into or exchangeable for any other securities or property and has limited voting rights.

The Series A Preferred Stock may be redeemed, in whole or in part, on one or more occasions, at the option of the

Company at any time after March 15, 2028 ("Series A First Reset Date") and in certain other circumstances prior to the Series A First Reset Date.

The Series A Preferred Stock has a liquidation preference of $ 1,000 per share, plus accumulated but unpaid dividends.

Series A Preferred Stock Dividends

The annual dividend rate on each share of Series A Preferred Stock is 10.25 % from the Series A Issuance Date to, but excluding the Series A First Reset Date.

On and after the Series A First Reset Date, the dividend rate on each share of Series A Preferred Stock shall equal the five-year U.S.

Treasury rate as of the most recent reset dividend determination date (subject to a floor of 1.00 %), plus a spread of 5.92 % per annum.

Cumulative cash dividends on the Series A Preferred Stock are payable semiannually, in arrears, on each March 15 and September 15, when, as and if declared by the Board of Directors.

In September 2023, the Company declared and paid a semi-annual dividend of $ 52.96 per share on its outstanding Series A Preferred Stock, totaling $ 34 million.

Note 17 — Investments Accounted for by the Equity Method and Variable Interest Entities

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NRG accounts for the Company's significant investments using the equity method of accounting.

NRG's carrying value of equity investments can be impacted by a number of elements including impairments, unrealized gains and losses on derivatives and movements in foreign currency exchange rates.

On June 1, 2022, the Company sold its 49 % ownership in the Watson natural gas generating facility for $ 59 million as further described in Note 4, Acquisitions and Dispositions.

On September 14, 2022, the Company sold its 50 % ownership in Petra Nova natural gas generating facility.

NRG's carrying value of equity investments can be impacted by a number of elements including impairments and movements in foreign currency exchange rates.

The following table summarizes NRG's equity method investments as of December 31, 2023:

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Gladstone 37.5 % $ 34

Ivanpah Master Holdings, LLC (a)

Midway-Sunset Cogeneration Company 50.0 % 8

Total equity investments in affiliates $ 42

(a) The equity method of accounting for Ivanpah has been suspended based on losses generated by the project, including the impact of debt service and depreciation

The following table summarizes the undistributed earnings from NRG's equity method investments as of December 31, 2023:

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Coal is sourced from local mines in Queensland.

NRG and the joint

venture participants receive their respective share of revenues directly from the off takers in proportion to the ownership interests in the joint venture.

NRG and the joint venture participants receive their respective share of revenues directly from the off takers in proportion to the ownership interests in the joint venture.

Power generated by the facility is primarily sold to an adjacent aluminum smelter, with excess power sold to the Queensland Government-owned utility under long-term supply contracts.

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Net assets $ 1,388 $ 1,956

Note 18 — Income Per Share

Basic income per common share is computed by dividing net income by the weighted average number of common shares outstanding.

Note 18 — (Loss)/Income Per Share

Basic (loss)/income per common share is computed by dividing net (loss)/income less cumulative dividends attributable to preferred stock by the weighted average number of common shares outstanding.

Shares issued and treasury shares repurchased during the year are weighted for the portion of the year that they were outstanding.

Diluted income per share is computed in a manner consistent with that of basic income per share, while giving effect to all potentially dilutive common shares that were outstanding during the period.

Dilutive effect for equity compensation and other equity instruments — The relative performance stock units, non-vested restricted stock units, market stock units and non-qualified stock options are not considered outstanding for purposes of computing basic income per share.

However, these instruments are included in the denominator for purposes of computing diluted income per share under the treasury stock method for periods when there is net income.

Diluted (loss)/income per share is computed in a manner consistent with that of basic (loss)/income per share, while giving effect to all potentially dilutive common shares that were outstanding during the period.

However, these instruments are included in the denominator for purposes of computing diluted (loss)/income per share under the treasury stock method for periods when there is net income.

The Convertible Senior Notes are convertible, under certain circumstances, into cash or combination of cash and Company’s common stock.

Prior to adoption of ASU 2020-06, there was no dilutive effect for the Convertible Senior Notes due to the Company’s expectation to settle the liability in cash.

Upon adoption of ASU 2020-06, on January 1, 2022, the Company is including the potential share settlements, if any, in the denominator for purposes of computing diluted income per share under the if converted method for periods when there is net income.

Upon adoption of ASU 2020-06, on January 1, 2022, the Company is including the potential share settlements, if any, in the denominator for purposes of computing diluted (loss)/income per share under the if converted method for periods when there is net income.

The potential shares settlements are calculated as the excess of the Company's conversion obligation over the aggregate principal amount (which will be settled in cash), divided by the average share price for the period.

For the year ended December 31, 2023, there was no dilutive effect for the Convertible Senior Note since there was a net loss.

For the year ended December 31, 2022, there was no dilutive effect for the Convertible Senior Notes since there were no potential share settlements for the period.

The reconciliation of NRG's basic income per share to diluted income per share is shown in the following table:

The reconciliation of NRG's basic and diluted (loss)/income per share is shown in the following table:

Year Ended December 31,

(In millions, except per share amounts) 2023 2022 2021

Basic income per share attributable to NRG Energy, Inc;

Net income attributable to NRG Energy, Inc.

common stockholders $ 1,221 $ 2,187 $ 510

Weighted average number of common shares outstanding-basic 236 245 245

Income per weighted average common share — basic $ 5.17 $ 8.93 $ 2.08

Diluted income per share attributable to NRG Energy, Inc;

Net income attributable to NRG Energy, Inc.

common stockholders $ 1,221 $ 2,187 $ 510

Weighted average number of common shares outstanding-basic 236 245 245

Incremental shares attributable to the issuance of equity compensation (treasury stock method)

Weighted average number of common shares outstanding-diluted 236 245 246

Income per weighted average common share — diluted $ 5.17 $ 8.93 $ 2.07

Basic and diluted (loss)/income per share:

Net (loss)/income $ ( 202 ) $ 1,221 $ 2,187

Cumulative dividends attributable to Series A Preferred Stock 54 — —

(Loss)/Income Available to Common Stockholders

$ ( 256 ) $ 1,221 $ 2,187

Weighted average number of common shares outstanding - basic and diluted 228 236 245

(Loss)/Income per weighted average common share — basic and diluted $ ( 1.12 ) $ 5.17 $ 8.93

As of December 31, 2023, the Company had 6 million of outstanding equity instruments that are anti-dilutive and were not included in the computation of the Company's diluted loss per share.

As of December 31, 2022 and 2021, the Company had an insignificant number of outstanding equity instruments that are anti-dilutive and were not included in the computation of the Company’s diluted income per share.

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The Company manages its operations based on the combined results of the retail and wholesale generation businesses with a geographical focus.

NRG's chief operating decision maker, its chief executive officer, evaluates the performance of its segments based on operational measures including adjusted earnings before interest, taxes, depreciation and amortization, or Adjusted EBITDA, free cash flow and allocation of capital, as well as net income/(loss).

Vivint Smart Home operations are reported within the Vivint Smart Home segment.

NRG's chief operating decision maker, its interim chief executive officer, evaluates the performance of its segments based on operational measures including adjusted earnings before interest, taxes, depreciation and amortization, or Adjusted EBITDA, free cash flow and allocation of capital, as well as net income/(loss).

The accounting policies of the segments are the same as those applied in the consolidated financial statements as disclosed in Note 2, Summary of Significant Accounting Policies .

The Company had no customer that comprised more than 10% of the Company's consolidated revenues during the years ended December 31, 2023, 2022 and 2021.

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For the Year Ended December 31, 2023

(In millions) Texas East West/Services/Other Corporate (a)

(In millions) Texas East West/Services/Other Vivint Smart Home (a)

Corporate (b)

$ 10,476 $ 12,547 $ 4,281 $ 1,549 $ — $ ( 30 ) $ 28,823

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Gain on sale of assets 1,319 259 — — — — 1,578

Operating income 1,262 318 558 ( 120 ) — 2,018

Equity in (losses)/earnings of unconsolidated affiliates ( 2 ) — 8 — — 6

Operating income/(loss) 3,092 ( 1,726 ) ( 859 ) 46 ( 169 ) — 384

Equity in earnings of unconsolidated affiliates — — 16 — — — 16

Impairment losses on investments — — ( 102 ) — — — ( 102 )

Other income, net 2 11 6 ( 12 ) 56 ( 16 ) 47

Gain on debt extinguishment — — — — 109 — 109

Interest expense ( 3 ) ( 3 ) ( 31 ) ( 177 ) ( 469 ) 16 ( 667 )

Income/(loss) before income taxes 3,091 ( 1,718 ) ( 970 ) ( 143 ) ( 473 ) — ( 213 )

Income tax expense — 1 57 384 — 442

Income tax (benefit)/expense (c)

— — ( 111 ) ( 32 ) 132 — ( 11 )

Net income/(loss) $ 3,091 $ ( 1,718 ) $ ( 859 ) $ ( 111 ) $ ( 605 ) $ — $ ( 202 )

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Total assets $ 8,236 $ 13,712 $ 3,626 $ 7,043 $ 19,919 $ ( 26,498 ) $ 26,038

(a) Inter-segment sales and inter-segment net derivative gains and losses included in revenues

(a) Includes results of operations following the acquisition date of March 10, 2023

(b) Inter-segment sales and inter-segment net derivative gains and losses included in revenues

$ 5 $ 9 $ 16 $ — $ — $ — $ 30

(c) Consolidated domestic federal and state income taxes are recorded to the Corporate segment, except for Vivint Smart Home which is recorded directly to the Vivint Smart Home segment.

West/Services/Other amounts represent foreign income taxes

For the Year Ended December 31, 2022

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Total operating cost and expenses 8,805 16,445 4,193 117 17 29,577

Gain on sale of assets 19 — 17 211 — 247

Operating income 1,286 1,901 112 42 — 3,341

Gain/(loss) on sale of assets 10 — 45 ( 3 ) — 52

Operating income/(loss) 1,262 318 558 ( 120 ) — 2,018

Equity in (losses)/earnings of unconsolidated affiliates ( 2 ) — 8 — — 6

Other income, net 5 10 3 54 ( 16 ) 56

Loss on debt extinguishment — — — ( 77 ) — ( 77 )

Interest expense — ( 1 ) ( 32 ) ( 400 ) 16 ( 417 )

Income/(loss) before income taxes 1,265 327 537 ( 466 ) — 1,663

Income tax expense — — 19 653 — 672

Income tax expense (b)

— 1 57 384 — 442

Net income/(loss) $ 1,265 $ 326 $ 480 $ ( 850 ) $ — $ 1,221

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$ 4 $ ( 26 ) $ 5 $ — $ — $ ( 17 )

(b) Consolidated domestic federal and state income taxes are recorded to the Corporate segment.

