NRG re-integrates renewables business directly into company

NRG Energy (NYSE:NRG) said Feb. 29 that it is re-integrating its business renewables affiliate (formerly GreenCo’s NRG Renew) back into NRG.

This move supports NRG’s advantaged position to participate in the changing landscape of the power industry and serve customers, especially with on- and offsite solar and distributed generation in the commercial and industrial space, said NRG President and CEO Mauricio Gutierrez.

NRG Energy held its quarterly earnings report and conference call with financial analysts on Feb. 29. It’s the company’s first earnings call since Gutierrez replaced Crane as CEO at NRG in early December.

“Amid a continued weak commodity price environment, NRG’s integrated competitive power platform once again delivered strong financial results, demonstrating that we have the right portfolio and the right platform to succeed,” Gutierrez said.

“Today we are reintegrating our successful business renewables solutions back into NRG as an important part of our diversified platform. With the further strengthening of our balance sheet and increased flexibility from recalibrating our dividend, we will be in a stronger position to benefit from market opportunities,” Gutierrez said.

The company has amended its partnership agreements with NRG Yield (NYSE:NYLD) in order to reallocate $50m of NRG Yield’s previously committed cash equity from the residential solar partnership to the business renewables partnership. This amendment reinforces NRG Energy’s relationship with NRG Yield by ensuring NRG Yield’s investment capital is more closely aligned with NRG Energy’s focus on renewable energy.

In 2015, NRG completed a gas conversion at the Big Cajun II Unit 2, enhanced environmental controls at Sayreville, Gilbert and W.A. Parish facilities. NRG is on track to successfully complete Avon Lake Unit 9 environmental enhancements by the middle of 2016.

Overall generation was down 3% from 2014, with coal and nuclear availability at 83.8% improving 2.4% over 2014, NRG said in its earnings news release.

Asset sales completed or pending represent 877 MWs and $138 million of $500m 2016 asset sales target.

NRG reported record full-year adjusted EBITDA of $3.34m. Adjusted cash flow from operations totaled $1.945m for 2015. Net loss for the 12 months of 2015 was $6.43m, including non-cash charges of $3.3m and $3.03m for asset impairments net of taxes and income tax valuation allowance expense, respectively.

These non-cash charges were primarily driven by the low commodity cycle and its impact on the Texas wholesale business. This resulted in a $19.46 loss per diluted common share in 2015 compared to net income of $132m, or 23 cents per diluted common share in 2014. Excluding the impact of the impairments and tax valuation allowance, the company’s net loss would have been $91m or 34 cent loss per diluted common share for the 12 months of 2015.

 

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.