NRG Touts Site Portfolio For Hyperscalers, Large Load Development -- EnergyChoiceMatters.com

NRG Touts Site Portfolio For Hyperscalers, Large Load Development

Cites "Reliable" Customer Counts, "Stable" Margins For Retail Platforms In Q1 Earnings

May 7, 2024

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Reporting by Paul Ring • ring@energychoicematters.com

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During a first quarter earnings call, NRG Energy touted its real estate portfolio, consisting of current and retired power plant sites, as NRG said that it is developing a strategy for data centers and other large loads to locate at these sites

NRG said that it is in discussion with Hyperscalers and other data centers to increase load up to ~3x at existing facilities over the next 36 months

NRG said that it has 21 sites and 21,000 acres for data center, other large load, and power supply development.

NRG said that this includes 6 sites and ~17,000 acres in Texas, and 15 sites and ~4,000 acres in the East/West

NRG said that it is exploring third-party lease, sale, and/or partnerships for large loads and colocation including both in-front-of-the meter and behind-the-meter strategies

NRG said that these sites also provide power generation opportunities including additional natural gas, renewables, and energy storage

NRG specifically said that it has shovel-ready development of 1.5 GWs natural gas generation in Texas and is evaluating the viability of the following:

                    MW        Target COD*
TH Wharton         415         Mid 2026
Cedar Bayou 5      689        Late 2027
Greens Bayou 6     443         Mid 2028

*Target commercial operation dates assume 
Texas Energy Fund loan proceeds will be 
available by end of Q3 2024

NRG’s first quarter 2024 Adjusted EBITDA grew by $203 million year-over-year, from $646 million a year ago to $849 million, as NRG said that the home and business integrated retail platforms, "delivered reliable customer counts and stable margins during the period."

"The East and West segments contributed higher gross margins due to favorable supply costs, partially offset by lower Texas results due primarily to mild winter weather driving lower gross margin on hedges procured as part of the Company's diversified supply strategy," NRG said

NRG reported that it added approximately 35,000 customers in Lubbock, Texas, as former customers of Lubbock Power & Light fully transitioned to competitively selected retail electric providers

For NRG's Texas segment, first quarter Adjusted EBITDA was $219 million, $35 million lower than the first quarter of 2023, primarily due to mild winter weather driving lower gross margin on hedges procured as part of the Company's diversified supply strategy, partially offset by lower plant operating expenses due to asset sales in 2023.

For NRG's East segment, first quarter Adjusted EBITDA was $351 million, $37 million higher than the first quarter of 2023, driven by lower retail power supply costs and increased customer counts, partially offset by lower natural gas gross margin.

For NRG's West/Services/Other segment, first quarter Adjusted EBITDA was $56 million, $51 million higher than the first quarter of 2023, primarily driven by lower retail power supply costs, higher natural gas gross margin, and the timing of planned outages at Cottonwood.

NRG said that its consumer energy platform increased customer count 8% year-over-year

NRG reported its first quarter power load and natural gas sales as follows:

              1Q23            1Q24

           Texas  EWO      Texas  EWO
Power Load (TWh)
Home        8      4         8     4
Business    9     13         9    15
Total      17     17        17    19


Natural Gas Sales (MDths) 
Total      --    581        --   583


EWO: East/West/Other; includes Services

NRG said that it is the second largest business power provider (~100 TWh) and largest business natural gas provider (~1.8 Tcf, includes wholesale volumes)

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