West/Services/Other amounts represent foreign income taxes

For the Year Ended December 31, 2021

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Total operating cost and expenses 9,028 11,124 3,564 169 10 23,895

(Loss)/gain on sale of assets — — ( 2 ) 5 — 3

Operating income/(loss) 814 362 15 ( 86 ) — 1,105

Gain on sale of assets 19 — 17 211 — 247

Operating income 1,286 1,901 112 42 — 3,341

Equity in (losses)/earnings of unconsolidated affiliates ( 3 ) — 20 — — 17

Impairment losses on investments ( 18 ) — — — — ( 18 )

Other income, net 8 7 3 59 ( 14 ) 63

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Income/(loss) before income taxes 1,290 1,907 107 ( 445 ) — 2,859

Income tax (benefit)/expense — ( 1 ) 2 250 — 251

Income tax expense (b)

— — 19 653 — 672

Net income/(loss) $ 1,290 $ 1,907 $ 88 $ ( 1,098 ) $ — $ 2,187

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$ 5 $ ( 18 ) $ 3 $ — $ — $ ( 10 )

(b) Consolidated domestic federal and state income taxes are recorded to the Corporate segment.

West/Services/Other amounts represent foreign income taxes

Note 20 — Income Taxes

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Total — deferred ( 109 ) 371 621

Total income tax expense $ 442 $ 672 $ 251

Total income tax (benefit)/expense $ ( 11 ) $ 442 $ 672

Effective income tax rate 5.2 % 26.6 % 23.5 %

The IRA enacted on August 16, 2022, introduced new provisions including a 15% corporate book minimum tax and a 1% excise tax on net share repurchases with both taxes effective beginning in fiscal year 2023 for NRG.

The Company will continue to evaluate the impact of the corporate book minimum tax when the U.S.

Treasury and the IRS release further guidance.

Additionally, the IRA establishes a production tax credit associated with existing nuclear facilities which begins in 2024 and terminates at the end of 2031.

The production tax credit will fully apply when gross revenues are at or below $25 per MWh and phases out completely at $43.75 per MWh.

Treasury is in the process of defining the methods by which gross revenues may be calculated pursuant to the IRA.

On March 27, 2020, the Senate passed the CARES Act to provide emergency relief related to the COVID-19 pandemic.

The CARES Act contains federal income tax provisions which, among other things:

(i) increases the amount of interest expense that businesses are allowed to deduct by increasing the adjusted taxable income limitation from 30% to 50% for tax years that begin in 2019 and 2020;

(ii) permits businesses to carry back to each of the five tax years NOLs arising from tax years beginning after December 31, 2017 and before January 1, 2020;

and (iii) temporarily removes the 80% limitation on NOLs until tax years beginning after 2020.

The CARES Act provisions did not have a material impact on the tax positions of the Company.

The IRA enacted on August 16, 2022, introduced new provisions including a 15% corporate alternative minimum tax and a 1% excise tax on net share repurchases with both taxes effective beginning in fiscal year 2023 for NRG.

There is no impact on the Company's provision for income taxes from the CAMT for the year ended December 31, 2023.

The Company will reevaluate the impact of the corporate alternative minimum tax upon the potential release of guidance by the U.S.

Treasury and the IRS regarding the treatment of unrealized gains and losses on derivative instruments.

The following represented the domestic and foreign components of income before income taxes:

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(In millions, except effective income tax rate) 2023 2022 2021

Income before income taxes $ 1,663 $ 2,859 $ 761

(Loss)/Income before income taxes $ ( 213 ) $ 1,663 $ 2,859

Tax at federal statutory tax rate ( 45 ) 349 600

Foreign rate differential 7 ( 3 ) —

State taxes ( 22 ) 69 111

Foreign rate differential ( 10 ) 7 ( 3 )

Changes in state valuation allowances 42 ( 3 ) ( 29 )

Permanent differences 31 17 8

Changes in valuation allowance ( 3 ) ( 29 ) 24

Deferred impact of state tax rate changes 14 ( 10 ) 2

Recognition of uncertain tax benefits 12 8 ( 10 )

Carbon capture tax credits ( 19 ) — —

Deferred impact of state tax rate changes 3 14 ( 10 )

Foreign tax refunds ( 17 ) — —

Return to provision adjustments ( 5 ) — 5

Income tax expense $ 442 $ 672 $ 251

Carbon capture tax credits — ( 19 ) —

Income tax (benefit)/expense $ ( 11 ) $ 442 $ 672

Effective income tax rate 5.2 % 26.6 % 23.5 %

For the year ended December 31, 2023, NRG's effective income tax rate was lower than the federal statutory tax rate of 21%, primarily due to permanent differences and changes in state valuation allowances.

For the year ended December 31, 2022, NRG's effective income tax rate was higher than the federal statutory tax rate of 21% primarily due to state tax expense partially offset by the recognition of carbon capture tax credits.

For the year ended December 31, 2021, NRG's effective income tax rate was higher than the federal statutory tax rate of 21% primarily due to state tax expense partially offset by tax benefits from the revaluation of state deferred tax assets, valuation allowance, and settlements of uncertain tax positions.

For the year ended December 31, 2020, NRG's effective income tax rate was higher than the federal statutory tax rate of 21% primarily due to state tax expense, the recognition of state valuation allowance on NOLs, and return to provision adjustments.

The temporary differences, which gave rise to the Company's deferred tax assets and liabilities consisted of the following:

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Deferred tax assets:

Deferred compensation, accrued vacation and other reserves $ 93 $ 114

Difference between book and tax basis of property 399 436

Pension and other postretirement benefits 62 65

Equity compensation 8 7

Allowance for credit losses 33 168

Federal net operating loss carryforwards $ 1,762 $ 1,717

Foreign net operating loss carryforwards 104 112

State net operating loss carryforwards 367 315

Foreign net operating loss carryforwards 110 104

Deferred revenues 347 —

Difference between book and tax basis of property 353 399

Federal and state tax credit carryforwards 317 393

Federal benefit on state uncertain tax positions 5 3

Deferred compensation, accrued vacation and other reserves 141 93

Interest disallowance carryforward per §163(j) of the Tax Act 132 65

Pension and other postretirement benefits 48 62

Allowance for credit losses 35 33

Equity compensation 24 8

Federal benefit on state uncertain tax positions 13 5

Inventory obsolescence 11 10

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Deferred tax liabilities:

Emissions allowances 19 20

Derivatives 874 591

Goodwill 26 40

Intangibles amortization (excluding goodwill) 726 269

Derivatives 156 874

Capitalized contract costs 131 —

Equity method investments 93 82

Convertible Debt — 14

Goodwill 40 26

Debt discount amortization 26 —

Emissions allowances 18 19

Total deferred tax liabilities 1,190 1,270

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Net deferred tax asset $ 2,229 $ 1,747

The primary drivers for the decrease in the net deferred tax asset from $ 2.1 billion as of December 31, 2021 to $ 1.7 billion as of December 31, 2022 is an increase in unrealized mark-to-market book gains on derivative instruments.

The primary drivers for the increase in the net deferred tax asset from $ 1.7 billion as of December 31, 2022 to $ 2.2 billion as of December 31, 2023 is due to unrealized mark-to-market book losses and deferred revenues, partially offset by capitalized contract costs and a step-up in basis of book intangibles associated with the acquisition of Vivint Smart Home.

Deferred tax assets and valuation allowance

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Taxes Receivable and Payable

As of December 31, 2022, NRG recorded a current net federal receivable of $ 5 million and a current net foreign receivable of $ 13 million due to filings of Canadian amended returns as well as prepayments of estimated taxes.

As of December 31, 2023, NRG recorded a current federal payable of $ 20 million, a current net state payable of $ 3 million and a current net foreign receivable of $ 7 million.

Uncertain tax benefits

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The Company recognizes interest and penalties related to uncertain tax benefits in income tax expense.

The Company recognized $ 1 million of interest expense for the year ended December 31, 2022, an immaterial amount for the year ended 2021 and $ 1 million for the year ended 2020.

The Company recognized $ 1 million of interest expense for the year ended December 31, 2023, $ 1 million for the year ended 2022 and an immaterial amount for the year ended 2021.

As of December 31, 2023 and 2022, NRG had cumulative interest and penalties related to these uncertain tax benefits of $ 3 million and $ 2 million, respectively.

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Increase due to current year positions 28 9

Increase due to acquired balance from Direct Energy — 9

Settlements, payments and statute closure — ( 15 )

Increase due to acquired balance from Vivint Smart Home 23 —

Uncertain tax benefits as of December 31 $ 73 $ 22

Note 21 — Stock-Based Compensation

The Company's stock-based compensation consists of awards granted under the NRG LTIP and following the Acquisition in March 2023, the Vivint LTIP.

NRG Energy, Inc.

Long-Term Incentive Plan

On April 27, 2017, the NRG LTIP was amended to increase the number of shares available for issuance by 3,000,000 .

As of December 31, 2023 and 2022, a total of 25,000,000 shares of NRG common stock were authorized for issuance under the NRG LTIP.

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The NRG LTIP is subject to adjustments in the event of reorganization, recapitalization, stock split, reverse stock split, stock dividend, and a combination of shares, merger or similar change in NRG's structure or outstanding shares of common stock.

As of December 31, 2023, the outstanding awards under the NRG LTIP include restricted stock units, deferred stock units and relative performance stock units.

Restricted Stock Units

As of December 31, 2022, RSUs granted under the Company's LTIPs typically have three -year graded vesting schedules beginning on the grant date.

As of December 31, 2023, RSUs granted under the NRG LTIP typically have three -year graded vesting schedules beginning on the grant date.

Fair value of the RSUs granted during 2023 and 2022 is derived from the closing price of NRG common stock on the grant date.

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DSUs represent the right of a participant to be paid one share of NRG common stock at the end of a deferral period established under the terms of the award.

DSUs granted under the Company's LTIPs are fully vested at the date of issuance.

DSUs granted under the NRG LTIP are fully vested at the date of issuance.

Fair value of the DSUs, which is based on the closing price of NRG common stock on the date of grant, is recorded as compensation expense in the period of grant.

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The amount of the award is subject to the Company's achievement of certain performance measures over the vesting period.

RPSUs are restricted grants where the quantity of shares increases and decreases alongside the Company's Total Shareholder Return, or TSR, relative to the TSR of the Company's current proxy peer group and the total returns of select indexes, or Peer Group.

RPSUs are restricted grants where the quantity of shares increases and decreases alongside the Company's Total Shareholder Return ("TSR"), relative to the TSR of the Company's current proxy peer group and the total returns of select indexes, or Peer Group.

For RPSU's granted in 2022 and forward, the peer group consists of the companies that comprise the Standard & Poor’s 500 Index on the first day of the performance period.

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Granted 617,510 39.46

Forfeited ( 54,392 ) 46.68

Forfeited (a)

( 737,227 ) 45.61

Vested ( 3,729 ) 50.28

Non-vested at December 31, 2023 671,889 46.27

(a) Includes January 2023 vestings that occurred at a 0 % payout as well as forfeitures due to the departure of certain officers

The weighted average grant date fair value of RPSUs granted during the years ended December 31, 2023, 2022 and 2021, was $ 39.46 , $ 57.41 and $ 46.78 , respectively.

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2023 2022 2021 (a)

RPSUs RPSUs RPSUs

Expected volatility 41.35 % 37.54 % 34.05 %

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Additional 60,815 RPSUs were granted in September 2021 with a risk free rate of 0.42 % and expected volatility of 37.38 %

For the years ended December 31, 2022 and 2021, expected volatility is calculated based on NRG's historical stock price volatility data over the period commensurate with the expected term of the RPSU, which equals the vesting period.

Non-Qualified Stock Options

All NQSOs granted under the Company's LTIP were fully vested as of December 31, 2022, 2021 and 2020.

No NQSOs were granted in 2022, 2021 or 2020.

Of the 17,870 NQSOs that were outstanding at December 31, 2021, 14,477 were exercised during the year ended December 31, 2022 and 3,393 expired.

No compensation expense was recognized during 2022, 2021 or 2020 related to NQSOs.

The expected volatility is calculated based on NRG's historical stock price volatility data over the period commensurate with the expected term of the RPSU, which equals the vesting period.

Vivint Smart Home Long-Term Incentive Plan

Effective March 10, 2023, in connection with the Vivint Smart Home Acquisition, as discussed in Note 4, Acquisitions and Dispositions, NRG assumed the Vivint Smart Home, Inc.

Long-Term Incentive Plan, or Vivint LTIP.

In addition to the rollover awards converted as part of the Acquisition, the Vivint LTIP provides for issuances of time-based restricted stock units and performance-based restricted stock units.

As of December 31, 2023, 17,500,000 shares of NRG common stock were authorized for issuance under the Vivint LTIP, and there were 12,749,736 shares of common stock remaining available for grants.

Restricted Stock Units

As of December 31, 2023, RSUs under the Vivint LTIP include RSUs which were granted prior to the Acquisition and were converted into awards that will vest as NRG common stock ("Rollover RSUs").

These awards typically had four-year graded vesting schedules beginning on the grant date.

The fair value of the Rollover RSUs is based on the fair value of NRG common stock on the Acquisition date after applying the conversion ratio as per the Merger Agreement.

The RSUs that were granted following the Acquisition date are typically subject to the same terms as the RSUs under the NRG LTIP.

The following table summarizes the non-vested RSUs under the Vivint LTIP and changes during the year:

Rollover RSUs RSUs granted following the Acquisition

Units Weighted Average Grant Date Fair Value per Unit Units Weighted Average Grant Date Fair Value per Unit

Non-vested at December 31, 2022 — $ — — $ —

Rollover RSUs at the Acquisition date 4,553,998 31.63 — —

Granted following the Acquisition date — — 895,827 35.24

Forfeited ( 288,776 ) 31.63 ( 110,531 ) 35.21

Vested ( 1,280,321 ) 31.63 ( 4,998 ) 35.21

Non-vested at December 31, 2023 2,984,901 31.63 780,298 35.24

The total fair value of RSUs vested during the year ended December 31, 2023 was $ 66 million.

Performance Stock Units

As of December 31, 2023, PSUs granted under the Vivint LTIP are generally granted under the same terms as the PSUs granted under the NRG LTIP, and are valued using the same methods and assumptions.

During the year ended December 31, 2023, 102,837 PSUs were granted at a weighted average grant date fair value per unit of $ 44.96 and remain outstanding as of year end.

Supplemental Information

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Award 2023 2022 2021 2023 2023

RSUs $ 15 $ 9 $ 9 $ 17 1.75

RSUs under NRG LTIP $ 20 $ 15 $ 9 $ 29 1.61

RSUs under Vivint LTIP 76 — — 69 1.82

PSUs under Vivint LTIP 2 — — 3 2.25

DSUs 2 2 2 — 0.00

RPSUs 3 11 9 17 1.69

PRSUs under NRG LTIP (a)

12 6 7 15 1.74

PRSUs under Vivint LTIP (a)

8 — — 14 2.29

Total $ 123 $ 34 $ 27 $ 147

Tax detriment/(benefit) recognized $ 3 $ 2 $ ( 9 )

Tax detriment recognized $ 2 $ 3 $ 2

(a) Phantom Restricted Stock Units, PRSUs, are liability-classified time-based awards that typically vest ratably over a three -year period.

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Note 23 — Commitments and Contingencies

Certain Fuel and Transportation Commitments

NRG has entered into long-term contractual arrangements to procure certain fuel and transportation services for the Company's generation assets.

As of December 31, 2022, the Company's minimum commitments under such outstanding agreements are estimated as follows:

Period (In millions)

Thereafter 56

(a) Actual fuel and transportation purchases are significantly higher than these estimated minimum unconditional long-term firm commitments with remaining term in excess of one year

For the years ended December 31, 2022, 2021 and 2020, the costs of certain fuel and transportation were $ 736 million, $ 584 million and $ 479 million, respectively.

Purchased Energy Commitments

NRG has long-term contractual commitments related to electricity and natural gas products, including power purchases, gas transportation and storage of various quantities and durations.

NRG has entered into long-term contractual arrangements related to energy products, including power purchases, gas transportation and storage, and fuel and transportation services.

These contracts are not included in the consolidated balance sheet as of December 31, 2023.

Minimum purchase commitment obligations are as follows as of December 31, 2022:

As of December 31, 2023, the Company's minimum commitments under such outstanding agreements are estimated as follows:

Period (In millions)

Thereafter 823

(a) Actual energy purchases are significantly higher than these estimated minimum unconditional long-term firm commitments with remaining term in excess of one year.

The year ending 2023 does not include an additional $ 1.5 billion of short-term commitments

For the years ended December 31, 2022, 2021 and 2020, the costs of purchased energy were $ 18.8 billion, $ 12.8 billion and $ 1.8 billion, respectively.

(a) The year 2024 does not include an additional $ 978 million of short-term commitments

The Company's actual costs may be significantly higher than these estimated minimum unconditional long-term firm commitments with remaining term in excess of one year.

For the years ended December 31, 2023, 2022 and 2021, the costs of fuel and purchased energy were $ 13.4 billion, $ 19.6 billion and $ 13.4 billion, respectively.

First Lien Structure

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To the extent that the underlying hedge positions for a counterparty are out-of-the-money to NRG, the counterparty would have a claim under the first lien program.

As of December 31, 2022, hedges under the first lien were out-of-the-money for NRG on a counterparty aggregate basis.

Nuclear Insurance

STP maintains required insurance coverage for liability claims arising from nuclear incidents pursuant to the Price-Anderson Act.

The current liability limit per incident is $ 13.7 billion, subject to change to account for the effects of inflation and the number of licensed reactors.

An inflation adjustment must be made at least once every five years with the next adjustment expected to be effective no later than November 1, 2023.

Under the Price-Anderson Act, owners of nuclear power plants in the U.S.

are required to purchase primary insurance limits of $ 450 million for each operating site.

In addition, the Price-Anderson Act requires an additional layer of protection through mandatory participation in a retrospective rating plan for power reactors resulting in an additional $ 13.2 billion in funds available for public liability claims.

The current maximum

assessment per incident, per reactor, is approximately $ 138 million, taking into account a 5 % adjustment for administrative fees, payable at approximately $ 21 million per reactor, per incident, per year.

NRG would be responsible for 44 % of the maximum assessment, or $ 9 million per reactor, per incident, per year, and a maximum of $ 61 million per incident, per reactor.

In addition, the U.S.

Congress retains the ability to impose additional financial requirements on the nuclear industry to pay liability claims that exceed $ 13.7 billion for a single incident.

The liabilities of the co-owners of STP with respect to the retrospective premium assessments for nuclear liability insurance are joint and several.

STP purchases insurance for property damage and site decontamination cleanup costs from Nuclear Electric Insurance Limited, or NEIL, and European Mutual Association for Nuclear Insurance, or EMANI, both of which are industry mutual insurance companies, of which STP is a member.

STP has purchased $ 2.8 billion in limits for nuclear events and $ 1.0 billion in limits for non-nuclear events.

The nuclear event limit remains the maximum available from NEIL.

The upper $ 1.3 billion in nuclear events limits (excess of the first $ 1.5 billion in nuclear events limits) is a single limit blanket policy shared with two Diablo Canyon nuclear reactors, which have no affiliation with the Company.

This shared limit is not subject to automatic reinstatement in the event of a loss.

The NEIL primary policy covers both nuclear and non-nuclear property damage events, and a NEIL companion policy provides Accidental Outage coverage for the co-owners of STP's lost revenue following a property damage event, at a weekly indemnity limit of $ 3 million per unit up to a maximum of $ 274 million nuclear per unit and $ 183 million non-nuclear per unit, and is subject to an eight-week waiting period.

NRG also purchases an Accidental Outage policy from NEIL, which provides protection for lost revenue due to an insurable event.

This coverage allows for reimbursement up to $ 2 million per week per unit up to a maximum of $ 216 million nuclear and $ 144 million non-nuclear, and is subject to an eight-week waiting period.

Accidental Outage coverage amounts decrease in the event more than one unit at a station is out of service due to a common accident.

Under the terms of the NEIL and EMANI policies, member companies may be assessed up to ten and six times their annual premiums, respectively, if the NEIL or EMANI Board of Directors determines their surplus has been depleted due to the payment of property losses at any of the licensed reactors in a single policy year.

NEIL and EMANI require that their members maintain an investment grade credit rating or ensure their annual retrospective obligation by providing a financial guarantee, letter of credit, deposit premium, or an insurance policy.

NRG has purchased an insurance policy from NEIL and EMANI to guarantee the Company's obligation;

however note the NEIL aspect of this insurance will only respond to retrospective premium adjustments assessed within twenty-four months after the policy term, whereas NEIL's Board of Directors can make such an adjustment up to 6 years after the policy expires.

All insurance coverage is subject to various sub limits and significant deductibles.

As of December 31, 2023, all hedges under the first liens were in-the-money on a counterparty aggregate basis.

Contingencies

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On September 9, 2019, Midwest Generation filed a Motion to Reconsider numerous issues, which the court granted in part and denied in part on February 6, 2020.

The IPCB will hold hearings to determine the appropriate relief.

In 2023, the IPCB held hearings to determine the appropriate relief.

Midwest Generation has been working with the Illinois EPA to address the groundwater issues since 2010.

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These matters were known and accrued for at the time of each acquisition.

XOOM Energy is a defendant in a putative class action lawsuit pending in New York.

This case is in the summary judgment phase.

XOOM Energy (E.D.N.Y.

2019) is a defendant in a putative class action lawsuit pending in New York.

The Court denied XOOM's motion for summary judgment and granted class certification.

The Second Circuit denied XOOM's request to appeal the class certification grants.

XOOM plans to challenge Mirkin's expert testimony to further hamper Mirkin's ability to support its case.

Direct Energy

There are four putative class actions pending against Direct Energy:

(1) Linda Stanley v.

Direct Energy (S.D.N.Y Apr.

2019) - The parties mediated in June 2021 and agreed on a settlement.

In April 2022, the Court granted final approval of the settlement, which was primarily paid during the second quarter of 2022.

This matter is complete and final;

(2) Martin Forte v.

Direct Energy (N.D.N.Y.

2017) - In December 2017, the Court granted Direct Energy's Motion for summary judgment effectively ending the matter at the district court level.

Forte appealed.

Direct Energy participated in oral argument on January 12, 2023.

The Second Circuit Court of Appeals recently issued an opinion in Direct Energy's favor;

There was one putative class action pending against Direct Energy:

Richard Schafer v.

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N.Y.) - The Second Circuit sent the matter back to the trial court in December 2021.

After discovery, Direct Energy filed summary judgement.

After discovery, Direct Energy filed summary judgment.

Direct Energy won summary judgment and Schafer appealed.

The parties are now briefing the appeal.

Given the result in the Forte case, the trial court's summary judgment will be upheld and Direct Energy is expected to prevail;

and (4) Andrew Gant v.

Direct Energy and NRG (D.N.J.

2022) - Direct Energy and NRG filed a Motion to Dismiss on October 18, 2022.

The appeal is fully briefed.

Oral argument occurred on October 25, 2023.

The Second Circuit upheld the trial court's grant of summary judgment in favor of Direct Energy.

Telephone Consumer Protection Act ("TCPA") Cases — In the cases set forth below, referred to as the TCPA Cases, such actions involve consumers alleging violations of the Telephone Consumer Protection Act of 1991, as amended, by receiving calls, texts or voicemails without consent in violation of the federal Telemarketing Sales Rule, and/or state counterpart legislation.

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On October 19, 2022, Direct Energy filed a Motion to Transfer Venue asking the Court to transfer the case to the Southern District where the Burk case was filed.

Direct Energy will await the court's ruling before moving forward with written discovery;

On April 12, 2023, the Court granted Direct Energy’s Motion to Transfer Venue, moving to the case to the Southern District of Texas;

and (2) Matthew Dickson v.

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Dickson appealed.

The Court held oral arguments on January 17, 2023.

Direct Energy anticipates a ruling within the next six months.

The Sixth Circuit found that Dickson has standing and reversed the trial court's dismissal of the case.

The matter is back at the trial court.

The parties will conduct further fact discovery and expert discovery and are likely to resubmit motions for further review by the Court.

Sales Practice Lawsuits

There are three litigation matters relating to claims made by Vivint Smart Home competitors against Vivint Smart Home alleging, among other things, that Vivint Smart Home's sales representatives used deceptive sales practices.

These matters were known and accrued for at the time of the acquisition.

The three matters are:

(1) CPI Security Systems, Inc.

Vivint Smart Home, Inc.

The CPI matter that was filed in 2020 went to trial, and in February 2023, the jury issued a verdict against Vivint Smart Home, in favor of CPI for $ 50 million of compensatory damages and an additional $ 140 million of punitive damages.

Vivint Smart Home has filed its notice of appeal and is awaiting a briefing schedule.

While Vivint Smart Home believes the CPI jury verdict is not legally or factually supported and intends to pursue post judgment remedies and file an appeal, there can be no assurance that such defense efforts will be successful;

(2) ADT LLC, et al.

Vivint Smart Home, Inc.

f/k/a Mosaic Acquisition Corporation, et al.(S.D.Fl.

The parties mediated in May 2023 and agreed on a settlement.

In June 2023, the Court granted final approval of the settlement, which was paid in June 2023;

and (3) Alert 360 Opco, Inc, et al.

("Alert 360") v.

Vivint Smart Home, Inc., et al (N.D.Ok.

On March 1, 2023, Alert 360 filed a complaint against Vivint Smart Home alleging, among other things, deceptive sales practices.

The parties settled the dispute in October 2023 and the case was dismissed.

Patent Infringement Lawsuits

SB IP Holdings LLC (“Skybell”) v.

Vivint Smart Home, Inc.

— O n October 23, 2023, a jury in the U.S.

District Court, Eastern District of Texas, Sherman Division, issued a verdict against the Company in favor of Skybell for $ 45 million in damages for patent infringement.

The patents that were the basis for the claims made by Skybell were ruled invalid by the U.S.

International Trade Commission in November 2021.

In accordance with advice by legal counsel, the Company does not believe the verdict is legally supported and will pursue post-judgment and appellate remedies along with any other legal options available.

Contract Disputes

Alarm.com — In September 2022, Vivint Smart Home sent Alarm.com a notice asserting that it was no longer obligated to pay certain license fees under the Patent Cross License Agreement between the parties on the basis that Vivint Smart Home no longer practices any claim under any valid Alarm.com patent and, therefore, no license fees are due.

Alarm.com filed an arbitration demand against Vivint Smart Home alleging, among other things, breach of the agreement due to continued use of the patents in question.

The parties have resolved all outstanding litigation and entered into a long-term intellectual property licensing agreement.

STP — In July 2023, the partners in STP, CPS and Austin Energy, initiated a lawsuit and filed to intervene in the license transfer application with the NRC, claiming a right of first refusal exists in relation to the proposed sale of NRG South Texas' 44 % interest in STP to Constellation.

NRG believes the claims set forth by CPS and Austin Energy in the lawsuit and the NRC proceedings are without merit and intends to vigorously defend against them.

For further discussion of the transaction, see Note 4, Acquisitions and Dispositions.

Winter Storm Uri Lawsuits

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and subrogation.

The case is currently stayed pending appeal by other parties on other issues.

The First Court of Appeals conditionally granted the generators' mundamus relief, ordering the trial court to grant the generator defendents' Motions to Dismiss.

The Company expected the Plaintiffs to challenge this ruling.

The Company intends to vigorously defend these matters.

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Plaintiffs sought damages for the alleged improper charges and a declaration as to which charges were proper under the contract.

In February 2020, the federal court dismissed this lawsuit without prejudice for lack of subject matter jurisdiction.

On March 17, 2020, plaintiffs filed a lawsuit in the Nineteenth Judicial District Court for the Parish of East Baton Rouge in Louisiana alleging substantially the same matters.

On February 4, 2019, NRG sold the South Central Portfolio, including the entities subject to this litigation.

However, NRG has agreed to indemnify the purchaser for certain losses suffered in connection therewith.

However, NRG has agreed to indemnify the purchaser for certain losses suffered in connection with this litigation.

In February 2020, the federal court dismissed this lawsuit without prejudice for lack of subject matter jurisdiction.

On March 17, 2020, plaintiffs filed a lawsuit in the Nineteenth Judicial District Court for the Parish of East Baton Rouge in Louisiana alleging substantially the same matters, which was dismissed on October 2, 2023 pursuant to a settlement agreement.

Note 24 — Regulatory Matters

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As such, NRG is affected by regulatory developments at the federal, state and provincial levels and in the regions in which NRG operates.

In addition, NRG is subject to the market rules, procedures and protocols of the various ISO and RTO markets in which NRG participates.

These power markets are subject to ongoing legislative and regulatory changes that may impact NRG's wholesale and retail operations.

In addition to the regulatory proceeding noted below, NRG and its subsidiaries are parties to other regulatory proceedings arising in the ordinary course of business or have other regulatory exposure.

In addition to the regulatory proceedings noted below, NRG and its subsidiaries are parties to other regulatory proceedings arising in the ordinary course of business or have other regulatory exposure.

In management's opinion, the disposition of these ordinary course matters will not materially adversely affect NRG's consolidated financial position, results of operations, or cash flows.

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The Company has established an appropriate accrual pending potential regulatory action by San Diego Gas & Electric regarding the Company's Encina facility.

Federal Trade Commission Investigation — In 2019, Vivint Smart Home received a civil investigative demand from the staff of the Federal Trade Commission (“FTC”) concerning potential violations of the Fair Credit Reporting Act and the “Red Flags Rule” thereunder, and the FTC Act.

In April 2021, Vivint Smart Home entered into a settlement with the FTC that resolved this investigation.

As part of this settlement, which was approved by a federal court on May 3, 2021, Vivint Smart Home paid $ 20 million and agreed to implement various additional compliance related measures ("Stipulated Order").

The Company is currently in the process of administering the terms of the Stipulated Order, which includes multiple undertakings by the Company.

The Company is engaged in ongoing discussions with the staff of the FTC regarding the Company’s compliance with the terms of the Stipulated Order.

Under the terms of the Stipulated Order, Vivint Smart Home is required to undertake biennial assessments by an independent third-party assessor (the "Assessor"), which reviews Vivint Smart Home’s compliance program and provides a report on Vivint Smart Home’s ongoing compliance with the Stipulated Order.

Since its inception until December 31, 2023, Vivint Smart Home has completed its initial assessment and its first biennial assessment as required by the Stipulated Order.

In addition, Vivint Smart Home has voluntarily undertaken six quarterly audits by the appointed Assessor.

In all the assessments, Vivint Smart Home received a report from the Assessor with no findings of non-compliance of any kind.

New York State Public Service Commission ("NYSPSC") - Notice of Apparent Violation — The NYSPSC issued an order referred to as the Retail Reset Order in December 2019 that limited ESCO's offers for electric and natural gas to three compliant products:

guaranteed savings from the utility default rate, a fixed term capped at 5% of the rolling 12-month average utility default rate, or NY-sourced renewable energy that is at least 50% greater than the prevailing NY Renewable Energy Standard for load serving entities.

The order effectively limited ESCO offers to natural gas customers to only the guaranteed savings and capped fixed term compliant products because no equivalent renewable energy product exists for natural gas.

NRG took action to comply with the order when it became effective April 16, 2021.

On January 8, 2024, the NYSPSC notified eight of NRG's retail energy suppliers (serving both electricity and natural gas) of alleged non-compliance with New York regulatory requirements.

Among other items, the notices allege that the NRG suppliers did not transition existing residential customers to one of the three compliant products authorized by the NYSPSC following the effective date of the order.

NRG responded to the notices in February 2024.

The outcome of this process has the potential to negatively impact the retail business in New York.

Note 25 — Environmental Matters

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The Company has elected to use a $ 1 million disclosure threshold, as permitted, for environmental proceedings to which the government is a party.

CPP/ACE Rules — On July 8, 2019, the EPA promulgated the ACE rule, which rescinded the CPP, which had sought to broadly regulate CO 2 emissions from the power sector.

CPP/ACE Rules — In 2019, the EPA promulgated the ACE rule, which rescinded the CPP, which had sought to broadly regulate CO 2 emissions from the power sector.

The ACE rule required states that have coal-fired EGUs to develop plans to seek heat rate improvements from coal-fired EGUs.

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The Court did not address the related issues of whether the EPA may adopt only measures applied at each source.

The Company anticipates that there will be additional proceedings at the D.C.

Circuit and additional rulemaking by the EPA over the next several years.

Cross-State Air Pollution Rule ("CSAPR") — In April 2022, the EPA proposed revising the CSAPR to address the good-neighbor provisions of the 2015 ozone NAAQS.

If the rule were finalized as proposed, it would apply to 25 states (including Texas) beginning in 2023.

In 2023, the revised Group 3 trading program (previously established in the Revised CSAPR Update Rule) would have emission budgets based on NO x emission rates that the EPA says are achievable by existing controls at power plants.

Starting in 2026, the NO x budgets would be reduced significantly based on levels achievable if SCR controls were installed at coal-fueled power plants that do not currently have such controls.

Starting in 2025, the budgets would be updated annually to account for retirements, changes to operations and new units.

The proposal also contemplates heightened surrender requirements for units that exceed certain NO x emission rate thresholds.

The Company cannot predict the outcome of this proposed revision and anticipates that this rulemaking will be subject to legal challenges after it is finalized.

The EPA anticipates finalizing the revised rule in Spring 2023.

Effluent Limitations Guidelines — In November 2015, the EPA revised the ELG for Steam Electric Generating Facilities, which imposed more stringent requirements (as individual permits were renewed) for wastewater streams from FGD, fly ash, bottom ash, and flue gas mercury control.

On May 23, 2023, the EPA proposed significantly revising the manner in which new and existing EGU's GHG emissions should be regulated including using hydrogen as a fuel, capturing and storing/sequestering CO 2 and requiring new units to be more efficient.

The EPA has stated that it intends to finalize these revisions in 2024.

The Company expects that the final rule will be challenged in the courts and accordingly uncertain over the next several years.

Cross-State Air Pollution Rule ("CSAPR") — On March 15, 2023, the EPA signed and released a prepublication of a final rule that sought to significantly revise the CSAPR to address the good-neighbor obligations of the 2015 ozone NAAQS for 23 states after earlier having disapproved numerous state plans to address the issue.

Several states, including Texas, challenged the EPA's disapproval of their state plans.

On May 1, 2023, the United States Court of Appeals for the Fifth Circuit stayed the EPA's disapproval of Texas' and Louisiana's state plans, which disapprovals are a condition precedent to the EPA imposing its plan on Texas and Louisiana.

Several other states are also similarly situated because of similar stays.

Nonetheless, on June 5, 2023, the EPA published this rule in the Federal Register.

On July 31, 2023, the EPA promulgated an interim final rule that addresses the various judicial orders that have stayed several State-Implementation-Plan disapprovals by limiting the effectiveness of certain requirements of the final rule promulgated on June 5, 2023 in Texas and five other states.

The final rule decreases, over time, the ozone-season NOx allowances allocated to generators in the states not affected by the judicial stays

beginning in 2023 by assuming that participants in this cap-and-trade program had or would optimize existing NOx controls and later install additional NOx controls.

The Company cannot predict the outcome of the legal challenges to the:

(i) various state disapprovals;

(ii) the final rule promulgated on June 5, 2023;

and (iii) the interim final rule promulgated on July 31, 2023 that seeks to address the judicial orders.

Regional Haze Proposal — On May 2023, the EPA proposed to withdraw the existing Texas Sulfur Dioxide Trading Program and replace it with unit-specific SO 2 limits for 12 units in Texas to address requirements to improve visibility at National Parks and Wilderness areas.

If finalized as proposed, the rule would result in more stringent SO 2 limits for two of the Company's coal-fired units in Texas.

The Company cannot predict the outcome of this proposal.

Effluent Limitations Guidelines — In 2015, the EPA revised the ELG for Steam Electric Generating Facilities, which imposed more stringent requirements (as individual permits were renewed) for wastewater streams from FGD, fly ash, bottom ash, and flue gas mercury control.

On September 18, 2017, the EPA promulgated a final rule that, among other things, postponed the compliance dates to preserve the status quo for FGD wastewater and bottom ash transport water by two years to November 2020 until the EPA amended the rule.

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and (iii) changing several deadlines.

On July 26, 2021, the EPA announced that it is initiating a new rulemaking to evaluate revising the ELG rule.

While the EPA is developing the new rule, the existing rule (as amended in 2020) will stay in place, and the EPA expects permitting authorities to continue to implement the current regulation.

The Company anticipates that the EPA will release a proposed rule in the first half of 2023.

In October 2021, NRG informed its regulators that the Company intends to comply with the ELG by ceasing combustion of coal by the end of 2028 at its domestic coal units outside of Texas, and installing appropriate controls by the end of 2025 at its two plants that have coal-fired units in Texas.

Byproducts, Wastes, Hazardous Materials and Contamination

In April 2015, the EPA finalized the rule regulating byproducts of coal combustion (e.g., ash and gypsum) as solid wastes under the RCRA.

On July 30, 2018, the EPA promulgated a rule that amended the ash rule by extending some of the deadlines and providing more flexibility for compliance.

On March 29, 2023, the EPA proposed revisions to the ELG and sought comments, which the EPA is analyzing.

In 2015, the EPA finalized a rule regulating byproducts of coal combustion (e.g., ash and gypsum) as solid wastes under the RCRA.

On August 21, 2018, the D.C.

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Circuit decision and extend some of the deadlines.

On November 12, 2020, the EPA finalized "A Holistic Approach to Closure Part B," which further amended the April 2015 Rule to, among other things, provide procedures for requesting approval to operate existing impoundments with an alternative liner.

NRG anticipates further rulemaking related to the Federal Permit Program and legacy surface impoundments.

On November 12, 2020, the EPA finalized "A Holistic Approach to Closure Part B:

Alternative Demonstration for Unlined Surface Impoundments," which further amended the April 2015 Rule to, among other things, provide procedures for requesting approval to operate existing ash impoundments with an alternative liner.

On May 23, 2023, the EPA proposed establishing requirements for:

(i) inactive (or legacy) surface impoundments at inactive facilities and (ii) all CCR management units (regardless of how or when the CCR was placed) at regulated facilities.

NRG anticipates further rulemaking related to legacy surface impoundments and the Federal Permit Program.

Note 26 — Cash Flow Information

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In several cases, the contract limits the liability of the indemnifier.

NRG has no reason to believe that the Company currently has any material liability relating to such routine indemnification obligations included in the table above, except for the California property tax indemnity for estimated increases in California property taxes of certain solar properties that the Company agreed to indemnify NRG Yield for, as part of the agreement to sell NRG Yield and the Renewables Platform.

NRG has no reason to believe that the Company currently has any material liability relating to such routine indemnification obligations included in the table above, except for the California property tax indemnity for estimated increases in California property taxes of certain solar properties that the Company agreed to indemnify, as part of the agreement to sell NRG Yield and the Renewables Platform.

The California property tax indemnity is estimated to be $ 126 million as of December 31, 2023 and is included in the above table under asset sales guarantee obligations.

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For those guarantees and indemnities that do not limit the Company's liability exposure, it may not be able to estimate what the Company's liability would be, until a claim is made for payment or performance, due to the contingent nature of these contracts.

Note 28 — Jointly Owned Plants

Certain NRG subsidiaries own undivided interests in jointly-owned plants, as described below.

These plants are maintained and operated pursuant to their joint ownership participation and operating agreements.

NRG is responsible for its subsidiaries' share of operating costs and direct expenses and includes its proportionate share of the facilities and related revenues and direct expenses in these jointly-owned plants in the corresponding balance sheet and income statement captions of the Company's consolidated financial statements.

The following table summarizes NRG's proportionate ownership interest in the Company's jointly-owned facilities:

Note 28 — Jointly Owned Plant

NRG owns an undivided interest in Cedar Bayou.

Cedar Bayou is maintained and operated pursuant to its joint ownership participation and operating agreement.

NRG is responsible for its subsidiaries' share of operating costs and direct expenses and includes its proportionate share of the facility and related revenues and direct expenses in the jointly-owned plant in the corresponding balance sheet and income statement captions of the Company's consolidated financial statements.

The following table summarizes NRG's proportionate ownership interest in the Company's jointly-owned facility:

(In millions unless otherwise stated)

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Construction in

South Texas Project Units 1 and 2, Bay City, TX 44.00 % $ 478 $ ( 235 ) $ 7

Cedar Bayou Unit 4, Baytown, TX 50.00 % $ 222 $ ( 115 ) $ 2

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End of Period

Allowance for credit losses, deducted from accounts receivable

Allowance for credit losses, deducted from accounts receivable and other non-current assets

Year Ended December 31, 2023 $ 133 $ 251 $ 35 $ ( 274 ) (a)

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Number Description Method of Filing

2.1 Third Amended Joint Plan of Reorganization of NRG Energy, Inc., NRG Power Marketing, Inc., NRG Capital LLC, NRG Finance Company I LLC, and NRGenerating Holdings (No.

Incorporated herein by reference to Exhibit 99.1 to the Registrant's current report on Form 8-K filed on November 19, 2003.

2.2 First Amended Joint Plan of Reorganization of NRG Northeast Generating LLC (and certain of its subsidiaries), NRG South Central Generating (and certain of its subsidiaries) and Berrians I Gas Turbine Power LLC.

Incorporated herein by reference to Exhibit 99.2 to the Registrant's current report on Form 8-K filed on November 19, 2003.

2.3 Acquisition Agreement, dated as of September 30, 2005, by and among NRG Energy, Inc., Texas Genco LLC and the Direct and Indirect Owners of Texas Genco LLC.

Incorporated herein by reference to Exhibit 2.1 to the Registrant's current report on Form 8-K filed on October 3, 2005.

2.4 Asset Purchase Agreement, dated October 18, 2013, by and among NRG Energy, Inc., Edison Mission Energy and NRG Energy Holdings Inc.

Incorporated herein by reference to Exhibit 2.2 to Amendment No.

1 to the Registrant’s current report on Form 8-K filed on October 21, 2013.

2.1 Third Amended Joint Plan of Reorganization of GenOn Energy, Inc.

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Incorporated herein by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K, filed on December 6, 2022.

2.6 Equity Purchase Agreement, dated May 31, 2023 by and among Constellation Energy Generation, LLC, as Buyer and Texas Genco GP, LLC, Texas Genco LP, LLC, together, Seller.

Incorporated herein by reference to Exhibit 2.1 to the Registrant's current report on Form 8-K filed on June 1, 2023.

2.7 Amendment No.1 to Equity Purchase Agreement dated September 29, 2023 by and among Constellation Energy Generation, LLC.

as Buyer and Texas Genco GP, LLC, together, Seller

Filed herewith.

2.8 Amendment No.

2 to Equity Purchase Agreement dated November 1, 2023 by and among Constellation Energy Generation, LLC.

as Buyer and Texas Genco GP, LLC, together, Seller

Filed herewith.

2.9 Amendment No.

3 to Equity Purchase Agreement dated November 1, 2023 by and among Constellation Energy Generation, LLC.

as Buyer and Texas Genco GP, LLC, together, Seller

Filed herewith.

3.1 Amended and Restated Certificate of Incorporation.

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Incorporated herein by reference to Exhibit 3.2 to the Registrant's current report on Form 8-K filed on December 2, 2022.

3.4 Series A Preferred Stock Certificate of Designation filed with the Secretary of the State of Delaware on March 9, 2023.

Incorporated herein by reference to Exhibit 3.1 to the Registrant's current report on Form 8-K filed on March 10, 2023.

4.1 Specimen of Certificate representing common stock of NRG Energy, Inc.

Incorporated herein by reference to Exhibit 4.3 to the Registrant's quarterly report on Form 10-Q filed on August 4, 2006.

4.2 Second Supplemental Indenture, dated as of July 19, 2016, among NRG Energy, Inc., the guarantors named therein and Law Debenture Trust Company of New York.

Incorporated herein by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K, filed on July 25, 2016.

4.3 Third Supplemental Indenture, dated August 2, 2016, among NRG Energy, Inc., the guarantors named therein and Law Debenture Trust Company of New York.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on August 3, 2016.

4.4 Form of 6.625% Senior Note due 2027.

Incorporated herein by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K, filed on August 3, 2016.

4.5 Registration Rights Agreement, dated August 2, 2016, among NRG Energy, Inc., the guarantors named therein and Morgan Stanley & Co.

LLC, as representative to the initial purchasers listed in Schedule I thereto.

Incorporated herein by reference to Exhibit 4.4 to the Registrant's Current Report on Form 8-K, filed on August 3, 2016.

4.6 Fourth Supplemental Indenture, dated December 7, 2017, among NRG Energy, Inc., the guarantors named therein and Delaware Trust Company, as trustee.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on December 8, 2017.

4.7 Form of 5.75% Senior Notes due 2028

Incorporated herein by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K, filed on December 8, 2017.

4.8 Registration Rights Agreement, dated December 7, 2017, among NRG Energy, Inc., the guarantors named therein and Citigroup Global Markets, Inc., as representative to the initial purchasers listed in Schedule I thereto.

Incorporated herein by reference to Exhibit 4.4 to the Registrant's Current Report on Form 8-K, filed on December 8, 2017.

4.9 Indenture, dated May 24, 2018, among NRG Energy, Inc., the guarantors named therein and Delaware Trust Company, as trustee.

4.2 Base Indenture, dated May 28, 2019, between NRG Energy, Inc.

and Delaware Trust Company, as trustee

Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed on May 30, 2019.

4.10 Form of 2.75% Convertible Senior Notes due 2048.

4.3 Supplemental Indenture, dated May 28, 2019, among NRG Energy, Inc., the guarantors named therein and Delaware Trust Company, as trustee, containing Form 3.750% Senior Secured First Lien Notes due 2024 and Form of 4.440% Senior Secured First Lien Notes due 2029

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K filed on May 30, 2019.

4.11 Description of NRG Energy, Inc.

securities registered pursuant to section 12 of the Securities Exchange Act of 1934

Incorporated herein by reference to Exhibit 4.15 to the Registrant's Annual Report on Form 10-K, filed on February 27, 2020.

4.12 Indenture, dated December 2, 2020, between NRG Energy, Inc.

4.4 Base Indenture, dated December 2, 2020, between NRG Energy, Inc.

and Deutsche Bank Trust Company Americas, as trustee, pertaining to the Secured Notes.

Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.13 Supplemental Indenture, dated December 2, 2020, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, pertaining to the Secured Notes

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.14 Form of 2.000% Senior Secured First Lien Notes due 2025

Incorporated herein by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.15 Form of 2.450% Senior Secured First Lien Notes due 2027

Incorporated herein by reference to Exhibit 4.4 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.16 Indenture, dated December 2, 2020, between NRG Energy, Inc.

and Deutsche Bank Trust Company Americas, as trustee, pertaining to the Unsecured Notes

Incorporated herein by reference to Exhibit 4.5 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.17 Supplemental Indenture, dated December 2, 2020, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, pertaining to the Unsecured Notes

Incorporated herein by reference to Exhibit 4.6 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.18 Form of 3.375% Senior Notes due 2029 (incorporated by reference to Exhibit 4.6 filed herewith)

Incorporated herein by reference to Exhibit 4.7 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.19 Form of 3.625% Senior Notes due 2031 (incorporated by reference to Exhibit 4.6 filed herewith)

Incorporated herein by reference to Exhibit 4.8 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.20 Facility Agreement, dated December 2, 2020, among NRG Energy, Inc., the guarantors party thereto, Alexander Funding Trust and Deutsche Bank Trust Company Americas, as the notes trustee

Incorporated herein by reference to Exhibit 4.9 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.21 Letter of Credit Facility Agreement, dated December 2, 2020, among NRG Energy, Inc., the financial institutions from time to time party thereto as letter of credit issuers, and Deutsche Bank Trust Company Americas, as administrative agent and as collateral agent

Incorporated herein by reference to Exhibit 4.10 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.22 Amended and Restated Declaration of Trust of Alexander Funding Trust, dated December 2, 2020, among NRG Energy, Inc.

as depositor and in its own capacity, Deutsche Bank Trust Company Americas, as trustee, and Deutsche Bank Trust Company Delaware, as Delaware trustee

Incorporated herein by reference to Exhibit 4.11 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.23 Indenture, dated December 2, 2020, between NRG Energy, Inc.

and Deutsche Bank Trust Company Americas, as trustee, pertaining to the P-Caps Secured Notes

Incorporated herein by reference to Exhibit 4.12 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.24 Supplemental Indenture, dated December 2, 2020, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, pertaining to the P-Caps Secured Notes

Incorporated herein by reference to Exhibit 4.13 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.25 Form of 1.841% Senior Secured First Lien Notes due 2023(incorporated by reference to Exhibit 4.31 filed herewith)

4.5 Supplemental Indenture, dated December 2, 2020, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, containing Form of 2.000% Senior Secured First Lien Notes due 2025 and Form of 2.450% Senior Secured First Lien Notes due 2027

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.26 Amendment and Restatement Agreement, dated as of June 30, 2016, to the Amended and Restated Credit Agreement, the Second Amended and Restated Collateral Trust Agreement and the Amended and Restated Guarantee and Collateral Agreement.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's quarterly report on Form 10-Q filed on August 9, 2016.

4.27 Second Amended and Restated Credit Agreement, dated as of June 30, 2016, by and among NRG Energy, Inc., the lenders party thereto, the joint lead arrangers and joint lead bookrunners party thereto, Citicorp North America, Inc., Commerzbank AG, New York Branch, Keybank Capital Markets Inc.

and CIT Bank, N.A.

Incorporated herein by reference to Exhibit 10.2 to the Registrant's quarterly report on Form 10-Q filed on August 9, 2016.

4.28 First Amendment Agreement, dated as of January 24, 2017, dated as of January 24, 2017, by and among NRG Energy, Inc., the lenders from time to time parties thereto and Citicorp North America, Inc., as administrative agent and collateral agent.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on January 24, 2017.

4.29 Second Amendment Agreement, dated as of March 21, 2018, by and among NRG Energy, Inc., the lenders from time to time parties thereto and Citicorp North America, Inc., as administrative agent and collateral agent.

4.6 Supplemental Indenture, dated March 9, 2023, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, containing Form of 7.000% Senior Secured First Lien Notes Due 2033

Incorporated herein by reference to Exhibit 4.2 to the Registrant's current report on Form 8-K filed on March 10, 2023.

4.30 Third Amendment Agreement, dated as of May 7, 2018, by and among NRG Energy, Inc., its subsidiaries parties thereto, the lenders from time to time parties thereto and Citicorp North America, Inc., as administrative agent and collateral agent.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on May 7, 2018.

4.31 Indenture, dated May 23, 2016, between NRG Energy, Inc.

4.7 Base Indenture, dated May 23, 2016, between NRG Energy, Inc.

and Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York), as trustee.

Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed on May 23, 2016.

4.32 Fifth Supplemental Indenture, dated May 14, 2019, among NRG Energy, Inc., the guarantors named therein and Delaware Trust Company, as trustee.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K filed on May 16, 2019.

4.33 Form of 5.250% Senior Notes due 2029 .

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K filed on May 14, 2019.

4.34 Indenture, dated May 28, 2019, between NRG Energy, Inc.

and Delaware Trust Company, as trustee

Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed on May 30, 2019.

4.35 Supplemental Indenture, dated May 28, 2019, among NRG Energy, Inc., the guarantors named therein and Delaware Trust Company, as trustee.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K filed on May 30, 2019.

4.36 Form of 3.750% Senior Secured First Lien Notes due 2024

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K filed on May 30, 2019.

4.37 Form of 4.450% Senior Secured First Lien Notes due 2029

4.8 Third Supplemental Indenture, dated August 2, 2016, among NRG Energy, Inc., the guarantors named therein and Law Debenture Trust Company of New York containing Form of 6.625% Senior Notes due 2027.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on August 3, 2016.

4.9 Fourth Supplemental Indenture, dated December 7, 2017, among NRG Energy, Inc., the guarantors named therein and Delaware Trust Company, as trustee, containing Form of 5.750% Senior Notes due 2028.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on December 8, 2017.

4.10 Fifth Supplemental Indenture, dated May 14, 2019, among NRG Energy, Inc., the guarantors named therein and Delaware Trust Company, as trustee, containing Form of 5.250% Senior Notes due 2029.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K filed on May 16, 2019.

4.38 Fourth Amendment dated as of May 28, 2019 to the Second Amended and Restated Credit Agreement dated as of June 30, 2016, included as Annex A thereto a clean, conformed copy of the Second Amended and Restated Credit Agreement

Incorporated herein by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on November 7, 2019.

4.39 Fifth Amendment to Credit Agreement and Third Amendment to Collateral Trust Agreement, dated as of August 20, 2020, by and among NRG Energy, Inc., its subsidiaries parties thereto, the lenders party thereto, Citicorp North America, Inc., as administrative agent and collateral agent, and Deutsche Bank Trust Company Americas, as collateral trustee.

4.11 Base Indenture, dated December 2, 2020, between NRG Energy, Inc.

and Deutsche Bank Trust Company Americas, as trustee, pertaining to the Unsecured notes.

Incorporated herein by reference to Exhibit 4.5 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.12 Supplemental Indenture, dated December 2, 2020, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, containing Form of 3.375% Senior Notes due 2029 and Form of 3.625% Senior Notes due 2031.

Incorporated herein by reference to Exhibit 4.6 to the Registrant's Current Report on Form 8-K, filed on December 4, 2020.

4.13 Second Supplemental Indenture, dated August 23, 2021, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, containing Form of 3.875% Senior Notes due 2032.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on August 23, 2021.

4.40 Receivables Sale Agreement, dated as of September 22, 2020, among the Originators from time to time parties thereto, NRG Retail LLC, as Servicer, and NRG Receivables LLC.

Incorporated herein by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on September 22, 2020.

4.41 Receivables Loan and Servicing Agreement, dated as of September 22, 2020, among NRG Receivables LLC, as Borrower, NRG Retail LLC, as Servicer, the persons from time to time party thereto as Conduit Lenders, the persons from time to time party thereto as Committed Lenders, the persons from time to time party thereto as Facility Agents, the financial institutions from time to time party thereto as LC Issuers, and Royal Bank of Canada as Administrative Agent

Incorporated herein by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on September 22, 2020.

4.14 Indenture, dated May 24, 2018, among NRG Energy, Inc., the guarantors named therein and Delaware Trust Company, as trustee, containing Form of 2.750% Convertible Senior Notes due 2048.

Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K, filed on May 25, 2018.

4.15 Supplemental Indenture (Additional Subsidiary Guarantees-2.750% Convertible Senior Notes due 2048) dated January 5, 2021, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.1 to the Registrant's quarterly report on Form 10-Q filed on May 6, 2021.

4.43 Supplemental Indenture (Additional Subsidiary Guarantees 1.841% Senior Secured First Lien Notes due 2023) dated January 5, 2021, among NRG Energy, Inc., each of its guarantor subsidiaries, and Deutsche Bank Trust Company Americas as trustee.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's quarterly report on Form 10-Q filed on May 6, 2021.

4.44 Supplemental Indenture (additional Subsidiary Guarantees-6.625% Senior Notes due 2027) dated January 5, 2021, among NRG Energy, Inc., each of its guarantor subsidiaries , and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.4 to the Registrant's quarterly report on Form 10-Q filed on May 6, 2021.

4.45 Supplemental Indenture (additional Subsidiary Guarantees-5.750% Senior Notes due 2028) dated January 5, 2021, Supplemental Indenture (additional Subsidiary Guarantees-5.750% Senior Notes due 2028) dated January 5, 2021, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.5 to the Registrant's quarterly report on Form 10-Q filed on May 6, 2021.

4.46 Supplemental Indenture (additional Subsidiary Guarantees-5.250% Senior Notes due 2029) dated January 5, 2021, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.6 to the Registrant's quarterly report on Form 10-Q filed on May 6, 2021.

4.47 Supplemental Indenture (Additional Subsidiary Guarantees 3.375% Senior Notes due 2029 and 3.625% Senior Notes due 2031) dated January 5, 2021, among NRG Energy, Inc., each of its guarantor subsidiaries , and Deutsche Bank Trust Company Americas as trustee.

Incorporated herein by reference to Exhibit 4.7 to the Registrant's quarterly report on Form 10-Q filed on May 6, 2021.

4.48 Supplemental Indenture (additional Subsidiary Guarantees-3.750% Senior Secured First Lien Notes due 2024 and 4.450% Senior Secured First Lien Notes due 2029) dated January 5, 2021, among NRG Energy, Inc., each of its guarantor subsidiaries , and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on August 23, 2021.

4.49 Supplemental Indenture (Additional Subsidiary Guarantees 2.000% Senior Secured First Lien Notes due 2025 and 2.450% Senior Secured First Lien Notes due 2027) dated January 5, 2021, among NRG Energy, Inc., each of its guarantor subsidiaries , and Deutsche Bank Trust Company Americas as trustee.

Incorporated herein by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K, filed on August 23, 2021.

4.50 Second Supplemental Indenture, dated August 23, 2021, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on August 23, 2021.

4.51 Form of 3.875% Senior Notes due 2032 .

Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on August 23, 2021.

4.52 Supplemental Indenture (Settlement Elections - 2.750% Convertible Senior Notes due 2048) dated February 22, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.52 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.16 Supplemental Indenture (Additional Subsidiary Guarantees-2.750% Convertible Senior Notes due 2048) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.53 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.54 Supplemental Indenture (Additional Subsidiary Guarantees-1.841% Senior Secured First Lien Notes due 2023) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Deutsche Bank Trust Company Americas as trustee.

Incorporated herein by reference to Exhibit 4.54 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.55 Supplemental Indenture (Additional Subsidiary Guarantees-6.625% Senior Notes due 2027) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.55 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.56 Supplemental Indenture (Additional Subsidiary Guarantees-5.750% Senior Notes due 2028) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.56 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.57 Supplemental Indenture (Additional Subsidiary Guarantees-5.250% Senior Notes due 2029) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.57 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.58 Supplemental Indenture (Additional Subsidiary Guarantees-3.375% Senior Notes due 2029 and 3.625% Senior Notes due 2031) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Deutsche Bank Trust Company Americas as trustee.

Incorporated herein by reference to Exhibit 4.58 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.59 Supplemental Indenture (Additional Subsidiary Guarantees-3.750% Senior Secured First Lien Notes due 2024 and 4.450% Senior Secured First Lien Notes due 2029) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.59 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.60 Supplemental Indenture (Additional Subsidiary Guarantees-2.000% Senior Secured First Lien Notes due 2025 and 2.450% Senior Secured First Lien Notes due 2027) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Deutsche Bank Trust Company Americas as trustee.

4.17 Supplemental Indenture (Settlement Elections - 2.750% Convertible Senior Notes due 2048) dated February 22, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Delaware Trust Company as trustee.

Incorporated herein by reference to Exhibit 4.52 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

4.61 Supplemental Indenture (Additional Subsidiary Guarantees-3.875% Senior Notes due 2032) dated February 17, 2022, among NRG Energy, Inc., each of its guarantor subsidiaries, and Deutsche Bank Trust Company Americas as trustee.

4.18 Base Indenture, dated August 29, 2023, between NRG Energy, Inc.

and Deutsche Bank Trust Company Americas, as trustee, pertaining to the Alexander Funding Trust II Pre-Capitalized Trust Securities.

Incorporated herein by reference to Exhibit 4.4 to the Registrant's current report on Form 8-K filed on August 29, 2023.

4.19 Supplemental Indenture, dated August 29, 2023, among NRG Energy, Inc., the guarantors named therein and Deutsche Bank Trust Company Americas, as trustee, containing Form 7.467% Senior Secured First Lien Notes due 2028.

Incorporated herein by reference to Exhibit 4.5 to the Registrant's current report on Form 8-K filed on August 29, 2023.

4.20 Indenture, dated as of February 14, 2020, among APX Group, Inc., the guarantors party thereto and Wilmington Trust, National Association as trustee and collateral agent relating to APX Group, Inc.’s 6.75% Senior Secured Notes due 2027.

Incorporated herein by reference to Exhibit 10.1 to Vivint Smart Home, Inc.'s Current Report on Form 8-K filed on February 19, 2020).

4.21 Indenture, dated as of July 9, 2021, between APX Group, Inc., as the Issuer, the guarantors party hereto, and Wilmington Trust, National Association, as trustee, payment agent and registrar, relating to the Company's 5.75% Senior Notes due 2029.

Incorporated herein by reference to Exhibit 10.1 to Vivint Smart Home, Inc.'s Current Report on Form 8-K filed on July 12, 2021.

4.22 Description of NRG Energy, Inc.

securities registered pursuant to section 12 of the Securities Exchange Act of 1934

Incorporated herein by reference to Exhibit 4.15 to the Registrant's Annual Report on Form 10-K, filed on February 27, 2020.

4.62 Sixth Amendment to Second Amended and Restated Credit Agreement, dated February 14, 2023, by and among NRG Energy, Inc., its subsidiaries party thereto, the lenders and issuing banks party thereto, Citicorp North America, Inc., as administrative agent and collateral agent, and Deutsche Bank Trust Company Americas, as collateral trustee.

Incorporated herein by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on February 14, 2023.

10.1* Form of NRG Energy, Inc.

7 unchanged sentences

Incorporated herein by reference to Exhibit 10.7 to the Registrant's annual report on Form 10-K filed on March 1, 2018.

10.4* Form of NRG Energy, Inc.

Long-Term Incentive Plan Performance Stock Unit Agreement.

Incorporated herein by reference to Exhibit 10.7 to the Registrant's annual report on Form 10-K filed on February 23, 2010.

10.4* Second Amended and Restated Annual Incentive Plan for Designated Corporate Officers.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed on May 7, 2015.

10.6† LLC Membership Interest Purchase Agreement between Reliant Energy, Inc.

and NRG Retail LLC, dated as of February 28, 2009.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's quarterly report on Form 10-Q filed on April 30, 2009.

10.5* The NRG Energy, Inc.

3 unchanged sentences

Incorporated herein by reference to Exhibit 10.49 to the Registrant’s annual report on Form 10-K filed on February 27, 2013.

10.9* NRG Energy, Inc.

Long-Term Incentive Plan Market Stock Unit Agreement.

Incorporated herein by reference to Exhibit 10.53 to the Registrant's annual report on Form 10-K filed on February 28, 2014.

10.10* NRG Energy, Inc.

2010 Stock Plan For GenOn Employees Market Stock Unit Agreement

Incorporated herein by reference to Exhibit 10.54 to the Registrant's annual report on Form 10-K filed on February 28, 2014.

10.11 Employment Agreement, dated December 21, 2015, by and between NRG Energy, Inc.

and Mauricio Gutierrez.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed on December 24, 2015.

10.12 Settlement Agreement, dated as of December 14, 2017, by and between NRG Energy, Inc.

on behalf of itself and the NRG Parties, GenOn Energy, Inc.

on behalf of itself and the Debtors.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on December 18, 2017.

10.13 Pension Indemnity Agreement, dated as of December 14, 2017, by and between NRG Energy, Inc.

and GenOn Energy, Inc.

Incorporated herein by reference to Exhibit 10.4 to the Registrant's Current Report on Form 8-K filed on December 18, 2017.

10.14 Tax Matters Agreement, initially dated as of December 14, 2017, by and between NRG Energy, Inc.

and GenOn Energy, Inc.

and by Reorganized GenOn upon the Effective Date.

Incorporated herein by reference to Exhibit 10.5 to the Registrant's Current Report on Form 8-K filed on December 18, 2017.

10.7* Form of NRG Energy, Inc.

6 unchanged sentences

Incorporated herein by reference to Exhibit 10.34 to NRG Yield, Inc.'s Annual Report on Form 10-K filed on March 1, 2018.

10.18* Amended and Restated Employee Stock Purchase Plan

Incorporated herein by reference to Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q filed on May 2, 2019.

10.10* NRG Energy, Inc.

Amended and Restated Executive Change-in-Control and General Severance Plan for Tier IA and Tier IIA Executives (Amended and Restated Effective April 1, 2018).

Incorporated herein by reference to Exhibit 10.2 to the Registrant's Quarterly Report on Form 10-Q filed on August 2, 2018.

10.20 A copy of Amendment No.

1 to Receivables Loan and Servicing Agreement, dated as of July 26, 2021, among NRG Retail LLC, as Servicer, NRG Receivables LLC, as Borrower, NRG Energy, Inc., as Performance Guarantor, the Conduit Lenders, Committed Lenders, Facility Agents and LC Issuers party, and Royal Bank of Canada, as administrative Agent, and included as Exhibit A-2 thereto a clean, conformed copy of the Receivables Loan and Servicing Agreement.

Amended and Restated Executive Change-in-Control and General Severance Plan for Tier IA and Tier IIA Executives (Amended and Restated Effective January 1, 2024).

Filed herewith

10.11 Sixth Amendment to Second Amended and Restated Credit Agreement, dated as of February 14, 2023, by and among NRG Energy, Inc., its subsidiaries party thereto, the lenders and issuing banks party thereto, Citicorp North America, Inc., as administrative agent and collateral agent, and Deutsche Bank Trust Company Americas, as collateral trustee, and included as Exhibit A-2 thereto a clean conformed copy of the Second Amended and Restated Credit Agreement

Incorporated herein by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed on February 15, 2023.

10.12 Seventh Amendment to Second Amended and Restated Credit Agreement, dated as of March 13, 2023, by and among NRG Energy, Inc., its subsidiaries party thereto, the lenders and issuing banks party thereto, Citicorp North America, Inc., as administrative agent and collateral agent, and Deutsche Bank Trust Company Americas, as collateral trustee.

Incorporated herein by reference to Exhibit 4.2 to the Registrant's quarterly report on Form 10-Q filed on May 4, 2023.

10.13 Second Amended and Restated Credit Agreement, dated as of July 9, 2021, among APX Group Holdings, Inc., as Holdings, APX Group, Inc., as the borrower, the guarantors party hereto from time to time, Bank of America, N.A., as administrative agent, swing line lender and an L/C issuer.

Incorporated herein by reference to Exhibit 10.2 to Vivint Smart Home, Inc.'s Current Report on Form 8-K filed on July 12, 2021.

10.14 Amendment No.1 to the Second Amended and Restated Credit Agreement, dated as of June 9, 2023, by and between AXP Group, Inc.

as borrower and the Bank of America, N.A., as administrative agent.

Incorporated herein by reference to Exhibit 4.1 to the Registrant's quarterly report on Form 10-Q filed on August 8, 2023.

10.15 Facility Agreement, dated August 29, 2023, among NRG Energy, Inc., the guarantors party thereto, Alexander Funding Trust II and Deutsche Bank Trust Company Americas, as the notes trustee

Incorporated herein by reference to Exhibit 4.1 to the Registrant's current report on Form 8-K filed on August 29, 2023.

10.16 Letter of Credit Facility Agreement, dated August 29, 2023, among NRG Energy, Inc., the financial institutions from time to time party thereto as letter of credit issuers, and Deutsche Bank Trust Company Americas, as administrative agent and as collateral agent

Incorporated herein by reference to Exhibit 4.2 to the Registrant's current report on Form 8-K filed on August 29, 2023.

10.17 Amended and Restated Declaration of Trust of Alexander Funding Trust II, dated August 29, 2023, among NRG Energy, Inc.

as depositor and in its own capacity, Deutsche Bank Trust Company Americas, as trustee, and Deutsche Bank Trust Company Delaware, as Delaware trustee

Incorporated herein by reference to Exhibit 4.3 to the Registrant's current report on Form 8-K filed on August 29, 2023.

10.18 Receivables Sale Agreement, dated as of September 22, 2020, among the Originators from time to time parties thereto, NRG Retail LLC, as Servicer, and NRG Receivables LLC.

Incorporated herein by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on September 22, 2020.

10.19 Amendment No.

3 to Receivables Loan and Servicing Agreement, dated as of June 22, 2023, among NRG Retail LLC, as Servicer, NRG Receivables LLC, as Borrower, NRG Energy, Inc., as Performance Guarantor, the Conduit Lenders, Committed Lenders, Facility Agents and LC Issuers party thereto, and Royal Bank of Canada, as administrative Agent, and included as Exhibit A-2 thereto a clean, conformed copy of the Receivables Loan and Servicing Agreement.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed on June 27, 2023.

10.20* Form of NRG Energy, Inc.

7 unchanged sentences

Incorporated herein by reference to Exhibit 10.23 to the Registrant's annual report on Form 10-K filed on February 24, 2022.

10.24 Amendment No.

2 to Receivables Loan and Servicing Agreement, dated as of July 26, 2022, among NRG Retail LLC, as Servicer, NRG Receivables LLC, as Borrower, NRG Energy, Inc., as Performance Guarantor, the Conduit Lenders, Committed Lenders, Facility Agents and LC Issuers party thereto, and Royal Bank of Canada, as administrative Agent, and included as Exhibit A-2 thereto a clean, conformed copy of the Receivables Loan and Servicing Agreement.

Incorporated herein by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed on August 1, 2022.

10.25 Joinder Agreement, dated as of July 26, 2022, by Direct Energy, LP, as an additional originator, and consented to by NRG Receivables LLC, as Borrower, NRG Retail LLC, as Servicer, and Royal Bank of Canada, as administrative agent, to the Receivables Sale Agreement, dated as of September 22, 2020, among the Originators from time to time parties thereto, NRG Retail LLC, as Servicer, and NRG Receivables LLC.

Incorporated herein by reference to Exhibit 10.2 to the Registrant's current report on Form 8-K filed on August 1, 2022.

10.26 Joinder Agreement, dated as of July 26, 2022, by Direct Energy Business, LLC, as an additional originator and consented to by NRG Receivables LLC, as Borrower, NRG Retail LLC, as Servicer, and Royal Bank of Canada, as administrative agent, to the Receivables Sale Agreement, dated as of September 22, 2020, among the Originators from time to time parties thereto, NRG Retail LLC, as Servicer, and NRG Receivables LLC.

Incorporated herein by reference to Exhibit 10.3 to the Registrant's current report on Form 8-K filed on August 1, 2022.

10.23* Form of NRG Energy, Inc.

Long-Term Incentive Plan Relative Performance Stock Unit Agreement for Senior Vice Presidents.

Filed herewith

10.24* Form of NRG Energy, Inc.

Long-Term Incentive Plan Restricted Stock Unit Agreement.

Filed herewith

10.25* Restricted Stock Unit Agreement, dated December 15 , 2023, between NRG Energy, Inc.

and Lawrence S.

Filed herewith

10.26* Vivint Smart Home, Inc.

2020 Omnibus Incentive Plan

Incorporated herein by reference to Exhibit 4.4 to Vivint Smart Home's Post-Effective Amendment on Form S-8 to Registration Statement on Form S-4 filed with the Securities and Exchange Commission on March 24, 2020

10.27* Vivint Smart Home, Inc.

Long-Term Incentive Plan Relative Performance Stock Unit Agreement and Notice of Grant under the Vivint Smart Home, Inc.

Omnibus Incentive Plan.

Incorporated herein by reference to Exhibit 10.2 to the Registrant's quarterly report on Form 10-Q filed on May 4, 2023.

10.28* Vivint Smart Home, Inc.

Long-Term Incentive Plan Restricted Stock Unit Agreement and Notice of Grant under the Vivint Smart Home, Inc.

Omnibus Incentive Plan.

Incorporated herein by reference to Exhibit 10.3 to the Registrant's quarterly report on Form 10-Q filed on May 4, 2023.

10.29* Vivint Smart Home, Inc.

Long-Term Incentive Plan Relative Performance Stock Unit Agreement and Notice of Grant under the Vivint Smart Home, Inc.

Omnibus Incentive Plan for Executive Vice President

Filed herewith

10.30* Vivint Smart Home, Inc.

Long-Term Incentive Plan Restricted Stock Unit Agreement and Notice of Grant under the Vivint Smart Home, Inc.

Omnibus Incentive Plan for Executive Vice Presidents.

Filed herewith

10.31* Amended and Restated Employee Stock Purchase Plan

Incorporated herein by reference to Exhibit 10.1 to the Registrant's current report on Form 8-K filed on May 2, 2023.

10.32* Retention letter, dated December 6, 2022, between Vivint Smart Home, Inc.

and Rasesh Patel.

Incorporated herein by reference to Exhibit 10.45 to Vivint Smart Home, Inc.'s Annual Report on Form 10-K for the annual period ended December 31, 2022.

10.33* Amended and Restated Employment Agreement, dated June 20, 2022, between Vivint Smart Home, Inc.

and Rasesh Patel

Incorporated by reference to Exhibit 10.5 to Vivint Smart Home, Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022

10.34* Amendment to the Vivint Smart Home, Inc.

2020 Omnibus Incentive Plan

Incorporated herein by reference to Exhibit 10.1 to the Registrant's quarterly report on Form 10-Q filed on August 8, 2023.

10.35 Cooperation Agreement, dated as of November 20, 2023, by and among NRG Energy, Inc., Elliott Investment Management L.P., Elliott Associates, L.P., and Elliott International, L.P.

Incorporated herein by reference to Exhibit 10.1 to the Registrant’s current report on Form 8-K filed on November 20, 2023

21.1 Subsidiaries of NRG Energy, Inc.

5 unchanged sentences

24.1 Power of Attorney Included on signature page

31.1 Rule 13a-14(a)/15d-14(a) certification of Mauricio Gutierrez.

31.1 Rule 13a-14(a)/15d-14(a) certification of Lawrence Coben

Filed herewith.

31.2 Rule 13a-14(a)/15d-14(a) certification of Alberto Fornaro.

31.2 Rule 13a-14(a)/15d-14(a) certification of Woo-Sung Chung

Filed herewith.

31.3 Rule 13a-14(a)/15d-14(a) certification of Emily Picarello.

31.3 Rule 13a-14(a)/15d-14(a) certification of G .

Alfred Spencer

Filed herewith.

1 unchanged sentence

Furnished herewith.

95.1 Mine Safety Disclosure

97 NRG Energy, Inc.

Clawback Policy

Filed herewith.

21 unchanged sentences

NRG ENERGY, INC.

/s/ MAURICIO GUTIERREZ

Mauricio Gutierrez

Chief Executive Officer

/s/ LAWRENCE S.

Interim President and Chief Executive Officer

February 28, 2024

5 unchanged sentences

Signature Title Date

/s/ MAURICIO GUTIERREZ President, Chief Executive Officer and February 23, 2023

Mauricio Gutierrez Director (Principal Executive Officer)

/s/ ALBERTO FORNARO Chief Financial Officer February 23, 2023

Alberto Fornaro (Principal Financial Officer)

/s/ EMILY PICARELLO Corporate Controller February 23, 2023

Emily Picarello (Principal Accounting Officer)

/s/ LAWRENCE S.

COBEN Chair of the Board February 23, 2023

COBEN Interim President and Chief Executive Officer and February 28, 2024

Coben Director (Principal Executive Officer, Chair of the Board)

/s/ WOO-SUNG CHUNG Chief Financial Officer February 28, 2024

Woo-Sung Chung (Principal Financial Officer)

ALFRED SPENCER Chief Accounting Officer February 28, 2024

Alfred Spencer (Principal Accounting Officer)

SPENCER ABRAHAM Director February 28, 2024

8 unchanged sentences

DONOHUE Director February 28, 2024

/s/ MARWAN FAWAZ Director February 28, 2024

HOBBY Director February 28, 2024

/s/ ALEX POURBAIX Director February 28, 2024

Alex Pourbaix

/s/ ALEXANDRA PRUNER Director February 28, 2024

1 unchanged sentence

SCHAUMBURG Director February 28, 2024

/s/ THOMAS H.

WEIDEMEYER Director February 23, 2023

/s/ MARCIE C.

ZLOTNIK Director February 28, 2024

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures