UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K/A
(Amendment No. 1)10-K
x 
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year ended December 31, 2017.2018.
   
o 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition period from                      to                       .
Commission File Number: 333-203369
NRG YieldClearway Energy LLC
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
 
32-0407370
(I.R.S. Employer Identification No.)
   
804300 Carnegie Center, Suite 300, Princeton, New Jersey
(Address of principal executive offices)
 
08540
(Zip Code)
(609) 524-4500608-1525
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes o    No x
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.   Yes x    No o
Indicate by check mark whether the registrant (1) has filed all reports to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  (Note: The registrant is a voluntary filer and not subject to the filing requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934. Although not subject to these filing requirements, the registrant has filed all reports that would have been required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months had the registrant been subject to such requirements.) Yes o    No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes x    No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer o
 
Accelerated filer o
 
Non-accelerated filer x
 
Smaller reporting company o
Emerging Growth Companygrowth company o
(Do not check if a smaller reporting company)
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes o    No x
NRG YieldClearway Energy LLC's outstanding equity interests are held by NRG Yield,Clearway Energy, Inc. and NRGClearway Energy Inc.Group LLC and there are no equity interests held by non-affiliates.
Indicate the number of shares outstanding of each of the registrant's classes of common stock as of the latest practicable date. There is no public market for the registrant's outstanding units.
Class Outstanding at January 31, 20182019
Class A Units 34,586,25034,599,645
Class B Units 42,738,750
Class C Units 64,730,51973,323,463
Class D Units 42,738,750
Documents Incorporated by Reference:
None.
NOTE: WHEREAS NRG YIELDCLEARWAY ENERGY LLC MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION I(1)(a) AND (b) OF FORM 10-K, THIS FORM 10-K IS BEING FILED WITH THE REDUCED DISCLOSURE FORMAT PURSUANT TO GENERAL INSTRUCTION I(2).
     

                                    


EXPLANATORY NOTE
The sole purpose of this Amendment No. 1 on Form 10-K/A to NRG Yield LLC’s Annual Report on Form 10-K for the year ended December 31, 2017, filed with the Securities and Exchange Commission on March 1, 2018 (the “Form 10-K”), is, at the request of KPMG LLP, to update their opinion to include a sentence previously omitted by KPMG LLP stating specifically, "The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.”These changes do not in any way change the conclusions expressed by KPMG LLP in the original report, or any other disclosure included in Part II, Item 8, Part II, Item 9 or Part IV, Item 15 of the Form 10-K.
No other changes have been made to any of the disclosures in the Form 10-K. This Form 10-K/A speaks as of the original filing date of the Form 10-K, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the Form 10-K, except as set forth above.

As required by Rule 12b-15 under the Securities Exchange Act of 1934, currently-dated Section 302 and Section 906 certifications have been included as exhibits to this Amendment No. 1.




TABLE OF CONTENTS
Index
GLOSSARY OF TERMS
3
PART I
7
Item 1 — Business
7
Item 1A — Risk Factors
1315
Item 1B — Unresolved Staff Comments
2930
Item 2 — Properties
3031
Item 3 — Legal Proceedings
3335
Item 4 — Mine Safety Disclosures
3335
PART II
3436
Item 5 — Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
3436
Item 6 — Selected Financial Data
3537
Item 7 — Management's Discussion and Analysis of Financial Condition and Results of Operations
3638
Item 7A — Quantitative and Qualitative Disclosures About Market Risk
5961
Item 8 — Financial Statements and Supplementary Data
5962
Item 9 — Changes in Disagreements With Accountants on Accounting and Financial Disclosure
6063
Item 9A — Controls and Procedures
6063
Item 9B — Other Information
6063
PART III
6164
Item 10 — Directors, Executive Officers and Corporate Governance
6164
Item 11 — Executive Compensation
6164
Item 12 — Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
6164
Item 13 — Certain Relationships and Related Transactions, and Director Independence
6164
Item 14 — Principal Accounting Fees and Services
6164
PART IV
6366
Item 15 — Exhibits, Financial Statement Schedules
6366
EXHIBIT INDEX
119125
Item 16 — Form 10-K Summary
124130
                                    


GLOSSARY OF TERMS
When the following terms and abbreviations appear in the text of this report, they have the meanings indicated below:
2019 Convertible Notes Yield,Clearway Energy, Inc.'s $345 million aggregate principal amount of 3.50% Convertible Notes due 2019
2020 Convertible Notes Yield,Clearway Energy, Inc.'s $287.5 million aggregate principal amount of 3.25% Convertible Notes due 2020
2024 Senior Notes $500 million aggregate principal amount of 5.375% unsecured senior notes due 2024, issued by NRG YieldClearway Energy Operating LLC
2025 Senior Notes$600 million aggregate principal amount of 5.750% unsecured senior notes due 2025, issued by Clearway Energy Operating LLC
2026 Senior Notes $350 million aggregate principal amount of 5.00% unsecured senior notes due 2026, issued by NRG YieldClearway Energy Operating LLC
Alta TE HoldcoAdjusted EBITDA Alta Wind X-XI TE Holdco LLCRepresents EBITDA adjusted for mark-to-market gains or losses, asset write offs and impairments; and factors which the Company does not consider indicative of future operating performance
Alta Wind Portfolio Seven wind facilities that total 947 MW located in Tehachapi, California and a portfolio of associated land leases
AOCL Accumulated Other Comprehensive Loss
ARO Asset Retirement Obligation
ARRA American Recovery and Reinvestment Act of 2009
ASC 
The FASB Accounting Standards Codification, which the FASB established as the source of
authoritative GAAP
ASU Accounting Standards Updates – updates to the ASC
ATM Program At-The-Market Equity Offering Program
August 2017 Drop Down Assets The remaining 25% interest in NRG Wind TE Holdco an 814 net MW portfolio
Bankruptcy CodeChapter 11 of twelve wind projects,Title 11 of the United States Code
Bankruptcy CourtU.S. Bankruptcy Court for the Northern District of California
Bridge Credit Agreement364-Day Bridge Credit Agreement, entered into by and between Clearway Operating LLC, as borrower, and Clearway Energy LLC, as guarantor, on August 31, 2018
Buckthorn Solar Drop Down AssetBuckthorn Renewables, LLC, which owns 100% of Buckthorn Solar Portfolio, LLC, which was acquired by Clearway Energy Operating LLC from NRG on August 1, 2017
Buckthorn SolarThe 154 MW Buckthorn Solar project
Buffalo BearBuffalo Bear, LLC, the operating subsidiary of Tapestry Wind LLC, which owns the Buffalo Bear projectMarch 30, 2018
CAA Clean Air Act
CAFD Cash Available Forfor Distribution which the Company defines as net income before interest expense, income taxes, depreciation and amortization,(CAFD) is Adjusted EBITDA plus cash distributionsdistributions/return of investment from unconsolidated affiliates, cash receipts from notes receivable, cash distributions from noncontrolling interests, less cash distributions to noncontrolling interests, maintenance capital expenditures, pro-rata Adjusted EBITDA from unconsolidated affiliates, cash interest paid, income taxes paid, principal amortization of indebtedness, Walnut Creek investment payments, and changes in prepaid and accrued capacity payments
Carlsbad 
The Carlsbad Energy Center, a 527 MW natural gas fired project located in Carlsbad, CA

CDFWCalifornia Department of Fish and Wildlife
CEGClearway Energy Group LLC (formerly Zephyr Renewables LLC)
CEG Master Services AgreementMaster Services Agreements, entered into as of August 31, 2018, between the Company, Clearway Energy LLC, Clearway Energy Operating LLC, and CEG
CEG ROFO AgreementRight of First Offer Agreement, entered into as of August 31, 2018, by and among Clearway Energy Group LLC and Clearway Energy, Inc., and solely for purposes of Section 2.4, GIP III Zephyr Acquisition Partners, L.P.
CfD Contract for Differences
CFTCClearway Energy Group LLC U.S. Commodity Future Trading CommissionThe holder of the Company's Class B and Class D common shares and Clearway Energy LLC's Class B and Class D units
Clearway Energy Operating LLCFormerly NRG Yield Operating LLC, the holder of the project assets that are owned by Clearway Energy LLC
COD Commercial Operation Date


Code
Internal Revenue Code of 1986, as amended
Company NRG YieldClearway Energy LLC, together with its consolidated subsidiaries
CVSR California Valley Solar Ranch
CVSR Drop Down The Company's acquisition from NRG of the remaining 51.05% interest of CVSR Holdco
CVSR Holdco CVSR Holdco LLC, the indirect owner of CVSR
DGCLDelaware General Corporation Law
DGPV Holdco 1 NRG DGPV Holdco 1 LLC
DGPV Holdco 2 NRG DGPV Holdco 2 LLC
DGPV Holdco 3 NRG DGPV Holdco 3 LLC
Distributed Solar

 Solar power projects, typically less than 20 MW in size, that primarily sell power produced to customers for usage on site, or are interconnected to sell power into the local distribution grid
Drop Down Assets Collectively, assets under common control acquired by the JuneCompany from NRG from January 1, 2014 Drop Down Assets, January 2015 Drop Down Assets, November 2015 Drop Down Assets, CVSR Drop Down, March 2017 Drop Down Assets,through the period ended August 2017 Drop Down Assets and November 2017 Drop Down Assets31, 2018
Economic Gross Margin Energy and capacity revenue, less cost of fuels
EDAECP Equity Distribution AgreementEnergy Center Pittsburgh LLC, a subsidiary of the Company
EGU Electric Utility Generating Unit


El SegundoEPA NRG West Holdings LLC, the subsidiary of Natural Gas Repowering LLC, which owns the El Segundo Energy Center projectUnited States Environmental Protection Agency
EPC Engineering, Procurement and Construction
ERCOT

 Electric Reliability Council of Texas, the ISO and the regional reliability coordinator of the various electricity systems within Texas
EWG Exempt Wholesale Generator
Exchange Act The Securities Exchange Act of 1934, as amended
FASB Financial Accounting Standards Board
FERC Federal Energy Regulatory Commission
FPA Federal Power Act
GAAP Accounting principles generally accepted in the U.S.
GenConn GenConn Energy LLC
GHG Greenhouse gas
GIPGIM Global Infrastructure PartnersManagement, LLC
GWGIP Gigawatt
Collectively, Global Infrastructure Partners III-C Intermediate AIV 3, L.P., Global Infrastructure Partners III-A/B AIV 3, L.P., Global Infrastructure Partners III-C Intermediate AIV 2, L.P., Global Infrastructure Partners III-C2 Intermediate AIV, L.P. and GIP III Zephyr Friends & Family, LLC.

GIP TransactionOn August 31, 2018, NRG transferred its full ownership interest in the Company to Clearway Energy Group LLC and subsequently sold 100% of its interests in Clearway Energy Group LLC, which includes NRG's renewable energy development and operations platform, to an affiliate of GIP. GIP, NRG and the Company also entered into a consent and indemnity agreement in connection with the purchase and sale agreement, which was signed on February 6, 2018
HLBV Hypothetical Liquidation at Book Value
IASBInternational Accounting Standards Board
IRS Internal Revenue Service
ISO Independent System Operator, also referred to as Regional Transmission Organization, oran RTO
ITC Investment Tax Credit
January 2015 Drop Down AssetsThe Laredo Ridge, Tapestry and Walnut Creek projects, which were acquired by Yield Operating LLC from NRG on January 2, 2015
June 2014 Drop Down AssetsThe TA High Desert, Kansas South and El Segundo projects, which were acquired by Yield Operating LLC from NRG on June 30, 2014
Kansas SouthNRG Solar Kansas South LLC, the operating subsidiary of NRG Solar Kansas South Holdings LLC, which owns the Kansas South project
KPPH 1,000 Pounds Per Hour
Laredo RidgeLaredo Ridge Wind, LLC, the operating subsidiary of Mission Wind Laredo, LLC, which owns the Laredo Ridge project
LIBOR London Inter-Bank Offered Rate
Management Services AgreementAgreement between NRG and the Company for various operational, management and administrative services
March 2017 Drop Down Assets (i) Agua Caliente Borrower 2 LLC, which owns a 16% interest (approximately 31% of NRG's 51% interest) in the Agua Caliente solar farm and (ii) NRG's 100% ownership in the Class A equity interests in the Utah Solar Portfolio (defined below), both acquired by the CompanyClearway Energy Operating LLC on March 27, 2017
Marsh LandingMBTA NRG Marsh Landing LLC, formerly GenOn Marsh Landing LLC
May 9, 2017 Form 8-KNRG Yield, Inc.'s Current Report on Form 8-K filed with the SEC on May 9, 2017 in connection with NRG Yield Operating LLC's acquisition of the March 2017 Drop Down AssetsMigratory Bird Treaty Act
MMBtu Million British Thermal Units


MW Megawatt
MWh Saleable megawatt hours, net of internal/parasitic load megawatt-hours
MWt Megawatts Thermal Equivalent
NECPNRG Energy Center Pittsburgh LLC
NERC North American Electric Reliability Corporation
Net Exposure Counterparty credit exposure to NRG Yield, Inc.Clearway Energy LLC, net of collateral
November 2015 Drop Down Assets 75% of the Class B interests of NRG Wind TE Holdco, which owns a portfolio of 12 wind facilities totaling 814 net MW, which was acquired by YieldClearway Energy Operating LLC from NRG on November 3, 2015


November 2017 Drop Down Assets 38 MW portfolio of distributed and small utility-scale solar assets, primarily comprised of assets from NRG's Solar Power Partners (SPP) funds, in addition to other projects developed since the acquisition of SPP by NRG, which was acquired by NRG YieldClearway Energy Operating LLC from NRG on November 1, 2017
NOx
 Nitrogen Oxides
NPNS Normal Purchases and Normal Sales
NRG NRG Energy, Inc.
NRG Power Marketing NRG Power Marketing LLC
NRG ROFO Agreement SecondThird Amended and Restated Right of First Offer Agreement, between the Company and NRG
NRG Transaction
On February 6, 2018, GIP entered into a purchaseas of August 31, 2018, by and sale agreement withbetween NRG for the acquisition of NRG's full ownership interest in Yield, Inc., and NRG's renewable energy development and operations platform. GIP, NRG and the Company also entered into a consent and indemnity agreement in connection with the purchase and sale agreement.

NRG Transformation PlanA three-year, three-part improvement plan announced by NRG on July 12, 2017, which includes exploring strategic alternatives for NRG's renewables platform and its interest in the Company
NRG Wind TE HoldcoTSA Transition Services Agreement entered into as of August 31, 2018 by and between NRG Wind TE Holdco LLCand the Company
OECDThe Organization for Economic Co-operation and Development
OCI/OCL Other comprehensive income/loss
O&M Operations and Maintenance
OSHAOccupational Safety and Health Administration
PG&E Pacific Gas &and Electric Company
PinnaclePG&E Bankruptcy Pinnacle Wind, LLC,On January 29, 2019, PG&E Corporation and Pacific Gas and Electric Company filed voluntary petitions for relief under the operating subsidiaryBankruptcy Code in the U.S. Bankruptcy Court for the Northern District of Tapestry Wind LLC, which owns the Pinnacle projectCalifornia
PJM PJM Interconnection, LLC
PPA Power Purchase Agreement
PTC Production Tax Credit
PUCT Public Utility Commission of Texas
PUHCA Public Utility Holding Company Act of 2005
PURPA Public Utility Regulatory Policies Act of 1978
QF Qualifying Facility under PURPA
REC Renewable Energy Certificate
RecapitalizationROFO The adoptionRight of the Company's Second Amended and Restated Certificate of Incorporation which authorized two new classes of common stock, Class C common stock and Class D common stock, and distributed shares of such new classes of common stock to holders of the Company’s outstanding Class A common stock and Class B common stock, respectively, through a stock split on May 14, 2015 
ROFO AssetsSpecified assets subject to sale, as described in the NRG ROFO Agreement
RPMReliability Pricing ModelFirst Offer
RPS Renewable Portfolio Standards
RPV Holdco NRG RPV Holdco 1 LLC
RTO Regional Transmission Organization
SCE Southern California Edison
SEC U.S. Securities and Exchange Commission
Senior Notes Collectively, the 2024 Senior Notes, the 2025 Senior Notes and the 2026 Senior Notes
SO2
 Sulfur Dioxide
SPP Solar Power Partners
TA High DesertTA-High Desert LLC, the operating subsidiary of NRG Solar Mayfair LLC, which owns the TA High Desert project
TalogaTaloga Wind, LLC, the operating subsidiary of Tapestry Wind LLC, which owns the Taloga project
TapestryCollection of the Pinnacle, Buffalo Bear and Taloga projects


Tax Act Tax Cuts and Jobs Act of 2017
Termination AgreementTermination Agreement entered into as of August 31, 2018 by and between NRG Energy, Inc. and the Company to terminate the Management Services Agreement between the parties
Thermal Business The Company's thermal business, which consists of thermal infrastructure assets that provide steam, hot water and/or chilled water, and in some instances electricity, to commercial businesses, universities, hospitals and governmental units


UPMC Thermal Project The University of Pittsburgh Medical Center Thermal Project, a 73 MWt district energy system that allows ECP to provide steam, chilled water and 7.5 MW of emergency backup power service to UPMC.
U.S. United States of America
U.S. DOE U.S. Department of Energy
Utah Solar Portfolio Collection consists of Four Brothers Solar, LLC, Granite Mountain Holdings, LLC, and Iron Springs Holdings, LLC, which are equity investments owned by Four Brothers Holdings, LLC, Granite Mountain Renewables, LLC, and Iron Springs Renewables, LLC, respectively, and are part of the March 2017 Drop Down Assets acquisition that closed on March 27, 2017
Utility Scale Solar

 Solar power projects, typically 20 MW or greater in size (on an alternating current, or AC, basis), that are interconnected into the transmission or distribution grid to sell power at a wholesale level
VaR Value at Risk
VIE Variable Interest Entity
Walnut CreekWind TE Holdco NRG Walnut Creek,Wind TE Holdco LLC, the operating subsidiaryan 814 net MW portfolio of WCEP Holdings, LLC, which owns the Walnut Creek project
Yield, Inc.NRG Yield, Inc.
Yield Operating LLCNRG Yield Operating LLC, the holding company that owns the project companies and is a wholly owned subsidiary of NRG Yield LLCtwelve wind projects
                                    


PART I
Item 1 — Business
General
Clearway Energy LLC (formerly NRG Yield LLC,LLC), together with its consolidated subsidiaries, or the Company, was formed as a Delaware limited liability company on March 5, 2013 to serve as the primary vehicle through whichis an energy infrastructure investor in and owner of modern, sustainable and long-term contracted assets across North America. On August 31, 2018, NRG owns, operates and acquires contracted renewable and conventional generation and thermal infrastructure assets. On February 6, 2018, Global Infrastructure Partners,Energy, Inc., or GIP, entered into a purchase and sale agreement with NRG, or the NRG Transaction, for the acquisition of NRG’stransferred its full ownership interest in the Company to Clearway Energy Group LLC, or CEG, which is also the holder of NRG Yield, Inc. and NRG’s's renewable energy development and operations platform. The Company believes itplatform, and NRG subsequently sold 100% of its interest in CEG to an affiliate of GIP, such transaction referred to hereinafter as the GIP Transaction. As a result of the GIP Transaction, GIP indirectly acquired a 45.2% economic interest in Clearway Energy LLC (formerly NRG Yield LLC) and a 55.0% voting interest in the Company. Global Infrastructure Management, LLC is well positioned to be a premier company for investors seeking stable and growing dividend income from a diversified portfolioan independent fund manager of lower-risk, high-quality assets.
The Company owns a diversified portfolio of contracted renewable and conventional generation and thermalfunds that invests in infrastructure assets in the U.S. energy and transport sectors and Global Infrastructure Partners III is its third equity fund. The Company is sponsored by GIP through GIP's portfolio company, CEG.
The Company’s contractedenvironmentally sound asset portfolio includes over 5,272 MW of wind, solar and natural gas-fired power generation portfolio collectively represents 5,118 net MWfacilities, as of December 31, 2017. Nearly all of these assets sell substantially all of its output pursuant to long-term offtake agreements with creditworthy counterparties.well as district energy systems. The weighted average remaining contract duration of these offtake agreements, based on CAFD, was approximately 15 years as of December 31, 2017, based on CAFD.2018. The Company also owns thermal infrastructure assets with an aggregate steam and chilled water capacity of 1,3191,385 net MWt and electric generation capacity of 123133 net MW. These thermal infrastructure assets provide steam, hot and/or chilled water, and, in some instances, electricity to commercial businesses, universities, hospitals and governmental units in multiple locations, principally through long-term contracts or pursuant to rates regulated by state utility commissions.
A complete listing of the Company's interests in facilities, operations and/or projects owned or leased as of December 31, 20172018 can be found in Item 2 — Properties.
HistoryPacific Gas and Electric Company Bankruptcy
On July 22, 2013, Yield, Inc. closed the initial public offering of 22,511,250 shares of its Class A common stockJanuary 29, 2019, Pacific Gas and Electric Company, or PG&E, filed for net proceeds, after deducting underwriting discounts, of $468 million, of which Yield, Inc. used $395 million to purchase 19,011,250reorganization under Chapter 11 of the Company's Class A units from NRG and $73 million to purchase 3,500,000U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Northern District of California, or the Company's Class A units directly from the Company. On July 29, 2014, Yield, Inc. issued 12,075,000 shares of Class A common stock for net proceeds, after underwriting discounts and expenses, of $630 million and utilized the proceeds of the offering to acquire 12,075,000 additional Class A units of the Company.
Effective May 14, 2015, Yield, Inc. amended its certificate of incorporation to create two new classes of capital stock, Class C common stock and Class D common stock, and distributed shares of the Class C common stock and Class D common stock to holders of Yield, Inc.'s outstanding Class A common stock and Class B common stock, respectively, through a stock split. The stock split is referred to as the Recapitalization. Contemporaneously with Yield, Inc.’s Recapitalization, each Class A unitBankruptcy Court.  Certain subsidiaries of the Company, was automatically reclassified into one Class A unitwhich hold interests in 6 solar facilities totaling 480 MW and one Class C unit and each Class B unitMarsh Landing with capacity of 720 MW, sell the output of their facilities to PG&E under long-term power purchase agreements, or PPAs.  The Company consolidates three of the Company was automatically reclassified into one Class B unitsolar facilities and one Class D unit. On June 29, 2015, Yield, Inc. issued 28,198,000 shares of Class C common stock for net proceeds of $599 millionMarsh Landing and utilizedrecords its interest in the proceeds of the offering to acquire 28,198,000 Class C units of the Company.
other solar facilities as equity method investments. As of December 31, 2017, NRG owned 42,738,7502018, the Company had $1.5 billion of eachproperty, plant and equipment, net, $352 million investments in unconsolidated affiliates and $1.4 billion of the Company's Class B units and Class D units and Yield, Inc. owned 34,586,250 of the Company's Class A units and 64,717,087 of the Company's Class C units. Yield, Inc., through its holdings of Class A units and Class C units, has a 53.7% economic interest in the Company. Yield, Inc. consolidates the resultslong - term debt related to these facilities. The related subsidiaries of the Company through its controlling interesthave entered into financing agreements consisting of non-recourse project level debt and, in certain cases, non-recourse holding company debt.  The PG&E Bankruptcy filing has triggered defaults under the PPAs with PG&E and such related financing agreements.  The Company is currently negotiating forbearance agreements with the lenders for each respective financing arrangement.  The Company continues to assess the potential future impacts of the PG&E Bankruptcy as sole managing member. NRG, through its holdingsevents occur, however, no impact to the Company’s immediate operating activities has occurred as of Class B units and Class D units, hasDecember 31, 2018. 
History
The Company was formed as a 46.3% economic interest in the Company.
Delaware limited liability company on March 5, 2013. The Company is a holding company for the companies that directly and indirectly own and operate Yield,Clearway, Inc.'s business. As of December 31, 2017, NRG continues to control Yield,2018, GIP, through CEG, controls Clearway, Inc., and Yield,Clearway, Inc. in turn, as the sole managing member of the Company, controls the Company and its subsidiaries.
    As of December 31, 2018, GIP, through CEG, owned 42,738,750 of each of the Company's Class B units and Class D units and Clearway, Inc. owned 34,586,250 of the Company's Class A units and 73,187,646 of the Company's Class C units. Clearway, Inc., through its holdings of Class A units and Class C units, has a 55.8% economic interest in the Company. Clearway, Inc. consolidates the results of the Company through its controlling interest as sole managing member. GIP, through CEG's holdings of Class B units and Class D units, has a 44.2% economic interest in the Company.
                                    


The diagram below depicts the Company’s organizational structure as of December 31, 2017:2018:
clearwayorg123118a01.jpg
Strategic Sponsorship with Global Infrastructure Partners
On February 6,As described above, on August 31, 2018, Global Infrastructure Partners, or GIP, entered into a purchase and sale agreement with NRG or the NRG Transaction, for the acquisition of NRG’stransferred its full ownership interest in NRG Yield, Inc. and NRG’sthe Company to Clearway Energy Group LLC, or CEG, the holder of NRG's renewable energy development and operations platform. The NRGplatform and subsequently sold 100% of its interest in CEG to an affiliate of GIP. As a result of the GIP Transaction, is subject to certain closing conditions, including customary legal and regulatory approvals. The Company expects the NRG Transaction to closeGIP indirectly acquired a 45.2% economic interest in the second halfCompany and a 55.0% voting interest in Clearway, Inc. as of August 31, 2018.

In connection with the NRGGIP Transaction, the CompanyClearway, Inc. entered into a Consent and Indemnity Agreement with NRG and GIP setting forth key terms and conditions of the Company'sClearway, Inc.'s consent to the NRGGIP Transaction. Key provisions
Also in connection with the GIP Transaction, Clearway, Inc. entered into the following agreements on August 31, 2018:
CEG Master Services Agreements
The Company, along with Clearway, Inc. and Clearway Energy Operating LLC, entered into Master Services Agreements with CEG, pursuant to which CEG and certain of its affiliates or third party service providers began providing certain services to Clearway, Inc. and certain of its subsidiaries, and Clearway, Inc. and certain of its subsidiaries began providing certain services to CEG, in exchange for the Consent and Indemnity Agreement include:payment of fees in respect of such services. Additional details regarding the Master Services Agreements are found in Item 15 — Note 13, Related Party Transactions, to the Consolidated Financial Statements.

Minimized impact to CAFD from potential change in control costs — No more than $10 million in reduced annual CAFD on a recurring basis that would result from changes in the Company's cost structure or any impact from various consents.ROFO Agreements
Enhanced ROFO pipeline — Upon closing, the Company will enterClearway, Inc. entered into a new ROFO agreement with GIP that adds 550 MW to the current pipeline through the operational 150 MW Langford Wind project and the 400 MW Mesquite Star Wind project which is under development. The NRG ROFO Agreement will be amended to remove the Ivanpah solar facility.
Financial cooperation and support — GIP has arranged a $1.5 billion backstop credit facility to manage any change of control costs associated with the Company's corporate debt. GIP has also committed to provide up to $400 million in financial support, if necessary, for the purchase of the Carlsbad Energy Center.
Voting and Governance Agreement — As part of the NRG Transaction, the parties have agreed to enter into a voting and governance agreement, which would provide that:
the Chief Executive Officer of Yield, Inc. will at all times be a full-time Yield, Inc. employee appointed by the Board of Directors,CEG, or the Board, of Yield, Inc.;
the parties thereto will use their commercially reasonable efforts to submit to Yield, Inc.’s stockholders at Yield, Inc.'s 2019 Annual Meeting of StockholdersCEG ROFO Agreement, and a charter amendment to classify the Board into two classes (with the independent directorsThird Amended and directors designated by an affiliate of GIP allocated across the two classes); and
the Board will be expanded to nine members at the closing of theRestated ROFO Agreement with NRG Transaction, comprised at that date of five directors designated by GIP, three independent directors and Yield, Inc.’s Chief Executive Officer.

as further discussed below.
                                    



Voting and Governance Agreement
Clearway, Inc. entered into a Voting and Governance Agreement with CEG relating to certain governance matters of Clearway, Inc.
Limited Liability Company Agreement
Clearway, Inc. entered into the Fourth Amended and Restated Limited Liability Company Agreement of the Company with CEG, which sets forth the rights and obligations of Clearway, Inc., as managing member, and CEG, as member, of the Company.
Transition Services Agreement
Clearway, Inc. entered into the NRG TSA, pursuant to which NRG or certain of its affiliates began providing transition services to Clearway, Inc. following the consummation of the GIP Transaction, in exchange for the payment of a fee in respect of such services. The agreement is effective until the earlier of June 30, 2019 or the date that all services are terminated by Clearway, Inc. Clearway, Inc. may extend the term on a month-by-month basis no later than March 31, 2020 for a fixed monthly fee provided for in the agreement.
Business Strategy
The Company's primary business strategy is to focus on the acquisition and ownership of assets with predictable, long-term cash flows in order that it may be able to increase the cash distributions to Yield,Clearway, Inc. and NRG over time without compromising the ongoing stability of the business. As discussed above, the PG&E Bankruptcy has caused uncertainty around the timing of when certain project-level distributions will be available to the Company and Clearway, Inc. As a result of such timing uncertainty, the Company reduced its quarterly distributions for the first quarter of 2019 to $0.20 per unit, compared to $0.331 per unit in the prior quarter. While the Company views this action as prudent from a financial perspective, it has not changed the Company's long-term business strategy.
The Company's plan for executing thisits business strategy includes the following key components:
Focus on contracted renewable energy and conventional generation and thermal infrastructure assets. The Company owns and operates utility scale and distributed renewable energy and natural gas-fired generation, thermal and other infrastructure assets with proven technologies, low operating risks and stable cash flows. The Company believes by focusing on this core asset class and leveraging its industry knowledge, it will maximize its strategic opportunities, be a leader in operational efficiency and maximize its overall financial performance.


Growing the business through acquisitions of contracted operating assets.The Company believes that its base of operations and relationship with NRG provideprovides a platform in the conventional and renewable power generation and thermal sectors for strategic growth through cash accretive and tax advantaged acquisitions complementary to its existing portfolio. In addition to acquiring renewable generation, conventional generation and thermal infrastructure assets from third parties where the Company believes its knowledge of the market and operating expertise provides it with a competitive advantage, the Company entered into a Right of First Offer Agreement with NRG, or the NRGCEG ROFO Agreement. Under the NRGCEG ROFO Agreement, NRGCEG has granted the Company and its affiliates a right of first offer on any proposed sale, transfer or other disposition of certain assets of NRGCEG, or the CEG ROFO Assets, until February 24, 2022. NRGAugust 31, 2023. CEG is not obligated to sell the remaining NRGCEG ROFO Assets to the Company and, if offered by NRG,CEG, the Company cannot be sure whether these assets will be offered on acceptable terms, or that the Company will choose to consummate such acquisitions. The assets listed in the table below represent the NRGCompany's currently committed investments and the CEG ROFO Assets:
Asset Fuel Type 
Rated Capacity
(MW)(a)
 COD
Agua Caliente Solar 102 2014
Ivanpah Solar 196 2013
Hawaii(b)
 Solar 80 2019
Distributed Solar (up to $190 million of equity in distributed solar generation portfolio(s)(b)
 Solar various various
Buckthorn Solar(c)
 Solar 154 2018
Carlsbad (d)
 Conventional 527 2018
Puente/Mandalay(e)
 Conventional Project not expected to move forward
Community Wind Sold to third party
Jeffers Wind Sold to third party
Minnesota Portfolio Wind Sold to third party
Committed Investments
Asset Technology Net Capacity (MW) State COD
Hawaii Solar Phase I(a)
 PV 80 HI 2019
$47 MM remaining in distributed and community solar partnerships(b)
 PV N/A Various Various
Repowering Partnership with CEG (c)
 Wind 283 TX 2020

Clearway Energy Group ROFO
Asset Technology Net Capacity (MW) State COD
Mililani I PV 39 HI 2021
Waiawa PV 36 HI 2021
Langford Wind 150 TX 2009
Mesquite Star Wind 419 TX 2020
Carlsbad(d)
 Natural Gas 527 CA 2018
Up to $170 MM equity investment in business renewables PV TBD Various TBD
 
(a)Represents On August 31, 2018, Clearway Energy Operating LLC and Clearway Energy Group executed a purchase agreement pursuant to which the maximum, or rated, electricity generating capacityCompany will acquire effective equity ownership in 80 MW of the facilityutility-scale solar projects (Waipao, Mililani II and Kawailoa Solar) located in MW multiplied by NRG's percentage ownership interest in the facility as of December 31, 2017.Oahu, Hawaii.
(b)Hawaii On December 26, 2018, the Company and Distributed Solar are partCEG amended the DGPV Holdco 3 partnership agreement to increase the capital commitment of the NRG ROFO Agreement. These are not expected$50 million to be offered by NRG prior to consummation of the NRG Transaction and, at that time, would become part of a new ROFO Agreement with GIP.$70 million.
(c) The transaction is expected to closeInvestment in the first quarter of 2018.Repowering Partnership with CEG is contingent upon obtaining related construction and tax equity financing.
(d) The transaction is expectedCompany maintains the option to close inpurchase Carlsbad from GIP at any time within 18 months after February 27, 2019 at the fourth quarter of 2018 and is contingent uponsame economic terms at which it originally agreed to purchase the consummation ofasset from NRG. Should the NRG Transaction. Reflects capacity per the Power Purchase & Tolling Agreement with San Diego Gas & Electric; actual tested capacity is expected to be 530 MW.
(e) On November 3, 2017, the California Energy Commission suspended the permitting process for the Puente Power Project after two commissioners issuedCompany not acquire Carlsbad within such 18 months, Carlsbad will become a statement stating their intention to deny the permit.  If the CEC formally denies a permit for the Puente Power Project, then the project will not move forward.CEG ROFO Asset.

Upon closing of the NRG Transaction, the Company will enter into a new ROFO agreement with GIP that adds 550 MW to the current pipeline through the operational 150 MW Langford Wind project and the 400 MW Mesquite Star Wind project which is under development. The NRG ROFO Agreement will bewas amended upon the closing of the GIP Transaction to (i) remove the Ivanpah solar facility.facility and (ii) provide the Company and its subsidiaries a right of first offer on any proposed sale or transfer of 100% of the membership interest in Agua Caliente Borrower 1, LLC, which owns a 35% interest in Agua Caliente, a 290 MW utility-scale solar project located in Dateland, Arizona with PG&E as the project’s customer. Pursuant to the terms of the NRG ROFO Agreement, the Company elected to forgo the acquisition. The Company continues to own a 16% interest in the project through Agua Caliente Borrower 2 LLC.

The Company entered into an agreement with NRG to purchase the Carlsbad project on February 6, 2018. The Company elected to exercise the Carlsbad backstop facility provided by GIP; as such, GIP purchased 100% of the membership interest in Carlsbad Energy Holdings LLC on February 27, 2019.
Additionally, the CEG ROFO Agreement was amended on February 14, 2019, to grant to the Company a right of first offer for Hawaii Solar Phase II, which consist of Mililani I and Waiawa solar and storage projects located in Oahu, Hawaii. The projects are expected to reach COD in 2021.
Primary focus on North America. The Company intends to primarily focus its investments in North America (including the unincorporated territories of the U.S.). The Company believes that industry fundamentals in North America present it with significant opportunity to acquire renewable, natural gas-fired generation and thermal infrastructure assets, without creating significant exposure to currency and sovereign risk. By primarily focusing its efforts on North America, the Company believes it will best leverage its regional knowledge of power markets, industry relationships and skill sets to maximize the performance of the Company.
                                    


Competition
Power generation is a capital-intensive business with numerous and diverse industry participants. The Company competes on the basis of the location of its plants and on the basis of contract price and terms of individual projects. Within the power industry, there is a wide variation in terms of the capabilities, resources, nature and identity of the companies with whom the Company competes with depending on the market. Competitors for energy supply are utilities, independent power producers and other providers of distributed generation. The Company also competes to acquire new projects with renewable developers who retain renewable power plant ownership, independent power producers, financial investors and other dividend, growth-oriented companies. Competitive conditions may be substantially affected by capital market conditions and by various forms of energy legislation and regulation considered by federal, state and local legislatures and administrative agencies, including tax policy. Such laws and regulations may substantially increase the costs of acquiring, constructing and operating projects, and it could be difficult for the Company to adapt to and operate under such laws and regulations.
The Company's thermal business has certain cost efficiencies that may form barriers to entry. Generally, there is only one district energy system in a given territory, for which the only competition comes from on-site systems. While the district energy system can usually make an effective case for the efficiency of its services, some building owners nonetheless may opt for on-site systems, either due to corporate policies regarding allocation of capital, unique situations where an on-site system might in fact prove more efficient, or because of previously committed capital in systems that are already on-site. Growth in existing district energy systems generally comes from new building construction or existing building conversions within the service territory of the district energy provider.
Competitive Strengths
Stable, high quality cash flows. The Company's facilities have a stable, predictable cash flow profile consisting of predominantly long-life electric generation assets that sell electricity under long-term fixed priced contracts or pursuant to regulated rates with investment grade and certain other credit-worthy counterparties. As discussed above, PG&E, one of the Company's significant customers, filed for bankruptcy on January 29, 2019. Additionally, the Company's facilities have minimal fuel risk. For the Company's conventional assets, fuel is provided by the toll counterparty or the cost thereof is a pass-through cost under the Contract for Differences, or CfD. Renewable facilities have no fuel costs, and most of the Company's thermal infrastructure assets have contractual or regulatory tariff mechanisms for fuel cost recovery. The offtake agreements for the Company's conventional and renewable generation facilities have a weighted-average remaining duration, based on CAFD, of approximately 15 years as of December 31, 2017, based on CAFD,2018, providing long-term cash flow stability. The Company's generation offtake agreements with counterparties for whom credit ratings are available have a weighted-average Moody’s rating of A3Ba1 (post PG&E Bankruptcy) based on rated capacity under contract. All of the Company's assets are in the U.S. and accordingly have no currency or repatriation risks.
High quality, long-lived assets with low operating and capital requirements. The Company benefits from a portfolio of relatively younger assets, other than thermal infrastructure assets. The Company's assets are comprised of proven and reliable technologies, provided by leading original solar and wind equipment manufacturers such as General Electric, Siemens AG, SunPower Corporation, or SunPower, First Solar Inc., or First Solar, Vestas, Suzlon and Mitsubishi. Given the modern nature of the portfolio, which includes a substantial number of relatively low operating and maintenance cost solar and wind generation assets, the Company expects to achieve high fleet availability and expend modest maintenance-related capital expenditures. Additionally, with the support of services provided by NRG, the Company expects to continue to implement the same rigorous preventative operating and management practices that NRG uses across its fleet of assets.
Significant scale and diversity. The Company owns and operates a large and diverse portfolio of contracted electric generation and thermal infrastructure assets. As of December 31, 2017,2018, the Company's 5,1185,272 net MW contracted generation portfolio benefits from significant diversification in terms of technology, fuel type, counterparty and geography. The Company's thermal business consists of twelvethirteen operations, seven of which are district energy centers that provide steam and chilled water to approximately 695 customers, and fivesix of which provide generation. The Company believes its scale and access to best practices across the fleet improves its business development opportunities through enhanced industry relationships, reputation and understanding of regional power market dynamics. Furthermore, the Company's diversification reduces its operating risk profile and reliance on any single market.
                                    


Relationship with NRG.GIP and CEG. The Company believes that its relationship with NRG, a leading competitive power generator in the U.S.,GIP and CEG provides significant benefits tobenefits. Global Infrastructure Management, LLC, or GIM, the Company, including access to the significant resourcesmanager of NRG to support its operational, financial, legal, regulatory and environmental functions.
Relationship with GIP. The Company believes its potential relationship with GIP, should the NRG Transaction be consummated, may provide significant benefits to the Company. GIP, is an independent infrastructure fund manager with over $45$51 billion in assets under management (as of September 30, 2018) that invests in infrastructure assets and businesses in both OECD and select emerging market countries. GIPGIM has a strong track record of investment and value creation in the renewable energy sector. Additionally, GIPGIM also has extensive experience with publicly traded yield vehicles and development platforms, ranging from Europe's first application of a yield company/development company model to the largest renewable platform in Asia-Pacific. Additionally, the Company believes that CEG provides the Company access to a highly capable renewable development and operations platform that is aligned to support the Company's growth.
Environmentally well-positioned portfolio of assets. The Company's portfolio of electric generation assets consists of 3,1733,327 net MW of renewable generation capacity that are non-emitting sources of power generation. The Company's conventional assets consist of the dual fuel-fired GenConn assets as well as the Marsh Landing and Walnut Creek simple cycle natural gas-fired peaking generation facilities and the El Segundo combined cycle natural gas-fired peaking facility. The Company does not anticipate having to expend any significant capital expenditures in the foreseeable future to comply with current environmental regulations applicable to its generation assets. Taken as a whole, the Company believes its strategy will be a net beneficiary of current and potential environmental legislation and regulatory requirements that may serve as a catalyst for capacity retirements and improve market opportunities for environmentally well-positioned assets like the Company's assets once its current offtake agreements expire.
Thermal infrastructure business has high entry costs. Significant capital has been invested to construct the Company's thermal infrastructure assets, serving as a barrier to entry in the markets in which such assets operate. As of December 31, 2017,2018, the Company's thermal gross property, plant, and equipment was approximately $473$583 million. The Company's thermal district energy centers are located in urban city areas, with the chilled water and steam delivery systems located underground. Constructing underground delivery systems in urban areas requires long lead times for permitting, rights of way and inspections and is costly. By contrast, the incremental cost to add new customers in existing markets is relatively low. Once thermal infrastructure is established, the Company believes it has the ability to retain customers over long periods of time and to compete effectively for additional business against stand-alone on-site heating and cooling generation facilities. Installation of stand-alone equipment can require significant modification to a building as well as significant space for equipment and funding for capital expenditures. The Company's system technologies often provide economies of scale in terms of fuel procurement, ability to switch between multiple types of fuel to generate thermal energy, and fuel conversion efficiency.
Segment Review
The following tables summarize the Company's operating revenues, net income (loss) and assets by segment for the years ended December 31, 2018, 2017 2016 and 2015,2016, as discussed in Item 15 — Note 12, Segment Reporting, to the Consolidated Financial Statements. All amounts have been recast to include the effect of the acquisitions of the Drop Down Assets, which were accounted for as transfers of entities under common control. The accounting guidance requires retrospective combination of the entities for all periods presented as if the combination has been in effect since the inception of common control. Accordingly, the Company prepared its consolidated financial statements to reflect the transfers as if they had taken place from the beginning of the financial statements period or from the date the entities were under common control (if later than the beginning of the financial statements period).  
Year ended December 31, 2017Year ended December 31, 2018
(In millions)Conventional Generation Renewables Thermal Corporate TotalConventional Generation Renewables Thermal Corporate Total
Operating revenues$336
 $501
 $172
 $—
 $1,009
$337
 $526
 $193
 $(3) $1,053
Net income (loss)120
 9
 25
 (92) 62
135
 86
 29
 (115) 135
Total assets1,897
 5,811
 422
 24
 8,154
1,788
 5,836
 516
 308
 8,448
Year ended December 31, 2016Year ended December 31, 2017
(In millions)Conventional Generation Renewables Thermal Corporate TotalConventional Generation Renewables Thermal Corporate Total
Operating revenues$333
 $532
 $170
 $—
 $1,035
$336
 $501
 $172
 $—
 $1,009
Net income (loss)153
 (86) 29
 (81) 15
120
 8
 25
 (92) 61
Total assets1,993
 6,114
 426
 212
 8,745
1,897
 6,017
 422
 24
 8,360
                                    


Year ended December 31, 2015Year ended December 31, 2016
(In millions)Conventional Generation Renewables Thermal Corporate TotalConventional Generation Renewables Thermal Corporate Total
Operating revenues$336
 $458
 $174
 $—
 $968
$333
 $532
 $170
 $—
 $1,035
Net income (loss)156
 (18) 22
 (65) 95
153
 (86) 29
 (81) 15
GovernmentPolicy Incentives
GovernmentPolicy incentives including PTCsin the U.S. have the effect of making the development of renewable energy projects more competitive by providing credits and ITCs, can enhance the economicsother tax benefits for a portion of the development costs. A loss of or reduction in such incentives could decrease the attractiveness of renewable energy projects to developers, including CEG, which could reduce the Company's generating assetsfuture acquisition opportunities. Such a loss or reduction could also reduce the Company's willingness to pursue or develop certain renewable energy projects due to higher operating costs or decreased revenues under its PPAs.

U.S. federal, state and investments by providing, for example, loan guarantees,local governments have established various incentives to support the development of renewable energy projects. These incentives include accelerated tax depreciation, PTCs, ITCs, cash grants, favorable tax treatment, favorable depreciation rulesabatements and RPS programs. Pursuant to the U.S. federal Modified Accelerated Cost Recovery System, or MACRS, wind and solar projects are fully depreciated for tax purposes over a five-year period even though the useful life of such projects is generally much longer than five years. The Tax Act also provides the ability for wind and solar projects to claim immediate expensing for property acquired and placed in service after September 27, 2017, and before January 1, 2023.

Owners of utility-scale wind facilities are eligible to claim an income tax credit (the PTC, or an ITC in lieu of the PTC) upon initially achieving commercial operation. The PTC is determined based on the amount of electricity produced by the wind facility during the first ten years of commercial operation. This incentive was created under the Energy Policy Act of 1992 and has been extended several times. Alternatively, an ITC equal to 30% of the cost of a wind facility may be claimed in lieu of the PTC. In order to qualify for the PTC (or ITC in lieu of the PTC), construction of a wind facility must begin before a specified date and the taxpayer must maintain a continuous program of construction or continuous efforts to advance the project to completion. The Internal Revenue Service, or IRS, issued guidance stating that the safe harbor for continuous efforts and continuous construction requirements will generally be satisfied if the facility is placed in service no more than four years after the year in which construction of the facility began. The IRS also confirmed that retrofitted wind facilities may re-qualify for PTCs or ITCs pursuant the begin construction requirement, as long as the cost basis of the new investment is at least 80% of the facility’s total fair value.

Owners of solar projects are eligible to claim a 30% ITC for new solar projects, or could have elected to receive an equivalent cash payment from the U.S. Department of Treasury for the value of the 30% ITC for qualifying solar projects where construction began before the end of 2011 and the projects were placed in service before 2017. Tax credits for qualifying wind and solar projects are subject to the following phase-down schedule.
 Year construction of project begins
 2015 2016 2017 2018 2019 2020 2021 2022
PTC(a)
100% 100% 80% 60% 40% 0  0  0 
Wind ITC30% 30% 24% 18% 12% 0  0  0 
Solar ITC(b)
30% 30% 30% 30% 30% 26% 22% 10%
(a) Percentage of the full PTC available for wind projects that begin construction during the applicable year.
(b) ITC is limited to 10% for projects not placed in service before January 1, 2024.

RPS, currently in place in certain states and territories, require electricity providers in the state or territory to meet a certain percentage of their retail sales with energy from renewable sources. Additionally, other incentives.states in the U.S. have set renewable energy goals to reduce GHG emissions from historic levels. The Company cannot predictbelieves that these standards and goals will create incremental demand for renewable energy in the effects that the current U.S. presidential administration will have on government incentives.future.




Regulatory Matters
As owners of power plants and participants in wholesale and thermal energy markets, certain of the Company's subsidiaries are subject to regulation by various federal and state government agencies. These agencies include FERC and the PUCT, as well as other public utility commissions in certain states where the Company's assets are located. Each of the Company's U.S. generating facilities qualifies as an EWG or QF. In addition, the Company is subject to the market rules, procedures and protocols of the various ISO and RTO markets in which it participates. Likewise, certain of the CompanyCompany's subsidiaries must also comply with the mandatory reliability requirements imposed by NERC and the regional reliability entities in the regions where the Company operates.has generating facilities subject to NERC's reliability authority. The Company's operations within the ERCOT footprint are not subject to rate regulation by FERC, as they are deemed to operate solely within the ERCOT market and not in interstate commerce. These operations are subject to regulation by PUCT.
FERC
FERC, among other things, regulates the transmission and the wholesale sale of electricity in interstate commerce under the authority of the FPA. The transmission of electric energy occurring wholly within ERCOT is not subject to FERC’s jurisdiction under Sections 203 or 205 of the FPA.jurisdiction. Under existing regulations, FERC determines whether an entity owning a generation facility is an EWG, as defined in the PUHCA. FERC also determines whether a generation facility meets the ownership and technicalapplicable criteria of a QF under the PURPA. Each of the Company’s non-ERCOT generating facilities qualifies as either an EWG.EWG or QF.
The FPA gives FERC exclusive rate-making jurisdiction over the wholesale sale of electricity and transmission of electricity in interstate commerce of public utilities (as defined by the FPA). Under the FPA, FERC, with certain exceptions, regulates the owners and operators of facilities used for the wholesale sale of electricity or transmission in interstate commerce as public utilities, and establishesis charged with ensuring that market rules that are just and reasonable.
Public utilities are required to obtain FERC’s acceptance, pursuant to Section 205 of the FPA, of their rate schedules for the wholesale sale of electricity. All of the Company’s non-QF generating entities located outside of ERCOT make sales of electricity pursuant to market-based rates, as opposed to traditional cost-of-service regulated rates. Every three years FERC will conduct a review of the Company’s market based rates of Company public utilities and potential market power onevery three years according to a regional basis.schedule established by FERC.
In accordance with the Energy Policy Act of 2005, FERC has approved the NERC as the national Energy Reliability Organization, or ERO. As the ERO, NERC is responsible for the development and enforcement of mandatory reliability standards for the wholesale electric power system. In addition to complying with NERC requirements, each entity must comply with the requirements of the regional reliability entity for the region in which it is located.
The PURPA was passed in 1978 in large part to promote increased energy efficiency and development of independent power producers. The PURPA created QFs to further both goals, and FERC is primarily charged with administering the PURPA as it applies to QFs. Certain QFs are exempt from regulation, either in whole or in part, under the FPA as public utilities.FPA.
The PUHCA provides FERC with certain authority over and access to books and records of public utility holding companies not otherwise exempt by virtue of their ownership of EWGs, QFs, and Foreign Utility Companies. The Company is exempt from many of the accounting, record retention, and reporting requirements of the PUHCA.



                                    


Environmental Matters
The Company is subject to a wide range of environmental laws in the development, construction, ownership and operation of projects. These laws generally require that governmental permits and approvals be obtained before construction and during operation of facilities. The Company is also subject to laws regarding the protection of wildlife, including migratory birds, eagles, threatened and endangered species. Federal and state environmental laws have historically become more stringent over time, although this trend could change with respect to federal laws underin the current U.S. presidential administration.future.
In October 2015, the EPA finalized the Clean Power Plan, or CPP, addressing GHG emissions from existing EGUs. On February 9, 2016, the U.S. Supreme Court stayed the CPP. The D.C. Circuit heard oral argument on the legal challenges to the CPP in September 2016. At the EPA's request, the D.C. Circuit agreed on April 28, 2017 to hold the case in abeyance. On October 16, 2017, the EPA proposed a rule to repeal the CPP. Accordingly, the Company believes the CPP is not likely to survive. In August 21, 2018, the EPA proposed the Affordable Clean Energy (ACE) rule which would establish emission guidelines for states to develop plans to address greenhouse gas emissions from existing coal-fired power plants. The ACE rule would replace the 2015 Clean Power Plan. A public hearing on the proposed ACE rule was held on October 1, 2018. As currently written, the ACE focuses on reducing emissions from existing coal-fired power plants and therefore, would not be applicable to the Company’s EGUs.
Migratory Bird Treaty Act
During the 2018 California legislative sessions AB 2627 (Kalra), a bill designed to backstop the Migratory Bird Treaty Act, or MBTA, interpretation by the Obama Administration was introduced. AB 2627 provided legislative confirmation of the illegality of take of any MBTA species, unless the entity deployed Best Management Practices that had been approved by the California Department of Fish and Wildlife, or CDFW. The bill was pulled by the author at the end of session. However, on November 30, 2018, CDFW issued a legal advisory declaring that the state can still prohibit the unintentional killing of migratory birds even if the Department of the Interior says the federal government cannot. It is expected a revival of the MBTA bill will occur in 2019.
Customers
The Company sells its electricity and environmental attributes, including RECs, primarily to local utilities under long-term, fixed-price PPAs. During the year ended December 31, 2017,2018, the Company derived approximately 41%40% of its consolidated revenue from Southern California Edison, or SCE, and approximately 23% of its consolidated revenue from Pacific Gas and Electric Company, or PG&E. See Pacific Gas and Electric Company Bankruptcy within this Item 1, Business and "Risks Related to the PG&E Bankruptcy" found in Item 1A, Risk Factors, to this Annual Report on Form 10-K for additional information regarding the PG&E Bankruptcy.
Employees
The Company employs Christopher Sotos as its President and Chief Executive Officer and Chad Plotkin as its Senior Vice President and Chief Financial Officer. As of December 31, 2017, other than Messrs. Sotos and Plotkin,2018, the Company did not employ any otherand its consolidated subsidiaries had 269 employees. The majority of personnel who manage operations of the Company are employees of NRG or third parties managed by NRG, and their services are provided for the Company's benefit under the Management Services Agreement and project operations and maintenance agreements with NRG as described in Item 15 —Note 13, Related Party Transactions, to the Consolidated Financial Statements.
Available Information
The Company's annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to section 13(a) or 15(d) of the Exchange Act are available free of charge through Yield,the "Investor Relations" section of Clearway, Inc.'s website, www.nrgyield.comwww.clearwayenergy.com, as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. The Company also routinely posts press releases, presentations, webcasts, and other information regarding the Company on Yield,Clearway Energy, Inc.'s website. The information posted on Yield,Clearway Energy, Inc.'s website is not a part of this report.

Item 1A — Risk Factors
Risks Relatedrelated to the Proposed NRG TransactionPG&E Bankruptcy
The Company may not realizePG&E bankruptcy could adversely affect the anticipated benefitsCompany’s results of operations, financial condition and cash flows.
On January 29, 2019, PG&E filed for reorganization under Chapter 11 of the NRG Transaction.

On February 6, 2018, Global Infrastructure Partners, or GIP, entered into a purchase and sale agreement with NRGU.S. Bankruptcy Code in the U.S. Bankruptcy Court for the acquisitionNorthern District of NRG’s full ownership interest inCalifornia. PG&E is one of the Company's largest customers, representing approximately 23% of the Company's consolidated operating revenues during the year ended December 31, 2018 and 16% of total accounts receivable as of December 31, 2018, of which all has been collected as of January 31, 2019. Certain subsidiaries of the Company, which hold interests in six solar facilities totaling 480 MW and NRG’s renewable energy development and operations platform. Also on February 6, 2018,Marsh Landing with capacity of 720 MW, sell the output of their facilities to PG&E under long-term PPAs.   The Company entered into a consent and indemnity agreement with NRG and GIP in connection with the purchase and sale agreement between NRG and GIP. The consent and indemnity agreement and the purchase and sale agreement are collectively referred to as the NRG Transaction. Consummationconsolidates three of the NRG Transaction is subject to a number of conditions, including receipt of certain contractual consentssolar facilities and regulatory approvals from certain regulatory agencies, including approval by FERCMarsh Landing, and approvals from certain state regulatory agencies. While the parties have begun the process of notifying agencies and obtaining regulatory approvals and consents, there is no assurance that the parties will be able to obtain the requisite regulatory approvals or consents to satisfy the closing conditions. Additionally, the NRG Transaction requires the Company’s consent which is conditioned upon a number of items, all of which may not be met on a timely basis, or at all.

If the NRG Transaction is consummated, GIP may exercise substantial influence over the Company’s policies and procedures and exercise substantial influence over the Company’s Board, management and the types of third party acquisitions the Company makes. The Company may not identify future acquisitions or be able to secure financing on attractive terms or at all for future acquisitions and the Company may not realize the anticipated benefits of the financing support to be provided by GIP, which includes a $1.5 billion backstop credit facility to manage any change-of-control costs associated with the Company’s corporate debt and up to $400 million in financing support for the Company’s acquisition of the Carlsbad Energy Center. Further, GIP may not be able to maintain the Company’s current relationships with customers, counterparties, suppliers, lenders and other thirdrecords its interest
                                    


parties. Uncertainty aboutin the effectother solar facilities as equity method investments.  Most of the NRG TransactionPPAs with PG&E have contract prices that are higher than currently estimated market prices.  These contracts are subject to review by the bankruptcy court and FERC, pursuant to a January 2019 FERC order, or the FERC Order.  PG&E has commenced an adversary proceeding against FERC seeking, among other things, an injunction with respect to the FERC Order. If PG&E does not have the financial means or refuses to pay the amounts owing to the Company under the PPAs, and if the Company cannot recover the amounts owed through other means, the Company may negativelybe required to write-off all, or a portion of, any outstanding accounts receivable, and to impair its fixed assets. Any such results would adversely affect the Company’s relationshipCompany's financial results.

The PG&E bankruptcy filing has triggered defaults under the PPAs with its counterpartiesPG&E and under the related financing agreements for each respective facility, all of which have a significant impactnon-recourse project level debt and in certain cases, non-recourse holding company debt. The Company is currently negotiating forbearance agreements with the lenders for each respective financing arrangement, but the Company can provide no assurance that it will be able to successfully negotiate the forbearance agreements. 

The Company continues to assess the potential future impacts of the PG&E Bankruptcy on the Company’s business.operations. The foregoingrealization of any of the above risks maycould significantly and adversely affect the Company’s operational performance or limit the Company’s growth prospects, includingCompany's ability to meet its financial expectations, its financial condition, results of operations, and cash flows, its ability to growmake distributions to its dividend per share.stockholders, the market price of its common stock, and its ability to satisfy its debt service obligations.

FollowingCounterparties to the consummationCompany's offtake agreements may not fulfill their obligations and, as the contracts expire, the Company may not be able to replace them with agreements on similar terms in light of increasing competition in the markets in which the Company operates.
A significant portion of the NRG Transaction, GIP and its affiliates will controlelectric power the Company generates is sold under long-term offtake agreements with public utilities or industrial or commercial end-users, with a weighted average remaining duration, based on CAFD, of approximately 15 years. As of December 31, 2018, the largest customers of the Company's power generation assets, including assets in which the Company has less than a 100% membership interest, were SCE and PG&E, which represented 40% and 23%, respectively, of total consolidated revenues generated by the Company during the year ended December 31, 2018. As previously noted, on January 29, 2019, PG&E filed for reorganization under Chapter 11 of the Bankruptcy Code.
If, for any reason, any of the purchasers of power under these agreements, including PG&E as a result of the PG&E Bankruptcy, are unable or unwilling to fulfill their related contractual obligations or if they refuse to accept delivery of power delivered thereunder or if they otherwise terminate such agreements prior to the expiration thereof, the Company's assets, liabilities, business, financial condition, results of operations and cash flows could be materially and adversely affected. Furthermore, to the extent any of the Company's power purchasers are, or are controlled by, governmental entities, the Company's facilities may be subject to legislative or other political action that may impair their contractual performance.
The power generation industry is characterized by intense competition and the Company's electric generation assets encounter competition from utilities, industrial companies and other independent power producers, in particular with respect to uncontracted output. In recent years, there has been increasing competition among generators for offtake agreements and this has contributed to a reduction in electricity prices in certain markets characterized by excess supply above designated reserve margins. In light of these market conditions, the Company may not be able to replace an expiring or terminated agreement with an agreement on equivalent terms and conditions, including at prices that permit operation of the related facility on a profitable basis. In addition, the Company believes many of its competitors have well-established relationships with the Company's current and potential suppliers, lenders and customers and have the abilityextensive knowledge of its target markets. As a result, these competitors may be able to designate a majority of the members of Yield, Inc.'s Board.

The governance agreementsrespond more quickly to be entered into among NRG, the Company, GIPevolving industry standards and its affiliates in connection with the NRG Transaction provide GIP the ability to designate a majority of Yield, Inc.’s Board to the Company’s Corporate Governance, Conflicts and Nominating Committee for nomination for election by Yield, Inc.’s stockholders and also require that the Company and GIP use their commercially reasonable efforts to submit to Yield, Inc.’s stockholders at Yield, Inc.’s 2019 Annual Meeting of Stockholders a charter amendment to classify Yield, Inc.’s Board into two classes (with the independent directors and directors designated by GIP allocated across the two classes). Due to such agreements and GIP's approximate 55.1% combined voting power in Yield, Inc. following the completion of the NRG Transaction, the ability of other holders of Yield, Inc.’s Class A and Class C common stock to exercise control over the corporate governance ofchanging customer requirements than the Company will be limited. In addition, dueable to. Adoption of technology more advanced than the Company's could reduce its competitors' power production costs resulting in their having a lower cost structure than is achievable with the technologies currently employed by the Company and adversely affect its ability to its approximate 55.1% combined voting powercompete for offtake agreement renewals. If the Company is unable to replace an expiring or terminated offtake agreement, the affected facility may temporarily or permanently cease operations. External events, such as a severe economic downturn or force majeure events, could also impair the ability of some counterparties to the Company's offtake agreements and other customer agreements to pay for energy and/or other products and services received.
The Company's inability to enter into new or replacement offtake agreements or to compete successfully against current and future competitors in the markets in which the Company following the completion of the NRG Transaction, GIP and its affiliates willoperates could have a substantial influencematerial adverse effect on Yield, Inc.’s affairsthe Company's business, financial condition, results of operations and its voting power will constitute a large percentage of any quorum of Yield, Inc.’s stockholders voting on any matter requiring the approval of Yield, Inc.’s stockholders, including the classification of Yield, Inc.'s Board of Directors. GIP may hold certain interests that are different from those of the Company or other holders of Yield, Inc.'s Class A and Class C common stock and there is no assurance that GIP will exercise its control over the Company in a manner that is consistent with the Company’s interests or those of the holders of Yield, Inc.'s Class A and Class C common stock.cash flows.



Risks Related to the Company's Business
Certain facilities are newly constructed and may not perform as expected.
Certain of the Company's conventional and renewable assets are newly constructed. The ability of these facilities to meet the Company's performance expectations is subject to the risks inherent in newly constructed power generation facilities and the construction of such facilities, including, but not limited to, degradation of equipment in excess of the Company's expectations, system failures, and outages. The failure of these facilities to perform as the Company expects could have a material adverse effect on the Company's business, financial condition, results of operations, cash flows and its ability to pay distributions to Yield,Clearway Energy, Inc. and NRG.CEG.
Pursuant to the Company's cash distribution policy, the Company intends to distribute a significant amount of the CAFD through regular quarterly distributions, and the Company's ability to grow and make acquisitions through cash on hand could be limited.
The Company expects to distribute a significant amount of the CAFD each quarter and to rely primarily upon external financing sources, including the issuance of debt and equity securities and, if applicable, borrowings under the Company's revolving credit facility to fund acquisitions and growth capital expenditures. The Company may be precluded from pursuing otherwise attractive acquisitions if the projected short-term cash flow from the acquisition or investment is not adequate to service the capital raised to fund the acquisition or investment, after giving effect to the Company's available cash reserves. The incurrence of bank borrowings or other debt by NRG YieldClearway Energy Operating LLC or by the Company's project-level subsidiaries to finance the Company’s growth strategy will result in increased interest expense and the imposition of additional or more restrictive covenants, which, in turn, may impact the cash distributions the Company makes to Yield,Clearway Energy, Inc. and NRG.CEG.


The Company may not be able to effectively identify or consummate any future acquisitions on favorable terms, or at all.
The Company's business strategy includes growth through the acquisitions of additional generation assets (including through corporate acquisitions). This strategy depends on the Company’s ability to successfully identify and evaluate acquisition opportunities and consummate acquisitions on favorable terms. However, the number of acquisition opportunities is limited. In addition, the Company will compete with other companies for these limited acquisition opportunities, which may increase the Company’s cost of making acquisitions or cause the Company to refrain from making acquisitions at all. Some of the Company’s competitors for acquisitions are much larger than the Company with substantially greater resources. These companies may be able to pay more for acquisitions and may be able to identify, evaluate, bid for and purchase a greater number of assets than the Company’s financial or human resources permit. If the Company is unable to identify and consummate future acquisitions, it will impede the Company’s ability to execute its growth strategy and limit the Company’s ability to increase the amount of dividends paid to holders of Yield,Clearway Energy, Inc.'s common stock.

Furthermore, the Company’s ability to acquire future renewable facilities may depend on the viability of renewable assets generally. These assets currently are largely contingent on public policy mechanisms including ITCs, cash grants, loan guarantees, accelerated depreciation, RPS and carbon trading plans. These mechanisms have been implemented at the state and federal levels to support the development of renewable generation, demand-side and smart grid and other clean infrastructure technologies. The availability and continuation of public policy support mechanisms will drive a significant part of the economics and viability of the Company’s growth strategy and expansion into clean energy investments.
The Company’s ability to effectively consummate future acquisitions will also depend on the Company’s ability to arrange the required or desired financing for acquisitions.
The Company may not have sufficient availability under the Company’s credit facilities or have access to project-level financing on commercially reasonable terms when acquisition opportunities arise. An inability to obtain the required or desired financing could significantly limit the Company’s ability to consummate future acquisitions and effectuate the Company’s growth strategy. If financing is available, utilization of the Company’s credit facilities or project-level financing for all or a portion of the purchase price of an acquisition could significantly increase the Company’s interest expense, impose additional or more restrictive covenants and reduce CAFD. The Company’s ability to consummate future acquisitions may also depend on the Company’s ability to obtain any required regulatory approvals for such acquisitions, including, but not limited to, approval by FERC under Section 203 of the FPA.


Finally, the acquisition of companies and assets are subject to substantial risks, including the failure to identify material problems during due diligence (for which the Company may not be indemnified post-closing), the risk of over-payingoverpaying for assets (or not making acquisitions on an accretive basis) and the ability to retain customers. Further, the integration and consolidation of acquisitions requires substantial human, financial and other resources and, ultimately, the Company's acquisitions may divert management’s attention from the Company's existing business concerns, disrupt the Company's ongoing business or not be successfully integrated. There can be no assurances that any future acquisitions will perform as expected or that the returns from such acquisitions will support the financing utilized to acquire them or maintain them. As a result, the consummation of acquisitions may have a material adverse effect on the Company's business, financial condition, results of operations, cash flows and ability to pay distributions to Yield,Clearway Energy, Inc. and NRG.CEG.
Even if the Company consummates acquisitions that it believes will be accretive to CAFD, those acquisitions may decrease CAFD as a result of incorrect assumptions in the Company’s evaluation of such acquisitions, unforeseen consequences or other external events beyond the Company’s control.
The acquisition of existing generation assets involves the risk of overpaying for such projects (or not making acquisitions on an accretive basis) and failing to retain the customers of such projects. While the Company will perform due diligence on prospective acquisitions, the Company may not discover all potential risks, operational issues or other issues in such generation assets. Further, the integration and consolidation of acquisitions require substantial human, financial and other resources and, ultimately, the Company’s acquisitions may divert the Company’s management’s attention from its existing business concerns, disrupt its ongoing business or not be successfully integrated. Future acquisitions might not perform as expected or the returns from such acquisitions might not support the financing utilized to acquire them or maintain them. A failure to achieve the financial returns the Company expects when it acquires generation assets could have a material adverse effect on the Company’s ability to grow its business and make cash distributions to its unitholders. Any failure of the Company’s acquired generation assets to be accretive or difficulty in integrating such acquisition into the Company’s business could have a material adverse effect on the Company’s ability to grow its business and make cash distributions to its unitholders.


The Company’s indebtedness could adversely affect its ability to raise additional capital to fund the Company’s operations or pay distributions. It could also expose the Company to the risk of increased interest rates and limit the Company’s ability to react to changes in the economy or the Company’s industry as well as impact the Company’s results of operations, financial condition and cash flows.
As of December 31, 20172018, the Company had approximately $5,899$6,038 million of total consolidated indebtedness, $4,376$4,329 million of which was incurred by the Company's non-guarantor subsidiaries. In addition, the Company’s share of its unconsolidated affiliates’ total indebtedness and letters of credit outstanding as of December 31, 2017,2018, totaled approximately $777$878 million and $98$80 million, respectively (calculated as the Company’s unconsolidated affiliates’ total indebtedness as of such date multiplied by the Company’s percentage membership interest in such assets). The Company’s substantial debt could have important negative consequences on the Company’s financial condition, including:
increasing the Company’s vulnerability to general economic and industry conditions;
requiring a substantial portion of the Company’s cash flow from operations to be dedicated to the payment of principal and interest on the Company’s indebtedness, therefore reducing the Company’s ability to pay distributions to Yield,Clearway Energy, Inc. and NRGCEG or to use the Company’s cash flow to fund its operations, capital expenditures and future business opportunities;
limiting the Company’s ability to enter into long-term power sales or fuel purchases which require credit support;
limiting the Company’s ability to fund operations or future acquisitions;
restricting the Company’s ability to make certain distributions to Yield,Clearway Energy, Inc. and NRGCEG and the ability of the Company’s subsidiaries to make certain distributions to it, in light of restricted payment and other financial covenants in the Company’s credit facilities and other financing agreements;
exposing the Company to the risk of increased interest rates because certain of the Company’s borrowings, which may include borrowings under the Company’s revolving credit facility, are at variable rates of interest;
limiting the Company’s ability to obtain additional financing for working capital including collateral postings, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; and
limiting the Company’s ability to adjust to changing market conditions and placing it at a competitive disadvantage compared to the Company’s competitors who have less debt.
The Company's revolving credit facility contains financial and other restrictive covenants that limit the Company’s ability to return capital to stockholders or otherwise engage in activities that may be in the Company’s long-term best interests. The Company’s inability to satisfy certain financial covenants could prevent the Company from paying cash distributions, and the Company’s failure to comply with those and other covenants could result in an event of default which, if not cured or waived, may entitle the related lenders to demand repayment or enforce their security interests, which could have a material adverse effect


on the Company’s business, financial condition, results of operations and cash flows. In addition, failure to comply with such covenants may entitle the related lenders to demand repayment and accelerate all such indebtedness.
As previously discussed, the PG&E bankruptcy filing has triggered defaults under the PPAs with PG&E and under the related financing agreements for each respective facility, all of which have non-recourse project level debt and in certain cases, holding company debt. The agreements governing the Company’s project-level financing contain financial and other restrictive covenants that limit the Company’s project subsidiaries’ ability to make distributions to the Company or otherwise engage in activities that may be in the Company’s long-term best interests. The project-level financing agreements generally prohibit distributions from the project entities to the Company unless certain specific conditions are met, including the satisfaction of certain financial ratios. The Company’s inability to satisfy certain financial covenants may prevent cash distributions by the particular project(s) to it and, the Company’s failure to comply with those and other covenants could result in an event of default which, if not cured or waived may entitle the related lenders to demand repayment or enforce their security interests, which could have a material adverse effect on the Company’s business, results of operations and financial condition. In addition, failure to comply with such covenants may entitle the related lenders to demand repayment and accelerate all such indebtedness. If the Company is unable to make distributions from the Company’s project-level subsidiaries, it would likely have a material adverse effect on the Company’s ability to pay distributions to Yield,Clearway, Inc. and NRG.CEG.
Letter of credit facilities to support project-level contractual obligations generally need to be renewed after five to seven years, at which time the Company will need to satisfy applicable financial ratios and covenants. If the Company is unable to renew the Company’s letters of credit as expected or replace them with letters of credit under different facilities on favorable terms or at all, the Company may experience a material adverse effect on its business, financial condition, results of operations and cash flows. Furthermore, such inability may constitute a default under certain project-level financing arrangements, restrict the ability of the project-level subsidiary to make distributions to it and/or reduce the amount of cash available at such subsidiary to make distributions to the Company.
In addition, the Company’s ability to arrange financing, either at the corporate level or at a non-recourse project-level subsidiary, and the costs of such capital, are dependent on numerous factors, including:
general economic and capital market conditions;


credit availability from banks and other financial institutions;
investor confidence in the Company, its partners, Yield,Clearway, Inc. (as the Company's sole managing member), NRG (as Yieldor GIP, through CEG, as Clearway, Inc.’s's principal stockholder on(on a combined voting basis, and manager under the Management Services Agreement), or GIP, as successor to NRG's interests in the Company if the NRG Transaction is consummated,basis) and the regional wholesale power markets;
the Company’s financial performance and the financial performance of the Company subsidiaries;
the Company’s level of indebtedness and compliance with covenants in debt agreements;
maintenance of acceptable project credit ratings or credit quality;
cash flow; and
provisions of tax and securities laws that may impact raising capital.
The Company may not be successful in obtaining additional capital for these or other reasons. Furthermore, the Company may be unable to refinance or replace project-level financing arrangements or other credit facilities on favorable terms or at all upon the expiration or termination thereof. The Company's failure, or the failure of any of the Company’s projects, to obtain additional capital or enter into new or replacement financing arrangements when due may constitute a default under such existing indebtedness and may have a material adverse effect on the Company's business, financial condition, results of operations and cash flows.
Certain of the Company's long-term bilateral contracts result from state-mandated procurements and could be declared invalid by a court of competent jurisdiction.
A significant portion of the Company's revenues are derived from long-term bilateral contracts with utilities that are regulated by their respective states, and have been entered into pursuant to certain state programs. Certain long-term contracts that other companies have with state-regulated utilities have been challenged in federal court and have been declared unconstitutional on the grounds that the rate for energy and capacity established by the contracts impermissibly conflicts with the rate for energy and capacity established by FERC pursuant to the FPA. If certain of the Company's state-mandated agreements with utilities are ever held to be invalid or unenforceable due to the financial conditions or other conditions of such utility, the Company may be unable to replace such contracts, which could have a material adverse effect on the Company's business, financial condition, results of operations and cash flows.


The generation of electric energy from solar and wind energy sources depends heavily on suitable meteorological conditions.
If solar or wind conditions are unfavorable, the Company's electricity generation and revenue from renewable generation facilities may be substantially below the Company's expectations. The electricity produced and revenues generated by a solar or wind energy generation facility is highly dependent on suitable solar or wind conditions, as applicable, and associated weather conditions, which are beyond the Company's control. Furthermore, components of the Company's systems, such as solar panels and inverters, could be damaged by severe weather, such as wildfires, hailstorms or tornadoes. In addition, replacement and spare parts for key components may be difficult or costly to acquire or may be unavailable. Unfavorable weather and atmospheric conditions could impair the effectiveness of the Company's assets or reduce their output beneath their rated capacity or require shutdown of key equipment, impeding operation of the Company's renewable assets. In addition, climate change may have the long-term effect of changing wind patterns at ourthe Company's projects. Changing wind patterns could cause changes in expected electricity generation. These events could also degrade equipment or components and the interconnection and transmission facilities’ lives or maintenance costs.
Although the Company bases its investment decisions with respect to each renewable generation facility on the findings of related wind and solar studies conducted on-site prior to construction or based on historical conditions at existing facilities, actual climatic conditions at a facility site, particularly wind conditions, may not conform to the findings of these studies and may be affected by variations in weather patterns, including any potential impact of climate change. Therefore, the Company's solar and wind energy facilities may not meet anticipated production levels or the rated capacity of the Company's generation assets, which could adversely affect the Company's business, financial condition, results of operations and cash flows.


Operation of electric generation facilities involves significant risks and hazards customary to the power industry that could have a material adverse effect on the Company's business, financial condition, results of operations and cash flows.
The ongoing operation of the Company's facilities involves risks that include the breakdown or failure of equipment or processes or performance below expected levels of output or efficiency due to wear and tear, latent defect, design error or operator error or force majeure events, among other things. Operation of the Company's facilities also involves risks that the Company will be unable to transport its products to its customers in an efficient manner due to a lack of transmission capacity. Unplanned outages of generating units, including extensions of scheduled outages due to mechanical failures or other problems, occur from time to time and are an inherent risk of the business. Unplanned outages typically increase operation and maintenance expenses, capital expenditures and may reduce revenues as a result of selling fewer MWh or require the Company to incur significant costs as a result of obtaining replacement power from third parties in the open market to satisfy forward power sales obligations. The Company's inability to operate its electric generation assets efficiently, manage capital expenditures and costs and generate earnings and cash flow from the Company's asset-based businesses could have a material adverse effect on the Company's business, financial condition, results of operations and cash flows. While the Company maintains insurance, obtains warranties from vendors and obligates contractors to meet certain performance levels, the proceeds of such insurance, warranties or performance guarantees may not cover the Company's lost revenues, increased expenses or liquidated damages payments should it experience equipment breakdown or non-performance by contractors or vendors.
Power generation involves hazardous activities, including acquiring, transporting and unloading fuel, operating large pieces of rotating equipment and delivering electricity to transmission and distribution systems.
In addition to natural risks such as earthquake, flood, lightning, hurricane and wind, other hazards, such as fire, explosion, structural collapse and machinery failure are inherent risks in the Company's operations. These and other hazards can cause significant personal injury or loss of life, severe damage to and destruction of property, plant and equipment and contamination of, or damage to, the environment and suspension of operations. The occurrence of any one of these events may result in the Company being named as a defendant in lawsuits asserting claims for substantial damages, including for environmental cleanup costs, personal injury and property damage and fines and/or penalties. The Company maintains an amount of insurance protection that it considers adequate but cannot provide any assurance that the Company's insurance will be sufficient or effective under all circumstances and against all hazards or liabilities to which the Company may be subject. Furthermore, the Company's insurance coverage is subject to deductibles, caps, exclusions and other limitations. A loss for which the Company is not fully insured (which may include a significant judgment against any facility or facility operator) could have a material adverse effect on the Company's business, financial condition, results of operations or cash flows. Further, due to rising insurance costs and changes in the insurance markets, the Company cannot provide any assurance that its insurance coverage will continue to be available at all or at rates or on terms similar to those presently available. Any losses not covered by insurance could have a material adverse effect on the Company's business, financial condition, results of operations and cash flows.


Maintenance, expansion and refurbishment of electric generation facilities involve significant risks that could result in unplanned power outages or reduced output.
The Company's facilities may require periodic upgrading and improvement. Any unexpected operational or mechanical failure, including failure associated with breakdowns and forced outages, could reduce the Company's facilities' generating capacity below expected levels, reducing the Company's revenues and jeopardizing the Company's ability to pay distributions to Yield,Clearway, Inc. and NRGCEG at expected levels or at all. Degradation of the performance of the Company's solar facilities above levels provided for in the related offtake agreements may also reduce the Company's revenues. Unanticipated capital expenditures associated with maintaining, upgrading or repairing the Company's facilities may also reduce profitability.
If the Company makes any major modifications to its conventional power generation facilities, it may be required to install the best available control technology or to achieve the lowest achievable emission rates as such terms are defined under the new source review provisions of the CAA in the future. Any such modifications could likely result in substantial additional capital expenditures. The Company may also choose to repower, refurbish or upgrade its facilities based on its assessment that such activity will provide adequate financial returns. Such facilities require time for development and capital expenditures before commencement of commercial operations, and key assumptions underpinning a decision to make such an investment may prove incorrect, including assumptions regarding construction costs, timing, available financing and future fuel and power prices. These events could have a material adverse effect on the Company's business, financial condition, results of operations and cash flows.


Counterparties to the Company's offtake agreements may not fulfill their obligations and, as the contracts expire, the Company may not be able to replace them with agreements on similar terms in light of increasing competition in the markets in which the Company operates.
A significant portion of the electric power the Company generates is sold under long-term offtake agreements with public utilities or industrial or commercial end-users, with a weighted average remaining duration of approximately 15 years based on CAFD. As of December 31, 2017, the largest customers of the Company's power generation assets, including assets in which the Company has less than a 100% membership interest, were SCE and PG&E, which represented 40% and 23%, respectively, of the net electric generation capacity of the Company's facilities.
If, for any reason, any of the purchasers of power under these agreements are unable or unwilling to fulfill their related contractual obligations or if they refuse to accept delivery of power delivered thereunder or if they otherwise terminate such agreements prior to the expiration thereof, the Company's assets, liabilities, business, financial condition, results of operations and cash flows could be materially and adversely affected. Furthermore, to the extent any of the Company's power purchasers are, or are controlled by, governmental entities, the Company's facilities may be subject to legislative or other political action that may impair their contractual performance.
The power generation industry is characterized by intense competition and the Company's electric generation assets encounter competition from utilities, industrial companies and other independent power producers, in particular with respect to uncontracted output. In recent years, there has been increasing competition among generators for offtake agreements and this has contributed to a reduction in electricity prices in certain markets characterized by excess supply above designated reserve margins. In light of these market conditions, the Company may not be able to replace an expiring or terminated agreement with an agreement on equivalent terms and conditions, including at prices that permit operation of the related facility on a profitable basis. In addition, the Company believes many of its competitors have well-established relationships with the Company's current and potential suppliers, lenders and customers and have extensive knowledge of its target markets. As a result, these competitors may be able to respond more quickly to evolving industry standards and changing customer requirements than the Company will be able to. Adoption of technology more advanced than the Company's could reduce its competitors' power production costs resulting in their having a lower cost structure than is achievable with the technologies currently employed by the Company and adversely affect its ability to compete for offtake agreement renewals. If the Company is unable to replace an expiring or terminated offtake agreement, the affected facility may temporarily or permanently cease operations. External events, such as a severe economic downturn, could also impair the ability of some counterparties to the Company's offtake agreements and other customer agreements to pay for energy and/or other products and services received.
The Company's inability to enter into new or replacement offtake agreements or to compete successfully against current and future competitors in the markets in which the Company operates could have a material adverse effect on the Company's business, financial condition, results of operations and cash flows.
The Company’s facilities may operate, wholly or partially, without long-term power sales agreements.

The Company’s facilities may operate without long-term power sales agreements for some or all of their generating capacity and output and therefore be exposed to market fluctuations. Without the benefit of long-term power sales agreements for the facilities, the Company cannot be sure that it will be able to sell any or all of the power generated by the facilities at commercially attractive rates or that the facilities will be able to operate profitably. This could lead to less predictable revenues, future impairments of the Company's property, plant and equipment or to the closing of certain of its facilities, resulting in economic losses and liabilities, which could have a material adverse effect on the Company's results of operations, financial condition or cash flows.

A portion of the steam and chilled water produced by the Company's thermal assets is sold at regulated rates, and the revenue earned by the Company's GenConn assets is established each year in a rate case; accordingly, the profitability of these assets is dependent on regulatory approval.
Approximately 378451 net MWt of capacity from certain of the Company's thermal assets are sold at rates approved by one or more federal or state regulatory commissions, including the Pennsylvania Public Utility Commission and the California Public Utilities Commission for the thermal assets. Similarly, the revenues related to approximately 380 MW of capacity from the GenConn assets are established each year by the Connecticut Public Utilities Regulatory Authority. While such regulatory oversight is generally premised on the recovery of prudently incurred costs and a reasonable rate of return on invested capital, the rates that the Company may charge, or the revenue that the Company may earn with respect to this capacity are subject to authorization of the applicable regulatory authorities. There can be no assurance that such regulatory authorities will consider all of the costs to have been prudently incurred or that the regulatory process by which rates or revenues are determined will always result in rates or revenues that achieve full recovery of costs or an adequate return on the Company's capital investments. While the Company's rates and revenues are generally established based on an analysis of costs incurred in a base year, the rates the Company is allowed


to charge, and the revenues the Company is authorized to earn, may or may not match the costs at any given time. If the Company's costs are not adequately recovered through these regulatory processes, it could have a material adverse effect on the business, financial condition, results of operations and cash flows.


Supplier and/or customer concentration at certain of the Company's facilities may expose the Company to significant financial credit or performance risks.
The Company often relies on a single contracted supplier or a small number of suppliers for the provision of fuel, transportation of fuel, equipment, technology and/or other services required for the operation of certain facilities. In addition, certain of the Company's suppliers provide long-term warranties with respect to the performance of their products or services. If any of these suppliers cannot perform under their agreements with the Company, or satisfy their related warranty obligations, the Company will need to utilize the marketplace to provide or repair these products and services. There can be no assurance that the marketplace can provide these products and services as, when and where required. The Company may not be able to enter into replacement agreements on favorable terms or at all. If the Company is unable to enter into replacement agreements to provide for fuel, equipment, technology and other required services, it would seek to purchase the related goods or services at market prices, exposing the Company to market price volatility and the risk that fuel and transportation may not be available during certain periods at any price. The Company may also be required to make significant capital contributions to remove, replace or redesign equipment that cannot be supported or maintained by replacement suppliers, which could have a material adverse effect on the business, financial condition, results of operations, credit support terms and cash flows.
In addition, potential or existing customers at the Company’s district energy centers and combined heat and power plants, or the Energy Centers, may opt for on-site systems in lieu of using the Company’s Energy Centers, either due to corporate policies regarding the allocation of capital, unique situations where an on-site system might in fact prove more efficient, because of previously committed capital in systems that are already on-site, or otherwise. At times, the Company relies on a single customer or a few customers to purchase all or a significant portion of a facility's output, in some cases under long-term agreements that account for a substantial percentage of the anticipated revenue from a given facility. For instance, during the year ended December 31, 2018, the Company derived approximately 23% of its consolidated revenue from PG&E, which filed for bankruptcy. For additional risks relating to the PG&E Bankruptcy, see "Risks related to the PG&E Bankruptcy" above.
The failure of any supplier to fulfill its contractual obligations to the Company or the Company’s loss of potential or existing customers could have a material adverse effect on its financial results. Consequently, the financial performance of the Company's facilities is dependent on the credit quality of, and continued performance by, the Company's suppliers and vendors and the Company’s ability to solicit and retain customers.
The Company currently owns, and in the future may acquire, certain assets in which the Company has limited control over management decisions and its interests in such assets may be subject to transfer or other related restrictions.
As described in Item 15 — Note 5, Investments Accounted for by the Equity Method and Variable Interest Entities, the Company has limited control over the operation of certain of its assets, because the Company beneficially owns less than a majority of the membership interests in such assets. The Company may seek to acquire additional assets in which it owns less than a majority of the related membership interests in the future. In these investments, the Company will seek to exert a degree of influence with respect to the management and operation of assets in which it owns less than a majority of the membership interests by negotiating to obtain positions on management committees or to receive certain limited governance rights, such as rights to veto significant actions. However, the Company may not always succeed in such negotiations. The Company may be dependent on its co-venturers to operate such assets. The Company's co-venturers may not have the level of experience, technical expertise, human resources management and other attributes necessary to operate these assets optimally. In addition, conflicts of interest may arise in the future between the Company and its stockholders, on the one hand, and the Company's co-venturers, on the other hand, where the Company's co-venturers' business interests are inconsistent with the interests of the Company and its stockholders. Further, disagreements or disputes between the Company and its co-venturers could result in litigation, which could increase expenses and potentially limit the time and effort the Company's officers and directors are able to devote to the business.
The approval of co-venturers may also be required for the Company to receive distributions of funds from assets or to sell, pledge, transfer, assign or otherwise convey its interest in such assets, or for the Company to acquire NRG'sGIP's or CEG's interests in such co-ventures as an initial matter. Alternatively, the Company's co-venturers may have rights of first refusal or rights of first offer in the event of a proposed sale or transfer of the Company's interests in such assets. These restrictions may limit the price or interest level for interests in such assets, in the event the Company wants to sell such interests.
Furthermore, certain of the Company's facilities are operated by third-party operators, such as First Solar. To the extent that third-party operators do not fulfill their obligations to manage operations of the facilities or are not effective in doing so, the amount of CAFD may be adversely affected.
                                    


The Company's assets are exposed to risks inherent in the use of interest rate swaps and forward fuel purchase contracts and the Company may be exposed to additional risks in the future if it utilizes other derivative instruments.
The Company uses interest rate swaps to manage interest rate risk. In addition, the Company uses forward fuel purchase contracts to hedge its limited commodity exposure with respect to the Company's district energy assets. If the Company elects to enter into such commodity hedges, the related asset could recognize financial losses on these arrangements as a result of volatility in the market values of the underlying commodities or if a counterparty fails to perform under a contract. If actively quoted market prices and pricing information from external sources are not available, the valuation of these contracts would involve judgment or the use of estimates. As a result, changes in the underlying assumptions or use of alternative valuation methods could affect the reported fair value of these contracts. If the values of these financial contracts change in a manner that the Company does not anticipate, or if a counterparty fails to perform under a contract, it could harm the business, financial condition, results of operations and cash flows.
The Company's business is subject to restrictions resulting from environmental, health and safety laws and regulations.
The Company is subject to various federal, state and local environmental and health and safety laws and regulations. In addition, the Company may be held primarily or jointly and severally liable for costs relating to the investigation and clean-up of any property where there has been a release or threatened release of a hazardous regulated material as well as other affected properties, regardless of whether the Company knew of or caused the release. In addition to these costs, which are typically not limited by law or regulation and could exceed an affected property's value, the Company could be liable for certain other costs, including governmental fines and injuries to persons, property or natural resources. Further, some environmental laws provide for the creation of a lien on a contaminated site in favor of the government as security for damages and any costs the government incurs in connection with such contamination and associated clean-up. Although the Company generally requires its operators to undertake to indemnify it for environmental liabilities they cause, the amount of such liabilities could exceed the financial ability of the operator to indemnify the Company. The presence of contamination or the failure to remediate contamination may adversely affect the Company's ability to operate the business.
The Company does not own all of the land on which its power generation or thermal assets are located, which could result in disruption to its operations.
The Company does not own all of the land on which its power generation or thermal assets are located and the Company is, therefore, subject to the possibility of less desirable terms and increased costs to retain necessary land use if it does not have valid leases or rights-of-way or if such rights-of-way lapse or terminate. Although the Company has obtained rights to construct and operate these assets pursuant to related lease arrangements, the rights to conduct those activities are subject to certain exceptions, including the term of the lease arrangement. The Company is also at risk of condemnation on land it owns. The loss of these rights, through the Company's inability to renew right-of-way contracts, condemnation or otherwise, may adversely affect the Company's ability to operate its generation and thermal infrastructure assets.
The Company’s use and enjoyment of real property rights for its projects may be adversely affected by the rights of lienholders and leaseholders that are superior to those of the grantors of those real property rights to the Company.
Solar and wind projects generally are, and are likely to be, located on land occupied by the project pursuant to long-term easements and leases. The ownership interests in the land subject to these easements and leases may be subject to mortgages securing loans or other liens (such as tax liens) and other easement and lease rights of third parties (such as leases of oil or mineral rights) that were created prior to the project’s easements and leases. As a result, the project’s rights under these easements or leases may be subject, and subordinate, to the rights of those third parties. The Company performs title searches and obtains title insurance to protect itself against these risks. Such measures may, however, be inadequate to protect the Company against all risk of loss of its rights to use the land on which the wind projects are located, which could have a material adverse effect on the Company’s business, financial condition and results of operations.

                                    


The electric generation business is subject to substantial governmental regulation and may be adversely affected by changes in laws or regulations, as well as liability under, or any future inability to comply with, existing or future regulations or other legal requirements.
The Company's electric generation business is subject to extensive U.S. federal, state and local laws and regulations. Compliance with the requirements under these various regulatory regimes may cause the Company to incur significant additional costs, and failure to comply with such requirements could result in the shutdown of the non-complying facility, the imposition of liens, fines, and/or civil or criminal liability. Public utilities under the FPA are required to obtain FERC acceptance of their rate schedules for wholesale sales of electric energy, capacity and ancillary services. Except for generating facilities within the footprint of ERCOT which are regulated by the PUCT, all of the Company’s assets make wholesale sales of electric energy, capacity and ancillary services in interstate commerce and are public utilities for purposes of the FPA, unless otherwise exempt from such status. FERC's orders that grant market-based rate authority to wholesale power marketerssellers reserve the right to revoke or revise that authority if FERC subsequently determines that the seller can exercise market power in transmission or generation, create barriers to entry, or engage in abusive affiliate transactions. In addition, public utilities are subject to FERC reporting requirements that impose administrative burdens and that, if violated, can expose the company to criminal and civil penalties or other risks.
The Company's market-based sales will beare subject to certain rules prohibiting manipulative or deceptive conduct, and if any of the Company's generating companies with market-based rate authority are deemed to have violated those rules, they willcould be subject to potential disgorgement of profits associated with the violation, penalties, suspension or revocation of market based rate authority. If such generating companies were to lose their market-based rate authority, such companies would be required to obtain FERC's acceptance of a cost-of-service rate schedule and could become subject to the significant accounting, record-keeping, and reporting requirements that are imposed on utilities with cost-based rate schedules. This could have a material adverse effect on the rates the Company is able to charge for power from its facilities.
Most of the Company's assets are operating as EWGs as defined under the PUHCA, or QFs as defined under the PURPA, as amended, and therefore are exempt from certain regulation under the PUHCA and the PURPA. If a facility fails to maintain its status as an EWG or a QF or there are legislative or regulatory changes revoking or limiting the exemptions to the PUHCA, then the Company may be subject to significant accounting, record-keeping, access to books and records and reporting requirements, and failure to comply with such requirements could result in the imposition of penalties and additional compliance obligations.
Substantially all of the Company's generation assets are also subject to the reliability standards promulgated by the designated Electric Reliability Organization (currently the North American Electric Reliability Corporation, or NERC) and approved by FERC. If the Company fails to comply with the mandatory reliability standards, it could be subject to sanctions, including substantial monetary penalties and increased compliance obligations. The Company will also be affected by legislative and regulatory changes, as well as changes to market design, market rules, tariffs, cost allocations, and bidding rules that occur in the existing regional markets operated by RTOs or ISOs, such as PJM. The RTOs/ISOs that oversee most of the wholesale power markets impose, and in the future may continue to impose, mitigation, including price limitations, offer caps, non-performance penalties and other mechanisms to address some of the volatility and the potential exercise of market power in these markets. These types of price limitations and other regulatory mechanisms may have a material adverse effect on the profitability of the Company's generation facilities acquired in the future that sell energy, capacity and ancillary products into the wholesale power markets. The regulatory environment for electric generation has undergone significant changes in the last several years due to state and federal policies affecting wholesale competition and the creation of incentives for the addition of large amounts of new renewable generation and, in some cases, transmission assets. These changes are ongoing and the Company cannot predict the future design of the wholesale power markets or the ultimate effect that the changing regulatory environment will have on the Company's business. In addition, in some of these markets, interested parties have proposed to re-regulate the markets or require divestiture of electric generation assets by asset owners or operators to reduce their market share. Other proposals to re-regulate may be made and legislative or other attention to the electric power market restructuring process may delay or reverse the deregulation process. If competitive restructuring of the electric power markets is reversed, discontinued, or delayed, the Company's business prospects and financial results could be negatively impacted.
                                    


The Company is subject to environmental laws and regulations that impose extensive and increasingly stringent requirements on its operations, as well as potentially substantial liabilities arising out of environmental contamination.
The Company's assets are subject to numerous and significant federal, state and local laws, including statutes, regulations, guidelines, policies, directives and other requirements governing or relating to, among other things: protection of wildlife, including threatened and endangered species; air emissions; discharges into water; water use; the storage, handling, use, transportation and distribution of dangerous goods and hazardous, residual and other regulated materials, such as chemicals; the prevention of releases of hazardous materials into the environment; the prevention, presence and remediation of hazardous materials in soil and groundwater, both on and offsite; land use and zoning matters; and workers' health and safety matters. The Company's facilities could experience incidents, malfunctions and other unplanned events that could result in spills or emissions in excess of permitted levels and result in personal injury, penalties and property damage. As such, the operation of the Company's facilities carries an inherent risk of environmental, health and safety liabilities (including potential civil actions, compliance or remediation orders, fines and other penalties), and may result in the assets being involved from time to time in administrative and judicial proceedings relating to such matters. The Company has implemented environmental, health and safety management programs designed to continually improve environmental, health and safety performance. Environmental laws and regulations have generally become more stringent over time. Significant costs may be incurred for capital expenditures under environmental programs to keep the assets compliant with such environmental laws and regulations. If it is not economical to make those expenditures, it may be necessary to retire or mothball facilities or restrict or modify the Company's operations to comply with more stringent standards. These environmental requirements and liabilities could have a material adverse effect on the business, financial condition, results of operations and cash flows.
The Company's businesses are subject to physical, market and economic risks relating to potential effects of climate change.
Climate change is producing changes in weather and other environmental conditions, including temperature and precipitation levels, and thus may affect consumer demand for electricity. In addition, the potential physical effects of climate change, such as increased frequency and severity of storms, floods and other climatic events, could disrupt the Company's operations and supply chain, and cause them to incur significant costs in preparing for or responding to these effects. These or other meteorological changes could lead to increased operating costs, capital expenses or power purchase costs.
GHG regulation could increase the cost of electricity generated by fossil fuels, and such increases could reduce demand for the power the Company's conventional assets generate and market.
Risks that are beyond the Company's control, including but not limited to acts of terrorism or related acts of war, natural disaster, hostile cyber intrusions or other catastrophic events, could have a material adverse effect on the business, financial condition, results of operations and cash flows.
The Company's generation facilities that were acquired or those that the Company otherwise acquires or constructs and the facilities of third parties on which they rely may be targets of terrorist activities, as well as events occurring in response to or in connection with them, that could cause environmental repercussions and/or result in full or partial disruption of the facilities ability to generate, transmit, transport or distribute electricity or natural gas. Strategic targets, such as energy-related facilities, may be at greater risk of future terrorist activities than other domestic targets. Hostile cyber intrusions, including those targeting information systems as well as electronic control systems used at the generating plants and for the related distribution systems, could severely disrupt business operations and result in loss of service to customers, as well as create significant expense to repair security breaches or system damage.
Furthermore, certain of the Company's power generation and thermal assets are located in active earthquake zones in California and Arizona, and certain project companies and suppliers conduct their operations in the same region or in other locations that are susceptible to natural disasters. In addition, California and some of the locations where certain suppliers are located, from time to time, have experienced shortages of water, electric power and natural gas. The occurrence of a natural disaster, such as an earthquake, wildfire, drought, flood or localized extended outages of critical utilities or transportation systems, or any critical resource shortages, affecting the Company or its suppliers, could cause a significant interruption in the business, damage or destroy the Company's facilities or those of its suppliers or the manufacturing equipment or inventory of the Company's suppliers. Any such terrorist acts, environmental repercussions or disruptions or natural disasters could result in a significant decrease in revenues or significant reconstruction or remediation costs, beyond what could be recovered through insurance policies, which could have a material adverse effect on the business, financial condition, results of operations and cash flows.
The operation of the Company’s businesses is subject to cyber-based security and integrity risk.


Numerous functions affecting the efficient operation of the Company’s businesses depend on the secure and reliable storage, processing and communication of electronic data and the use of sophisticated computer hardware and software systems. The operation of the Company's generating assets rely on cyber-based technologies and, therefore, subject to the risk that such systems could be the target of disruptive actions, particularly through cyber-attack or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, or otherwise be compromised by unintentional events. As a result, operations could be interrupted, property could be damaged and sensitive customer information could be lost or stolen, causing the Company to incur significant losses of revenues, other substantial liabilities and damages, costs to replace or repair damaged equipment and damage to the Company's reputation. In addition, the Company may experience increased capital and operating costs to implement increased security for its cyber systems and generating assets.


Government regulations providing incentives for renewable generation could change at any time and such changes may negatively impact the Company's growth strategy.
The Company's growth strategy depends in part on government policies that support renewable generation and enhance the economic viability of owning renewable electric generation assets. Renewable generation assets currently benefit from various federal, state and local governmental incentives such as ITCs, cash grants in lieu of ITCs, loan guarantees, RPS, programs, modified accelerated cost-recovery system of depreciation and bonus depreciation. In December 2015, the U.S. Congress enacted an extension of the 30% solar ITC so that projects that began construction in 2016 through 2019 will continue to qualify for the 30% ITC.  Projects beginning construction in 2020 and 2021 will be eligible for the ITC at the rates of 26% and 22%, respectively.  The same legislation also extended the 10-year wind PTC for wind projects that began construction in years 2016 through 2019.  Wind projects that began construction in 2018 and or begin construction in the years 2018 and 2019 are eligible for PTC at 60% and 40% of the statutory rate per kWh, respectively.
Many states have adopted RPS programs mandating that a specified percentage of electricity sales come from eligible sources of renewable energy. However, the regulations that govern the RPS programs, including pricing incentives for renewable energy, or reasonableness guidelines for pricing that increase valuation compared to conventional power (such as a projected value for carbon reduction or consideration of avoided integration costs), may change. If the RPS requirements are reduced or eliminated, it could lead to fewer future power contracts or lead to lower prices for the sale of power in future power contracts, which could have a material adverse effect on the Company's future growth prospects. Such material adverse effects may result from decreased revenues, reduced economic returns on certain project company investments, increased financing costs, and/or difficulty obtaining financing. Furthermore, the ARRA included incentives to encourage investment in the renewable energy sector, such as cash grants in lieu of ITCs, bonus depreciation and expansion of the U.S. DOE loan guarantee program. It is uncertain what loan guarantees may be made by the U.S. DOE loan guarantee program in the future. In addition, the cash grant in lieu of ITCs program only applies to facilities that commenced construction prior to December 31, 2011, which commencement date may be determined in accordance with the safe harbor if more than 5% of the total cost of the eligible property was paid or incurred by December 31, 2011.
If the Company is unable to utilize various federal, state and local government incentives to acquire additional renewable assets in the future, or the terms of such incentives are revised in a manner that is less favorable to the Company, it may suffer a material adverse effect on the business, financial condition, results of operations and cash flows.
The Company relies on electric interconnectiondistribution and transmission facilities that it does not own or control and that are subject to transmission constraints within a number of the Company's regions. If these facilities fail to provide the Company with adequate transmission capacity, it may be restricted in its ability to deliver electric power to its customers and may either incur additional costs or forego revenues.
The Company depends on electric interconnectiondistribution and transmission facilities owned and operated by others to deliver the wholesale power it will sell from its electric generation assets to its customers. A failure or delay in the operation or development of these interconnection or transmission facilities or a significant increase in the cost of the development of such facilities could result in lost revenues. Such failures or delays could limit the amount of power the Company's operating facilities deliver or delay the completion of the Company's construction projects. Additionally, such failures, delays or increased costs could have a material adverse effect on the business, financial condition and results of operations. If a region's power transmission infrastructure is inadequate, the Company's recovery of wholesale costs and profits may be limited. If restrictive transmission price regulation is imposed, the transmission companies may not have a sufficient incentive to invest in expansion of transmission infrastructure. The Company also cannot predict whether interconnection anddistribution or transmission facilities will be expanded in specific markets to accommodate competitive access to those markets. In addition, certain of the Company's operating facilities' generation of electricity may be curtailed without compensation due to transmission limitations or limitations on the electricity grid's ability to accommodate intermittent electricity generating sources, reducing the Company's revenues and impairing its ability to capitalize fully on a particular facility's generating potential. Such curtailments could have a material adverse effect on the business, financial condition, results of operations and cash flows. Furthermore, economic congestion on transmission networks in certain of the markets in which the Company operates may occur and the Company may be deemed responsible for congestion costs. If the Company were liable for such congestion costs, its financial results could be adversely affected.
                                    


The Company's costs, results of operations, financial condition and cash flows could be adversely impacted by the disruption of the fuel supplies necessary to generate power at its conventional and thermal power generation facilities.
Delivery of fossil fuels to fuel the Company's conventional and thermal generation facilities is dependent upon the infrastructure (including natural gas pipelines) available to serve each such generation facility as well as upon the continuing financial viability of contractual counterparties. As a result, the Company is subject to the risks of disruptions or curtailments in the production of power at these generation facilities if a counterparty fails to perform or if there is a disruption in the fuel delivery infrastructure.
If the Company is deemed to be an investment company, the Company may be required to institute burdensome compliance requirements and the Company's activities may be restricted, which may make it difficult for the Company to complete strategic acquisitions or effect combinations.
              If the Company is deemed to be an investment company under the Investment Company Act of 1940, or the Investment Company Act, the Company's business would be subject to applicable restrictions under the Investment Company Act, which could make it impracticable for the Company to continue its business as contemplated.
              The Company believes it is not an investment company under Section 3(b)(1) of the Investment Company Act because the Company is primarily engaged in a non-investment company business. The Company intends to conduct its operations so that the Company will not be deemed an investment company. However, if the Company were to be deemed an investment company, restrictions imposed by the Investment Company Act, including limitations on the Company's capital structure and the Company's ability to transact with affiliates, could make it impractical for the Company to continue its business as contemplated.
The Company depends on key management employees,personnel, the loss of any of which could have a material adverse effect on the Company's financial condition and results of operations.
 
The Company believes its current operations and future success depend largely on the continued services of the management employeeskey personnel that it employs, in particular Christopher Sotos, the Company’s President and Chief Executive Officer and Chad Plotkin, the Company’s Senior Vice President and Chief Financial Officer.employs. Although the Company currently has access to the resources of NRG,CEG, the loss of Mr. Sotos’ or Mr. Plotkin’s services, or other key management personnel employed by the Company in connection with the NRG Transaction or in the future, could have a material adverse effect on the Company’s financial condition and results of operations.

Risks Related to the Company's RelationshipRelationships with NRGGIP and CEG
NRGGIP, through its ownership of CEG, exercises substantial influence over the Company through its position as controlling shareholder of Yield,Clearway, Inc. The Company is highly dependent on NRG.GIP.
NRGGIP, through its ownership of CEG, owns all of the outstanding Class B and Class D common stock of Yield,Clearway, Inc. and owns 55.1%55.0% of the combined voting power of Yield,Clearway, Inc. as of December 31, 20172018. As a result of NRG'sGIP's ownership of Yield,Clearway, Inc. and Yield,Clearway, Inc.'s position as sole managing member of the Company, NRGGIP has a substantial influence on the Company's affairs and its voting power will constitute a large percentage of any quorum of Yield,Clearway, Inc.'s stockholders voting on any matter requiring the approval of its stockholders. Such matters include the approval of mergers or sale of all or substantially all of its assets. This concentration of ownership may also have the effect of delaying or preventing a change in control of Yield,Clearway, Inc. or discouraging others from making tender offers for their shares. In addition, NRGGIP has the right to elect all of Yield,Clearway, Inc.'s directors. NRGGIP may cause corporate actions to be taken even if their interests conflict with the interests of Yield,Clearway, Inc.'s other stockholders (including holders of Yield,Clearway, Inc.'s Class A and Class C common stock). If the NRG Transaction is consummated, GIP will become Yield, Inc.'s controlling stockholder and, like NRG, will have substantial control and influence over the Company. See the risk factor entitled “Following the consummation of the NRG Transaction, GIP and its affiliates will control the Company and have the ability to designate a majority of the members of the Company’s Board.”
Furthermore, the Company depends on the management and administrationcertain services provided by or under the direction of NRGCEG under the ManagementCEG Master Services Agreement. NRGCEG personnel and support staff that provide services to the Company under the ManagementCEG Master Services Agreement are not required to, and the Company does not expect that they will, have as their primary responsibility the management and administration of the Company or to act exclusively for the Company and the ManagementCEG Master Services Agreement does not require any specific individuals to be provided by NRG.CEG. Under the ManagementCEG Master Services Agreement, NRGCEG has the discretion to determine which of its employees perform assignments required to be provided to the Company. Any failure to effectively manage the Company's operations or to implement its strategy could have a material adverse effect on the business, financial condition, results of operations and cash flows. The ManagementCEG Master Services Agreement will continue in perpetuity, until terminated in accordance with its terms.


The Company also depends upon CEG and NRG for the provision of management, administration and certain other services at allcertain of the Company's facilities and contracts with NRG, or its subsidiaries, to procure fuel and sell power for certain of its operating facilities. Any failure by CEG or NRG to perform its requirements under these arrangements or the failure by the Company to identify and contract with replacement service providers, if required, could adversely affect the operation of the Company's facilities and have a material adverse effect on the business, financial condition, results of operations and cash flows.


In connection with the proposed NRGGIP Transaction, GIP has agreed to enter into certain agreements with the Company relating to the provision of services and NRG has agreed to enter into certain agreements with the Company relating to transition services and ongoing commercial arrangements. While the provision of transitional services is contemplated under the proposed NRG Transaction, itIt is uncertain whether, after the transition services end, GIP or its affiliates wouldwill continue to provide the same services, or offer the same capabilities and resources, to the Company that the Company currently receives from NRG or whether the Company may have to seek alternative service providers. The Company may not be able to replicate the same level of services, capabilities, experience and familiarity with the Company’s business offered by NRG either through GIP or through alternative service providers or on terms or costs similar to those provided by NRG. The loss of services provided by NRG and the benefits offered to the Company through its relationship with NRG such as management, operational and financing expertise, could have an impact on the Company’s business, financial condition, results of operations and cash flows. See also
GIP and its affiliates control the risk factor entitled “Company and have the ability to designate a majority of the members of Clearway Energy, Inc.'s Board.

IfThe governance agreements entered into among NRG, terminates the Management Services Agreement or defaults in the performance ofClearway Energy, Inc., GIP and its obligations under the agreement, or if the transition services to be provided by NRG to the Companyaffiliates in connection with the consummationGIP Transaction provide GIP the ability to designate a majority of Clearway Energy, Inc.’s Board to the Company’s Corporate Governance, Conflicts and Nominating Committee for nomination for election by Clearway Energy, Inc.’s stockholders and also require that the Company and GIP use their commercially reasonable efforts to submit to Clearway Energy, Inc.’s stockholders at Clearway Energy, Inc.’s 2019 Annual Meeting of Stockholders a charter amendment to classify Clearway Energy, Inc.’s Board into two classes (with the independent directors and directors designated by GIP allocated across the two classes). Due to such agreements and GIP's approximate 55.0% combined voting power in Clearway Energy, Inc., the ability of other holders of Clearway Energy, Inc.’s Class A and Class C common stock to exercise control over the corporate governance of the NRG Transaction are inadequate or end,Company will be limited. In addition, due to its approximate 55.0% combined voting power in the Company, GIP and its affiliates have a substantial influence on Clearway Energy, Inc.’s affairs and its voting power constitutes a large percentage of any quorum of Clearway Energy, Inc.’s stockholders voting on any matter requiring the approval of Clearway Energy, Inc.’s stockholders, including the classification of Clearway Energy, Inc.'s Board of Directors. GIP and its affiliates may be unable to contracthold certain interests that are different from those of the Company or other holders of Clearway Energy, Inc.'s Class A and Class C common stock and there is no assurance that GIP and its affiliates will exercise its control over the Company in a manner that is consistent with a substitute service provider on similar terms,the Company’s interests or at all.”those of the holders of Clearway Energy, Inc.'s Class A and Class C common stock.

The Company may not be able to consummate future acquisitions from NRG.CEG.
Until the NRG Transaction is consummated, if at all, the
The Company's ability to grow through acquisitions depends, in part, on NRG'sCEG's ability to identify and present the Company with acquisition opportunities. NRG established the Company to hold and acquire a diversified suite of power generating assets in the U.S. and its territories. Although NRGCEG has agreed to grant the Company a right of first offer with respect to certain power generation assets that NRGCEG may elect to sell in the future, NRGCEG is under no obligation to sell any such power generation assets or to accept any related offeroffers from the Company. In addition, NRGCEG has not agreed to commit any minimum level of dedicated resources for the pursuit of renewable power-related acquisitions. There are a number of factors which could materially and adversely impact the extent to which suitable acquisition opportunities are made available from NRG, including:
CEG, including that the same professionals within NRG'sCEG's organization that are involved in acquisitions that are suitable for the Company have responsibilities within NRG'sCEG's broader asset management business, which may include sourcing acquisition opportunities for NRG.CEG. Limits on the availability of such individuals will likewise result in a limitation on the availability of acquisition opportunities for the Company; and
in addition to structural limitations, the question of whether a particular asset is suitable is highly subjective and is dependent on a number of factors including an assessment by NRG relating to the Company's liquidity position at the time, the risk profile of the opportunity and its fit with the balance of the Company's then current operations and other factors. If NRG determines that an opportunity is not suitable for the Company, it may still pursue such opportunity on its own behalf, or on behalf of another NRG affiliate.
Company. In making these determinations, NRGCEG may be influenced by factors that result in a misalignment with the Company's interests or conflict of interest.
The departure of some or all of NRG's employees could prevent the Company from achieving its objectives.
The Company depends on the diligence, skill and business contacts of NRG's professionals and the information and opportunities they generate during the normal course of their activities. Furthermore, approximately 24% of NRG's employees at the Company's generation plants are covered by collective bargaining agreements as of December 31, 2017. The Company's future success will depend on the continued service of these individuals, who are not obligated to remain employed with NRG, or otherwise successfully renegotiate their collective bargaining agreements when such agreements expire or otherwise terminate. NRG has experienced departures of key professionals and personnel in the past and may do so if the NRG Transaction is consummated, and the Company cannot predict the impact that any such departures will have on its ability to achieve its objectives. The Management Services Agreement does not require NRG to maintain the employment of any of its professionals or to cause any particular professional to provide services to the Company or on its behalf. The departure of a significant number of NRG's professionals or a material portion of the NRG employees who work at any of the Company's facilities for any reason, or the failure to appoint qualified or effective successors in the event of such departures, could have a material adverse effect on the Company's ability to achieve its objectives.


The Company's organizational and ownership structure may create significant conflicts of interest that may be resolved in a manner that is not in the best interests of the Company and that may have a material adverse effect on the business, financial condition, results of operations and cash flows.
The Company's organizational and ownership structure involves a number of relationships that may give rise to certain conflicts of interest between the Company and NRG. Pursuant to the Management Services Agreement with NRG, certain of the Company's executive officers are shared NRG executives and devote their time to both the Company and NRG as needed to conduct the respective businesses. Although the Company's directors and executive officers owe fiduciary duties to the Company's stockholders, these shared NRG executives have fiduciary and other duties to NRG, which duties may be inconsistent with the Company's best interests. In addition, NRG and its representatives, agents and affiliates have access to the Company's confidential information. Although some of these persons are subject to confidentiality obligations pursuant to confidentiality agreements or implied duties of confidence, the Management Services Agreement does not contain general confidentiality provisions.
Additionally, all of the Company's executive officers continue to have economic interests in NRG and, accordingly, the benefit to NRG from a transaction between the Company and NRG will proportionately inure to their benefit as holders of economic interests in NRG. NRG is a related person under the applicable securities laws governing related person transactions and may have interests which differ from the Company's interests, including with respect to the types of acquisitions made, the timing and amount of distributions by the Company, the reinvestment of returns generated by the Company's operations, the use of leverage when making acquisitions and the appointment of outside advisors and service providers. Any material transaction between the Company and NRG will be subject to Yield, Inc.'s related person transaction policy, which will require prior approval of such transaction by Yield, Inc.'s Corporate Governance, Conflicts and Nominating Committee. Those of the Company's executive officers who have economic interests in NRG may be conflicted when advising Yield, Inc.'s Corporate Governance, Conflicts and Nominating Committees or otherwise participating in the negotiation or approval of such transactions. These executive officers have significant project- and industry-specific expertise that could prove beneficial to the Company's decision-making process and the absence of such strategic guidance could have a material adverse effect on the board committees' ability to evaluate any such transaction. Furthermore, the creation of Yield, Inc.'s Corporate Governance, Conflicts and Nominating Committee and Yield, Inc.'s related person transaction approval policy may not insulate the Company from derivative claims with respect to related person transactions and the conflicts of interest described in this risk factor. Regardless of the merits of such claims, the Company may be required to expend significant management time and financial resources in the defense thereof. Additionally, to the extent the Company fails to appropriately deal with any such conflicts, it could negatively impact the Company's reputation and ability to raise additional funds and the willingness of counterparties to do business with the Company, all of which could have a material adverse effect on the business, financial condition, results of operations and cash flows.
The Company may be unable or unwilling to terminate the ManagementCEG Master Services Agreement.
The ManagementCEG Master Services Agreement provides that the Company may terminate the agreement upon 30 days prior written notice to NRGCEG upon the occurrence of any of the following: (i) NRGCEG defaults in the performance or observance of any material term, condition or covenant contained therein in a manner that results in material harm to the Company and the default continues unremedied for a period of 30 days after written notice thereof is given to NRG;CEG; (ii) NRGCEG engages in any act of fraud, misappropriation of funds or embezzlement that results in material harm to the Company; (iii) NRGCEG is grossly negligent in the performance of its duties under the agreement and such negligence results in material harm to the Company; or (iv) upon the happening of certain events relating to the bankruptcy or insolvency of NRG.CEG. Furthermore, if the Company requests an amendment to the scope of services provided by NRGCEG under the ManagementCEG Master Services Agreement and is not able to agree with NRGCEG as to a change to the service fee resulting from a change in the scope of services within 180 days of the request, the Company will be able to terminate the agreement upon 30 days prior notice to NRG.CEG. The Company will not be able to terminate the agreement for any other reason, including if NRGCEG experiences a change of control, and the agreement continues in perpetuity, until terminated in accordance with its terms.
                                    


If NRGCEG terminates the ManagementCEG Master Services Agreement or defaults in the performance of its obligations under the agreement, or if the transition services to be provided by NRG to the Company in connection with the consummation of the NRG Transaction are inadequate or end, the Company may be unable to contract with a substitute service provider on similar terms, or at all.
The Company relies on NRGCEG to provide managementcertain services under the ManagementCEG Master Services Agreement and has limited executive or senior management personnel independent from NRG.Agreement. The ManagementCEG Master Services Agreement provides that NRGCEG may terminate the agreement upon 180 days prior written notice of termination to the Company if it defaults in the performance or observance of any material term, condition or covenant contained in the agreement in a manner that results in material harm and the default continues unremedied for a period of 30 days after written notice of the breach is given. If NRGCEG terminates the Management Services Agreement or defaults in the performance of its obligations under the agreement, or if the transition services to be provided by NRG to the Company, in the event the NRG Transaction is consummated, are not adequate or end, the Company may be unable to contract with GIPCEG or a substitute service provider on similar terms or at all, and the costs of substituting service providers may be substantial. In addition, in light of NRG'sCEG's familiarity with the Company's assets, GIP or a substitute service provider may not be able to provide the same level of service due to lack of pre-existing synergies. Additionally, the Company relies on transition services provided by NRG under the NRG TSA. If the Company cannot locate a service provider that is able to provide substantially similar services as NRGCEG does under the ManagementCEG Master Services Agreement, or the services provided by NRG under the NRG TSA, on similar terms, it could have a material adverse effect on the business, financial condition, results of operation and cash flows.
The liability of NRGCEG is limited under the Company's arrangements with it and the Company has agreed to indemnify NRGCEG against claims that it may face in connection with such arrangements, which may lead NRGCEG to assume greater risks when making decisions relating to the Company than it otherwise might if acting solely for its own account.
Under the ManagementCEG Master Services Agreement, NRGCEG does not assume any responsibility other than to provide or arrange for the provision of the services described in the ManagementCEG Master Services Agreement in good faith. In addition, under the ManagementCEG Master Services Agreement, the liability of NRGCEG and its affiliates is limited to the fullest extent permitted by law to conduct involving bad faith, fraud, willful misconduct or gross negligence or, in the case of a criminal matter, action that was known to have been unlawful. In addition, the Company has agreed to indemnify NRGCEG to the fullest extent permitted by law from and against any claims, liabilities, losses, damages, costs or expenses incurred by an indemnified person or threatened in connection with the Company's operations, investments and activities or in respect of or arising from the ManagementCEG Master Services Agreement or the services provided by NRG,CEG, except to the extent that the claims, liabilities, losses, damages, costs or expenses are determined to have resulted from the conduct in respect of which such persons have liability as described above. These protections may result in NRGCEG tolerating greater risks when making decisions than otherwise might be the case, including when determining whether to use leverage in connection with acquisitions. The indemnification arrangements to which NRGCEG is a party may also give rise to legal claims for indemnification that are adverse to the Company.Company and holders of its common stock.
Certain of the Company’s PPAs and project-level financing arrangements include provisions that would permit the counterparty to terminate the contract or accelerate maturity in the event NRGGIP or its affiliates ceases to control or own, directly or indirectly, a majority of the voting power of the Company.
Certain of the Company’s PPAs and project-level financing arrangements contain change in control provisions that provide the counterparty with a termination right or the ability to accelerate maturity in the event of a change of control of the Company without the counterparty's consent. These provisions are triggered in the event NRGGIP or its affiliates ceases to own, directly or indirectly, capital stock representing more than 50% of the voting power of all of Yield, Inc.’sthe Company’s capital stock outstanding on such date, or, in some cases, if NRGGIP or its affiliates ceases to be the majority owner, directly or indirectly, of the applicable project subsidiary. As a result, if NRGGIP or its affiliates ceases to control, or in some cases, own a majority of the voting power of the Company, as is contemplated by the NRG Transaction, the counterparties could terminate such contracts or accelerate the maturity of such financing arrangements. Even though the Company’s consent to the NRG Transaction is conditioned upon the receipt of consents from such counterparties, the Company may have to expend significant resources and funds to obtain the consents of such counterparties to the NRG Transaction and there can be no assurance that such counterparties will provide their consents at all. The termination of any of the Company’s PPAs or the acceleration of the maturity of any of the Company’s project-level financing could have a material adverse effect on the Company’s business, financial condition, results of operations and cash flow.

                                    


CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This Annual Report on Form 10-K of NRG YieldClearway Energy LLC, together with its consolidated subsidiaries, or the Company, includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. The words "believes," "projects," "anticipates," "plans," "expects," "intends," "estimates" and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance and achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These factors, risks and uncertainties include the factors described under Item 1A — Risk Factors and the following:
Potential risks related to the PG&E bankruptcy;
The Company's ability to maintain and grow its quarterly distributions;
Potential risks related to the Company as a result of the NRG Transaction;Company's relationships with GIP and CEG;
The Company's ability to successfully identify, evaluate and consummate acquisitions from third parties;
The Company's ability to acquire assets from NRG;GIP or CEG;
The Company's ability to raise additional capital due to its indebtedness, corporate structure, market conditions or otherwise;
Changes in law, including judicial decisions;
Hazards customary to the power production industry and power generation operations such as fuel and electricity price volatility, unusual weather conditions (including wind and solar conditions), catastrophic weather-related or other damage to facilities, unscheduled generation outages, maintenance or repairs, unanticipated changes to fuel supply costs or availability due to higher demand, shortages, transportation problems or other developments, environmental incidents, or electric transmission or gas pipeline system constraints and the possibility that the Company may not have adequate insurance to cover losses as a result of such hazards;
The Company's ability to operate its businesses efficiently, manage maintenance capital expenditures and costs effectively, and generate earnings and cash flows from its asset-based businesses in relation to its debt and other obligations;
The willingness and ability of counterparties to the Company's offtake agreements to fulfill their obligations under such agreements;
The Company's ability to enter into contracts to sell power and procure fuel on acceptable terms and prices as current offtake agreements expire;
Government regulation, including compliance with regulatory requirements and changes in market rules, rates, tariffs and environmental laws;
Operating and financial restrictions placed on the Company that are contained in the project-level debt facilities and other agreements of certain subsidiaries and project-level subsidiaries generally, in the NRG YieldClearway Energy Operating LLC amended and restated revolving credit facility and in the indentures governing the Senior Notes;
Cyber terrorism and inadequate cybersecurity, or the occurrence of a catastrophic loss and the possibility that the Company may not have adequate insurance to cover losses resulting from such hazards or the inability of the Company's insurers to provide coverage;
The Company's ability to engage in successful mergers and acquisitions activity; and
The Company's ability to borrow additional funds and access capital markets, as well as the Company's substantial indebtedness and the possibility that the Company may incur additional indebtedness going forward.
Forward-looking statements speak only as of the date they were made, and the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The foregoing review of factors that could cause the Company's actual results to differ materially from those contemplated in any forward-looking statements included in this Annual Report on Form 10-K should not be construed as exhaustive.
Item 1B — Unresolved Staff Comments
None.
                                    


Item 2 — Properties
Listed below are descriptions of the Company's interests in facilities, operations and/or projects owned or leased as of December 31, 2017.2018.
 Capacity     Capacity    
 Rated MW 
Net MW(a)
 Owner-ship PPA Terms Rated MW 
Net MW(a)
 Owner-ship PPA Terms
Assets Location Fuel COD Counterparty Expiration Location Fuel COD Counterparty Expiration
Conventional              
El Segundo El Segundo, CA 550
 550
 100% Natural Gas August 2013 Southern California Edison 2023 El Segundo, CA 550
 550
 100% Natural Gas August 2013 Southern California Edison 2023
GenConn Devon Milford, CT 190
 95
 50% Natural Gas/Oil June 2010 Connecticut Light & Power 2040 Milford, CT 190
 95
 50% Natural Gas/Oil June 2010 Connecticut Light & Power 2040
GenConn Middletown Middletown, CT 190
 95
 50% Natural Gas/Oil June 2011 Connecticut Light & Power 2041 Middletown, CT 190
 95
 50% Natural Gas/Oil June 2011 Connecticut Light & Power 2041
Marsh Landing Antioch, CA 720
 720
 100% Natural Gas May 2013 Pacific Gas and Electric 2023 Antioch, CA 720
 720
 100% Natural Gas May 2013 Pacific Gas and Electric 2023
Walnut Creek City of Industry, CA 485
 485
 100% Natural Gas May 2013 Southern California Edison 2023 City of Industry, CA 485
 485
 100% Natural Gas May 2013 Southern California Edison 2023
Total ConventionalTotal Conventional 2,135
 1,945
   Total Conventional 2,135
 1,945
   
Utility Scale SolarUtility Scale Solar       Utility Scale Solar       
Agua Caliente Dateland, AZ 290
 46
 16% Solar June 2014 Pacific Gas and Electric 2039 Dateland, AZ 290
 46
 16% Solar June 2014 Pacific Gas and Electric 2039
Alpine Lancaster, CA 66
 66
 100% Solar January 2013 Pacific Gas and Electric 2033 Lancaster, CA 66
 66
 100% Solar January 2013 Pacific Gas and Electric 2033
Avenal Avenal, CA 45
 23
 50% Solar August 2011 Pacific Gas and Electric 2031 Avenal, CA 45
 23
 50% Solar August 2011 Pacific Gas and Electric 2031
Avra Valley Pima County, AZ 26
 26
 100% Solar December 2012 Tucson Electric Power 2032 Pima County, AZ 26
 26
 100% Solar December 2012 Tucson Electric Power 2032
Blythe Blythe, CA 21
 21
 100% Solar December 2009 Southern California Edison 2029 Blythe, CA 21
 21
 100% Solar December 2009 Southern California Edison 2029
Borrego Borrego Springs, CA 26
 26
 100% Solar February 2013 San Diego Gas and Electric 2038 Borrego Springs, CA 26
 26
 100% Solar February 2013 San Diego Gas and Electric 2038
Buckthorn Solar City of Georgetown, TX 154
 154
 100% Solar July 2018 City of Georgetown, TX 2043
CVSR San Luis Obispo, CA 250
 250
 100% Solar October 2013 Pacific Gas and Electric 2038 San Luis Obispo, CA 250
 250
 100% Solar October 2013 Pacific Gas and Electric 2038
Desert Sunlight 250 Desert Center, California 250
 63
 25% Solar December 2014 Southern California Edison 2034 Desert Center, CA 250
 63
 25% Solar December 2014 Southern California Edison 2034
Desert Sunlight 300 Desert Center, California 300
 75
 25% Solar December 2014 Pacific Gas and Electric 2039 Desert Center, CA 300
 75
 25% Solar December 2014 Pacific Gas and Electric 2039
Four Brothers Solar New Castle/Milford, UT 320
 160
 50% Solar July 2016 - August 2016 PacifiCorp 2036 New Castle/Milford, UT 320
 160
 50% Solar July 2016 - August 2016 PacifiCorp 2036
Granite Mountain Cedar City, UT 130
 65
 50% Solar September 2016 PacifiCorp 2036 Cedar City, UT 130
 65
 50% Solar September 2016 PacifiCorp 2036
Iron Springs Cedar City, UT 80
 40
 50% Solar August 2016 PacifiCorp 2036 Cedar City, UT 80
 40
 50% Solar August 2016 PacifiCorp 2036
Kansas South Lemoore, CA 20
 20
 100% Solar June 2013 Pacific Gas and Electric 2033 Lemoore, CA 20
 20
 100% Solar June 2013 Pacific Gas and Electric 2033
Roadrunner Santa Teresa, NM 20
 20
 100% Solar August 2011 El Paso Electric 2031 Santa Teresa, NM 20
 20
 100% Solar August 2011 El Paso Electric 2031
TA High Desert Lancaster, CA 20
 20
 100% Solar March 2013 Southern California Edison 2033 Lancaster, CA 20
 20
 100% Solar March 2013 Southern California Edison 2033
Total Utility Scale SolarTotal Utility Scale Solar 1,864
 921
   Total Utility Scale Solar 2,018
 1,075
   
Distributed SolarDistributed Solar       Distributed Solar       
Apple I LLC Projects CA 9
 9
 100% Solar October 2012 - December 2012 Various 2032 CA 9
 9
 100% Solar October 2012 - December 2012 Various 2032
AZ DG Solar Projects AZ 5
 5
 100% Solar December 2010 - January 2013 Various 2025-2033 AZ 5
 5
 100% Solar December 2010 - January 2013 Various 2025 - 2033
SPP Projects Various 25
 25
 100% Solar June 2008 - June 2012 Various 2026-2037 Various 25
 25
 100% Solar June 2008 - June 2012 Various 2026 - 2037
Other DG Projects Various 13
 13
 100% Solar October 2012 - October 2015 Various 2023-2039 Various 13
 13
 100% Solar October 2012 - October 2015 Various 2023 - 2039
Total Distributed SolarTotal Distributed Solar 52
 52
   Total Distributed Solar 52
 52
   
WindWind       Wind       
Alta I Tehachapi, CA 150
 150
 100% Wind December 2010 Southern California Edison 2035
                                    


 Capacity     Capacity    
 Rated MW 
Net MW(a)
 Owner-ship PPA Terms Rated MW 
Net MW(a)
 Owner-ship PPA Terms
Assets Location Fuel COD Counterparty Expiration Location Fuel COD Counterparty Expiration
Alta I Tehachapi, CA 150
 150
 100% Wind December 2010 Southern California Edison 2035
Alta II Tehachapi, CA 150
 150
 100% Wind December 2010 Southern California Edison 2035 Tehachapi, CA 150
 150
 100% Wind December 2010 Southern California Edison 2035
Alta III Tehachapi, CA 150
 150
 100% Wind February 2011 Southern California Edison 2035 Tehachapi, CA 150
 150
 100% Wind February 2011 Southern California Edison 2035
Alta IV Tehachapi, CA 102
 102
 100% Wind March 2011 Southern California Edison 2035 Tehachapi, CA 102
 102
 100% Wind March 2011 Southern California Edison 2035
Alta V Tehachapi, CA 168
 168
 100% Wind April 2011 Southern California Edison 2035 Tehachapi, CA 168
 168
 100% Wind April 2011 Southern California Edison 2035
Alta X (b)
 Tehachapi, CA 137
 137
 100% Wind February 2014 Southern California Edison 2038 Tehachapi, CA 137
 137
 100% Wind February 2014 Southern California Edison 2038
Alta XI (b)
 Tehachapi, CA 90
 90
 100% Wind February 2014 Southern California Edison 2038 Tehachapi, CA 90
 90
 100% Wind February 2014 Southern California Edison 2038
Buffalo Bear Buffalo, OK 19
 19
 100% Wind December 2008 Western Farmers Electric Co-operative 2033 Buffalo, OK 19
 19
 100% Wind December 2008 Western Farmers Electric Co-operative 2033
Crosswinds (b)
 Ayrshire, IA 21
 21
 99% Wind June 2007 Corn Belt Power Cooperative 2027 Ayrshire, IA 21
 21
 99% Wind June 2007 Corn Belt Power Cooperative 2027
Elbow Creek (b)
 Howard County, TX 122
 122
 100% Wind December 2008 NRG Power Marketing LLC 2022 Howard County, TX 122
 122
 100% Wind December 2008 NRG Power Marketing LLC 2022
Elkhorn Ridge (b)
 Bloomfield, NE 81
 54
 66.7% Wind March 2009 Nebraska Public Power District 2029 Bloomfield, NE 81
 54
 66.7% Wind March 2009 Nebraska Public Power District 2029
Forward (b)
 Berlin, PA 29
 29
 100% Wind April 2008 Constellation NewEnergy, Inc. 2022 Berlin, PA 29
 29
 100% Wind April 2008 Constellation NewEnergy, Inc. 2022
Goat Wind (b)
 Sterling City, TX 150
 150
 100% Wind April 2008/June 2009 Dow Pipeline Company 2025 Sterling City, TX 150
 150
 100% Wind April 2008/June 2009 Dow Pipeline Company 2025
Hardin (b)
 Jefferson, IA 15
 15
 99% Wind May 2007 Interstate Power and Light Company 2027 Jefferson, IA 15
 15
 99% Wind May 2007 Interstate Power and Light Company 2027
Laredo Ridge Petersburg, NE 80
 80
 100% Wind February 2011 Nebraska Public Power District 2031 Petersburg, NE 80
 80
 100% Wind February 2011 Nebraska Public Power District 2031
Lookout (b)
 Berlin, PA 38
 38
 100% Wind October 2008 Southern Maryland Electric Cooperative 2030 Berlin, PA 38
 38
 100% Wind October 2008 Southern Maryland Electric Cooperative 2030
Odin (b)
 Odin, MN 20
 20
 99.9% Wind June 2008 Missouri River Energy Services 2028 Odin, MN 20
 20
 99.9% Wind June 2008 Missouri River Energy Services 2028
Pinnacle Keyser, WV 55
 55
 100% Wind December 2011 Maryland Department of General Services and University System of Maryland 2031 Keyser, WV 55
 55
 100% Wind December 2011 Maryland Department of General Services and University System of Maryland 2031
San Juan Mesa (b)
 Elida, NM 120
 90
 75% Wind December 2005 Southwestern Public Service Company 2025 Elida, NM 120
 90
 75% Wind December 2005 Southwestern Public Service Company 2025
Sleeping Bear (b)
 Woodward, OK 95
 95
 100% Wind October 2007 Public Service Company of Oklahoma 2032 Woodward, OK 95
 95
 100% Wind October 2007 Public Service Company of Oklahoma 2032
South Trent Sweetwater, TX 101
 101
 100% Wind January 2009 AEP Energy Partners 2029 Sweetwater, TX 101
 101
 100% Wind January 2009 AEP Energy Partners 2029
Spanish Fork (b)
 Spanish Fork, UT 19
 19
 100% Wind July 2008 PacifiCorp 2028 Spanish Fork, UT 19
 19
 100% Wind July 2008 PacifiCorp 2028
Spring Canyon II (b)
 Logan County, CO 32
 29
 90.1% Wind October 2014 Platte River Power Authority 2039 Logan County, CO 32
 29
 90.1% Wind October 2014 Platte River Power Authority 2039
Spring Canyon III(b)
 Logan County, CO 28
 25
 90.1% Wind December 2014 Platte River Power Authority 2039 Logan County, CO 28
 25
 90.1% Wind December 2014 Platte River Power Authority 2039
Taloga Putnam, OK 130
 130
 100% Wind July 2011 Oklahoma Gas & Electric 2031 Putnam, OK 130
 130
 100% Wind July 2011 Oklahoma Gas & Electric 2031
Wildorado (b)
 Vega, TX 161
 161
 100% Wind April 2007 Southwestern Public Service Company 2027 Vega, TX 161
 161
 100% Wind April 2007 Southwestern Public Service Company 2027
Total WindTotal Wind 2,263
 2,200
   Total Wind 2,263
 2,200
   
Thermal GenerationThermal Generation       Thermal Generation       
Dover Dover, DE 103
 103
 100% Natural Gas June 2013 NRG Power Marketing LLC 2018
Paxton Creek Cogen Harrisburg, PA  12
 12
 100% Natural Gas November 1986 Power sold into PJM markets
Princeton Hospital Princeton, NJ 5
 5
 100% Natural Gas January 2012 Excess power sold to local utility
Tucson Convention Center Tucson, AZ 2
 2
 100% Natural Gas January 2003 Excess power sold to local utility
                                    


 Capacity     Capacity    
 Rated MW 
Net MW(a)
 Owner-ship PPA Terms Rated MW 
Net MW(a)
 Owner-ship PPA Terms
Assets Location Fuel COD Counterparty Expiration Location Fuel COD Counterparty Expiration
CA Fuel Cell Tulare, CA 3
 3
 100% Natural Gas May 2018 City of Tulare 2038
Dover Dover, DE 103
 103
 100% Natural Gas June 2013 NRG Power Marketing LLC 2018
Energy Center - Pittsburgh Pittsburgh, PA 7
 7
 100% Diesel January 2019 University of Pittsburgh Medical Center 2038
Paxton Creek Cogen Harrisburg, PA  12
 12
 100% Natural Gas November 1986 Power sold into PJM markets
Princeton Hospital Princeton, NJ 5
 5
 100% Natural Gas January 2012 Excess power sold to local utility
Tucson Convention Center Tucson, AZ 2
 2
 100% Natural Gas January 2003 Excess power sold to local utility
University of Bridgeport Bridgeport, CT 1
 1
 100% Natural Gas April 2015 University of Bridgeport 2034 Bridgeport, CT 1
 1
 100% Natural Gas April 2015 University of Bridgeport 2034
Total Thermal GenerationTotal Thermal Generation 123
 123
   Total Thermal Generation 133
 133
   
Total NRG Yield, Inc. (c)
 6,437
 5,241
   
Total Clearway Energy LLC (c)
Total Clearway Energy LLC (c)
 6,601
 5,405
   
 
(a) Net capacity represents the maximum, or rated, generating capacity of the facility multiplied by the Company's percentage ownership in the facility as of December 31, 2017.2018.
(b) Projects are part of tax equity arrangements, as further described in Note 2, Summary of Significant Accounting Policies.
(c) NRG Yield'sClearway Energy LLC's total generation capacity is net of 6 MWs for noncontrolling interest for Spring Canyon II and III. NRG Yield'sClearway Energy LLC's generation capacity including this noncontrolling interest was 5,2475,411 MWs.
In addition to the facilities owned or leased in the table above, the Company entered into partnerships to own or purchase solar power generation projects, as well as other ancillary related assets from a related party via intermediate funds.  The Company does not consolidate these partnerships and accounts for them as equity method investments. The Company's net interest in these projects is 247268 MW based on cash to be distributed. For further discussions, refer to Item 15 — Note 5, Investments Accounted for by the Equity Method and Variable Interest Entities to the Consolidated Financial Statements.
The following table summarizes the Company's thermal steam and chilled water facilities as of December 31, 2017:2018:
Name and Location of Facility Thermal Energy Purchaser % Owned Rated Megawatt
Thermal
Equivalent
Capacity (MWt)		 Net Megawatt
Thermal
Equivalent
Capacity (MWt)		 Generating
Capacity
NRG Energy Center Minneapolis, MN Approx. 100 steam and 55 chilled water customers 100 322
136
 322
136
 Steam: 1,100 MMBtu/hr.
Chilled water: 38,700 tons
NRG Energy Center
San Francisco, CA		 Approx. 180 steam customers 100 133
 133
 Steam: 454 MMBtu/hr.
NRG Energy Center
Omaha, NE		 Approx. 60 steam and 65 chilled water customers 
100
12(a)
100
0(a)
 142
73
77
26
 142
9
77
0
 Steam: 485 MMBtu/hr
Steam: 250 MMBtu/hr
Chilled water: 22,000 tons
Chilled water: 7,250 tons
NRG Energy Center Harrisburg, PA Approx. 125 steam and 5 chilled water customers 100 108
13
 108
13
 Steam: 370 MMBtu/hr.
Chilled water: 3,600 tons
NRG Energy Center Phoenix, AZ Approx. 35 chilled water customers 
24(a)
100
12(a)
0(a)
 5
104
14
28
 1
104
2
0
 Steam: 17 MMBtu/hr
Chilled water: 29,600 tons
Chilled water: 3,920 tons
Chilled water: 8,000 tons
NRG Energy Center Pittsburgh, PA Approx. 25 steam and 25 chilled water customers 100 88
49
 88
49
 Steam: 302 MMBtu/hr.
Chilled water: 13,874 tons
NRG Energy Center
San Diego, CA		 Approx. 20 chilled water customers 100 31
 31
 Chilled water: 8,825 tons
NRG Energy Center
Dover, DE		 Kraft Heinz Company; Proctor and Gamble 100 66
 66
 Steam: 225 MMBtu/hr.
NRG Energy Center Princeton, NJ Princeton HealthCare System 100 21
17
 21
17
 Steam: 72 MMBtu/hr.
Chilled water: 4,700 tons
  Total Generating Capacity (MWt)   1,453
 1,319
  
Name and Location of Facility Thermal Energy Purchaser % Owned Rated Megawatt
Thermal
Equivalent
Capacity (MWt)		 Net Megawatt
Thermal
Equivalent
Capacity (MWt)		 Generating
Capacity
Energy Center Minneapolis, MN Approx. 95 steam and 55 chilled water customers 100 315
136
 315
136
 Steam: 1,075 MMBtu/hr.
Chilled water: 38,700 tons
Energy Center
San Francisco, CA		 Approx. 180 steam customers 100 133
 133
 Steam: 454 MMBtu/hr.
Energy Center
Omaha, NE		 Approx. 60 steam and 65 chilled water customers 
100
16(a)
100
0(a)
 142
56
77
21
 142
9
77
0
 Steam: 485 MMBtu/hr
Steam: 190 MMBtu/hr
Chilled water: 22,000 tons
Chilled water: 6,000 tons
Energy Center Harrisburg, PA Approx. 125 steam and 5 chilled water customers 100 108
13
 108
13
 Steam: 370 MMBtu/hr.
Chilled water: 3,600 tons
Energy Center Phoenix, AZ Approx. 40 chilled water customers 
24(a)
100
12(a)
0(a)
 5
104
14
28
 1
104
2
0
 Steam: 17 MMBtu/hr
Chilled water: 29,600 tons
Chilled water: 3,920 tons
Chilled water: 8,000 tons
Energy Center Pittsburgh, PA Approx. 25 steam and 25 chilled water customers 100 132
78
 132
78
 Steam: 452 MMBtu/hr.
Chilled water: 22,224 tons
Energy Center
San Diego, CA		 Approx. 20 chilled water customers 100 31
 31
 Chilled water: 8,825 tons
Energy Center
Dover, DE		 Kraft Heinz Company; Proctor and Gamble 100 66
 66
 Steam: 225 MMBtu/hr.
Energy Center Princeton, NJ Princeton HealthCare System 100 21
17
 21
17
 Steam: 72 MMBtu/hr.
Chilled water: 4,700 tons
  Total Generating Capacity (MWt)   1,497
 1,385
  
 


(a) Net MWt capacity excludes 134112 MWt available under the right-to-use provisions contained in agreements between two of the Company's thermal facilities and certain of its customers.
Other Properties
Through the Management Services Agreement with NRG, the Company utilizes NRG's leased corporate headquarters offices at 804 Carnegie Center, Princeton, New Jersey.
                                    


Item 3 — Legal Proceedings
See "Pacific Gas and Electric Company Bankruptcy" found in Item 1, Business, of this Annual Report on Form 10-K and Item 15 — Note 14, Commitments and Contingencies, to the Consolidated Financial Statements for discussion of the material legal proceedings to which the Company is a party.party or of which any of its properties is subject.
Item 4 — Mine Safety Disclosures
Not applicable.


PART II
Item 5 — Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information and Holders
As of the date of this report, there is no publicly-traded market for the Company's membership units. All of the Company's Class A and Class C units are held by Yield,Clearway Energy, Inc. and all of the Company's Class B and Class D units are held by NRG.CEG.
Distributions
The following table lists the distributions paid on the Company's Class A, Class B, Class C and Class D units during the year ended December 31, 2017:2018:
Fourth Quarter 2017 Third Quarter 2017 Second Quarter 2017 First Quarter 2016Fourth Quarter 2018 Third Quarter 2018 Second Quarter 2018 First Quarter 2016
Distributions per Class A and Class B unit$0.288
 $0.28
 $0.27
 $0.260
$0.331
 $0.320
 $0.309
 $0.298
Distributions per Class C and Class D unit$0.288
 $0.28
 $0.27
 $0.260
$0.331
 $0.320
 $0.309
 $0.298
On February 15, 2018,12, 2019, the Company declared a quarterly distribution on its Class A, Class B, Class C and Class D units of $0.298$0.20 per unit payable on March 15, 2018.2019.
                                    


Item 6 — Selected Financial Data
The following table presents the Company's historical selected financial data, which has been recast to include the Buckthorn Solar Drop Down Assets,Asset, as if the transferstransfer had taken place fromat the beginning of the financial statements period, or from the date the respective entities were under common control, (if later than the beginning of the financial statements period).which was November 9, 2016. The acquisitions aredrop down is further described in Item 15 — Note 3, Business Acquisitions, to the Consolidated Financial Statements. Additionally, for all periods prior to the formation of the Company, the data below reflects the Company's accounting predecessor, or NRG Yield, the financial statements of which were prepared on a ''carve-out'' basis from NRG and are intended to represent the financial results of the contracted renewable energy and conventional generation and thermal infrastructure assets in the U.S. that were acquired by the Company on July 22, 2013. For all periods subsequent to the formation of the Company, the data below reflects the Company's consolidated financial results.
This historical data should be read in conjunction with the Consolidated Financial Statements and the related notes thereto in Item 15 and Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations.
Fiscal year ended December 31,Fiscal year ended December 31,
(In millions)2017 2016 2015 2014 20132018 2017 2016 2015 2014
Statement of Income Data:      
Operating Revenues                  
Total operating revenues$1,009
 $1,035
 $968
 $844
 $451
$1,053
 $1,009
 $1,035
 $968
 $844
Operating Costs and Expenses                  
Cost of operations326
 308
 323
 279
 156
332
 326
 308
 323
 279
Depreciation and amortization334
 303
 303
 240
 98
331
 334
 303
 303
 240
Impairment losses44
 185
 1
 —
 —
—
 44
 185
 1
 —
General and administrative19
 14
 10
 8
 7
20
 19
 14
 10
 8
Acquisition-related transaction and integration costs3
 1
 3
 4
 —
20
 3
 1
 3
 4
Development costs3
 —
 —
 —
 —
Total operating costs and expenses726
 811

640

531

261
706
 726

811

640

531
Operating Income283
 224

328

313

190
347
 283

224

328

313
Other Income (Expense)                  
Equity in earnings of unconsolidated affiliates71
 60
 31
 22
 27
74
 71
 60
 31
 22
Other income, net4
 3
 3
 6
 4
8
 4
 3
 3
 6
Loss on debt extinguishment(3) —
 (9) (1) —
(7) (3) —
 (9) (1)
Interest expense(293) (272) (258) (217) (72)(294) (294) (272) (258) (217)
Total other expense, net(221) (209) (233) (190) (41)(212) (222) (209) (233) (190)
Income Before Income Taxes62
 15
 95
 123
 149
Income tax expense (benefit)—
 —
 —
 —
 (3)
Net Income62
 15
 95
 $123
 $152
135
 61
 15
 $95
 $123
Less: Net (loss) income attributable to noncontrolling interests(75) (111) (62) 9
 —
(105) (75) (111) (62) 9
Net Income Attributable to NRG Yield LLC$137
 $126
 $157
 $114
 $152
Net Income Attributable to Clearway Energy LLC$240
 $136
 $126
 $157
 $114
                  
Other Financial Data:                  
Capital expenditures$31
 $20
 $29
 $79
 $790
$83
 $190
 $20
 $29
 $79
Cash Flow Data:                  
Net cash provided by (used in):                  
Operating activities$516
 $577
 $424
 $363
 $174
$492
 $517
 $577
 $424
 $363
Investing activities(283) (131) (1,098) (760) (987)(185) (442) (131) (1,098) (760)
Financing activities(416) (202) 354
 767
 853
(38) (258) (202) 354
 767
Balance Sheet Data (at period end):                  
Cash and cash equivalents$146
 $321
 $110
 $430
 $60
$407
 $146
 $321
 $110
 $430
Property, plant and equipment, net5,204
 5,554
 5,980
 6,119
 3,488
5,245
 5,410
 5,579
 5,980
 6,119
Total assets8,154
 8,746
 8,759
 8,930
 4,831
8,448
 8,360
 8,772
 8,759
 8,930
Long-term debt, including current maturities5,845
 6,069
 5,692
 5,828
 2,916
5,762
 6,006
 6,069
 5,692
 5,828
Total liabilities6,146
 6,382
 6,054
 6,173
 3,221
6,266
 6,331
 6,384
 6,054
 6,173
Total members' equity2,008
 2,364
 2,705
 2,757
 1,610
2,182
 2,029
 2,388
 2,705
 2,757
                                    


Item 7 — Management's Discussion and Analysis of Financial Condition and the Results of Operations
The following discussion analyzes the Company's historical financial condition and results of operations, which werehave been recast to include the effectBuckthorn Solar Drop Down Asset, as if the transfer had taken place at the beginning of the Drop Down Assets acquired from NRG.common control, which was November 9, 2016. As further discussed in Item 15 — Note 1, Nature of Business, to the Consolidated Financial Statements, the purchases of these assets were accounted for in accordance with ASC 805-50, Business Combinations - Related Issues, whereas the assets and liabilities transferred to the Company relate to interests under common control by NRG and, accordingly, were recorded at historical cost. The difference between the cash proceeds and historical value of the net assets was recorded as a distribution to/from NRG and offset to the noncontrolling interest on the Company's consolidated balance sheet. In accordance with GAAP, the Company preparedprepares its consolidated financial statements to reflect the transfers as if they had taken place from the beginning of the financial statements period, or from the date the entities were under common control (if later than the beginning of the financial statements period).
As you read this discussion and analysis, refer to the Company's Consolidated Statements of Operations to this Form 10-K, which present the results of operations for the years ended December 31, 2018, 2017 2016 and 2015.2016. Also refer to Item 1 — Business and Item 1A — Risk Factors, which include detailed discussions of various items impacting the Company's business, results of operations and financial condition.
The discussion and analysis below has been organized as follows:
Executive Summary, including a description of the business and significant events that are important to understanding the results of operations and financial condition;
Results of operations, including an explanation of significant differences between the periods in the specific line items of the consolidated statements of operations;
Financial condition addressing liquidity position, sources and uses of cash, capital resources and requirements, commitments, and off-balance sheet arrangements;
Known trends that may affect the Company’s results of operations and financial condition in the future; and
Critical accounting policies which are most important to both the portrayal of the Company's financial condition and results of operations, and which require management's most difficult, subjective or complex judgment.
                                    


Executive Summary
Introduction and Overview
Clearway Energy LLC, together with its consolidated subsidiaries, or the Company, is an energy infrastructure investor in and owner of modern, sustainable and long-term contracted assets across North America. The Company is a dividend growth-orientedsponsored by GIP through GIP's portfolio company, that has historically served as the primary vehicle through which NRG owns, operates and acquires contracted renewable and conventional generation and thermal infrastructure assets. The Company believes it is well positioned to be a premier company for investors seeking stable and growing distribution income from a diversified portfolio of lower-risk high-quality assets.CEG.
The Company owns a diversifiedCompany’s environmentally-sound asset portfolio of contracted renewable and conventional generation and thermal infrastructure assets in the U.S. The Company’s contracted generation portfolio collectively representsincludes over 5,272 5,118 net MW.MW of wind, solar and natural gas-fired power generation facilities, as well as district energy systems. EachNearly all of these assets sellssell substantially all of itstheir output pursuant to long-term offtake agreements with creditworthy counterparties. The weighted average remaining contract duration of these offtake agreements was approximately15 years as of December 31, 2017, 2018 based on CAFD.CAFD. The Company also owns thermal infrastructure assets with an aggregate steam and chilled water capacity of 1,3191,385 net MWt and electric generation capacity of 123133 net MW. These thermal infrastructure assets provide steam, hot water and/or chilled water, and, in some instances, electricity to commercial businesses, universities, hospitals and governmental units in multiple locations, principally through long-term contracts or pursuant to rates regulated by state utility commissions.

Significant Events
Strategic SponsorshipPacific Gas and Electric Company Bankruptcy
On January 29, 2019, PG&E filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Northern District of California.  Certain subsidiaries of the Company, which hold interests in 6 solar facilities totaling 480 MW and Marsh Landing with Global Infrastructure Partnerscapacity of 720 MW, sell the output of their facilities to PG&E under long-term PPAs.  The Company consolidates three of the solar facilities and Marsh Landing, and records its interest in the other solar facilities as equity method investments. As of December 31, 2018, the Company had $1.5 billion of property, plant and equipment, net, $352 million investments in unconsolidated affiliates and $1.4 billion of long - term debt related to these facilities. The related subsidiaries of the Company have entered into financing agreements consisting of non-recourse project level debt and, in certain cases, non-recourse holding company debt. The PG&E bankruptcy filing has triggered defaults under the PPAs with PG&E and such related financing agreements. The Company is currently negotiating forbearance agreements with the lenders for each respective financing arrangement.  The Company continues to assess the potential future impacts of the PG&E bankruptcy filing as events occur, however, no impact to the Company’s immediate operating activities has occurred as of December 31, 2018.
Distribution Reduction
On February 6,12, 2019, and as a result of impacts related to the PG&E Bankruptcy, Clearway, Inc.'s Board of Directors declared a quarterly dividend on Class A and Class C common stock of $0.20 per share payable on March 15, 2019, to stockholders of record as of March 1, 2019. This dividend is reduced from the last quarterly dividend paid in December 2018 Global Infrastructure Partners, or GIP, entered intoof $0.331 per share. A similar decrease was made to the Company's distributions to unitholders. The Company will continue to assess the level of the distribution pending developments in the PG&E bankruptcy, including the Company’s ability to receive unrestricted project distributions.

Forgoing Agua Caliente Drop Down
On November 1, 2018, NRG offered the Company the opportunity to acquire Agua Caliente Borrower 1 LLC, which owns a purchase and sale agreement with NRG, or the NRG Transaction, for the acquisition of NRG’s full ownership35% interest in NRG Yield, Inc. and NRG’s renewable energy development and operations platform. The NRG Transaction is subject to certain closing conditions, including customary legal and regulatory approvals. The Company expectsAgua Caliente, a 290 MW utility-scale solar project located in Dateland, Arizona with PG&E as the NRG Transaction to close in the second half of 2018.

In connection with the NRG Transaction, the Company entered into a Consent and Indemnity Agreement with NRG and GIP setting forth key terms and conditions of the Company's consentproject’s customer. Pursuant to the NRG Transaction. Key provisionsterms of the Consent and Indemnity Agreement include:

Minimized impact to CAFD from potential change in control costs — No more than $10 million in reduced annual CAFD on a recurring basis that would result from changes in the Company's cost structure or any impact from various consents.
Enhanced ROFO pipeline — Upon closing, the Company will enter into a new ROFO agreement with GIP that immediately adds 550 MW to the current pipeline. The NRG ROFO Agreement, will be amendedthe Company elected to removeforgo the Ivanpah solar facility.

Financial cooperation and support — GIP has arrangedacquisition. The Company continues to own a $1.5 billion backstop credit facility to manage any change of control costs associated with the Company's corporate debt. GIP has also committed to provide up to $400 million in financial support, if necessary, for the purchase of the Carlsbad Energy Center.

Voting and Governance Agreement — As part of the NRG Transaction, the parties have agreed to enter into a voting and governance agreement, which would provide that:
the Chief Executive Officer of Yield, Inc. will at all times be a full-time Yield, Inc. employee appointed by the Board of Directors, or the Board, of Yield, Inc.;
the parties thereto will use their commercially reasonable efforts to submit to Yield, Inc.’s stockholders at Yield, Inc.'s 2019 Annual Meeting of Stockholders a charter amendment to classify the Board into two classes (with the independent directors and directors designated by an affiliate of GIP allocated across the two classes); and
the Board will be expanded to nine members at the closing of the NRG Transaction, comprised at that date of five directors designated by GIP, three independent directors and Yield, Inc.’s Chief Executive Officer.






Significant Events
NRG Transaction
On February 6, 2018, NRG entered into agreements with GIP for the sale of 100% of its16% interest in NRG Yield, Inc. and its renewable energy development and operations platform. In connection with this, the Company entered into a Consent and Indemnity Agreement with NRG and GIP. For further discussion, refer to Item 1 — Business.project through Agua Caliente Borrower 2 LLC.
Drop Down Assets AcquisitionsCarlsbad Equity Backstop
On February 6, 2018, the Company entered into an agreement with NRG to purchase its interest100% of the membership interests in Carlsbad Energy Holdings LLC, which indirectly owns the Carlsbad project, a 527 MW natural gas fired project in Carlsbad, CA.CA, pursuant to the NRG ROFO Agreement. Following the COD of the project in December 2018, the Company elected to utilize the Carlsbad backstop facility provided by GIP; as such, GIP purchased 100% of the membership interest in Carlsbad Energy Holdings LLC on February 27, 2019. The purchase price for the transaction is $365was $387 million in cash consideration, exclusive of working capital and other adjustments, as well as the assumption of non-recourse debt of $601 million at completion. The Company maintains the option to purchase Carlsbad from GIP at any time within 18 months after February 27, 2019 at the same economic terms at which it originally agreed to purchase the asset from NRG. Should the Company not acquire Carlsbad during such 18 months, the project will become a CEG ROFO Asset.


Strategic Sponsorship with GIP
On August 31, 2018, NRG transferred its full ownership interest in the Company to CEG, the holder of NRG's renewable energy development and operations platform, and subsequently sold 100% of its interest in CEG to an affiliate of GIP. As a result of the GIP Transaction, GIP indirectly acquired a 45.2% economic interest in Clearway Energy LLC and a 55% voting interest in the Company as of August 31, 2018.
Drop Down Asset Acquisitions
On August 31, 2018, the Company entered into a binding agreement with CEG to acquire the effective equity interest in 80 MW of utility-scale solar projects located in Kawailoa and Oahu, Hawaii for approximately $28 million in cash consideration, subject to customary working capital and other adjustments.adjustments, as well as the assumption of non-recourse debt of $169 million. The transaction is expected to close in the fourth quartersummer of 2018 and is contingent upon the consummation of the NRG Transaction.2019.
On January 24,March 30, 2018, the Company entered into an agreement with NRG to acquireacquired 100% of NRG's ownership interestNRG’s interests in Buckthorn Renewables, LLC, or Buckthorn Solar, which owned a 154 MW utility-scale solar generation project for totalcash consideration of $42 million, subjectplus assumed non-recourse debt of approximately $132 million as of September 30, 2018. The Buckthorn Solar project sells power under a 25-year power purchase agreement to adjustments,the City of Georgetown, Texas. On July 1, 2018, the project achieved commercial operation.
Financing and is expectedEquity Activities
On April 30, 2018, the Company closed on the refinancing of the revolving credit facility, which extended the maturity of the facility to closeApril 28, 2023 and decreased the Company's overall cost of borrowing. The facility will continue to be used for general corporate purposes including financing of future acquisitions and posting letters of credit.
On September 10, 2018, pursuant to the terms of the 2019 Convertible Notes and the 2020 Convertible Notes indentures, the Company delivered to the holders of the Convertible Notes a fundamental change notice and offer to repurchase any and all of the 2019 Convertible Notes and 2020 Convertible Notes for cash at a price equal to 100% of the principal amount of the Convertible Notes plus any accrued and unpaid interest. An aggregate principal amount of $109 million of the 2019 Convertible Notes and $243 million of the 2020 Convertible Notes were tendered on or prior to the expiration date of October 10, 2018 and accepted by the Company for purchase. After the expiration of the tender offer, $220 million aggregate principal amount of the 2019 Convertible Notes and $45 million aggregate principal amount of the 2020 Convertible Notes remained outstanding as of December 31, 2018.
In August 2018 and January 2019, the Company completed a series of open market repurchases of 2019 Convertible Notes in aggregate principal amount of $66 million. The repurchases were funded through a partial repayment of the intercompany note between Clearway Energy Operating LLC and Clearway Energy, Inc. which was reduced by $66 million. During the first quarter of 2018.
As discussed in Item 15 — Note 3, Business Acquisitions, to the Consolidated Financial Statements,2019, the Company acquiredpaid off the following:
◦On November 1, 2017, a 38 MW solar portfolio primarily comprised of assets from NRG's Solar Power Partners (SPP) funds and other projects developed by NRG, or the November 2017 Drop Down Assets, for cash consideration of $74 million plus assumed non-recourse debt of $26 million. During the quarter ended September 30, 2017, NRG recorded an impairment of $13 million related to the November 2017 Drop Down Assets.
◦On August 1, 2017, the remaining 25% interest in NRG Wind TE Holdco, a portfolio of 12 wind projects, from NRG for total cash consideration of $44 million. The purchase agreement also included potential additional payments to NRG dependent upon actual energy prices for merchant periods beginning in 2027, which were estimated and accrued as contingent consideration in the amount of $8 million as of December 31, 2017.
◦On March 27, 2017, the following entities: Agua Caliente Borrower 2 LLC and NRG's interests in the Utah Solar Portfolio, for cash consideration of $132 million. The Company recorded the acquired interests as equity method investments. The Company also assumed non-recourse debt of $41 million and $287 million on Agua Caliente Borrower 2 LLC and the Utah Solar Portfolio.
Impairment Lossesremaining balance of aggregate principal amount of $220 million, which was funded through the payment of the remaining balance of the intercompany note due 2019 between Clearway Energy Operating LLC and Clearway Energy, Inc.
During the fourth quarter of 2017,On October 9, 2018, the Company recorded asset impairment lossesreceived a notice of $31 million,conversion with respect to Elbow Creek and Forward projects from the Renewables segment. For further discussion, refer to Management’s discussion$395,000 aggregate principal amount of the results of operations for the years ended December 31, 2017 and 2016 andCritical Accounting Policies in this Item 7 below, as well as Item 15 — Note 9, Asset Impairments,2020 Convertible Notes. The Company elected, pursuant to the Consolidated Financial Statements.
Financing Activitiesterms of the 2020 Convertible Notes indenture, to settle the conversion of such 2020 Convertible Notes in Class C common stock, par value $0.01 per share. The conversion of the 2020 Convertible Notes resulted in the issuance by the Company on October 12, 2018 of 14,363 shares of Class C common stock.
On February 6,September 27, 2018, NRG YieldClearway Energy, Inc. issued and sold an additional 3,916,449 shares of Class C common stock for net proceeds of $75 million. The Company utilized the proceeds of the offering to acquire additional 3,916,449 Class C units of Clearway Energy LLC.
On October 1, 2018, Clearway Energy Operating LLC issued $600 million of senior unsecured notes, or the 2025 Senior Notes. The 2025 Senior Notes bear interest at 5.750% and mature on October 15, 2025. Interest on the notes is payable semi-annually on April 15 and October 15 of each year, and interest payments will commence on April 15, 2019. The 2025 Senior Notes are unsecured obligations of Clearway Energy Operating LLC and NRG Yield LLC amended the revolving credit facility to modify the change of control provisions to permit the consummation of the NRG Transaction, and also to permit NRG Yield Operating LLC, NRG Yieldare guaranteed by Clearway Energy LLC and by certain subsidiaries to incur up to $1.5 billion of unsecured indebtedness in order to repurchase or make other required cash payments, in each case if applicable, with respect to NRG YieldClearway Energy Operating LLC’s outstanding senior notesLLC's wholly owned current and NRG Yield's outstanding convertible notes in connection with the NRG Transaction.
On March 16, 2017, NRG Energy Center Minneapolis LLC, a subsidiary of the Company, amended the shelf facility of its existing Thermal financing arrangement to allow for the issuance of an additional $10 million of Series F notes at a 4.60% interest rate, or the Series F Notes, increasing the total principal amount of notes available for issuance under the shelf facility to $80 million. The Series F Notes are secured by substantially all of the assets of NRG Energy Center Minneapolis LLC. NRG Thermal LLC has guaranteed the indebtedness and its guarantee is secured by a pledge of the equity interests in all of NRG Thermal LLC’sfuture subsidiaries.
During the year ended December 31, 2017, NRG Yield,2018, Clearway Energy, Inc. issued 1,921,8664,492,473 shares of Class C common stock under the ATM Program for gross proceeds of $35$79 million and incurred commission fees of $346$790 thousand, as described in Sources of Liquidity in this Item 7.
                                    


Repowering Partnership
On August 30, 2018, Wind TE Holdco entered into a partnership with CEG in order to facilitate the repowering of the Elbow Creek and Wildorado facilities. As part of the repowering partnership, the Company bought out an existing tax equity partner of Wind TE Holdco for $19 million on January 2, 2019.
Thermal Activities
On June 19, 2018, upon reaching substantial completion, the Company acquired from NRG the UPMC Thermal Project for cash consideration of $84 million, subject to working capital adjustments. The Company had a payable of $4 million to NRG as of December 31,2018, $3 million of which was paid in January 2019 upon final completion of the project pursuant to the EPC agreement. The project adds 73 MWt of thermal equivalent capacity and 7.5 MW of emergency backup electrical capacity to the Company's portfolio. The transaction was accounted for as an asset acquisition and is reflected in the Company's Thermal segment.
As further described in Note 10, Long-term Debt, on June 19, 2018, Energy Center Minneapolis LLC, a subsidiary of the Company, entered into an amended and restated Thermal note purchase and private shelf agreement under which it authorized the issuance of the Series E Notes, Series F Notes, Series G Notes, and Series H Notes and established a private shelf facility for the further issuance of $40 million in notes.
On November 1, 2018, the Company entered into an Energy Services Agreement with Mylan LLC to supply chilled water, hot water and electricity through a dedicated combined heat and power facility to be constructed at Mylan's Caguas, Puerto Rico facility. The Company anticipates the project to total $11 million in capital expenditures and is expected to commence commercial operations in the second quarter of 2019.
Environmental Matters and Regulatory Matters
Details of environmental matters and regulatory matters are presented in Item 1 — Business, Regulatory Matters and Item 1A— Risk Factors. Details of some of this information relate to costs that may impact the Company's financial results.
Trends or Matters Affecting Results of Operations and Future Business Performance
PG&E Bankruptcy
As discussed above, the Company continues to assess the potential future impacts of the PG&E bankruptcy filing as events occur. However, no impact to the Company’s immediate operating activities has occurred as of December 31, 2018. 
Wind and Solar Resource Availability
The availability of the wind and solar resources affects the financial performance of the wind and solar facilities, which may impact the Company’s overall financial performance. Due to the variable nature of the wind and solar resources, the Company cannot predict the availability of the wind and solar resources and the potential variances from expected performance levels from quarter to quarter. To the extent the wind and solar resources are not available at expected levels, it could have a negative impact on the Company’s financial performance for such periods.
Operational Matters
Walnut Creek Forced Outage
During the first half of 2017, Walnut Creek experienced forced outages due to mechanical failures of turbine parts that caused downstream damage to several of the plant's Units, primarily Unit 1. The repairs necessary to return Unit 1 to service were completed in the second quarter of 2017 and the plant has performed reliably since then. The estimated cost of this outage is approximately $2 million after the recovery of insurance proceeds. Also, during 2017, the Company recorded a loss on disposal of assets of $14 million, in relation to the Unit 1 forced outage. In the third quarter of 2017, the Company, through Walnut Creek, executed an amendment to the contractual service agreement with the original equipment manufacturer to improve long term reliability. The amendment provides for the original equipment manufacturer to perform all required, currently available and future turbine reliability upgrades, and collateral damage reimbursement rights in exchange for an investment of $15 million that would be paid over the next five years, of which $8 million is expected to be paid in 2018.
El Segundo Forced Outage
In January 2017, the El Segundo Energy Center began a forced outage on Units 5 and 6 due to increasing vibrations on successive operations at Unit 5. In consultation with the Company’s operations and maintenance service provider, a subsidiary of NRG, the Company elected to replace the rotor on Unit 5. Both Unit 5 and 6 returned to service on February 24, 2017. In July 2017, the Company executed a warranty settlement agreement with the original equipment manufacturer that reduced total cost from $12 million to $5 million.


Consolidated Results of Operations
2017 compared to 2016
The following table provides selected financial information:
 Year ended December 31,
(In millions)2017 2016 Change
Operating Revenues     
Energy and capacity revenues$1,078
 $1,104
 $(26)
Contract amortization(69) (69) —
Total operating revenues1,009
 1,035
 (26)
Operating Costs and Expenses     
Cost of fuels63
 61
 2
Emissions credit amortization—
 6
 (6)
Operations and maintenance197
 176
 21
Other costs of operations66
 65
 1
Depreciation and amortization334
 303
 31
Impairment losses44
 185
 (141)
General and administrative19
 14
 5
Acquisition-related transaction and integration costs3
 1
 2
Total operating costs and expenses726
 811
 (85)
Operating Income283
 224
 59
Other Income (Expense)    
Equity in earnings of unconsolidated affiliates71
 60
 11
Other income, net4
 3
 1
Loss on debt extinguishment(3) —
 (3)
Interest expense(293) (272) (21)
Total other expense, net(221) (209) (12)
Net Income62
 15
 47
Less: Net loss attributable to noncontrolling interests(75) (111) 36
Net Income Attributable to NRG Yield LLC$137
 $126
 $11
 Year ended December 31,
Business metrics:2017 2016
Renewables MWh generated/sold (in thousands) (a)
6,844
 7,291
Conventional MWh generated (in thousands) (a)(b)
1,809
 1,697
Thermal MWt sold (in thousands)1,926
 1,966
Thermal MWh sold (in thousands) (c)
35
 71
(a) Volumes do not include the MWh generated/sold by the Company's equity method investments.
(b) Volumes generated are not sold as the Conventional facilities sell capacity rather than energy.
(c) MWh sold do not include 72 and 204 MWh generated by NRG Dover, a subsidiary of the Company, under the PPA with NRG Power Marketing during the years ended December 31, 2017 and December 31, 2016, respectively, as further described in Item 15 — Note 13, Related Party Transactions, to the Consolidated Financial Statements.

                                    


Management’s discussion of the results of operations for the years ended December 31, 2017 and 2016
Gross Margin
The Company calculates gross margin in order to evaluate operating performance as operating revenues less cost of sales, which includes cost of fuel, contract and emission credit amortization and mark-to-market for economic hedging activities.
Economic Gross Margin
In addition to gross margin, the Company evaluates its operating performance using the measure of economic gross margin, which is not a GAAP measure and may not be comparable to other companies’ presentations or deemed more useful than the GAAP information provided elsewhere in this report.  Economic gross margin should be viewed as a supplement to and not a substitute for the Company' presentation of gross margin, which is the most directly comparable GAAP measure.  Economic gross margin is not intended to represent gross margin. The Company believes that economic gross margin is useful to investors as it is a key operational measure reviewed by the Company's chief operating decision maker. Economic gross margin is defined as energy and capacity revenue less cost of fuels. Economic gross margin excludes the following components from GAAP gross margin: contract amortization, mark-to-market results, emissions credit amortization and (losses) gains on economic hedging activities. Mark-to-market results consist of unrealized gains and losses on contracts that are not yet settled.
The below tables present the composition of gross margin, as well as the reconciliation to economic gross margin for the years ended December 31, 2017 and 2016:
 Conventional Renewables Thermal Total
(In millions)       
Year ended December 31, 2017       
Energy and capacity revenues$341
 $563
 $174
 $1,078
Cost of fuels(1) —
 (62) (63)
Contract amortization(5) (62) (2) (69)
Gross margin335
 501
 110
 946
Contract amortization5
 62
 2
 69
Economic gross margin$340
 $563
 $112
 $1,015
 

 

 

 
Year ended December 31, 2016      
Energy and capacity revenues$338
 $594
 $172
 $1,104
Cost of fuels(1) —
 (60) (61)
Contract amortization(5) (62) (2) (69)
Emissions credit amortization(6) —
 —
 (6)
Gross margin326
 532
 110
 968
Contract amortization5
 62
 2
 69
Emissions credit amortization6
 —
 —
 6
Economic gross margin$337
 $594
 $112
 $1,043



Gross margin decreased by $22 million and economic gross margin decreased by $28 million during the year ended December 31, 2017, compared to the same period in 2016, primarily due to:
(In millions) 
Renewables: 
A 7% decrease in volume generated by wind projects, due to lower wind resources at the Alta Wind and NRG Wind TE Holdco projects$(31)
Conventional: 
Higher revenues due to 2016 higher priced peak season forced outages, as well as additional start-up revenue from Marsh Landing in 20173
Decrease in economic gross margin$(28)
Emissions credit amortization of NOx allowances at Walnut Creek and El Segundo in compliance with amendments to the Regional Clean Air Incentives Market program in 20166
Decrease in gross margin$(22)
Operations and Maintenance Expense
 Conventional Renewables Thermal Total
(In millions) 
Year ended December 31, 2017$52
 $97
 $48
 $197
Year ended December 31, 201632
 96
 48
 176

Operations and maintenance expense increased by $21 million during the year ended December 31, 2017, compared to the same period in 2016, due to the forced outages in the Conventional segment.  The Company recorded higher operations and maintenance costs in Walnut Creek in connection with the Unit 1 forced outages that took place in April of 2017, including an increase of loss on disposal of assets of $12 million, as well as higher operations and maintenance costs in El Segundo due to the forced outages in Units 5 and Unit 6 that took place in January 2017.
Impairment Losses
The Company recorded impairment losses of $44 million and $185 million for the years ended December 31, 2017 and 2016, respectively.
During the fourth quarter of 2017, as the Company updated its estimated cash flows in connection with the preparation and review of the Company’s annual budget, it was determined that both Elbow Creek and Forward projects were impaired due to the continued declining merchant power prices in the post contract periods. As a result, the Company recorded impairment losses of $26 million and $5 million for the Elbow Creek and Forward projects, respectively.
In addition, in connection with the sale of the November 2017 Drop Down Assets, it was identified that undiscounted cash flows were lower than the book value of certain SPP funds and NRG recorded an impairment expense of $13 million. In accordance with the guidance for transfer of assets under common control, the impairment is reflected in the Company's consolidated statements of operations for the period ended December 31, 2017.
During the fourth quarter of 2016, as the Company updated its estimated cash flows in connection with the preparation and review of the Company's annual budget, it was determined that the cash flows for the Elbow Creek and Goat Wind projects and the Forward project were below the carrying value of the related assets, primarily driven by declining merchant power prices in post-contract periods, and that the assets were considered impaired. The Company recorded impairment losses of $117 million, $60 million and $6 million for Elbow Creek, Goat Wind, and Forward, respectively. The other impairments of $2 million related to the projects that were part of the November 2017 Drop Down Assets. Since the acquisition by the Company of the November 2017 Drop Down Assets related to transfer of assets under common control, these impairments were reflected in the Company's consolidated statements of operations for the period ending December 31, 2016. For further discussion see Item 15 — Note 9, Asset Impairments, to the Consolidated Financial Statements, as well as in Critical Accounting Policies and Estimates in this Item 7.



Equity in Earnings of Unconsolidated Affiliates
Equity in earnings of unconsolidated affiliates increased by $11 million during the year ended December 31, 2017, compared to the same period in 2016, primarily due to higher earnings from the solar partnerships with NRG, as well as acquisition of the Utah Solar Portfolio in November 2016, partially offset by lower earnings from the San Juan Mesa investment.
Interest Expense
Interest expense increased by $21 million during the year ended December 31, 2017, compared to the same period in 2016 due to:
 (In millions)
Assumption of the Utah Solar Portfolio debt in connection with the March 2017 Drop Down Assets$14
Issuance of the 2026 Senior Notes in the third quarter of 201611
Issuance of new project level debt in the second half of 2016 and 2017 partially offset by the lower principal balances on project level debt in 20171
Higher borrowings in 2016 on the revolving credit facility(5)
 $21
Income Attributable to Noncontrolling Interests
For the year ended December 31, 2017, the Company had a loss of $75 million attributable to noncontrolling interests with respect to its tax equity financing arrangements and the application of the HLBV method.
For the year ended December 31, 2016, the Company had a loss of $111 million attributable to noncontrolling interests with respect to its tax equity financing arrangements and the application of the HLBV method, which was primarily related to the impairment losses described above.



Consolidated Results of Operations
20162018 compared to 20152017
The following table provides selected financial information:
 Year ended December 31,
(In millions)2018 2017 Change
Operating Revenues     
Energy and capacity revenues$1,084
 $1,038
 $46
Other revenues39
 40
 (1)
Contract amortization(70) (69) (1)
Total operating revenues1,053
 1,009
 44
Operating Costs and Expenses     
Cost of fuels74
 63
 11
Operations and maintenance189
 197
 (8)
Other costs of operations69
 66
 3
Depreciation and amortization331
 334
 (3)
Impairment losses—
 44
 (44)
General and administrative20
 19
 1
Acquisition-related transaction and integration costs20
 3
 17
Development costs3
 —
 3
Total operating costs and expenses706
 726
 (20)
Operating Income347
 283
 64
Other Income (Expense)    
Equity in earnings of unconsolidated affiliates74
 71
 3
Other income, net8
 4
 4
Loss on debt extinguishment—
 (3) 3
Interest expense(294) (294) —
Total other expense, net(212) (222) 10
Net Income135
 61
 74
Less: Net loss attributable to noncontrolling interests(105) (75) (30)
Net Income Attributable to Clearway Energy LLC$240
 $136
 $104
 Year ended December 31,
(In millions)2016 2015 Change
Operating Revenues     
Energy and capacity revenues$1,104
 $1,024
 $80
Contract amortization(69) (54) (15)
Mark-to-market economic hedging activities—
 (2) 2
Total operating revenues1,035
 968
 67
Operating Costs and Expenses     
Cost of fuels61
 71
 (10)
Emissions credit amortization6
 —
 6
Operations and maintenance176
 180
 (4)
Other costs of operations65
 72
 (7)
Depreciation and amortization303
 303
 —
Impairment losses185
 1
 184
General and administrative14
 10
 4
Acquisition-related transaction and integration costs1
 3
 (2)
Total operating costs and expenses811
 640
 171
Operating Income224
 328
 (104)
Other Income (Expense)     
Equity in earnings of unconsolidated affiliates60
 31
 29
Other income, net3
 3
 —
Loss on debt extinguishment—
 (9) 9
Interest expense(272) (258) (14)
Total other expense, net(209) (233) 24
Net Income15
 95
 (80)
Less: Net (loss) income attributable to noncontrolling interests(111) (62) (49)
Net Income Attributable to NRG Yield LLC$126
 $157
 $(31)
Year ended December 31,Year ended December 31,
Business metrics:2016 20152018 2017
Renewables MWh generated/sold (in thousands) (a)
7,291
 6,463
7,197
 6,844
Conventional MWh generated (in thousands) (a)(b)
1,697
 2,487
Thermal MWt sold (in thousands)1,966
 1,946
2,042
 1,926
Thermal MWh sold (in thousands) (c)
71
 297
48
 35
Conventional MWh generated (in thousands) (a)(b)
1,656
 1,809
Conventional equivalent availability factor94.3% 93.9%
 
(a) Volumes do not include the MWh generated/sold by the Company's equity method investments.
(b) Volumes generated are not sold as the Conventional facilities sell capacity rather than energy.
(c) MWh sold do not include 108 and 72 MWh generated by NRG Dover, a subsidiary of the Company, under the PPA with NRG Power Marketing during the years ended December 31, 2018 and December 31, 2017, respectively, as further described in Item 15 — Note 13, Related Party Transactions, to the Consolidated Financial Statements.



Management’s discussion of the results of operations for the years ended December 31, 2018 and 2017
Gross Margin
The Company calculates gross margin in order to evaluate operating performance as operating revenues less cost of sales, which includes cost of fuel, contract and emission credit amortization and mark-to-market for economic hedging activities.
Economic Gross Margin
In addition to gross margin, the Company evaluates its operating performance using the measure of economic gross margin, which is not a GAAP measure and may not be comparable to other companies’ presentations or deemed more useful than the GAAP information provided elsewhere in this report.  Economic gross margin should be viewed as a supplement to and not a substitute for the Company' presentation of gross margin, which is the most directly comparable GAAP measure.  Economic gross margin is not intended to represent gross margin.  The Company believes that economic gross margin is useful to investors as it is a key operational measure reviewed by the Company's chief operating decision maker. Economic gross margin is defined as energy and capacity revenue, plus other revenues, less cost of fuels. Economic gross margin excludes the following components from GAAP gross margin: contract amortization, mark-to-market results, emissions credit amortization and (losses) gains on economic hedging activities. Mark-to-market results consist of unrealized gains and losses on contracts that are not yet settled.
The below tables present the composition of gross margin, as well as the reconciliation to economic gross margin for the years ended December 31, 2018 and 2017:
 Conventional Renewables Thermal Eliminations Total
(In millions)         
Year ended December 31, 2018         
Energy and capacity revenues$342
 $572
 $170
 $—
 $1,084
Other revenues—
 16
 26
 (3) 39
Cost of fuels(3) —
 (71) —
 (74)
Contract amortization(5) (62) (3) —
 (70)
Gross margin334
 526
 122
 (3) 979
Contract amortization5
 62
 3
 —
 70
Economic gross margin$339
 $588
 $125
 $(3) $1,049
 

 

 

   
Year ended December 31, 2017        
Energy and capacity revenues$341
 $547
 $150
 $—
 $1,038
Other revenues—
 16
 24
 —
 40
Cost of fuels(1) —
 (62) —
 (63)
Contract amortization(5) (62) (2) —
 (69)
Gross margin335
 501
 110
 —
 946
Contract amortization5
 62
 2
 —
 69
Economic gross margin$340
 $563
 $112
 $—
 $1,015

Gross margin increased by $33 million during the year ended December 31, 2018, compared to the same period in 2017, primarily due to:
Segment Increase (Decrease) Reason for Increase
(In millions)    
Renewables: $22
 An increase of $15 million related to higher wind generation, primarily at the Alta Wind projects, and higher insolation, and a $7 million increase due to the Buckthorn Solar project reaching COD in July 2018
Thermal: 12
 $7 million increase due to the acquisition of the UPMC Thermal Project, which was completed in 2018, as well as an increase of $5 million due to higher steam and chilled water usage across the portfolio in 2018
Conventional: (1) Decrease due to an emission credit reimbursement in 2017

 $33
  


Operations and Maintenance Expense
Operations and maintenance expense decreased by $8 million during the year ended December 31, 2018, compared to the same period in 2017, primarily due to:
Segment Increase (Decrease) Reason for Increase (Decrease)
(In millions)    
Renewables $6
 Increase primarily driven by the Buckthorn Solar project being placed in service in July 2018
Conventional (14) Lower outages in 2018 compared to 2017
  $(8) 
Impairment Losses
The Company recorded impairment losses of $44 million for the years ended December 31, 2017.
During the fourth quarter of 2017, as the Company updated its estimated cash flows in connection with the preparation and review of the Company’s annual budget, it was determined that both Elbow Creek and Forward projects were impaired due to the continued declining merchant power prices in the post contract periods. As a result, the Company recorded impairment losses of $26 million and $5 million for the Elbow Creek and Forward projects, respectively.
In addition, in connection with the sale of the November 2017 Drop Down Assets, it was identified that undiscounted cash flows were lower than the book value of certain SPP funds and NRG recorded an impairment expense of $13 million. In accordance with the guidance for transfer of assets under common control, the impairment is reflected in the Company's consolidated statements of operations for the period ended December 31, 2017.
For further discussion see Item 15 — Note 9, Asset Impairments, to the Consolidated Financial Statements, as well as in Critical Accounting Policies and Estimates in this Item 7.
Acquisition-Related Transaction and Integration Costs
Acquisition-related transaction and integration costs of $20 million during the year ended December 31, 2018, reflect fees paid to advisors and other costs associated with the GIP Transaction, as well as fees paid in connection with the acquisitions that took place in 2018, as further described in Note 3, Business Acquisitions.
Development Costs
The Company incurred $3 million of development cost expense during the year ended December 31, 2018. A total of $2 million of it was for the business development, personnel and benefits costs related to development projects within the Company's Thermal segment.
Equity in Earnings of Unconsolidated Affiliates
Equity in earnings of unconsolidated affiliates increased by $3 million during the year ended December 31, 2018, compared to the same period in 2017, primarily due to income allocated to the Company in DGPV Holdco 3, which was formed in September 2017, partially offset by losses allocated to the company in RPV Holdco and the Utah Solar Portfolio.  The HLBV method of accounting generally allocates more losses to the tax equity investors in the first several years after fund formation, and conversely, more income to the Company


Interest Expense
Interest expense remained flat during the year ended December 31, 2018, compared to the same period in 2017 due to:
(In millions) Increase (Decrease)
Normal amortization of project-level debt $(10)
Issuance of 2025 Senior Notes, partially offset by lower interest expense for the intercompany notes between Clearway Operating LLC and Clearway Energy, Inc., which were partially repaid in connection with the tender offer in October 2018 6
Change in mark-market of interest rate swaps (3)
Issuance of Energy Center Minneapolis Series E, F, G, H Notes in June 2018 and additional interest expense for the Buckthorn Solar project-level debt 7
  $—
Net Loss Attributable to Noncontrolling Interests
For the year ended December 31, 2018, the Company had a loss of $1 million attributable to CEG's economic interest in Repowering LLC and a loss of $104 million attributable to noncontrolling interests with respect to its tax equity financing arrangements and the application of the HLBV method.
For the year ended December 31, 2017, the Company had a loss of $75 million attributable to noncontrolling interests with respect to its tax equity financing arrangements and the application of the HLBV method, which was primarily related to the impairment losses described above.



Consolidated Results of Operations
2017 compared to 2016
The following table provides selected financial information:
 Year ended December 31,
(In millions)2017 2016 Change
Operating Revenues     
Energy and capacity revenues$1,038
 $1,065
 $(27)
Other revenues40
 39
 1
Contract amortization(69) (69) —
Total operating revenues1,009
 1,035
 (26)
Operating Costs and Expenses     
Cost of fuels63
 61
 2
Emissions credit amortization—
 6
 (6)
Operations and maintenance197
 176
 21
Other costs of operations66
 65
 1
Depreciation and amortization334
 303
 31
Impairment losses44
 185
 (141)
General and administrative19
 14
 5
Acquisition-related transaction and integration costs3
 1
 2
Total operating costs and expenses726
 811
 (85)
Operating Income283
 224
 59
Other Income (Expense)     
Equity in earnings of unconsolidated affiliates71
 60
 11
Other income, net4
 3
 1
Loss on debt extinguishment(3) —
 (3)
Interest expense(294) (272) (22)
Total other expense, net(222) (209) (13)
Net Income61
 15
 46
Less: Net loss attributable to noncontrolling interests(75) (111) 36
Net Income Attributable to Clearway Energy LLC$136
 $126
 $10
 Year ended December 31,
Business metrics:2017 2016
Renewables MWh generated/sold (in thousands) (a)
6,844
 7,291
Thermal MWt sold (in thousands)1,926
 1,966
Thermal MWh sold (in thousands) (c)
35
 71
Conventional MWh generated (in thousands) (a)(b)
1,809
 1,697
Conventional equivalent availability factor93.9% 95.3%
(a) Volumes do not include the MWh generated/sold by the Company's equity method investments.
(b) Volumes generated are not sold as the Conventional facilities sell capacity rather than energy.
(c) MWh sold do not include 72 and 204 MWh generated by NRG Dover, a subsidiary of the Company, under the PPA with NRG Power Marketing during the yearyears ended December 31, 2017 and 2016,, respectively, as further described in Item 15 — Note 13, Related Party Transactions, to the Consolidated Financial Statements.  

                                    


Management’s discussion of the results of operations for the years ended December 31, 20162017 and 20152016
Gross Margin
The Company calculates gross margin in order to evaluate operating performance as operating revenues less cost of sales, which includes cost of fuel, contract and emission credit amortization and mark-to-market for economic hedging activities.
Economic Gross Margin
In addition to gross margin, the Company evaluates its operating performance using the measure of economic gross margin, which is not a GAAP measure and may not be comparable to other companies’ presentations or deemed more useful than the GAAP information provided elsewhere in this report.  Economic gross margin should be viewed as a supplement to and not a substitute for the Company' presentation of gross margin, which is the most directly comparable GAAP measure.  Economic gross margin is not intended to represent gross margin.  The Company believes that economic gross margin is useful to investors as it is a key operational measure reviewed by the Company's chief operating decision maker. Economic gross margin is defined as energy and capacity revenue, plus other revenues, less cost of fuels. Economic gross margin excludes the following components from GAAP gross margin: contract amortization, mark-to-market results, emissions credit amortization and (losses) gains on economic hedging activities. Mark-to-market results consist of unrealized gains and losses on contracts that are not yet settled.
The following tables present the composition of gross margin, as well as the reconciliation to economic gross margin for the years ended December 31, 20162017 and 2015:2016:
Conventional Renewables Thermal TotalConventional Renewables Thermal Total
(In millions)  
Year ended December 31, 2017      
Energy and capacity revenues$341
 $547
 $150
 $1,038
Other revenues—
 16
 24
 40
Cost of fuels(1) —
 (62) (63)
Contract amortization(5) (62) (2) (69)
Gross margin$335
 $501
 $110
 $946
Contract amortization5
 62
 2
 69
Economic gross margin$340
 $563
 $112
 $1,015
       
Year ended December 31, 2016      
       
Energy and capacity revenues$338
 $594
 $172
 $1,104
$338
 $577
 $150
 $1,065
Other revenues—
 17
 22
 39
Cost of fuels(1) —
 (60) (61)(1) —
 (60) (61)
Contract amortization(5) (62) (2) (69)(5) (62) (2) (69)
Emissions credit amortization(6) —
 —
 (6)(6) —
 —
 (6)
Gross margin$326
 $532
 $110
 $968
$326
 $532
 $110
 $968
Contract amortization5
 62
 2
 69
5
 62
 2
 69
Emissions credit amortization6
 —
 —
 6
6
 —
 —
 6
Economic gross margin$337
 $594
 $112
 $1,043
$337
 $594
 $112
 $1,043
       
Year ended December 31, 2015       
Energy and capacity revenues$341
 $507
 $176
 $1,024
Cost of fuels(1) (1) (69) (71)
Contract amortization(5) (47) (2) (54)
Mark-to-market for economic hedging activities—
 (2) —
 (2)
Gross margin$335
 $457
 $105
 $897
Contract amortization5
 47
 2
 54
Mark-to-market for economic hedging activities—
 2
 —
 2
Economic gross margin$340
 $506
 $107
 $953
                                    


Gross margin increaseddecreased by $71$22 million and economic gross margin increaseddecreased by $90$28 million during the year ended December 31, 2016,2017, compared to the same period in 2015, driven by:2016, primarily due to:
Renewables: (In millions)
26% increase in volume generated at the Alta wind projects, as well as a 7% increase in generation at other Wind projects. Additionally, there was an increase of $4 million in economic gross margin due to the acquisition of Spring Canyon in May 2015$61
Increase in average price per MWh due to higher pricing in the Alta X and XI PPAs which were effective in January 2016, compared with merchant prices in 201527
Thermal: 
Higher sales volume in 2016 as a result of milder weather in 2015, as well as the completion of a project for a new customer in the second half of the year5
Conventional: 
Lower revenues at Walnut Creek as a result of forced outages in 2016, partially offset by higher revenues at El Segundo in 2016 as a result of forced outages in 2015(3)
Increase in economic gross margin$90
Higher contract amortization primarily for the Alta X and XI PPAs, which began in January 2016(15)
Emissions credit amortization of NOx allowances at Walnut Creek and El Segundo in compliance with amendments to the Regional Clean Air Incentives Market program(6)
Unrealized losses on forward contracts prior to the start of the PPA for Elbow Creek which began October 20152
Increase in gross margin$71
Segment(Decrease)IncreaseReason for Increase (Decrease)
(In millions)  
Renewables:(31)A 7% decrease in volume generated by wind projects, due to lower wind resources at the Alta Wind and Wind TE Holdco projects
Conventional:3
Higher revenues due to 2016 higher peak season forced outages, as well as additional start-up revenue from Marsh Landing in 2017
Economic gross margin$(28) 
 6
Emissions credit amortization of NOx allowances at Walnut Creek and El Segundo in compliance with amendments to the Regional Clean Air Incentives Market program in 2016
Gross margin$(22) 
Operations and Maintenance Expense
 Conventional Renewables Thermal Total
 (In millions)   
Year ended December 31, 2016$32
 $96
 $48
 $176
Year ended December 31, 201530
 99
 51
 180
Operations and maintenance expense decreasedincreased by $4$21 million during the year ended December 31, 2016,2017, compared to the same period in 2015, driven by:
 (In millions)
Increase in Conventional segment primarily due to Walnut Creek forced outages in 2016, compared to the forced outages at El Segundo in 2015$2
Decrease in Renewables segment primarily due to insurance proceeds received at Wildorado in 2016 in connection with a 2014 wind outage claim(3)
Decrease in Thermal segment primarily due to acceleration of maintenance work on thermal facilities into 2015(3)
 $(4)
Other Costs of Operations
Other costs of operations decreased by $7 million during the year ended December 31, 2016, compareddue to the same periodforced outages in 2015, primarily due to lower assessments for property taxes at Alta Xthe Conventional segment.  The Company recorded higher operations and XI and NRG Wind TE Holdco.
General and Administrative Expenses
General and administrative expenses increased by $4 million for the year ended December 31, 2016 compared to the same periodmaintenance costs in 2015, primarily due to new executive compensation in 2016, and an increase in base management fee for the Management Services Agreement with NRGWalnut Creek in connection with the acquisitionUnit 1 forced outages that took place in April of 2017, including an increase of loss on disposal of assets of $12 million, as well as higher operations and maintenance costs in El Segundo due to the Drop Down Assets.forced outages in Units 5 and Unit 6 that took place in January 2017.


Impairment Losses
ForThe Company recorded impairment losses of $44 million and $185 million for the yearyears ended December 31, 2017 and 2016, respectively.
During the fourth quarter of 2017, as the Company updated its estimated cash flows in connection with the preparation and review of the Company’s annual budget, it was determined that both Elbow Creek and Forward projects were impaired due to the continued declining merchant power prices in the post contract periods. As a result, the Company recorded impairment losses of $185$26 million and $5 million for the Elbow Creek and Forward projects, respectively.
In addition, in connection with the sale of the November 2017 Drop Down Assets, it was identified that undiscounted cash flows were lower than the book value of certain SPP funds and NRG recorded an impairment expense of $13 million. In accordance with the guidance for transfer of assets under common control, the impairment is reflected in the Company's consolidated statements of operations for the period ended December 31, 2017.
During the fourth quarter of 2016, as the Company updated its estimated cash flows in connection with the preparation and review of the Company's annual budget, it was determined that the cash flows for the Elbow Creek and Goat Wind projects and the Forward project were below the carrying value of the related assets, primarily due todriven by declining merchant power prices in post-contract periods, and that the impairmentsassets were considered impaired. The Company recorded impairment losses of property, plant$117 million, $60 million and equipment$6 million for Elbow Creek, Goat Wind, and Forward, asrespectively. The other impairments of $2 million related to the projects that were part of the November 2017 Drop Down Assets. Since the acquisition by the Company of the November 2017 Drop Down Assets related to transfer of assets under common control, these impairments were reflected in the Company's consolidated statements of operations for the period ending December 31, 2016. For further described indiscussion see Item 15 — Note 9, Asset Impairments, to the Consolidated Financial Statements,, as well as in Critical Accounting Policies and Estimates in this Item 7 below. Because the projects were acquired from NRG and related to interests under common control by NRG, the property, plant and equipment for these assets was recorded at historical cost of $298 million rather than estimated fair value of $132 million at the acquisition date. The three projects were acquired as part of the November 2015 Drop Down Assets.  As discussed in Item 15 — Note 3, Business Acquisitions, the historical cost for November 2015 Drop Down Assets was $369 million for the net assets, which was higher than the fair value paid of $207 million.  The difference between the historical cost of net assets and the fair value paid for the November 2015 Drop Down Assets was recorded to contributed capital on the Company’s consolidated balance sheet.
Loss on Debt Extinguishment
A loss on debt extinguishment of $9 million was recorded for the year ended December 31, 2015, driven by the refinancing of the El Segundo credit facility and the termination of the interest rate swaps for Alta Wind X and XI in connection with the sale of an economic interest in Alta TE Holdco to a financial institution as further described in Item 15 — Note 5, Investments Accounted for by the Equity Method and Variable Interest Entities, to the Consolidated Financial Statements.7.
Equity in Earnings of Unconsolidated Affiliates
Equity in earnings of unconsolidated affiliates increased by $29$11 million during the year ended December 31, 2016,2017, compared to the same period in 2015,2016, primarily due to an increase in equityhigher earnings from Desert Sunlight, which was acquiredthe solar partnerships with NRG, as well as the acquisition of the Utah Solar Portfolio in June 2015, DGPV Holdco 1 and RPV Holdco,November 2016, partially offset by losseslower earnings from Elkhorn Ridge.the San Juan Mesa investment.


Interest Expense     
Interest expense increased by $14$22 million during the year ended December 31, 2016,2017, compared to the same period in 2015,2016, due to:
 (In millions)
Amortization of the fair value of interest rate swaps primarily acquired with the January 2015 Drop Down Assets and November 2015 Drop Down Assets$10
Issuance of 2026 Senior Notes in August 20167
Utah Solar Portfolio debt assumed in connection with the March 2017 Drop Down Assets6
Intercompany debt issued with Yield, Inc. in 2015, due 20205
Issuance of 2037 CVSR Holdco Notes in July 20164
Higher revolving credit facility borrowings in 20162
Repricing of project-level financing arrangements and lower principal balances(20)
 $14
 (in millions)
Assumption of the Utah Solar Portfolio debt in connection with the March 2017 Drop Down Assets, as well as debt assumed in connection with the Buckthorn Solar Drop Down Asset on March 30, 2018$15
Issuance of 2026 Senior Notes in the third quarter of 201611
Issuance of new project level debt in the second half of 2016 and 2017 partially offset by the lower principal balances on project level debt in 20171
Higher borrowings in 2016 on the revolving credit facility(5)
 $22
IncomeNet Loss Attributable to Noncontrolling Interests
For the year ended December 31, 2017, the Company had a loss of $75 million attributable to noncontrolling interests with respect to its tax equity financing arrangements and the application of the HLBV method. For the year ended December 31, 2016, the Company had a loss of $111 million attributable to noncontrolling interests with respect to its tax equity financing arrangements and the application of the HLBV method, which was primarily related to the impairment losses described above. For the year ended December 31, 2015, the Company had a loss of $62 million attributable to noncontrolling interests with respect to its tax equity financing arrangements and the application of the HLBV method.
                                    


Liquidity and Capital Resources
The Company's principal liquidity requirements are to meet its financial commitments, finance current operations, fund capital expenditures, including acquisitions from time to time, service debt and pay distributions. As a normal part of the Company's business, depending on market conditions, the Company will from time to time consider opportunities to repay, redeem, repurchase or refinance its indebtedness. Changes in the Company's operating plans, lower than anticipated sales, increased expenses, acquisitions or other events may cause the Company to seek additional debt or equity financing in future periods. There can be no guarantee that financing will be available on acceptable terms or at all. Debt financing, if available, could impose additional cash payment obligations and additional covenants and operating restrictions.
Current Liquidity Position
As of December 31, 20172018 and 2016,2017, the Company's liquidity was approximately $680$1,037 million and $932$680 million, respectively, comprised of cash, restricted cash, and availability under the Company's revolving credit facility.
 As of December 31,
 2017 2016
 (In millions)
Cash and cash equivalents$146
 $321
Restricted cash - operating86
 76
Restricted cash - reserves 
82
 100
Total314
 497
Total credit facility availability366
 435
Total liquidity$680
 $932
 As of December 31,
 2018 2017
 (In millions)
Cash and cash equivalents:   
Clearway Energy LLC, excluding subsidiaries$298
 $22
Subsidiaries109
 124
Restricted cash:   
Operating accounts84
 25
Reserves, including debt service, distributions, performance obligations and other reserves92
 143
Total cash, cash equivalents and restricted cash$583
 $314
Revolving credit facility availability$454
 $366
Total liquidity$1,037
 $680
The Company's liquidity includes $168$176 million and $176$168 million of restricted cash balances as of December 31, 20172018 and 20162017, respectively. Restricted cash consists primarily of funds to satisfy the requirements of certain debt arrangements and funds held within the Company's projects that are restricted in their use.As of Of these funds as of December 31, 2017,2018, these restricted funds comprised of $84 million designated to fund operating expenses, approximately $25$26 million is designated for current debt service payments, $25 million is designated to fund operating expenses and $36 million is designated for distributions to the Company, with the remaining $82$32 million restricted for reserves including debt service, performance obligations and other reserves, as well as capital expenditures. The remaining $34 million is held in distribution reserve accounts, of which $31 million related to subsidiaries affected by the PG&E bankruptcy as discussed further below and may not be distributed during the pendency of the bankruptcy.
As of December 31, 2018, the Company had no borrowings under the revolving credit facility and $41 million of letters of credit were outstanding under the revolving credit facility.
Subsequent to December 31, 2018, the Clearway Energy, Inc. repaid the remaining $220 million balance of the 2019 Convertible Notes. which was funded through the payment of the remaining balance of the intercompany note due 2019 between Clearway Energy Operating LLC and Clearway Energy, Inc., and acquired the Class A interest in Wind TE Holdco for $19 million, as further described below in Uses of Liquidity. 
In August 2018 and January 2019, the Company completed a series of open market repurchases of 2019 Convertible Notes in aggregate principal amount of $66 million. The Company's various financing arrangements are2019 Convertible Notes matured on February 1, 2019 and the Company paid off the remaining balance of an aggregate principal amount of $170 million as further described in Item 15 — Note 10, Long-term Debt, to the Consolidated Financial StatementsStatements.
. AsOn January 29, 2019, PG&E filed for bankruptcy under Chapter 11 of December 31, 2017, $55 million of borrowings and $74 million of letters of credit were outstandingthe U.S. Bankruptcy Code. The PG&E bankruptcy had no effect on availability under the Company’s revolving credit facility. However, the Company has non-recourse project-level debt related to each of its subsidiaries that sell their output to PG&E under long-term PPAs. The PG&E bankruptcy filing is an event of default under the related financing agreements which caused uncertainty around the timing of when certain project-level cash distributions will be available to the Company.  As of December 31, 2018, all project level cash balances for these subsidiaries were classified as restricted cash.


Management believes that the Company's liquidity position, cash flows from operations and availability under its revolving credit facility will be adequate to meet the Company's financial commitments; debt service obligations; growth, operating and maintenance capital expenditures; and to fund distributions to Yield,Clearway Energy, Inc. and NRG.Clearway Energy Group, LLC.  Management continues to regularly monitor the Company's ability to finance the needs of its operating, financing and investing activity within the dictates of prudent balance sheet management.


NRG Transaction and Related Liquidity Considerations
On February 6, 2018, NRG entered into agreements for the sale of 100% of its interest in NRG Yield, Inc. and its renewable energy development and operations platform, or the NRG Transaction. In connection with this, the Company entered into a Consent and Indemnity Agreement with NRG and Global Infrastructure Partners. For further discussion of the NRG Transaction and the related ROFO impacts, refer to Item 1 — Business, as well as, Item 15 — Note 1, Nature of Business.
As part of the Consent and Indemnity Agreement, GIP has arranged a $1.5 billion backstop credit facility to manage any change of control costs associated with NRG Yield's corporate debt. In addition, GIP has committed to provide $400 million in financing support for the Carlsbad Energy Center transaction, which would be exercised if necessary.
On February 6, 2018, NRG Yield Operating LLC and NRG Yield LLC amended the revolving credit facility to modify the change of control provisions to permit the consummation of the NRG Transaction, and also to permit NRG Yield Operating LLC, NRG Yield LLC and certain subsidiaries to incur up to $1.5 billion of unsecured indebtedness in order to repurchase or make other required cash payments, in each case if applicable, with respect to NRG Yield Operating LLC’s outstanding senior notes and NRG Yield's outstanding convertible notes in connection with the NRG Transaction.
Credit Ratings
Credit rating agencies rate a firm's public debt securities. These ratings are utilized by the debt markets in evaluating a firm's credit risk. Ratings influence the price paid to issue new debt securities by indicating to the market the Company's ability to pay principal, interest and preferred dividends. Rating agencies evaluate a firm's industry, cash flow, leverage, liquidity, and hedge profile, among other factors, in their credit analysis of a firm's credit risk. As of December 31, 2017,2018, the Company's 2024 Senior Notes, 2025 Senior Notes and 2026 Senior Notes are rated BB by S&P and Ba2 by Moody's. The ratings outlook is stable.
On February 7, 2018, S&P and Moody's reaffirmed the ratings outlook as stable.stable on February 25, 2019 and on February 15, 2019, respectively.

Sources of Liquidity
The Company's principal sources of liquidity include cash on hand, cash generated from operations, borrowings under new and existing financing arrangements and the issuance of additional equity and debt securities by Yield,Clearway Energy, Inc. or the Company as appropriate given market conditions. As described in Item 15— Note 10, Long-term Debt, to the Consolidated Financial Statements, and above in Significant Events During the Year Ended December 31, 2017,2018, the Company's financing arrangements consist of Clearway Energy, Inc.'s equity offering of Class C common stock on September 27, 2018, corporate level debt, which includes Senior Notes, intercompany borrowings with Clearway Energy, Inc., and the revolving credit facility,facility; the 2024 Senior Notes, the 2026 Senior Notes, its intercompany borrowings with Yield, Inc.ATM Program; and project-level financings for its various assets.
At-the-Market2025 Senior Notes — On October 1, 2018, Clearway Energy Operating LLC issued $600 million of senior unsecured notes, or the 2025 Senior Notes. The 2025 Senior Notes bear interest at 5.750% and mature on October 15, 2025. Interest on the notes is payable semi-annually on April 15 and October 15 of each year, and interest payments will commence on April 15, 2019. The 2025 Senior Notes are unsecured obligations of Clearway Energy Operating LLC and are guaranteed by Clearway Energy LLC and by certain of Clearway Energy Operating LLC's wholly owned current and future subsidiaries.
2018 Equity Offering Program
In 2016, NRG Yield,— On September 27, 2018, Clearway Energy, Inc. entered intoissued and sold an equity distribution agreement, or EDA, with Barclays Capital Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and RBC Capital Markets, LLC, as sales agents. Pursuant to the terms of the EDA, NRG Yield, Inc. may offer and selladditional 3,916,449 shares of its Class C common stock par value $0.01 per share, from time to time throughfor net proceeds of $75 million. The Company utilized the sales agents, as NRG Yield, Inc.’s sales agents for the offer and saleproceeds of the shares, upoffering to an aggregate sales price of $150,000,000 through an at-the-market equity offering program, or ATM Program. NRG Yield, Inc. may also sell shares of itsacquire 3,916,449 Class C common stock to anyunits of Clearway Energy LLC.
Revolving Credit Facility — On April 30, 2018, the Company closed on the refinancing of the sales agents, as principalsrevolving credit facility, which extended the maturity of the facility to April 28, 2023 and decreased the Company's overall cost of borrowing. The facility will continue to be used for its own account, atgeneral corporate purposes including financing of future acquisitions and posting letters of credit.
ATM Sales — Clearway Energy, Inc. sold a price agreed upon at the timetotal of sale. As of December 31, 2017, Yield, Inc. issued 1,921,866 shares4,492,473 of Class C common stock under the ATM Programprogram for gross proceeds of $35$79 million andduring the year ended December 31, 2018. Clearway Energy, Inc. incurred commission fees of $346 thousand. At$790 thousand during the period ended December 31, 2017,2018. Clearway Energy, Inc. used the net proceeds to acquire 4,492,473 Class C units from Clearway Energy LLC.
As of February 28, 2019, approximately $115$36 million of Class C common stock remains available for issuance under the ATM Program.
Thermal Notes Yield, Inc. used the net proceeds to acquire 1,921,866 Class C units from Yield LLC.
Thermal Financing
— On March 16, 2017, NRGJune 19, 2018, Energy Center Minneapolis LLC, a subsidiary of the Company, amendedcompleted the shelf facilityissuances of its existing Thermal financing arrangement to allow for4.80% Series E notes due June 15, 2033, or the issuance of an additional $10 million ofSeries E Notes, and 4.60% Series F notes at a 4.60% interest rate,due March 15, 2033, or the Series F Notes, increasingfor gross proceeds of $80 million. The proceeds of the total principal amount of notes available for issuance under the shelf facility to $80 million. TheSeries E Notes and Series F Notes are secured by substantially allwere utilized to finance the acquisition of the assets of NRGUPMC Thermal Project. Also, on June 19, 2018, Energy Center Minneapolis LLC. NRG Thermal LLC has guaranteedissued $83 million of 5.90% Series G notes due June 15, 2035, or the indebtednessSeries G Notes, which were utilized to refinance its $83 million of outstanding Series C notes. Energy Center Minneapolis LLC also issued 4.83% Series H notes due June 15, 2037, or the Series H Notes for proceeds of $40 million and its guarantee is secured byestablished a pledgeprivate shelf facility for the future issuance of the equity interests$40 million in all of NRG Thermal LLC’s subsidiaries.additional notes.

                                    


Uses of Liquidity
The Company's requirements for liquidity and capital resources, other than for operating its facilities, are categorized as: (i) debt service obligations, as described more fully in Item 15 — Note 10, Long-term Debt to the Consolidated Financial Statements; (ii) capital expenditures; (iii) acquisitions and investments; and (iv) distributions.
Debt Service Obligations
Principal payments on debt as of December 31, 2017,2018, are due in the following periods:
Description2018 2019 2020 2021 2022 There - after Total2019 2020 2021 2022 2023 There- after Total
(In millions)(In millions)
Long-term debt - affiliate, due 2019$—
 $337
 $—
 $—
 $—
 $—
 $337
$215
 $—
 $—
 $—
 $—
 $—
 $215
Long-term debt - affiliate, due 2020—
 —
 281
 —
 —
 —
 281
—
 44
 —
 —
 —
 —
 44
NRG Yield Operating LLC Senior Notes, due 2024—
 —
 —
 —
 —
 500
 500
NRG Yield Operating LLC Senior Notes, due 2026—
 —
 —
 —
 —
 350
 350
NRG Yield LLC and NRG Yield Operating LLC Revolving Credit Facility, due 2019—
 55
 —
 —
 —
 —
 55
Clearway Energy Operating LLC Senior Notes, due 2024—
 —
 —
 —
 —
 500
 500
Clearway Energy Operating LLC Senior Notes, due 2025          600
 600
Clearway Energy Operating LLC Senior Notes, due 2026—
 —
 —
 —
 —
 350
 350
Total Corporate-level debt—
 392
 281
 —
 —
 850
 1,523
215
 44
 —
 —
 —
 1,450
 1,709
Project-level debt:            

            

Agua Caliente Borrower 2, due 20381
 1
 1
 1
 1
 36
 41
1
 1
 1
 1
 1
 34
 39
Alpine, due 20228
 8
 8
 8
 103
 —
 135
8
 8
 8
 103
 —
 —
 127
Alta Wind I - V lease financing arrangements, due 2034 and 203540
 41
 45
 45
 47
 708
 926
41
 45
 45
 47
 49
 659
 886
Buckthorn Solar, due 20253
 3
 3
 3
 3
 117
 132
CVSR, due 203726
 24
 21
 23
 25
 627
 746
24
 21
 23
 25
 26
 601
 720
CVSR Holdco Notes, due 20376
 6
 6
 7
 9
 160
 194
6
 6
 7
 9
 9
 151
 188
El Segundo Energy Center, due 202348
 49
 53
 57
 63
 130
 400
49
 53
 57
 63
 130
 —
 352
Energy Center Minneapolis, due 20257
 11
 11
 11
 11
 32
 83
Energy Center Minneapolis Series D Notes, due 2031—
 —
 —
 —
 —
 125
 125
Energy Center Minneapolis Series C, D, E, F, G, H Notes, due 2025-2037—
 —
 —
 —
 —
 328
 328
Kansas South, due 20302
 2
 2
 2
 2
 16
 26
Laredo Ridge, due 20285
 5
 6
 6
 7
 66
 95
5
 6
 6
 7
 7
 58
 89
Marsh Landing, due 202355
 57
 60
 62
 65
 19
 318
57
 60
 62
 65
 19
 —
 263
South Trent Wind, due 20205
 45
 —
 —
 —
 —
 50
Tapestry, due 202111
 11
 11
 129
 —
 —
 162
11
 11
 129
 —
 —
 —
 151
Utah Solar Portfolio, due 202212
 14
 13
 13
 226
 —
 278
14
 13
 13
 227
 —
 —
 267
Viento, due 202316
 18
 16
 16
 17
 80
 163
18
 16
 16
 17
 79
 —
 146
Walnut Creek, due 202345
 47
 49
 52
 55
 19
 267
47
 49
 52
 55
 19
 —
 222
Other26
 30
 69
 25
 24
 269
 443
23
 22
 23
 22
 45
 208
 343
Total project-level debt306
 322
 369
 455
 653
 2,271
 4,376
314
 361
 447
 646
 389
 2,172
 4,329
Total debt$306
 $714
 $650
 $455
 $653
 $3,121
 $5,899
$529
 $405
 $447
 $646
 $389
 $3,622
 $6,038
Capital Expenditures
The Company's capital spending program is mainly focused on maintenance capital expenditures, consisting of costs to maintain the assets currently operating, such as costs to replace or refurbish assets during routine maintenance, and growth capital expenditures, consisting of costs to construct new assets, costs to complete the construction of assets where construction is in process, and capital expenditures related to acquiring additional thermal customers. For the years ended December 31, 20172018, 2016,2017, and 2015,2016, the Company used approximately $31$83 million, $20$190 million, and $29$20 million, respectively, to fund capital expenditures, including maintenance capital expenditures of $27$36 million, $1627 million and $20$16 million, respectively. Growth capital expenditures in 2018 include $33 million in the Renewables segment in connection with the construction of Buckthorn Solar Drop Down Asset, of which $10 million was incurred by NRG during the construction of Buckthorn Solar prior to its acquisition by the Company on March 30, 2018, as described below. Growth capital expenditures in 2017 were in primarily in the Thermal segment and relate to servicing new customers in district energy centers.$159 million incurred by NRG during the construction of Buckthorn Solar prior to its acquisition by the Company. Growth capital expenditures in 2016 and 2015 primarily related to the servicing new customers in district energy centers within the Thermal segment and construction of the Company's solar generating assets.segment. The Company develops annual capital spending plans based on projected requirements for maintenance and growth capital. The Company estimates $32$30 million of maintenance expenditures for 2018.2019. These estimates are subject to continuing review and adjustment and actual capital expenditures may vary from these estimates.


Acquisitions and Investments


The Company intends to acquire generation and thermal infrastructure assets developed and constructed by NRG or other third parties in the future,CEG, as well as generation and thermal infrastructure assets from third parties where the Company believes its knowledge of the market and operating expertise provides a competitive advantage, and to utilize such acquisitions as a means to grow its CAFD.
Wind TE Holdco Buyout — On February 24, 2017,January 2, 2019, the Company amendedbought out 100% of Class A membership interest from the TE Investor, for cash consideration of $19 million, as further described in Item 15 — Note 5, Investments Accounted for by the Equity Method and restatedVariable Interest Entities.
UPMC Thermal Project — On June 19, 2018, upon reaching substantial completion, the ROFO Agreement, expandingCompany acquired from NRG the ROFO Assets pipelineUPMC Thermal Project for cash consideration of $84 million, subject to working capital adjustments. The Company had a payable of $4 million to NRG as of December 31,2018, $3 million of which was paid in January 2019 upon final completion of the project pursuant to the EPC agreement. The project adds 73 MWt of thermal equivalent capacity and 7.5 MW of emergency backup electrical capacity to the Company's portfolio. The transaction was accounted for as an asset acquisition and is reflected in the Company's Thermal segment.
Central CA Fuel Cell 1, LLC — On April 18, 2018, the Company acquired the Central CA Fuel Cell 1, LLC project in Tulare, California from FuelCell Energy Finance, Inc., for cash consideration of $11 million, subject to working capital adjustments. The project adds 2.8 MW of thermal capacity to the Company's portfolio, with a 20-year PPA contract with the additionCity of 234 netTulare. The transaction is reflected in the Company's Thermal segment.
Buckthorn Solar Drop Down Asset— On March 30, 2018, the Company acquired 100% of NRG's interests in Buckthorn Renewables, LLC, which owns a 154 MW ofconstruction-stage utility-scale solar projects, consisting ofgeneration project, located in Texas, or the Buckthorn Solar Drop Down Asset, for cash consideration of approximately $42 million, subject to working capital adjustments. The project sells power under a 154 net MW solar facility25-year PPA to the City of Georgetown, Texas which commenced in Texas, and Hawaii solar projects, which have a combined capacity of 80 net MW.July 2018.
Carlsbad Project —On February 6, 2018, the Company entered into an agreement with NRG to purchase 100% of the membership interests in Carlsbad Energy Holdings LLC, which indirectly owns the Carlsbad project, a 527 MW natural gas fired project in Carlsbad, CA, pursuant to the NRG ROFO Agreement. Following the COD of the project in December 2018, the Company elected to utilize the Carlsbad backstop facility provided by GIP; as such, GIP purchased 100% of the membership interest in Carlsbad Energy Holdings LLC on February 27, 2019. The purchase price for the transaction is $365was $387 million in cash consideration, exclusive of working capital and other adjustments, as well as the assumption of non-recourse debt of $601 million at completion. The Company maintains the option to purchase Carlsbad from GIP at any time within 18 months after February 27, 2019 at the same economic terms at which it originally agreed to purchase the asset from NRG. Should the Company not acquire Carlsbad during such 18 months, the project will become a CEG ROFO Asset.
Hawaii Solar Assets— On August 31, 2018, the Company entered into a binding agreement with CEG to acquire 80 MW of utility-scale solar projects located in Kawailoa and Oahu, Hawaii for cash consideration of $28 million, subject to customary working capital and other adjustments.adjustments, as well as the assumption of non-recourse debt of $169 million. The transaction is expected to close during the fourth quarterin summer of 2018 and is contingent upon the consummation of the NRG Transaction.2019.
Mylan Pharmaceuticals— On January 24,November 1, 2018, the Company entered into an agreementEnergy Services Agreement with NRGMylan LLC to purchase 100% of NRG's ownership interestsupply chilled water, hot water and electricity through a dedicated combined heat and power facility to be constructed at Mylan's Caguas, Puerto Rico facility. The Company incurred approximately $7 million in Buckthorn Solar pursuantconstruction work in progress costs and anticipates the project to the ROFO Agreement for cash consideration of $42total $11 million subject to other adjustments.in capital expenditures. The transactionproject is expected to close duringcommence commercial operations in the firstsecond quarter of 2018.
As discussed in Item 1 — Note 3, Business Acquisitions, the Company completed the following acquisitions in 2017:
November 2017 Drop Down Assets — On November 1, 2017, the Company acquired a 38 MW solar portfolio primarily comprised of assets from NRG's Solar Power Partners (SPP) funds and other projects developed by NRG, for cash consideration of $74 million, including a working capital adjustment of $3 million, plus assumed non-recourse debt of $26 million.
August 2017 Drop Down Assets — On August 1, 2017, the Company acquired the remaining 25% interest in NRG Wind TE Holdco, a portfolio of 12 wind projects, from NRG for total cash consideration of $44 million, including a working capital adjustment of $3 million. The transaction also includes potential additional payments to NRG dependent upon actual energy prices for merchant periods beginning in 2027.
March 2017 Drop Down Assets — On March 27, 2017, the Company acquired the following interests from NRG: (i) Agua Caliente Borrower 2 LLC, which owns a 16% interest (approximately 31% of NRG's 51% interest) in the Agua Caliente solar farm, one of the ROFO Assets, representing ownership of approximately 46 net MW of capacity, and (ii) NRG's interests in seven utility-scale solar farms located in Utah, which are part of a tax equity structure with Dominion Solar Projects III, Inc., or Dominion, from which the Company would receive 50% of cash to be distributed. The Company paid cash consideration of $132 million,2019.
Investment Partnership with NRG
On September 26, 2017, the Company entered into an additional partnership with NRG by forming NRG DGPV Holdco 3 LLC, or DGPV Holdco 3, in which the Company would invest up to $50 million in an operating portfolio of distributed solar assets, primarily comprised of community solar projects, developed by NRG. The Company owns approximately 43 MW of distributed solar capacity, based on cash to be distributed, with a weighted average contract life of approximately 20 years as of December 31, 2017.CEG
During the year endedperiod of January 1, 2018 to December 31, 2017,2018, the Company invested $64$34 million in distributed generation partnerships with NRG.CEG.
Open Market Repurchases and Tender Offer
In August 2018, Clearway Energy, Inc. repurchased an aggregate principal amount of $16 million of the 2019 Convertible Notes in open market transactions. The repurchases were funded through a repayment of the intercompany note between Clearway Operating LLC and Clearway Energy, Inc. which was reduced by $16 million.
On September 10, 2018, pursuant to the 2019 Convertible Notes and the 2020 Convertible Notes indentures, Clearway Energy, Inc. delivered to the holders of the Convertible Notes a fundamental change notice and offer to repurchase any and all of the 2019 Convertible Notes and 2020 Convertible Notes for cash at a price equal to 100% of the principal amount of the Convertible


Notes plus any accrued and unpaid interest. The tender offer expired on October 9, 2018. An aggregate principal amount of $109 million of the 2019 Convertible Notes and $243 million of the 2020 Convertible Notes were tendered on or prior to the expiration date and accepted by Clearway Energy, Inc. for purchase. After the expiration of the tender offer, $220 million aggregate principal amount of the 2019 Convertible Notes and $45 million aggregate principal amount of the 2020 Convertible Notes remained outstanding as of December 31, 2018.
Subsequent to December 31, 2018, Clearway Energy, Inc. repaid the remaining balance of the 2019 Convertible Notes, which was funded through the payment of the remaining balance of the intercompany note due 2019 between Clearway Energy Operating LLC and Clearway Energy, Inc..
Cash Distributions to Yield,Clearway Energy, Inc. and NRGCEG
The Company intends to distribute to its unit holders in the form of a quarterly distribution all of the CAFD that is generated each quarter less reserves for the prudent conduct of the business, including among others, maintenance capital expenditures to maintain the operating capacity of the assets. CAFD is defined as net income before interest expense, income taxes, depreciation and amortization, plus cash distributions from unconsolidated affiliates, cash receipts from notes receivable, less cash distributions to noncontrolling interests, maintenance capital expenditures, pro-rata EBITDA from unconsolidated affiliates, cash interest paid, income taxes paid, principal amortization of indebtedness and changes in prepaid and accrued capacity payments. Distributions on units are subject to available capital, market conditions, and compliance with associated laws, regulations and other contractual obligations. The Company expects that, based on current circumstances, comparable distributions will continue to be paid in the foreseeable future. The Company will continue to evaluate its capital allocation approach during the pendency of the PG&E Bankruptcy.


The following table lists the distributions paid on the Company's Class A, Class B, Class C and Class D units during the year ended December 31, 2017:2018:
Fourth Quarter 2017 Third Quarter 2017 Second Quarter 2017 First Quarter 2017Fourth Quarter 2018 Third Quarter 2018 Second Quarter 2018 First Quarter 2018
Distributions per Class A and Class B unit$0.288
 $0.28
 $0.27
 $0.26
$0.331
 $0.320
 $0.309
 $0.298
Distributions per Class C and Class D unit$0.288
 $0.28
 $0.27
 $0.26
$0.331
 $0.320
 $0.309
 $0.298
On February 15, 2018,12, 2019, the Company declared a quarterly distribution on its Class A, Class B, Class C and Class D units of $0.298$0.20 per unit payable on March 15, 2018.2019.

                                    


Cash Flow Discussion
Year Ended December 31, 20172018 Compared to Year Ended December 31, 20162017
The following table reflects the changes in cash flows for the year ended December 31, 20172018, compared to 20162017:
Year ended December 31,2017 2016 Change2018 2017 Change
(In millions)  
Net cash provided by operating activities$516
 $577
 $(61)$492
 $517
 $(25)
Net cash used in investing activities(283) (131) (152)(185) (442) 257
Net cash used in financing activities(416) (202) (214)(38) (258) 220
Net Cash Provided By Operating Activities
Changes to net cash provided by operating activities were driven by:(In millions)
Decrease in operating income adjusted for non-cash items driven by primarily by lower revenues in the Renewables segment in 2017 compared to 2016$(63)
Decrease in working capital driven primarily by the timing of accounts receivable collections, and inventory build up in the Renewables segment in connection with the transition to self operations, as well as higher prepaid expenses in 2017 compared to 2016(12)
Higher distributions from unconsolidated affiliates primarily due to the acquisition of the Utah Solar Portfolio, which was acquired by the Company in March 2017 and by NRG in November 201614
 $(61)
Changes to net cash provided by operating activities were driven by:(In millions)
Increase in operating income adjusted for non-cash items driven in 2018 compared to 2017$4
Decrease in working capital driven primarily by the timing of accounts receivable collections, paying down accounts payable - affiliate balances to NRG during 2018, as well payments made to reduce certain Alta Wind projects letters of credit(27)
Lower distributions from unconsolidated affiliates(2)
 $(25)
Net Cash Used In Investing Activities
Changes to net cash used in investing activities were driven by:(In millions)
Payments for the acquisition of the March 2017, August 2017, and November 2017 Drop Down Assets in 2017 compared to the payments made for the CVSR Drop Down in 2016$(173)
Higher return of investment from unconsolidated affiliates combined with lower investments primarily in DGPV HoldCo entities in 201729
Higher capital expenditures primarily related to maintenance capital expenditures at Walnut Creek as a result of the forced outages in 2017(11)
Higher insurance proceeds in 2017 in the Conventional segment compared to the insurance proceeds in 2016 in the Renewables segment3
 $(152)
Changes to net cash used in investing activities were driven by:(In millions)
Current year reflects the Buckthorn Solar Drop Down Asset and UPMC Thermal Project compared to the payment made for the March 2017, August 2017, and November 2017 Drop Down Assets in 2017$124
Lower net investment in unconsolidated affiliates primarily in the DGPV partnerships with CEG during 201837
Payment to acquire Central CA Fuel Cell 1, LLC in 2018(11)
Lower capital expenditures driven by prior year capital expenditures for the Buckthorn Solar project107
 $257
Net Cash Used In Financing Activities
Changes in net cash used in financing activities were driven by:(In millions)
Increase in net contributions from noncontrolling interests due to higher production-based payments in 2017 compared to 2016$8
Lower net payments of distributions to NRG for the Drop Down Assets relating to the pre-acquisition period in 2017 compared to 2016164
Proceeds from the issuance of Class C units33
Net payments of $306 million under the revolving credit facility in 2016 compared to proceeds of $55 million in 2017361
Higher borrowing in 2016, primarily related to the 2026 Senior Notes and CVSR Holdco Notes due 2037 partially offset by higher repayments of long-term debt in 2017(751)
Increase in distributions paid to unit holders(29)
 $(214)
Changes in net cash used in financing activities were driven by:(In millions)
Net proceeds from the refinancing of the Thermal note purchase and private shelf agreement$120
Net proceeds from corporate-level debt driven by the issuance of the 2025 Senior Notes, partially offset by the repayments of the intercompany notes with Clearway Energy, Inc.241
Proceeds from borrowings for the Buckthorn Solar project in 2017, as well as higher project level debt amortization in 2018 compared to 2017(216)
Net payments of $55 million under the revolving credit facility in 2018 compared to proceeds of $55 million in 2017(110)
Increase in net contributions from noncontrolling interests primarily for the tax equity arrangements for the Buckthorn Solar project which closed in 201893
Lower net payments of distributions to NRG for the Drop Down Assets relating to the pre-acquisition period in 2018 compared to 201723
Higher net proceeds from the Clearway Energy, Inc. common stock offering under the ATM Program in 2018 compared to 201745
Net proceeds from the Class C Common stock offering in September 201875
Increase in distributions paid to unit holders(51)
 $220
                                    



Year Ended December 31, 20162017 Compared to Year Ended December 31, 20152016
The following table reflects the changes in cash flows for the year ended December 31, 2016,2017, compared to 2015:2016:
Year ended December 31,2016 2015 Change2017 2016 Change
(In millions)(In millions) (In millions) 
Net cash provided by operating activities$577
 $424
 $153
$517
 $577
 $(60)
Net cash used in investing activities(131) (1,098) 967
(442) (131) (311)
Net cash (used in) provided by financing activities(202) 354
 (556)(258) (202) (56)
Net Cash Provided By Operating Activities
Changes to net cash provided by operating activities were driven by:(In millions)
Increase in operating income adjusted for non-cash items driven by higher revenues mainly in the Renewables segment in 2016 compared to 2015$120
Changes in working capital driven primarily by the timing of accounts receivable collections in 2015 compared to 201635
Lower distributions from unconsolidated affiliates(2)
 $153
Changes to net cash provided by operating activities were driven by:(In millions)
Decrease in operating income adjusted for non-cash items driven by primarily by lower revenues in the Renewables segment in 2017 compared to 2016$(63)
Decrease in working capital driven primarily by the timing of accounts receivable collections, and inventory build up in the Renewables segment in connection with the transition to self operations, as well as higher prepaid expenses in 2017 compared to 2016(11)
Higher distributions from unconsolidated affiliates primarily due to the acquisition of the Utah Solar Portfolio, which was acquired by the Company in March 2017 and by NRG in November 201614
 $(60)
Net Cash Used In Investing Activities
Changes to net cash used in investing activities were driven by:(In millions)
Payments to acquire businesses, net of cash acquired, in 2015$37
Higher payments for the acquisition of the January 2015 and November 2015 Drop Down Assets in 2015 compared to the payments made for the CVSR Drop Down in 2016621
Decrease in capital expenditures primarily due to the completion of a project in the Thermal segment in 2015, as well as lower maintenance capital expenditures in 20169
Higher net investments in unconsolidated affiliates in 2015, primarily due to investment in Desert Sunlight305
Other(5)
 $967
Changes to net cash used in investing activities were driven by:(In millions)
Payments for the acquisition of the March 2017, August 2017, and November 2017 Drop Down Assets in 2017 compared to the CVSR Drop Down in 2016$(173)
Higher return of investment from unconsolidated affiliates combined with lower investments primarily in the DGPV Holdco entities in 201729
Higher capital expenditures primarily related to maintenance capital expenditures at Walnut Creek as a result of the forced outages in 2017(11)
Capital expenditures incurred by NRG in connection with construction of the Buckthorn Solar Drop Down Asset in 2017, which was acquired by the Company on March 30, 2018(159)
Higher proceeds in 2017 in the Conventional segment compared to the insurance proceeds received in 2016 in the Renewables segment3
 $(311)
Net Cash (Used In) Provided By Financing Activities
Changes in net cash provided by financing activities were driven by:(In millions)
Higher payments of distributions to NRG from Drop Down Assets prior to the acquisition dates$(105)
Proceeds from sale of an economic interest in Alta TE Holdco in 2015, as further described in Item 15 — Note 5, Investments Accounted for by the Equity Method and Variable Interest Entities, compared to lower net contributions from tax equity investors in 2016
(117)
Proceeds from the issuance of Class C units in 2015(599)
Increase in distributions paid to unit holders(34)
Net repayments of $306 million under the revolving credit facility in 2016 compared to the net borrowings of $306 million in 2015(612)
Issuance of the Series D Notes in October 2016, 2026 Senior Notes in August 2016, and CVSR Holdco Notes, due 2037 in July 2016, partially offset by lower debt principal payments throughout 2016, compared to 2015919
Higher debt issuance costs paid in 2016(8)
 $(556)
Changes in net cash provided by financing activities were driven by:(In millions)
Lower net payments of distributions to NRG for the Drop Down Assets relating to the pre-acquisition period in 2017 compared to 2016$161
Increase in net contributions from noncontrolling interests due to higher production-based payments in 2017 compared to 20168
Proceeds from the Clearway Energy, Inc. Class C common stock offerings under the ATM Program, net of underwriting discounts and commissions33
Increase in distributions paid to unit holders(29)
Net repayments of $306 million under the revolving credit facility in 2016 compared to proceeds of $66 million in 2017361
Higher borrowing in 2016, primarily related to the 2026 Senior Notes and CVSR Holdco Notes due 2037, as well as higher repayments of long-term debt in 2017, partially offset by borrowings at Buckthorn Solar Drop Down Asset in 2017(590)
 $(56)
                                    


Off-Balance Sheet Arrangements
Obligations under Certain Guarantee Contracts
The Company may enter into guarantee arrangements in the normal course of business to facilitate commercial transactions with third parties.
Retained or Contingent Interests
The Company does not have any material retained or contingent interests in assets transferred to an unconsolidated entity.
Obligations Arising Out of a Variable Interest in an Unconsolidated Entity
Variable interest in equity investments — As of December 31, 2017,2018, the Company has several investments with an ownership interest percentage of 50% or less in energy and energy-related entities that are accounted for under the equity method. NRG DGPV Holdco 1 LLC, NRG DGPV Holdco 2 LLC, NRG DGPV Holdco 3 LLC, NRG RPV Holdco 1 LLC and GenConn are variable interest entities for which the Company is not the primary beneficiary. The Company's pro-rata share of non-recourse debt held by unconsolidated affiliates was approximately $777$878 million as of December 31, 2017.2018. This indebtedness may restrict the ability of these subsidiaries to issue dividends or distributions to the Company. See also Item 15 — Note 5, Investments Accounted for by the Equity Method and Variable Interest Entities, to the Consolidated Financial Statements.
Contractual Obligations and Commercial Commitments
The Company has a variety of contractual obligations and other commercial commitments that represent prospective cash requirements in addition to the Company's capital expenditure programs. The following table summarizes the Company's contractual obligations. See Item 15 — Note 10, Long-term Debt and Note 14, Commitments and Contingencies, to the Consolidated Financial Statements for additional discussion.
By Remaining Maturity at December 31,By Remaining Maturity at December 31,
2017 20162018 2017
Contractual Cash Obligations
Under
1 Year
 1-3 Years 3-5 Years 
Over
5 Years
 Total Total
Under
1 Year
 1-3 Years 3-5 Years 
Over
5 Years
 Total Total
(In millions)(In millions)
Long-term debt (including estimated interest)$593
 $1,856
 $1,500
 $3,907
 $7,856
 $8,328
$831
 $1,388
 $1,467
 $4,441
 $8,127
 $8,026
Operating leases9
 18
 18
 151
 196
 199
13
 26
 25
 207
 271
 196
Fuel purchase and transportation obligations11
 8
 6
 16
 41
 45
11
 6
 6
 13
 36
 41
Other liabilities (a)
29
 45
 29
 105
 208
 129
30
 51
 26
 113
 220
 208
Total$642
 $1,927
 $1,553
 $4,179
 $8,301
 $8,701
$885
 $1,471
 $1,524
 $4,774
 $8,654
 $8,471
 
(a) Includes water right agreements, service and maintenance agreements, and LTSA commitments.
Fair Value of Derivative Instruments
The Company may enter into fuel purchase contracts and other energy-related financial instruments to mitigate variability in earnings due to fluctuations in spot market prices and to hedge fuel requirements at certain generation facilities. In addition, in order to mitigate interest rate risk associated with the issuance of variable rate debt, the Company enters into interest rate swap agreements.
The tables below disclose the activities of non-exchange traded contracts accounted for at fair value in accordance with ASC 820. Specifically, these tables disaggregate realized and unrealized changes in fair value; disaggregate estimated fair values at December 31, 20172018, based on their level within the fair value hierarchy defined in ASC 820; and indicate the maturities of contracts at December 31, 20172018. For a full discussion of the Company's valuation methodology of its contracts, see Derivative Fair Value Measurements in Item 15 — Note 6, Fair Value of Financial Instruments, to the Consolidated Financial Statements.
Derivative Activity (Losses)/Gains(In millions)(In millions)
Fair value of contracts as of December 31, 2016$(76)
Fair value of contracts as of December 31, 2017$(47)
Contracts realized or otherwise settled during the period32
18
Changes in fair value(2)19
Fair value of contracts as of December 31, 2017$(46)
Fair value of contracts as of December 31, 2018$(10)
                                    


Fair value of contracts as of December 31, 2017Fair value of contracts as of December 31, 2018
MaturityMaturity
Fair Value Hierarchy Losses1 Year or Less Greater Than
1 Year to 3 Years		 Greater Than
3 Years to 5 Years		 Greater Than
5 Years		 Total Fair
Value
Fair Value Hierarchy (Losses)/Gains1 Year or Less Greater Than
1 Year to 3 Years		 Greater Than
3 Years to 5 Years		 Greater Than
5 Years		 Total Fair
Value
(In millions)(In millions)
Level 216
 15
 9
 6
 46
(1) (7) (4) 2
 (10)
The Company has elected to disclose derivative assets and liabilities on a trade-by-trade basis and does not offset amounts at the counterparty master agreement level. As discussed below in Quantitative and Qualitative Disclosures about Market Risk -Commodity Price Risk, NRG, on behalf of the Company, measures the sensitivity of the portfolio to potential changes in market prices using VaR, a statistical model which attempts to predict risk of loss based on market price and volatility. NRG's risk management policy places a limit on one-day holding period VaR, which limits the net open position.
Critical Accounting Policies and Estimates
The Company's discussion and analysis of the financial condition and results of operations are based upon the consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements and related disclosures in compliance with GAAP requires the application of appropriate technical accounting rules and guidance as well as the use of estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. The application of these policies necessarily involves judgments regarding future events, including the likelihood of success of particular projects, legal and regulatory challenges, and the fair value of certain assets and liabilities. These judgments, in and of themselves, could materially affect the financial statements and disclosures based on varying assumptions, which may be appropriate to use. In addition, the financial and operating environment may also have a significant effect, not only on the operation of the business, but on the results reported through the application of accounting measures used in preparing the financial statements and related disclosures, even if the nature of the accounting policies has not changed.
On an ongoing basis, the Company evaluates these estimates, utilizing historic experience, consultation with experts and other methods the Company considers reasonable. Actual results may differ substantially from the Company's estimates. Any effects on the Company's business, financial position or results of operations resulting from revisions to these estimates are recorded in the period in which the information that gives rise to the revision becomes known.
The Company's significant accounting policies are summarized in Item 15 — Note 2, Summary of Significant Accounting Policies, to the Consolidated Financial Statements. The Company identifies its most critical accounting policies as those that are the most pervasive and important to the portrayal of the Company's financial position and results of operations, and that require the most difficult, subjective and/or complex judgments by management regarding estimates about matters that are inherently uncertain. The Company's critical accounting policies include impairment of long lived assets and other intangible assets and acquisition accounting.assets.
Accounting PolicyJudgments/Uncertainties Affecting Application
  
Impairment of Long Lived AssetsRecoverability of investments through future operations
 Regulatory and political environments and requirements
 Estimated useful lives of assets
 Operational limitations and environmental obligations
 Estimates of future cash flows
 Estimates of fair value
 Judgment about triggering events
Acquisition AccountingIdentification of intangible assets acquired
Inputs for fair value of assets and liabilities acquired
Application of various methodologies


Evaluation of Assets for Impairment and Other-Than-Temporary Decline in Value
In accordance with ASC 360, Property, Plant, and Equipment, or ASC 360, property, plant and equipment and certain intangible assets are evaluated for impairment whenever indicators of impairment exist. Examples of such indicators or events are:
Significant decrease in the market price of a long-lived asset;
Significant adverse change in the manner an asset is being used or its physical condition;
Adverse business climate;


Accumulation of costs significantly in excess of the amount originally expected for the construction or acquisition of an asset;
Current-period loss combined with a history of losses or the projection of future losses; and
Change in the Company's intent about an asset from an intent to hold to a greater than 50% likelihood that an asset will be sold or disposed of before the end of its previously estimated useful life.
Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future net cash flows expected to be generated by the asset, through considering project specific assumptions for long-term power pool prices, escalated future project operating costs and expected plant operations. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The fair value may be determined by factoring in the probability weighting of different courses of action available to the Company as appropriate. Generally, fair value will be determined using valuation techniques such as the present value of expected future cash flows or comparable values determined by transactions in the market. The Company uses its best estimates in making these evaluations and considers various factors, including forward price curves for energy, fuel costs and operating costs. However, actual future market prices and project costs could vary from the assumptions used in the Company's estimates, and the impact of such variations could be material.
Annually, during the fourth quarter, the Company revises its views of power prices, including the Company's fundamental view for long-term power prices, forecasted generation and operating and capital expenditures, in connection with the preparation of its annual budget.
The Company recorded certain long-lived asset impairments in 2017 and 2016, as described in Item 15 — Note 9, Asset Impairments, to the Consolidated Financial Statements, with respect to several wind projects.
During the fourth quarter of 2017, as the Company updated its estimated cash flows in connection with the preparation and review of the Company's annual budget, the Company determined that the cash flows for the Elbow Creek and Forward facilities were below the carrying value of the related assets, primarily driven by continued declining merchant power prices in post-contract periods, and that the assets were considered impaired. The fair value of the facilities was determined using an income approach by applying a discounted cash flow methodology to the long-term budgets for each respective plant. The income approach utilizes estimates of discounted future cash flows, which include key inputs, such as forecasted power prices, operations and maintenance expense, and discount rates. The Company measured the impairment loss as the difference between the carrying amount and the fair value of the assets and recorded impairment losses of $26 million and $5 million for Elbow Creek and Forward, respectively.

The Company is also required to evaluate its equity method investments to determine whether or not they are impaired. ASC 323, Investments - Equity Method and Joint Ventures, or ASC 323, provides the accounting requirements for these investments. The standard for determining whether an impairment must be recorded under ASC 323 is whether the value is considered to be an other-than-temporary decline in value. The evaluation and measurement of impairments under ASC 323 involves the same uncertainties as described for long-lived assets that the Company owns directly and accounts for in accordance with ASC 360. Similarly, the estimates that the Company makes with respect to its equity method investments are subjective, and the impact of variations in these estimates could be material. Additionally, if the projects in which the Company holds these investments recognize an impairment under the provisions of ASC 360, the Company would record its proportionate share of that impairment loss and would evaluate its investment for an other-than-temporary decline in value under ASC 323.
Certain of the Company’s projects have useful lives that extend well beyond the contract period and therefore, management’s view of long-term power prices in the post-contract periods may have a significant impact on the expected future cash flows for these projects.  Accordingly, if management’s view of long-term power prices in certain markets continues to decrease, it is possible that some of the Company’s other long-lived assets may be impaired.   
As previously described, on January 29, 2019, PG&E filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code.  Certain subsidiaries of the Company sell the output of their facilities to PG&E under long-term PPAs, including interests in 6 solar facilities totaling 480 MW and Marsh Landing with capacity of 720 MW.   The Company consolidates three of the solar facilities and Marsh Landing and records its interest in the other solar facilities as equity method investments. The Company has determined that it has no impairment of the long-lived assets or equity method investments associated with these subsidiaries. Assumptions utilized to test these assets for impairment may change based on future events related to the PG&E bankruptcy, which could result in an impairment loss if the PPAs are rejected or amended, or if the Company is not able to collect its revenues from PG&E in a timely manner.
                                    


Acquisition Accounting
The Company applies ASC 805, Business Combinations, when accounting for the acquisition of a business, with identifiable assets acquired and liabilities assumed recorded at their estimated fair values on the acquisition date. The Company completes the accounting for an acquisition when the evaluations are completed to the extent that additional information is obtained about the facts and circumstances that existed as of the acquisition date. The allocation of the purchase price may be modified up to one year from the date of the acquisition as more information is obtained about the fair value of assets acquired and liabilities assumed. Consideration is measured based on fair value of the assets transferred to the seller.
Significant judgment is required in determining the acquisition date fair value of the assets acquired and liabilities assumed, predominantly with respect to property, plant and equipment, power purchase agreements, asset retirement obligations and other contractual arrangements. Evaluations include numerous inputs including forecasted cash flows that incorporate the specific attributes of each asset including age, useful life, equipment condition and technology, as well as current replacement costs for similar assets. Other key inputs that require judgment include discount rates, comparable market transactions, estimated useful lives and probability of future transactions. The Company evaluates all available information, as well as all appropriate methodologies when determining the fair value of assets acquired and liabilities assumed in a business combination. In addition, once the appropriate fair values are determined, the Company must determine the remaining useful life for property, plant and equipment and the amortization period and method of amortization for each finite-lived intangible asset.
The Company must apply ASC 805-50, Business Combinations - Related Issues, when it acquires an interest from NRG. The assets and liabilities transferred to the Company related to interests under common control by NRG must be recorded at historical cost, with the difference between the amount paid and the historical value of the related equity recorded as a distribution to or contribution from NRG with the offset to noncontrolling interest. Economics may change in the years subsequent to NRG’s construction or acquisition of certain assets, and although the Company may acquire these assets from NRG based on a different valuation, the Company must record the assets at historical cost. These changes in economics may impact the amount that the Company pays for the assets but will not alter the carrying amount. Accordingly, significant changes in the economics related to these assets may trigger a requirement for impairment testing.
Recent Accounting Developments
See Item 15 — Note 2, Summary of Significant Accounting Policies, to the Consolidated Financial Statements for a discussion of recent accounting developments.

                                    


Item 7A — Quantitative and Qualitative Disclosures About Market Risk
The Company is exposed to several market risks in its normal business activities. Market risk is the potential loss that may result from market changes associated with the Company's power generation or with an existing or forecasted financial or commodity transaction. The types of market risks the Company is exposed to are commodity price risk, interest rate risk, liquidity risk, and credit risk.
Commodity Price Risk
Commodity price risks result from exposures to changes in spot prices, forward prices, volatilities, and correlations between various commodities, such as electricity, natural gas and emissions credits. The Company manages the commodity price risk of its merchant generation operations by entering into derivative or non-derivative instruments to hedge the variability in future cash flows from forecasted power sales or purchases of fuel. The portion of forecasted transactions hedged may vary based upon management's assessment of market, weather, operation and other factors. See Item 15 — Note 7, Accounting for Derivative Instruments and Hedging Activities, to the Consolidated Financial Statements for more information.
Based on a sensitivity analysis using simplified assumptions, the impact of a $0.50 per MMBtu increase or decrease in natural gas prices across the term of the derivative contracts would cause a change of approximately $1 million in the net value of derivatives as of December 31, 20172018.
Interest Rate Risk
The Company is exposed to fluctuations in interest rates through its issuance of variable rate debt. Exposures to interest rate fluctuations may be mitigated by entering into derivative instruments known as interest rate swaps, caps, collars and put or call options. These contracts reduce exposure to interest rate volatility and result in primarily fixed rate debt obligations when taking into account the combination of the variable rate debt and the interest rate derivative instrument. NRG's risk management policies allow the Company to reduce interest rate exposure from variable rate debt obligations. See item 15 — Note 7, Accounting for Derivative Instruments and Hedging Activities, to the Consolidated Financial Statements for more information.
Most of the Company's project subsidiaries enter into interest rate swaps, intended to hedge the risks associated with interest rates on non-recourse project level debt. See Item 15 — Note 10, Long-term Debt, to the Consolidated Financial Statements for more information about interest rate swaps of the Company's project subsidiaries.
If all of the above swaps had been discontinued on December 31, 20172018, the Company would have owed the counterparties $50$4 million. Based on the credit ratings of the counterparties, the Company believes its exposure to credit risk due to nonperformance by counterparties to its hedge contracts to be insignificant.
The Company has long-term debt instruments that subject it to the risk of loss associated with movements in market interest rates. As of December 31, 20172018, a 1% change in interest rates would result in an approximately $3 million change in market interest expense on a rolling twelve monthtwelve-month basis.
As of December 31, 20172018, the fair value of the Company's debt was $5,915$5,938 million and the carrying value was $5,899$6,038 million. The Company estimates that a 1% decrease in market interest rates would have increased the fair value of its long-term debt by $306$304 million.
Liquidity Risk
Liquidity risk arises from the general funding needs of the Company's activities and in the management of the Company's assets and liabilities.
Counterparty Credit Risk
Credit risk relates to the risk of loss resulting from non-performance or non-payment by counterparties pursuant to the terms of their contractual obligations. The Company monitors and manages credit risk through credit policies that include: (i) an established credit approval process, and (ii) the use of credit mitigation measures such as prepayment arrangements or volumetric limits. Risks surrounding counterparty performance and credit could ultimately impact the amount and timing of expected cash flows. The Company seeks to mitigate counterparty risk by having a diversified portfolio of counterparties. See Item 15 — Note 1, Nature of Business, and Note 6, Fair Value of Financial Instruments, to the Consolidated Financial Statements for more information about concentration of credit risk.


As previously described, on January 29, 2019, PG&E filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code.  Certain subsidiaries of the Company sell the output of their facilities to PG&E under long-term PPAs, including interests in 6 solar facilities totaling 480 MW and Marsh Landing with capacity of 720 MW.   The Company consolidates three of the solar facilities and Marsh Landing and records its interest in the other solar facilities as equity method investments. The Company had $17 million in accounts receivable for its consolidated projects as of December 31, 2018. All of these amounts were collected in January 2019.
Item 8 — Financial Statements and Supplementary Data
The financial statements and schedules are listed in Part IV, Item 15 of this Form 10-K.
                                    


Item 9 — Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A — Controls and Procedures
Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures and Internal Control Over Financial Reporting
Under the supervision and with the participation of the Company's management, including its principal executive officer, principal financial officer and principal accounting officer, the Company conducted an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures, as such term is defined in Rules 13a-15(e) or 15d-15(e) of the Exchange Act. Based on this evaluation, the Company's principal executive officer, principal financial officer and principal accounting officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this reportAnnual Report on Form 10-K.
Changes in Internal Control over Financial Reporting
In connection with the GIP Transaction, the Company entered into a TSA pursuant to which NRG Energy, Inc. provided information technology, systems, applications, and business processes to the Company.  Under the TSA with NRG Energy, Inc., the Company continued to review, document and evaluate the internal controls over financial reporting through year-end 2018. There were no other changes in the Company’s internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) that occurred induring the fourth quarter of 2017ended December 31, 2018, that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
Inherent Limitations over Internal Controls
The Company's internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with GAAP. The Company's internal control over financial reporting includes those policies and procedures that:
1. Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company's assets;
2. Provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with GAAP, and that the Company's receipts and expenditures are being made only in accordance with authorizations of its management and directors; and
3. Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the consolidated financial statements.
Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations, including the possibility of human error and circumvention by collusion or overriding of controls. Accordingly, even an effective internal control system may not prevent or detect material misstatements on a timely basis. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.
Management's Report on Internal Control over Financial Reporting
The Company's management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of the Company's management, including its principal executive officer, principal financial officer and principal accounting officer, the Company conducted an evaluation of the effectiveness of its internal control over financial reporting based on the framework in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. 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, 2017.2018.
Item 9B — Other Information
None.
    

PART III
Item 10 — Directors, Executive Officers and Corporate Governance
Item 10 has been omitted from this report pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.
Item 11 — Executive Compensation
Item 11 has been omitted from this report pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.
Item 12 — Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Item 12 has been omitted from this report pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.
Item 13 — Certain Relationships and Related Transactions, and Director Independence
Item 13 has been omitted from this report pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.
Item 14 — Principal Accounting Fees and Services
Audit and Nonaudit Fees
The following table presents fees for professional services rendered by KPMG LLP, the Company's principal independent registered public accounting firm, for the years ended December 31, 20172018 and December 31, 2016.2017.
Year Ended
December 31,
Year Ended
December 31,
2017 20162018 2017
Audit Fees$1,916,700
 $1,952,210
$1,682,000
 $1,916,700
Audit-Related Fees—
 —
—
 —
Tax Fees12,700
 79,269
14,800
 12,700
All Other Fees—
 —
—
 —
Total$1,929,400
 $2,031,479
$1,696,800
 $1,929,400

Audit Fees
For 20172018 and 20162017 audit services, KPMG LLP billed the Company approximately $1,916,700$1,682,000 and $1,952,210,$1,916,700, respectively, for the audit of the Company’s consolidated financial statements and the review of the Company’s quarterly consolidated financial statements on Form 10-Q that are customary under the standards of the Public Company Accounting Oversight Board (United States), and in connection with statutory audits.
Audit-Related Fees
There were no audit-related fees billed to the Company by KPMG LLP for 20172018 or 2016.2017.
Tax Fees
There were approximately $14,800 in tax fees billed to the Company by KPMG LLP for 2018, relating mainly to compliance work. There were approximately $12,700 in tax fees billed to the Company by KPMG LLP for 2017, relating mainly to compliance work. There were approximately $79,269 in tax fees billed to the Company by KPMG LLP for 2016.2017.
All Other Fees
There were no other fees billed to the Company by KPMG LLP for 20172018 or 2016.2017.
                                    


Policy on Audit Committee Pre-approval
The Audit Committee of Yield,Clearway Energy, Inc. is responsible for appointing, setting compensation for, and overseeing the work of the independent registered public accounting firm of the Company. The Audit Committee of Yield,Clearway Energy, Inc. has established a policy regarding pre-approval of all audit and permissible nonaudit services provided by the independent registered public accounting firm of the Company.
The Audit Committee of Yield,Clearway Energy, Inc. will annually review and pre-approve services that are expected to be provided by the independent registered public accounting firm. The term of the pre-approval will be 12 months from the date of the pre-approval, unless the Audit Committee of Yield,Clearway Energy, Inc. approves a shorter time period. The Audit Committee may periodically amend and/or supplement the pre-approved services based on subsequent determinations.
Unless the Audit Committee of Yield,Clearway Energy, Inc. has pre-approved Audit Services or a specified category of nonaudit services, any engagement to provide such services must be pre-approved by the Audit Committee of Yield,Clearway Energy, Inc. if it is to be provided by the independent registered public accounting firm. The Audit Committee of Yield,Clearway Energy, Inc. must also pre-approve any proposed services exceeding the pre-approved budgeted fee levels for a specified type of service.
The Audit Committee of Yield,Clearway Energy, Inc. has authorized its Chair to pre-approve services in amounts up to $100,000 per engagement. Engagements exceeding $100,000 must be approved by the full Audit Committee of Yield,Clearway Energy, Inc. Engagements pre-approved by the Chair are reported to the Audit Committee of Yield,Clearway Energy, Inc. at its next scheduled meeting.

                                    


PART IV
Item 15 — Exhibits, Financial Statement Schedules
(a)(1) Financial Statements
The following consolidated financial statements of NRG YieldClearway Energy LLC and related notes thereto, together with the reports thereon of KPMG LLP, are included herein:
Consolidated Statements of Operations — Years ended December 31, 20172018, 20162017 and 20152016
Consolidated Statements of Comprehensive Income — Years ended December 31, 20172018, 20162017 and 20152016
Consolidated Balance Sheets — As of December 31, 20172018 and 20162017
Consolidated Statements of Cash Flows — Years ended December 31, 20172018, 20162017 and 20152016
Consolidated Statements of Members' Equity — Years ended December 31, 20172018, 20162017 and 20152016
Notes to Consolidated Financial Statements
(a)(2) Not applicable
(a)(3) Exhibits: See Exhibit Index submitted as a separate section of this report
(b) Exhibits
See Exhibit Index submitted as a separate section of this report
(c) Not applicable
                                    


Report of Independent Registered Public Accounting Firm
The Members
NRG YieldClearway Energy LLC:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of NRG YieldClearway Energy, LLC and subsidiaries(and subsidiaries) (the “Company”)Company) as of December 31, 20172018 and 2016,2017, the related consolidated statements of operations, comprehensive income, members’stockholders’ equity, and cash flows for each of the years in the three‑year period ended December 31, 2017,2018, and the related notes (collectively, the “consolidatedconsolidated financial statements”)statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 20172018 and 2016,2017, and the results of its operations and its cash flows for each of the years in the three‑year period ended December 31, 2017,2018, in conformity with U.S. generally accepted accounting principles.
Change in Accounting Principle
As discussed in Note 2 to the consolidated financial statements, effective January 1, 2018, the Company adopted the guidance in Accounting Standards Codification Topic 606, Revenue from Contracts with Customers, and related amendments.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
(signed) KPMG LLP
We have served as the Company’s auditor since 2012.
Philadelphia, Pennsylvania
March 1, 2018February 28, 2019


                                    


NRG YIELDCLEARWAY ENERGY LLC
CONSOLIDATED STATEMENTS OF OPERATIONS
Year ended December 31,Year ended December 31,
(In millions)2017 
2016 (a)
 
2015 (a)
2018 
2017 (a)
 
2016 (a)
Operating Revenues          
Total operating revenues$1,009
 $1,035
 $968
$1,053
 $1,009
 $1,035
Operating Costs and Expenses          
Cost of operations326
 308
 323
332
 326
 308
Depreciation and amortization334
 303
 303
331
 334
 303
Impairment losses44
 185
 1
—
 44
 185
General and administrative19
 14
 10
20
 19
 14
Acquisition-related transaction and integration costs3
 1
 3
20
 3
 1
Development costs3
 —
 —
Total operating costs and expenses726
 811
 640
706
 726
 811
Operating Income283
 224
 328
347
 283
 224
Other Income (Expense)          
Equity in earnings of unconsolidated affiliates71
 60
 31
74
 71
 60
Other income, net4
 3
 3
8
 4
 3
Loss on debt extinguishment(3) —
 (9)—
 (3) —
Interest expense(293) (272) (258)(294) (294) (272)
Total other expense, net(221) (209) (233)(212) (222) (209)
Net Income62
 15
 95
135
 61
 15
Less: Net loss attributable to noncontrolling interests(75) (111) (62)(105) (75) (111)
Net Income Attributable to NRG Yield LLC$137
 $126
 $157
Net Income Attributable to Clearway Energy LLC$240
 $136
 $126
 
(a) Retrospectively adjusted as discussed in Note 1, Nature of Business.

See accompanying notes to consolidated financial statements.
                                    


NRG YIELDCLEARWAY ENERGY LLC
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Year ended December 31,Year ended December 31,
2017 
2016 (a)
 
2015 (a)
2018 
2017 (a)
 
2016 (a)
(In millions)          
Net Income$62
 $15
 $95
$135
 $61
 $15
Other Comprehensive Income (Loss)          
Unrealized gain (loss) on derivatives17
 13
 (17)24
 17
 13
Other comprehensive income (loss)17
 13
 (17)24
 17
 13
Comprehensive Income79
 28
 78
159
 78
 28
Less: Comprehensive loss attributable to noncontrolling interests(75) (111) (63)(105) (75) (111)
Comprehensive Income Attributable to NRG Yield LLC$154
 $139
 $141
Comprehensive Income Attributable to Clearway Energy LLC$264
 $153
 $139
 
(a) Retrospectively adjusted as discussed in Note 1, Nature of Business.

See accompanying notes to consolidated financial statements.
                                    


NRG YIELDCLEARWAY ENERGY LLC
CONSOLIDATED BALANCE SHEETS

December 31, 2017 
December 31, 2016 (a)
December 31, 2018 
December 31, 2017 (a)
ASSETS(In millions)(In millions)
Current Assets      
Cash and cash equivalents$146
 $321
$407
 $146
Restricted cash168
 176
176
 168
Accounts receivable — trade96
 96
104
 95
Accounts receivable — affiliates5
 1
Inventory39
 39
40
 39
Notes receivable — current13
 16
—
 13
Prepayments and other current assets19
 22
29
 19
Total current assets481
 670
761
 481
Property, plant and equipment, net   5,245
 5,410
Property, plant and equipment, net5,204
 5,554
Other Assets      
Equity investments in affiliates1,178
 1,152
1,172
 1,178
Intangible assets, net1,228
 1,303
1,156
 1,228
Derivative instruments8
 1
Other non-current assets63
 67
106
 62
Total other assets2,469
 2,522
2,442
 2,469
Total Assets$8,154
 $8,746
$8,448
 $8,360
LIABILITIES AND MEMBERS' EQUITY      
Current Liabilities      
Current portion of long-term debt — external$306
 $323
$314
 $339
Current portion of long-term debt — affiliate215
 —
Accounts payable — trade27
 23
45
 46
Accounts payable — affiliate48
 40
20
 49
Derivative instruments17
 33
4
 18
Accrued interest expense44
 38
Accrued expenses and other current liabilities87
 85
57
 49
Total current liabilities485
 504
699
 539
Other Liabilities      
Long-term debt — external4,921
 5,128
5,404
 5,049
Long-term debt — affiliate618
 618
44
 618
Accounts payable — affiliate—
 9
Derivative instruments31
 46
17
 31
Other non-current liabilities91
 77
102
 94
Total non-current liabilities5,661
 5,878
5,567
 5,792
Total Liabilities6,146
 6,382
6,266
 6,331
Commitments and Contingencies   —
 —
Members' Equity      
Contributed capital1,897
 2,179
1,940
 1,919
Retained earnings17
 44
86
 16
Accumulated other comprehensive loss(68) (85)(44) (68)
Noncontrolling interest162
 226
200
 162
Total Members' Equity2,008
 2,364
2,182
 2,029
Total Liabilities and Members’ Equity$8,154
 $8,746
$8,448
 $8,360
 
(a) Retrospectively adjusted as discussed in Note 1, Nature of Business.

See accompanying notes to consolidated financial statements.
                ��                   


NRG YIELDCLEARWAY ENERGY LLC
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year ended December 31,Year ended December 31,
2017 
2016 (a)
 
2015 (a)
2018 
2017 (a)
 
2016 (a)
(In millions)(In millions)
Cash Flows from Operating Activities          
Net (loss) income$62
 $15
 $95
Net income$135
 $61
 $15
Adjustments to reconcile net income to net cash provided by operating activities:          
Equity in earnings of unconsolidated affiliates(71) (60) (31)(74) (71) (60)
Distributions from unconsolidated affiliates72
 58
 60
70
 72
 58
Depreciation and amortization334
 303
 303
331
 334
 303
Amortization of financing costs13
 8
 7
13
 13
 8
Amortization of intangibles and out-of-market contracts70
 76
 55
70
 70
 76
Loss on debt extinguishment3
 —
 9
—
 3
 —
Impairment losses44
 185
 1
—
 44
 185
Changes in derivative instruments(16) (15) (44)(16) (15) (15)
Loss on disposal of asset components16
 6
 3
(Gain) loss on disposal of asset components—
 16
 6
Cash provided by (used in) changes in other working capital:          
Changes in prepaid and accrued capacity payments(4) (8) (12)—
 (4) (8)
Changes in other working capital(7) 9
 (22)(37) (6) 9
Net Cash Provided by Operating Activities516
 577
 424
492
 517
 577
Cash Flows from Investing Activities          
Acquisition of businesses, net of cash acquired—
 —
 (37)
Acquisition of business(11) —
 —
Acquisition of Drop Down Assets, net of cash acquired(250) (77) (698)(126) (250) (77)
Capital expenditures(31) (20) (29)(83) (190) (20)
Cash receipts from notes receivable17
 17
 17
13
 17
 17
Return of investment from unconsolidated affiliates47
 28
 42
45
 47
 28
Investments in unconsolidated affiliates(73) (83) (402)(34) (73) (83)
Other7
 4
 9
11
 7
 4
Net Cash Used in Investing Activities(283) (131) (1,098)(185) (442) (131)
Cash Flows from Financing Activities          
Net contributions from noncontrolling interests13
 5
 122
106
 13
 5
Net distributions and return of capital to NRG prior to the acquisition of Drop Down Assets(20) (184) (79)—
 (23) (184)
Proceeds from the issuance of class C units33
 —
 599
153
 33
 —
Payments of distributions(202) (173) (139)(253) (202) (173)
Proceeds from the revolving credit facility55
 60
 551
35
 55
 60
Payments for the revolving credit facility—
 (366) (245)(90) —
 (366)
Proceeds from issuance of long-term debt — external41
 740
 6
827
 210
 740
Proceeds from issuance of long-term debt — affiliate—
 —
 281
Payments of debt issuance costs(4) (15) (7)(14) (12) (15)
Payments for long-term debt — external(332) (269) (735)(443) (332) (269)
Net Cash (Used in) Provided by Financing Activities(416) (202) 354
Net (Decrease) Increase in Cash and Cash Equivalents(183) 244
 (320)
Payments for long-term debt — affiliate(359) —
 —
Net Cash Used in Financing Activities(38) (258) (202)
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash269
 (183) 244
Cash, Cash Equivalents and Restricted Cash at Beginning of Period497
 253
 573
314
 497
 253
Cash, Cash Equivalents and Restricted Cash at End of Period$314
 $497
 $253
$583
 $314
 $497
          
Supplemental Disclosures          
Interest paid, net of amount capitalized$(297) $(271) $(279)$(292) $(297) $(271)
Non-cash investing and financing activities:          
Additions to fixed assets for accrued capital expenditures4
 3
 3
Non-cash return of capital and distributions to NRG, net of contributions$(2) $65
 $(9)
(Reductions) Additions to fixed assets for accrued capital expenditures(15) 22
 3
Non-cash contributions from CEG, NRG, net of distributions$36
 $(2) $90
 
(a) Retrospectively adjusted as discussed in Note 1, Nature of Business.
See accompanying notes to consolidated financial statements.
                                    


NRG YIELDCLEARWAY ENERGY LLC
CONSOLIDATED STATEMENTS OF MEMBERS' EQUITY

(In millions) Contributed Capital Retained Earnings 
Accumulated
Other
Comprehensive
Loss
 Noncontrolling Interest 
Total
Members' Equity
 Contributed Capital Retained Earnings 
Accumulated
Other
Comprehensive
Loss
 Noncontrolling Interest 
Total
Members' Equity
Balances at December 31, 2014 (a)
 $2,308
 $133
 $(80) $334
 $2,695
Members' equity - Acquired Drop Down Assets 208
 (9) (2) (135) 62
Balances at December 31, 2014 $2,516
 $124
 $(82) $199
 $2,757
Net income (loss) (b)
 —
 157
 —
 (62) 95
Unrealized loss on derivatives —
 —
 (16) (1) (17)
Payment for January 2015 and November 2015 Drop Down Assets (698) —
 —
 —
 (698)
Balances at December 31, 2015 $2,364
 $107
 $(98) $332
 $2,705
Net income (loss) (a)
 —
 126
 —
 (111) 15
Unrealized gain on derivatives —
 —
 13
 —
 13
Payment for CVSR Drop Down Asset (77) —
 —
 —
 (77)
Distributions and returns of capital to NRG, net of contributions (b)
 (38) (41) —
 —
 (79) (182) (2) —
 —
 (184)
Capital contributions from NRG, non-cash (b)
 (15) 6
 —
 —
 (9)
Capital contributions from NRG, net of distributions, non-cash (a)
 99
 (9) —
 —
 90
Capital contributions from tax equity investors —
 —
 —
 122
 122
 —
 —
 —
 5
 5
Noncontrolling interest acquired in Spring Canyon acquisition —
 —
 —
 74
 74
Proceeds from the issuance of Class C units 599
 —
 —
 —
 599
Distributions paid to NRG on Class B and Class D units —
 (70) —
 —
 (70) —
 (81) —
 —
 (81)
Distributions paid to Yield, Inc. —
 (69) —
 —
 (69)
Balances at December 31, 2015 $2,364
 $107
 $(98) $332
 $2,705
Net income (loss) (b)
 —
 126
 —
 (111) 15
Unrealized loss on derivatives —
 —
 13
 —
 13
Payment for CVSR Drop Down Asset (77) —
 —
 —
 (77)
Capital contributions from tax equity investors —
 —
 —
 5
 5
Distributions paid to NRG, net of contributions (b)
 (182) (2) —
 —
 (184)
Distributions paid to NRG, net of contributions, non-cash (b)
 74
 (9) —
 —
 65
Distributions paid to NRG on Class B and Class D units —
 (81) —
 —
 (81)
Distributions paid to Yield, Inc., non-cash —
 (5) —
 —
 (5)
Distributions paid to Yield, Inc. —
 (92) —
 —
 (92)
Distributions paid to Clearway Energy, Inc., non-cash —
 (5) —
 —
 (5)
Distributions paid to Clearway Energy, Inc. —
 (92) —
 —
 (92)
Balances at December 31, 2016 $2,179
 $44
 $(85) $226
 $2,364
 $2,204
 $44
 $(85) $226
 $2,389
Net income (loss) —
 137
 —
 (75) 62
Net income (loss) (a)
 —
 136
 —
 (75) 61
Unrealized gain on derivatives —
 —
 17
 —
 17
 —
 —
 17
 —
 17
Payments for the March 2017, August 2017 and November 2017 Drop Down Assets (250) —
 —
 —
 (250) (250) —
 —
 —
 (250)
August 2017 Drop Down Assets contingent consideration (8) —
 —
 —
 (8) (8) —
 —
 —
 (8)
Capital contributions from tax equity investors —
 —
 —
 11
 11
Distributions paid to NRG, net of contributions (a)
 (21) —
 —
 —
 (21)
Distributions paid to NRG, net of contributions, non-cash (a)
 (8) 6
 —
 —
 (2)
Proceeds from the issuance of Class C Common Stock 34
 —
 —
 —
 34
Distributions paid to NRG on Class B and Class D units (6) (88) —
 —
 (94)
Distributions paid to Clearway Energy, Inc. (26) (82) —
 —
 (108)
Balances at December 31, 2017 $1,919
 $16
 $(68) $162
 $2,029
Net income (loss) —
 240
 —
 (105) 135
Unrealized gain on derivatives —
 —
 24
 —
 24
Payment for the Buckthorn Solar Drop Down Asset and UPMC (52) —
 —
 —
 (52)
Capital contributions from tax equity investors, net of distributions —
 —
 —
 11
 11
 —
 —
 —
 106
 106
Proceeds from the issuance of Class C units 34
 —
 —
 —
 34
 153
 —
 —
 —
 153
Distributions paid to NRG, net of contributions (18) —
 —
 —
 (18) (11) —
 —
 —
 (11)
Distributions paid to NRG, net of contributions, non-cash (8) 6
 —
 —
 (2)
Distributions paid to NRG on Class B and Class D units (6) (88) —
 —
 (94)
Distributions paid to Yield, Inc. (26) (82) —
 —
 (108)
Balances at December 31, 2017 $1,897
 $17
 $(68) $162
 $2,008
Contributions from CEG, NRG, net of distributions, non-cash (1) —
 —
 37
 36
Distributions paid to NRG/CEG on Class B and Class D units —
 (108) —
 —
 (108)
Distributions paid to Clearway Energy, Inc. (68) (62) —
 —
 (130)
Balances at December 31, 2018 $1,940
 $86
 $(44) $200
 $2,182
 
(a) As previously reported in the Company's consolidated financial statements for the year ended December 31, 2016, included in the Company's May 9, 2017 Form 8-K.
(b) Retrospectively adjusted as discussed in Note 1, Nature of Business.

See accompanying notes to consolidated financial statements.

                                    


NRG YIELDCLEARWAY ENERGY LLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 — Nature of Business
Clearway Energy LLC (formerly NRG Yield LLC,LLC), together with its consolidated subsidiaries, or the Company, iswas formed by NRG as a Delaware limited liability company on March 5, 2013, to serve as the primary vehicle through which NRG owns, operates and acquires contracted renewable and conventional generation and thermal infrastructure assets. On August 31, 2018, NRG ownsEnergy, Inc., or NRG, transferred its full ownership interest in Clearway Energy, Inc. (formerly NRG Yield, Inc.) to Clearway Energy Group LLC, or CEG, the holder of NRG's renewable energy development and operations platform, and subsequently sold 100% of its interest in CEG to Global Infrastructure Partners III, or GIP, referred to hereinafter as the Company'sGIP Transaction. As a result of the GIP Transaction, GIP indirectly acquired a 45.2% economic interest in the Company and a 55% voting interest in the Clearway Energy, Inc. GIP is an independent fund manager that invests in infrastructure assets in energy and transport sectors. The Company is sponsored by GIP through GIP's portfolio company, Clearway Energy Group.
The Company’s environmentally-sound asset portfolio includes over 5,272 MW of wind, solar and natural gas-fired power generation facilities, as well as district energy systems. Nearly all of these assets sell substantially all of their output pursuant to long-term offtake agreements with creditworthy counterparties. The weighted average remaining contract duration of these offtake agreements was approximately 15 years as of December 31, 2018 based on CAFD. The Company also owns thermal infrastructure assets with an aggregate steam and chilled water capacity of 1,385 net MWt and electric generation capacity of 133 net MW. These thermal infrastructure assets provide steam, hot and/or chilled water, and, in some instances, electricity to commercial businesses, universities, hospitals and governmental units in multiple locations, principally through long-term contracts or pursuant to rates regulated by state utility commissions.
The Company consolidates the results of Clearway Energy LLC through its controlling interest, with CEG's interest shown as noncontrolling interest in the financial statements. The holders of Clearway Energy, Inc.'s outstanding shares of Class B unitsA and Class D units andC common stock are entitled to dividends as declared. CEG receives its distributions from Clearway Energy LLC through its ownership of theseClearway Energy LLC Class B and Class D units. NRG Yield, Inc., or Yield, Inc., owns 100%
As a result of the Company's Class A units and Class C units. NRG Yield LLC, through its wholly owned subsidiary, NRG Yield Operating LLC, or Yield Operating LLC, holds a portfolio of renewable and conventional generation and thermal infrastructure assets, primarily located in the Northeast, Southwest, Midwest and California regions of the U.S.
Yield,Clearway Energy, Inc. closed its initial public offering of Class A common stock in July 2013, which was then followed by a Class A common stock offering in July 2014, a Recapitalization in May 2015, as described below, and a Class C common stock offering in June 2015.
Effective May 14, 2015, Yield,issuances during the year ended December 31, 2018, Clearway Energy, Inc. amended its certificate of incorporation to create two new classes of capital stock, Class C common stock and Class D common stock, and distributed sharescurrently owns 55.8% of the Class C common stock and Class D common stock to holders of Yield, Inc.'s outstanding Class A common stock and Class B common stock, respectively, through a stock split. The stock split is referred to as the Recapitalization. The Company also amended its operating agreement to reflect the Recapitalization. Effective May 14, 2015, each Class A uniteconomic interests of the Company, was automatically reclassified into one Class A unit and one Class C unit and each Class B unitwith CEG retaining 44.2% of the Company was automatically reclassified into one Class B unit and one Class D unit.economic interests of the Company.


The following table represents the structure of the Company as of December 31, 2017:2018:

clearwayorg123118a01.jpg


On July 12, 2017, NRG announced that it had adoptedJanuary 29, 2019, Pacific Gas and initiated a three-year, three-part improvement plan,Electric, or the NRG Transformation Plan. As partPG&E, filed voluntary petitions for relief under Chapter 11 of the NRG Transformation Plan, NRG announced that it is exploring strategic alternatives for its renewables platformUnited States Bankruptcy Code. Certain subsidiaries of the Company, holding interests in 6 solar facilities totaling 480 MW and Marsh Landing with capacity of 720 MW, sell the output of their facilities to PG&E, under long-term PPAs. The Company consolidates three of the solar facilities and Marsh Landing and records its interest in the Company. NRG, through its holdings of Class B common stock and Class D common stock, has a 55.1% voting interest in the Company and receives distributions from NRG Yield LLC through its ownership of Class B units and Class D units.
On February 6, 2018, Global Infrastructure Partners, or GIP, entered into a purchase and sale agreement with NRG, or the NRG Transaction, for the acquisition of NRG's full ownership interests in the Company and NRG's renewable development and operations platform. The NRG Transaction is subject to certain closing conditions, including customary legal and regulatory approvals. The Company expects the NRG Transaction to close in the second half of 2018. NRG is the Company's controlling stockholder and the Company has been highly dependent on NRG for, among other things, growth opportunities and management and administration services. See Part I, Item 1A, Risk Factors for risks related to the Strategic Sponsorship with GIP and the Company's relationship with NRG.

As of December 31, 2017, the Company's operating assets are comprised of the following projects:
Projects Percentage Ownership 
Net Capacity (MW) (a)
 Offtake Counterparty Expiration
Conventional        
El Segundo 100% 550
 Southern California Edison 2023
GenConn Devon 50% 95
 Connecticut Light & Power 2040
GenConn Middletown 50% 95
 Connecticut Light & Power 2041
Marsh Landing 100% 720
 Pacific Gas and Electric 2023
Walnut Creek 100% 485
 Southern California Edison 2023
    1,945
    
Utility Scale Solar        
Agua Caliente 16% 46
 Pacific Gas and Electric 2039
Alpine 100% 66
 Pacific Gas and Electric 2033
Avenal 50% 23
 Pacific Gas and Electric 2031
Avra Valley 100% 26
 Tucson Electric Power 2032
Blythe 100% 21
 Southern California Edison 2029
Borrego 100% 26
 San Diego Gas and Electric 2038
CVSR 100% 250
 Pacific Gas and Electric 2038
Desert Sunlight 250 25% 63
 Southern California Edison 2034
Desert Sunlight 300 25% 75
 Pacific Gas and Electric 2039
Kansas South 100% 20
 Pacific Gas and Electric 2033
Roadrunner 100% 20
 El Paso Electric 2031
TA High Desert 100% 20
 Southern California Edison 2033
Utah Solar Portfolio(b)(e)
 50% 265
 PacifiCorp 2036
    921
    
Distributed Solar        
Apple I LLC Projects 100% 9
 Various 2032
AZ DG Solar Projects 100% 5
 Various 2025-2033
SPP Projects 100% 25
 Various 2026-2037
Other DG Projects 100% 13
 Various 2023-2039
    52
    
Wind        
Alta I 100% 150
 Southern California Edison 2035
Alta II 100% 150
 Southern California Edison 2035
Alta III 100% 150
 Southern California Edison 2035
Alta IV 100% 102
 Southern California Edison 2035
Alta V 100% 168
 Southern California Edison 2035
Alta X (b)
 100% 137
 Southern California Edison 2038
Alta XI (b)
 100% 90
 Southern California Edison 2038
Buffalo Bear 100% 19
 Western Farmers Electric Co-operative 2033


Projects Percentage Ownership 
Net Capacity (MW) (a)
 Offtake Counterparty Expiration
Crosswinds (b)(f)
 99% 21
 Corn Belt Power Cooperative 2027
Elbow Creek (b)(f)
 100% 122
 NRG Power Marketing LLC 2022
Elkhorn Ridge (b)(f)
 66.7% 54
 Nebraska Public Power District 2029
Forward (b)(f)
 100% 29
 Constellation NewEnergy, Inc. 2022
Goat Wind (b)(f)
 100% 150
 Dow Pipeline Company 2025
Hardin (b)(f)
 99% 15
 Interstate Power and Light Company 2027
Laredo Ridge 100% 80
 Nebraska Public Power District 2031
Lookout (b)(f)
 100% 38
 Southern Maryland Electric Cooperative 2030
Odin (b)(f)
 99.9% 20
 Missouri River Energy Services 2028
Pinnacle 100% 55
 Maryland Department of General Services and University System of Maryland 2031
San Juan Mesa (b)(f)
 75% 90
 Southwestern Public Service Company 2025
Sleeping Bear (b)(f)
 100% 95
 Public Service Company of Oklahoma 2032
South Trent 100% 101
 AEP Energy Partners 2029
Spanish Fork (b)(f)
 100% 19
 PacifiCorp 2028
Spring Canyon II (b)
 90.1% 29
 Platte River Power Authority 2039
Spring Canyon III (b)
 90.1% 25
 Platte River Power Authority 2039
Taloga 100% 130
 Oklahoma Gas & Electric 2031
Wildorado (b)(f)
 100% 161
 Southwestern Public Service Company 2027
    2,200
    
Thermal        
NRG Energy Center Dover LLC 100% 103
 NRG Power Marketing LLC 2018
Thermal generation 100% 20
 Various Various
    123
    
Total net generation capacity(c)
   5,241
    
         
Thermal equivalent MWt(d)
 100% 1,319
 Various Various
(a) Net capacity represents the maximum, or rated, generating capacity of the facility multiplied by the Company's percentage ownership in the facility as of December 31, 2017.
(b) Projects are part of tax equity arrangements.
(c) The Company's total generation capacity is net of 6 MWs for noncontrolling interest for Spring Canyon II and III. The Company's generation capacity including this noncontrolling interest was 5,247.
(d)For thermal energy, net capacity represents MWt for steam or chilled water and excludes 134 MWt available under the right-to-use provisions contained in agreements between two of the Company's thermalsolar facilities and certain of its customers.
(e) Represents interests in Four Brothers Solar, LLC, Granite Mountain Holdings, LLC, and Iron Springs Holdings, LLC, all acquired as part of the March 2017 Drop Down Assets acquisition (ownership percentage is based upon cash to be distributed).
(f) Projects are part of NRG Wind TE Holdco portfolio.
In addition to the facilities owned or leased in the table above, the Company entered into partnerships to own or purchase solar power generation projects, as well as other ancillary related assets from a related party via intermediate funds.  The Company does not consolidate these partnerships and accounts for them as equity method investments. The related subsidiaries of the Company have entered into financing agreements consisting of non-recourse project level debt and in certain cases, non-recourse holding company debt. The effect of the bankruptcy filing on the Company's net interestoperations is further described in these projects is 247 MW based on cash to be distributed asNote 2, Summary of December 31, 2017. For further discussions, refer toSignificant Accounting Policies, Note 5, Investments Accounted for by the Equity Method and Variable Interest Entities, and Note 10, Long-Term Debt to the Consolidated Financial Statements.
Substantially all of the Company's generation assets are under long-term contractual arrangements for the output or capacity from these assets. The thermal assets are comprised of district energy systems and combined heat and power plants that produce steam, hot water and/or chilled water and, in some instances, electricity at a central plant. Certain district energy systems are subject to rate regulation by state public utility commissions (although they may negotiate certain rates) while the other district energy systems have rates determined by negotiated bilateral contracts.
As described in Note 13, For the complete listing of the company's generation assets, refer to Item 2 - Related Party TransactionsProperties to this Form 10-K.
Recast of the ConsolidatedHistorical Financial Statements
Prior to the Company has a management services agreement with NRG for various services, including human resources, accounting, tax, legal, information systems, treasury, and risk management.


During the years ending DecemberGIP Transaction on August 31, 2017 and 20162018, the Company completed fourseveral acquisitions of Drop Down Assets from NRG.NRG, which were accounted for as transfer of entities under common control, and are further described in Note 3, Business Acquisitions. The accounting guidance for transfers of entities under common control requires retrospective combination of the entities for all periods presented as if the combination hascombinations had been in effect from the beginning of the financial statement period or from the date the entities were under common control (if later than the beginning of the financial statement period). For further discussion, see Note 3, Business Acquisitions


Transition Services Agreement
As a result of the GIP Transaction, the Company entered into a Transition Services Agreement with NRG, or the NRG TSA, pursuant to which NRG or certain of its affiliates began providing transitional services to the Consolidated Financial Statements.Company following the consummation of the GIP Transaction, in exchange for the payment of a fee in respect of such services. The agreement is effective until the earlier of June 30, 2019 or the date that all services are terminated by the Company. The Company may extend the term on a month-by-month basis no later than March 31, 2020 for a fixed monthly fee provided for in the agreement. Expenses related to the NRG TSA are recorded in general and administrative expenses in the consolidated statements of operations.

Note 2 — Summary of Significant Accounting Policies
Basis of Presentation and Principles of Consolidation
The Company's consolidated financial statements have been prepared in accordance with GAAP. The ASC is the source of authoritative GAAP to be applied by nongovernmental entities. In addition, the rules and interpretative releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants.
The consolidated financial statements include the Company's accounts and operations and those of its subsidiaries in which it has a controlling interest. All significant intercompany transactions and balances have been eliminated in consolidation. The usual condition for a controlling financial interest is ownership of a majority of the voting interests of an entity. However, a controlling financial interest may also exist through arrangements that do not involve controlling voting interests. As such, the Company 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 variable interest entity, or VIE, should be consolidated.
Cash and Cash Equivalents, and Restricted Cash
Cash and cash equivalents include highly liquid investments with an original maturity of three months or less at the time of purchase. Cash and cash equivalents held at project subsidiaries was $124$109 million and $111$124 million as of December 31, 2018 and 2017, and 2016, respectively.
Restricted Cash
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the statements of cash flows.
Year Ended December 31,Year ended December 31,
2017 2016 20152018 2017 2016
(In millions)(In millions)
Cash and cash equivalents$146
 $321
 $110
$407
 $146
 $321
Restricted cash168
 176
 143
176
 168
 176
Cash, cash equivalents and restricted cash shown in the statement of cash flows314
 497
 253
583
 314
 497
Restricted cash consists primarily of funds held to satisfy the requirements of certain debt agreements and funds held within the Company's projects that are restricted in their use. Of these funds asAs of December 31, 2017,2018, these restricted funds comprised of $84 million designated to fund operating expenses, approximately $25$26 million is designated for current debt service payments, $25 million is designated to fund operating expenses and $36 million is designated for distributions to the Company, with the remaining $82$32 million restricted for reserves including debt service, performance obligations and other reserves, as well as capital expenditures. The remaining $34 million is held in distribution reserve accounts, of which $31 million related to subsidiaries affected by the PG&E Bankruptcy as discussed further below and may not be distributed during the pendency of the bankruptcy.
On January 29, 2019, PG&E filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code.  The Company has non-recourse project-level debt related to each of its subsidiaries that sell their output to PG&E under long-term PPAs. The PG&E bankruptcy filing is an event of default under the related financing agreements. As of December 31, 2018, all project level cash balances for these subsidiaries were classified as restricted cash.
Trade Receivables and Allowance for Doubtful Accounts
Trade receivables are reported on the balance sheet at the invoiced amount adjusted for any write-offs and the allowance for doubtful accounts. The allowance for doubtful accounts is reviewed periodically based on amounts past due and significance. The allowance for doubtful accounts was immaterial as of December 31, 20172018 and 2016.2017.


Inventory
Inventory consists principally of spare parts and fuel oil. Spare parts inventory is valued at weighted average cost, unless evidence indicates that the weighted average cost will not be recovered with a normal profit in the ordinary course of business.  Fuel oil inventory is valued at the lower of weighted average cost or market. The Company removes fuel inventories as they are used in the production of steam, chilled water or electricity.  Spare parts inventory are removed when they are used for repairs, maintenance or capital projects.


Property, Plant and Equipment
Property, plant and equipment are stated at cost or, in the case of third party business acquisitions, fair value; however impairment adjustments are recorded whenever events or changes in circumstances indicate that their carrying values may not be recoverable. See Note 3, Business Acquisitions, for more information on acquired 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 is computed using the straight-line method 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 of the Company's property, plant and equipment refer to Note 4, Property, Plant and Equipment to the Consolidated Financial Statements.
Development costs include project development costs, which are expensed in the preliminary stages of a project and
capitalized when the project is deemed to be commercially viable. Commercial viability is determined by one or a series of actions including, among others, Board of Director approval pursuant to a formal project plan that subjects the Company to significant future obligations that can only be discharged by the use of a Company asset. When a project is available for operations, capitalized interest and capitalized project development costs are reclassified to property, plant and equipment and depreciated on a straightline basis over the estimated useful life of the project's related assets. Capitalized costs are charged to expense if a project is abandoned or management otherwise determines the costs to be unrecoverable.
Asset Impairments
Long-lived assets that are held and used are reviewed for impairment whenever events or changes in circumstances indicate carrying values may not be recoverable. Such reviews are performed in accordance with ASC 360. An impairment loss is indicated if the total future estimated undiscounted cash flows expected from an asset are less than its carrying value. An impairment charge is measured by the difference between an asset's carrying amount and fair value with the difference recorded in operating costs and expenses in the statements of operations. Fair values are determined by a variety of valuation methods, including appraisals, sales prices of similar assets and present value techniques. For further discussion of the Company's long-lived asset impairments, refer to Note 9, Asset Impairments to the Consolidated Financial Statements.
Investments accounted for by the equity method are reviewed for impairment in accordance with ASC 323, Investments-Equity Method and Joint Ventures, which requires that a loss in value of an investment that is an other-than-temporary decline should be recognized. The Company identifies and measures losses in the value of equity method investments based upon a comparison of fair value to carrying value.
Debt Issuance Costs
Debt issuance costs are capitalized and amortized as interest expense on a basis which approximates the effective interest method over the term of the related debt. Debt issuance costs related to the long term debt are presented as a direct deduction from the carrying amount of the related debt in both the current and prior periods. Debt issuance costs related to the senior secured revolving credit facility line of credit are recorded as a non-current asset on the balance sheet and are amortized over the term of the credit facility.
Notes Receivable
Notes receivable consist of receivables related to the financing of required network upgrades. The notes issued with respect to network upgrades will be repaid within a 5-year period following the date each facility reached commercial operations.
Intangible Assets
Intangible assets represent contractual rights held by the Company. The Company recognizes specifically identifiable intangible assets including power purchase agreements, leasehold improvements, customer relationships, customer contracts, and development rights when specific rights and contracts are acquired. These intangible assets are amortized primarily on a straight-line basis. For further discussion of the Company's intangible assets, refer to Note 8, Intangible Assets to the Consolidated Financial Statements.
Notes Receivable
Notes receivable consist of receivables related to the financing of required network upgrades. The notes issued with respect to network upgrades will be repaid within a 5-year period following the date each facility reached commercial operations.

Income Taxes
The Company is classified as a partnership for federal and state income tax purposes. Therefore, federal and state income taxes are assessed at the partner level. Accordingly, no provision has been made for federal or state income taxes in the accompanying financial statements.
Revenue Recognition
Revenue from Contracts with Customers
On January 1, 2018, the Company adopted the guidance in ASC 606, Revenue from Contracts with Customers, orTopic 606, using the modified retrospective method applied to contracts which were not completed as of the adoption date, with no adjustment required to the financial statements upon adoption. Following the adoption of the new standard, the Company’s revenue recognition of its contracts with customers remains materially consistent with its historical practice. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The Company's policies with respect to its various revenue streams are detailed below. In general, the Company applies the invoicing practical expedient to recognize revenue for the revenue streams detailed below, except in circumstances where the invoiced amount does not represent the value transferred to the customer.
Thermal Revenues
Steam and chilled water revenue is recognized as the Company transfers the product to the customer, based on customer usage as determined by meter readings taken at month-end. Some locations read customer meters throughout the month, and recognize estimated revenue for the period between meter read date and month-end. For thermal contracts, the Company’s performance obligation to deliver steam and chilled water is satisfied over time and revenue is recognized based on the invoiced amount. The Thermal Business subsidiaries collect and remit state and local taxes associated with sales to their customers, as required by governmental authorities. These taxes are presented on a net basis in the income statement.


As contracts for steam and chilled water are long-term contracts, the Company has performance obligations under these contracts that have not yet been satisfied. These performance obligations have transaction prices that are both fixed and variable, and that vary based on the contract duration, customer type, inception date and other contract-specific factors. For the fixed price contracts, the Company cannot accurately estimate the amount of its unsatisfied performance obligations as it will vary based on customer usage, which will depend on factors such as weather and customer activity.
Power Purchase Agreements, or PPAs
The majority of the Company’s revenues are obtained through PPAs or other contractual agreements. Energy, capacity and where applicable, renewable attributes, from the majority of the Company’s renewable energy assets and certain conventional energy plants is sold through long-term PPAs and tolling agreements to a single counterparty, which is often a utility or commercial customer. The majority of these PPAs are accounted for as operating leases under ASC 840.leases. ASC 840 requires the minimum lease payments received to be amortized over the term of the lease and contingent rentals are recorded when the achievement of the contingency becomes probable. Judgment is required by management in determining the economic life of each generating facility, in evaluating whether certain lease provisions constitute minimum payments or represent contingent rent and other factors in determining whether a contract contains a lease and whether the lease is an operating lease or capital lease.
Certain of these leases have no minimum lease payments and all of the rental income under these leases is recorded as contingent rent on an actual basis when the electricity is delivered. The contingent rental income recognized in the years ended December 31, 2018, 2017 and 2016 and 2015 was $583 million, $559 million $583 million and $443$583 million, respectively. These balances include intercompany revenue for Elbow Creek of $6 million for the eight months ended August 31, 2018 and $8 million for each of the years ended December 31, 2017 and 2016, as further discussed in Note 13 Related Party Transactions.
Renewable Energy Credits, or RECs
As stated above, renewable energy credits, or RECs, are usually sold through long-term PPAs. Revenue from the sale of self-generated RECs is recognized when the related energy is generated and simultaneously delivered even in cases where there is a certification lag as it has been deemed to be perfunctory.
In a bundled contract to sell energy, capacity and/or self-generated RECs, all performance obligations are deemed to be delivered at the same time and hence, timing of recognition of revenue for all performance obligations is the same and occurs over time. In such cases, it is often unnecessary to allocate transaction price to multiple performance obligations.


Sale of Emission Allowances
The Company records its bank of emission allowances as part of intangible assets. From time to time, management may authorize the transfer of emission allowances in excess of usage from the Company's emission bank to intangible assets held-for-sale for trading purposes. The Company records the sale of emission allowances on a net basis within operating revenue in the Company's consolidated statements of operations.
Disaggregated Revenues
The following tables represent the Company’s disaggregation of revenue from contracts with customers for the year ended December 31, 2018, along with the reportable segment for each category:
 Year ended December 31, 2018
(In millions)Conventional Generation Renewables Thermal Corporate Total
Energy revenue(a)
$5
 $572
 $4
 —
 $581
Capacity revenue(a)
337
 —
 166
 —
 503
Other revenues—
 16
 26
 (3) 39
Contract amortization(5) (62) (3) —
 (70)
Total operating revenue337
 526
 193
 (3) 1,053
Less: Lease revenue(342) (534) (2) —
 (878)
Less: Contract amortization5
 62
 3
 —
 70
Total revenue from contracts with customers$—
 $54
 $194
 (3) $245
(a) The following amounts of energy and capacity revenue relate to leases and are accounted for under ASC 840:
  Conventional Generation Renewables Thermal Total
Energy Revenue $5
 $534
 $2
 $541
Capacity Revenue 337
 —
 —
 337
  342
 534
 2
 878
Contract Amortization
Assets and liabilities recognized from power sales agreements assumed through acquisitions related to the sale of electric capacity and energy in future periods for which the fair value has been determined to be significantly less (more) than market are amortized to revenue over the term of each underlying contract based on actual generation and/or contracted volumes or on a straight-line basis, where applicable.
Contract Balances
The following table reflects the contract assets and liabilities included on the Company’s balance sheet as of December 31, 2018:
(In millions) December 31, 2018 December 31, 2017
Accounts receivable, net - Contracts with customers $35
 $28
Accounts receivable, net - Leases 69
 67
Total accounts receivable, net $104
 $95
Derivative Financial Instruments
The Company accounts for derivative financial instruments under ASC 815, Derivatives and Hedging, or ASC 815, which requires the Company to record all derivatives on the balance sheet at fair value unless they qualify for a NPNS exception. Changes in the fair value of non-hedge derivatives are immediately recognized in earnings. Changes in the fair value of derivatives accounted for as hedges, if elected for hedge accounting, are either:
Recognized in earnings as an offset to the changes in the fair value of the related hedged assets, liabilities and firm commitments; or


Deferred and recorded as a component of accumulated OCI until the hedged transactions occur and are recognized in earnings.
The Company's primary derivative instruments are interest rate instruments used to mitigate variability in earnings due to fluctuations in interest rates, power purchase or sale contracts used to mitigate variability in earnings due to fluctuations in market prices and fuels purchase contracts used to control customer reimbursable fuel cost, and interest rate instruments used to mitigate variability in earnings due to fluctuations in interest rates.cost. On an ongoing basis, the Company qualitatively assesses the effectiveness of allits derivatives that are designated as hedges for accounting purposes in order to determine that each derivative continues to be highly effective in offsetting changes in fair values or cash flows of hedged items. InternalIf necessary, the Company will perform an analyses thatto measure the statistical correlation between the derivative and the associated hedged item determine the effectiveness of such a contract designated as a hedge. IfThe Company will discontinue hedge accounting if it is determined that the derivative instrumenthedge is not highly effective as a hedge, hedge accounting will be discontinued prospectively.no longer effective. In this case, the gain or loss previously deferred in accumulated OCI would be frozen until the underlying hedged item is delivered unless the transaction being hedged is no longer probable of occurring in which case the amount in OCI would be immediately reclassified into earnings. If the derivative instrument is terminated, the effective portion of this derivative deferred in accumulated OCI will be frozen until the underlying hedged item is delivered.
Revenues and expenses on contracts that qualify for the NPNS exception are recognized when the underlying physical transaction is delivered. While these contracts are considered derivative financial instruments under ASC 815, they are not recorded at fair value, but on an accrual basis of accounting. If it is determined that a transaction designated as NPNS no longer meets the scope exception, the fair value of the related contract is recorded on the balance sheet and immediately recognized through earnings.
Concentrations of Credit Risk
Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of accounts receivable, notes receivable and derivative instruments, which are concentrated within entities engaged in the energy and financial industry. These industry concentrations may impact the overall exposure to credit risk, either positively or negatively, in that the customers may be similarly affected by changes in economic, industry or other conditions. In addition, many of the Company's projects have only one customer. However,See Item 1A, Risk Factors, Risks related to the Company believes thatPG&E Bankruptcy for a discussion on the credit risk posed by industry concentration is offset by the diversification and creditworthiness of its customer base.Company’s dependence on major customers. See Note 6, Fair Value of Financial Instruments, for a further discussion of derivative concentrations and Note 12, Segment Reporting, for concentration of counterparties.
Fair Value of Financial Instruments
The carrying amount of cash and cash equivalents, restricted cash, accounts receivable, accounts receivable - affiliate, accounts payable, current portion of account payable - affiliate, and accrued expenses and other current liabilities approximate fair value because of the short-term maturity of these instruments. See Note 6, Fair Value of Financial Instruments, for a further discussion of fair value of financial instruments.


Asset Retirement Obligations
Asset retirement obligations, or AROs, are accounted for in accordance with ASC 410-20, Asset Retirement Obligations, or ASC 410-20. Retirement obligations associated with long-lived assets included within the scope of ASC 410-20 are those for which a legal obligation exists under enacted laws, statutes, and written or oral contracts, including obligations arising under the doctrine of promissory estoppel, and for which the timing and/or method of settlement may be conditional on a future event. ASC 410-20 requires an entity to recognize the fair value of a liability for an ARO in the period in which it is incurred and a reasonable estimate of fair value can be made.
Upon initial recognition of a liability for an ARO, the asset retirement cost is capitalized by increasing the carrying amount of the related long-lived asset by the same amount. Over time, the liability is accreted to its future value, while the capitalized cost is depreciated over the useful life of the related asset. The Company's AROs are primarily related to the future dismantlement of equipment on leased property and environmental obligations related to site closures and fuel storage facilities. The Company records AROs as part of other non-current liabilities on its balance sheet.
The following table represents the balance of ARO obligations as of December 31, 20172018 and 2016,2017, along with the additions and accretion related to the Company's ARO obligations for the year ended December 31, 2017:2018:
(In millions)(In millions)
Balance as of December 31, 2016$49
Balance as of December 31, 2017$58
Revisions in estimates for current obligations/Additions2
5
Accretion — expense4
4
Balance as of December 31, 2017$55
Balance as of December 31, 2018$67


Guarantees
The Company enters into various contracts that include indemnification and guarantee provisions as a routine part of its business activities. Examples of these contracts include operation and maintenance agreements, service agreements, commercial sales arrangements and other types of contractual agreements with vendors and other third parties, as well as affiliates. These contracts generally indemnify the counterparty for tax, environmental liability, litigation and other matters, as well as breaches of representations, warranties and covenants set forth in these agreements. Because many of the guarantees and indemnities the Company issues to third parties and affiliates do not limit the amount or duration of its obligations to perform under them, there exists a risk that the Company may have obligations in excess of the amounts agreed upon in the contracts mentioned above. For those guarantees and indemnities that do not limit the liability exposure, the Company may not be able to estimate what the liability would be, until a claim is made for payment or performance, due to the contingent nature of these contracts.
Investments Accounted for by the Equity Method
The Company has investments in various energy projects accounted for by the equity method, several of which are VIEs, where the Company is not a primary beneficiary, as described in Note 5, Investments Accounted for by the Equity Method and Variable Interest Entities. The equity method of accounting is applied to these investments in affiliates because the ownership structure prevents the Company from exercising a controlling influence over the operating and financial policies of the projects. Under this method, equity in pre-tax income or losses of the investments is reflected as equity in earnings of unconsolidated affiliates. 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.
Sale Leaseback Arrangements
The Company is party to sale-leaseback arrangements that provide for the sale of certain assets to a third party and simultaneous leaseback to the Company. In accordance with ASC 840-40, Sale-Leaseback Transactions, if the seller-lessee retains, through the leaseback, substantially all of the benefits and risks incident to the ownership of the property sold, the sale-leaseback transaction is accounted for as a financing arrangement. An example of this type of continuing involvement would include an option to repurchase the assets or the buyer-lessor having the option to sell the assets back to the Company. This provision is included in most of the Company’s sale-leaseback arrangements. As such, the Company accounts for these arrangements as financings.


Under the financing method, the Company does not recognize as income any of the sale proceeds received from the lessor that contractually constitutes payment to acquire the assets subject to these arrangements. Instead, the sale proceeds received are accounted for as financing obligations and leaseback payments made by the Company are allocated between interest expense and a reduction to the financing obligation. Interest on the financing obligation is calculated using the Company’s incremental borrowing rate at the inception of the arrangement on the outstanding financing obligation. Judgment is required to determine the appropriate borrowing rate for the arrangement and in determining any gain or loss on the transaction that would be recorded either at the end of or over the lease term.
Business Combinations
The Company accounts for its business combinations in accordance with ASC 805, Business Combinations, or ASC 805. For third party acquisitions, ASC 805 requires an acquirer to recognize and measure in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree at fair value at the acquisition date. It also recognizes and measures the goodwill acquired or a gain from a bargain purchase in the business combination and determines what information to disclose to enable users of an entity's financial statements to evaluate the nature and financial effects of the business combination. In addition, transaction costs are expensed as incurred. For acquisitions that relate to entities under common control, ASC 805 requires retrospective combination of the entities for all periods presented as if the combination has been in effect from the beginning of the financial statement period of from the date the entities were under common control (if later than the beginning of the financial statement period). The difference between the cash paid and historical value of the entities' equity is recorded as a distribution/contribution from/to NRG with the offset to contributed capital. Transaction costs are expensed as incurred.


Use of Estimates
The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions. These estimates and assumptions impact the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements. They also impact the reported amounts of net earnings during the reporting periods. Actual results could be different from these estimates.
In recording transactions and balances resulting from business operations, the Company uses estimates based on the best information available. Estimates are used for such items as plant depreciable lives, uncollectible accounts, environmental liabilities, acquisition accounting and legal costs incurred in connection with recorded loss contingencies, among others. In addition, estimates are used to test long-lived assets for impairment and to determine the fair value of impaired assets. As better information becomes available or actual amounts are determinable, the recorded estimates are revised. Consequently, operating results can be affected by revisions to prior accounting estimates.
Tax Equity Arrangements
Certain portions of the Company’s noncontrolling interests in subsidiaries represent third-party interests in the net assets under certain tax equity arrangements, which are consolidated by the Company, that have been entered into to finance the cost of wind facilities eligible for certain tax credits. Additionally, certain portions of the Company’s investments in unconsolidated affiliates reflect the Company’s interests in tax equity arrangements, that are not consolidated by the Company, that have been entered into to finance the cost of distributed solar energy systems under operating leases or PPAs eligible for certain tax credits. The Company has determined that the provisions in the contractual agreements of these structures represent substantive profit sharing arrangements. Further, the Company has determined that the appropriate methodology for calculating the noncontrolling interest and investment in unconsolidated affiliates that reflects the substantive profit sharing arrangements is a balance sheet approach utilizing the hypothetical liquidation at book value, or HLBV, method. Under the HLBV method, the amounts reported as noncontrolling interests and investment in unconsolidated affiliates represent the amounts the investors 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 determined in accordance with GAAP. The investors’ interests in the results of operations of the funding structures are determined as the difference in noncontrolling interests and investment in unconsolidated affiliates at the start and end of each reporting period, after taking into account any capital transactions between the structures and the funds’ investors. The calculations utilized to apply the HLBV method include estimated calculations of taxable income or losses for each reporting period.


Reclassifications
Certain prior year amounts have been reclassified for comparative purposes.
Recent Accounting Developments - Adopted in 2017
ASU 2017-12 — In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities, or ASU No. 2017-12. ASU No. 2017-12 amends ASU No. 2016-15. The amendments of ASU No. 2016-15 were issued to simplify the application of hedge accounting guidance and more closely aligning financial reporting for hedging relationships with economic results of an entity's risk management activities. The issues addressed by ASU No. 2017-12 include but are not limited to alignment of risk management activities and financial reporting, risk component hedging, accounting for the hedged item in fair value hedges of interest rate risk, recognition and presentation of the effects of hedging instruments, amounts excluded from the assessment of hedge effectiveness, and other simplifications of hedge accounting guidance. The amendments of ASU No. 2017-12 are effective for fiscal years beginning after December 15, 2018, and interim periods therein. Early adoption is permitted in any interim period and the effect of the adoption should be reflected as of the beginning of the fiscal year of adoption. The Company early adopted ASU No. 2017-12 during the fourth quarter 2017. The adoption of ASU No. 2017-12 did not have a material impact on our consolidated results of operations, cash flows, and statement of financial position.
ASU 2016-18 — In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230), Restricted Cash, or ASU No. 2016-18. The amendments of ASU No. 2016-18 require an entity to include amounts generally described as restricted cash and restricted cash equivalents with cash and cash equivalents when reconciling the beginning of period and end of period total amounts on the statement of cash flows. The amendments of ASU No. 2016-18 are effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual periods. Early adoption is permitted and the adoption of ASU No. 2016-18 will be applied retrospectively. The Company early adopted ASU No. 2016-18 during the second quarter of 2017. Net cash flows used in investing activities for the year ended December 31, 2016 decreased by $33 million. The sum of Company's cash and cash equivalents and restricted cash reported within the consolidated balance sheet as of December 31, 2016 equals the beginning balances of cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows for the year ended December 31, 2017. The sum of Company's cash and cash equivalents and restricted cash reported within the consolidated balance sheet as of December 31, 2017 equals to the ending balances of cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows for the year ended December 31, 2017.
Recent Accounting Developments - Not Yet Adopted2019
ASU 2016-02 — In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), or Topic 842, as amended, with the objective to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and to improve financial reporting by expanding the related disclosures. The guidance in Topic 842 provides that a lessee that may have previously accounted for a lease as an operating lease under current GAAP should recognize the assets and liabilities that arise from a lease on the balance sheet. In addition, Topic 842 expands the required quantitative and qualitative disclosures with regards to lease arrangements.
The Company will adoptadopted the standard effective January 1, 2019 using the modified retrospective transition method and expects to electwill not restate prior periods for the impact of Topic 842. In addition, the Company elected certain of the permitted practical expedients, permitted, including the expedient that permits the Company to retain its existing lease assessment and classification. The company will not record a right-of-use asset and related lease liability for leases with an initial term of 12 months or less and will account for lease and non-lease components for specific asset classes as a single lease component.
The Company's leases consist mainly of land leases for many operating asset locations, as well as leases of office space and office equipment. The Company is currently working throughestimates it will record lease liabilities of approximately $160 million to $170 million and right-of-use assets of approximately $155 million to $165 million, as of January 1, 2019, with an immaterial impact estimated to retained earnings. The actual amounts recorded may vary from this estimate as the Company completes its adoption plan and evaluatingof the anticipatedguidance. Other than disclosed, the Company does not expect that there will be a material impact onto the Company's resultsconsolidated statements of operations, comprehensive income or consolidated cash flows and financial position. While the Company is currently evaluating the impact the new guidance will have on its financial position and resultsas a result of operations, the Company expects to recognize lease liabilities and right of use assets. The extent of the increase to assets and liabilities associated with these amounts remains to be determined pending the Company’s review of its existing lease contracts and service contracts which may contain embedded leases. While this review is still in process, the Company believes the adoption of Topic 842 may be material to its financial statements. The Company is continuing to monitor potential changes to Topic 842 that have been proposed by the FASB and will assess any necessary changes to the implementation as the guidance is updated.this new guidance.

                                    


ASU 2014-09 — In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), or Topic 606, which was further amended through various updates issued by the FASB thereafter.  The amendments of ASU No. 2014-09 completed the joint effort between the FASB and the IASB, to develop a common revenue standard for GAAP and IFRS, and to improve financial reporting.  The guidance under Topic 606 provides that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for the goods or services provided and establishes a five step model to be applied by an entity in evaluating its contracts with customers.  The Company has elected the practical expedient available under Topic 606 for measuring progress toward complete satisfaction of a performance obligation and for disclosure requirements of remaining performance obligations.  The practical expedient allows an entity to recognize revenue in the amount to which the entity has the right to invoice such that the entity has a right to the consideration in an amount that corresponds directly with the value to the customer for performance completed to date by the entity. The majority of the Company's revenues are obtained through PPAs, which are currently accounted for as operating leases. In connection with the implementation of Topic 842, as described above, the Company expects to elect certain of the practical expedients permitted, including the expedient that permits the Company to retain its existing lease assessment and classification. The Company adopted the standard effective January 1, 2018 under the modified retrospective transition method. As leases are excluded from the scope of Topic 606, the adoption of Topic 606 at the date of initial application will not have a material impact on the Company's financial statements. The adoption of Topic 606 also includes additional disclosure requirements beginning in the first quarter of 2018. As a significant portion of the Company's revenue is generated through operating leases, the majority of the new required disclosures will not be relevant or material to the Company.
Note 3 — Business Acquisitions
2018 Acquisitions
UPMC Thermal Project Asset Acquisition— On June 19, 2018, upon reaching substantial completion, the Company acquired from NRG the UPMC Thermal Project for cash consideration of $84 million, subject to working capital adjustments. The Company had a payable of $4 million to NRG as of December 31,2018, $3 million of which was paid in January 2019 upon final completion of the project pursuant to the EPC agreement. The project adds 73 MWt of thermal equivalent capacity and 7.5 MW of emergency backup electrical capacity to the Company's portfolio. The transaction is reflected in the Company's Thermal segment. The acquisition was funded with the proceeds from the sale of the Series E Notes and Series F Notes, as further described in Note 7, Long-term Debt. The assets transferred to the Company relate to interests under common control by NRG and were recorded at book value in accordance with ASC 805-50, Business Combinations - Related Issues. The difference between the purchase price and book value of the assets was recorded as a distribution to NRG and decreased the balance of contributed capital. The acquisition was determined to be an asset acquisition and not a business combination, therefore no recast of the historical financial information was deemed necessary.
Central CA Fuel Cell 1, LLC — On April 18, 2018, the Company acquired the Central CA Fuel Cell 1, LLC project in Tulare, California from FuelCell Energy Finance, Inc., for cash consideration of $11 million, subject to working capital adjustments. The project adds 2.8 MW of thermal capacity to the Company's portfolio, with a 20-year PPA contract with the City of Tulare. The transaction is reflected in the Company's Thermal segment.
Buckthorn Solar Drop Down Asset — On March 30, 2018, the Company acquired 100% of NRG's interests in Buckthorn Renewables, LLC, which owns a 154 MW construction-stage utility-scale solar generation project located in Texas, or the Buckthorn Solar Drop Down Asset, for cash consideration of approximately $42 million, subject to working capital adjustments. The Company also assumed non-recourse debt of $183 million and non-controlling interest of $19 million (as of acquisition date) attributable to the Class A member, as further described below. The Company converted $132 million of non-recourse debt to a term loan and the remainder of the outstanding debt was paid down with the contribution from the Class A member in the amount of $80 million upon the project reaching substantial completion in May 2018. The purchase price for the Buckthorn Solar Drop Down Asset was funded with cash on hand and borrowings from the Company's revolving credit facility. The assets and liabilities transferred to the Company related to interests under common control by NRG and were recorded at historical cost in accordance with ASC 805-50, Business Combinations - Related Issues. The difference between the cash paid and historical value of the entities' equity was recorded as a distribution to NRG and decreased the balance of contributed capital. Since the transaction constituted a transfer of net assets under common control, the guidance requires retrospective combination of the entities for all periods presented as if the combination had been in effect since the inception of common control.
Buckthorn Solar Portfolio, LLC, a wholly owned subsidiary of Buckthorn Renewables, LLC, is the Class B member in a tax equity partnership, Buckthorn Holdings, LLC, the owner of the Buckthorn Solar Drop Down Asset. The Class A member is a tax equity investor, or TE investor, who receives 99% of allocations of taxable income and other items through the six month anniversary of the placed in service date, at which time the allocations change to 67% through the last calendar year before the flip point, and then back to 99% through the flip point (which occurs when the TE Investor obtains a specified return on its initial investment), at which time the allocations to the TE Investor change to 5% for all the periods thereafter. Before the flip point, the TE investor would receive a priority distribution of distributable cash, as defined, plus a percentage of remaining distributable cash after the priority distribution subject to a percentage cap.
The project sells power under a 25-year PPA to the City of Georgetown, Texas, which commenced in July 2018.


The following is a summary of net assets transferred in connection with the acquisition of the Buckthorn Solar Drop Down Asset as of March 31, 2018:
 (In millions)
Assets: 
Current assets$20
Property, plant and equipment212
Non-current assets3
Total assets235
Liabilities: 
Debt (Current and non-current) (a)
176
Other current and non-current liabilities15
Total liabilities191
Less: noncontrolling interest 
19
Net assets acquired$25
(a)Net of $7 million of net debt issuance costs.
The following table presents a summary of the Company's historical information for the year ended December 31, 2017, which combines the financial information for the Buckthorn Solar Drop Down Asset transferred in connection with the acquisition.
 Year ended December 31, 2017
 As Previously Reported Buckthorn Solar Drop Down Asset As Currently Reported
(In millions)     
Total operating revenues$1,009
 $—
 $1,009
Operating income283
 —
 283
Net income62
 (1) 61
Net income attributable to Clearway Energy LLC137
 (1) 136
The Buckthorn Solar Drop Down Asset had no impact on the Company's consolidated statements of operations for the year end ended December 31, 2016.
2017 Acquisitions
November 2017 Drop Down Assets — On November 1, 2017, the Company acquired a 38 MW solar portfolio primarily comprised of assets from NRG's Solar Power Partners (SPP) funds and other projects developed by NRG, for cash consideration of $74 million, including working capital adjustments, of $3 million, plus assumed non-recourse debt of $26 million.
The purchase price for the November 2017 Drop Down Assets was funded with cash on hand. The assets and liabilities transferred to the Company relate to interests under common control by NRG and were recorded at historical cost in accordance with ASC 805-50, Business Combinations - Related Issues. The difference between the cash paid and historical value of the entities' equity was recorded as a contribution from NRG and increased the balance of contributed capital. BecauseSince the transaction constituted a transfer of net assets under common control, the guidance requires retrospective combination of the entities for all periods presented as if the combination has been in effect since the inception of common control.
The following is a summary of assets and liabilities transferred in connection with the acquisition of the November 2017 Drop Down Assets as of November 1, 2017:
 (In millions)
Assets: 
Current assets$7
Property, plant and equipment83
Non-current assets12
Total assets102
Liabilities: 
Debt (Current and non-current) (a)
23
Other current and non-current liabilities3
Total liabilities assumed26
Net assets acquired$76
(a)Net of $3 million of net debt issuance costs.
Since the acquisition date, the November 2017 Drop Down Assets have contributed $1 million in operating revenues to the Company.
August 2017 Drop Down Assets — On August 1, 2017, the Company acquired the remaining 25% interest in NRG Wind TE Holdco, a portfolio of 12 wind projects, from NRG for total cash consideration of $44 million, including working capital adjustment of $3 million.adjustments. The purchase agreement also included potential additional payments to NRG dependent upon actual


energy prices for merchant periods beginning in 2027, which were estimated and accrued as contingent consideration in the amount of $8 million as of September 30, 2017.million.
The Company originally acquired 75% of NRG Wind TE Holdco on November 3, 2015, or November 2015 Drop Down Assets, which were consolidated with 25% of the net assets recorded as noncontrolling interest. The assets and liabilities transferred to the Company related to interests under common control by NRG and were recorded at historical cost in accordance with ASC 805-50, Business Combination - Related Issues. As the Company had reflected NRG's 25% ownership of NRG Wind TE Holdco in


noncontrolling interest, the difference between the cash paid of $44 million, net of the contingent consideration of $8 million, and the historical value of the remaining 25% of $87 million as of July 31, 2017, was recorded as an adjustment to NRG's noncontrolling interest. Since the transaction constituted a transfer of entities under common control, the accounting guidance requires retrospective combination of the entities for all periods presented as if the combination has been in effect from the beginning of the financial statement period or from the date the entities were under common control (if later than the beginning of the financial statement period).
The Class A interests of NRG Wind TE Holdco are owned by a tax equity investor, or TE Investor, who receives 99% of allocations of taxable income and other items until the flip point, which occurs when the TE Investor obtains a specified return on its initial investment, at which time the allocations to the TE Investor change to 8.53%. The Company generally receives 100% of CAFD until the flip point, at which time the allocations to the Company of CAFD change to 91.47%. If the flip point has not occurred by a specified date, 100% of CAFD is allocated to the TE Investor until the flip point occurs. NRG Wind TE Holdco is a VIE and the Company is the primary beneficiary, through its position as managing member, and consolidates NRG Wind TE Holdco.
The following tables present a summary of the Company's historical information combining the financial information for the November 2017 Drop Down Assets and August 2017 Drop Down Assets transferred in connection with the acquisitions:
 Year ended December 31, 2016 Year ended December 31, 2015
 
As Previously Reported (a)
 November 2017 Drop Down Assets August 2017 Drop Down Assets As Currently Reported 
As Previously Reported (a)
 November 2017 Drop Down Assets August 2017 Drop Down Assets As Currently Reported
(In millions)               
Total operating revenues$1,021
 $14
 $—
 $1,035
 $953
 $15
 $—
 $968
Operating income220
 4
 —
 224
 322
 6
 —
 328
Net income15
 —
 —
 15
 93
 2
 —
 95
Net income attributable to Yield LLC157
 —
 (31) 126
 144
 3
 10
 157
(a)As previously reported in the May 9, 2017 Form 8-K filed in connection with the March 2017 Drop Down completed on March 27, 2017
 As of December 31, 2016
(In millions)
As Previously Reported (a)
 November 2017 Drop Down Assets As Currently Reported
Assets:     
Current assets$656
 $14
 $670
Property, plant and equipment5,460
 94
 5,554
Non-current assets2,504
 18
 2,522
Total assets8,620
 126
 8,746
Liabilities:     
Debt (Current and non-current)6,007
 62
 6,069
Other current and non-current liabilities309
 4
 313
Total liabilities assumed6,316
 66
 6,382
Net assets$2,304
 $60
 $8,746
(a)As previously reported in the May 9, 2017 Form 8-K filed in connection with the March 2017 Drop Down completed on March 27, 2017.


March 2017 Drop Down Assets — On March 27, 2017, the Company acquired the following interests from NRG: (i) Agua Caliente Borrower 2 LLC, which owns a 16% interest (approximately 31% of NRG's 51% interest) in the Agua Caliente solar farm, one of the ROFO Assets, representing ownership of approximately 46 net MW of capacity and (ii) NRG's interests in the Utah Solar Portfolio. Agua Caliente is located in Yuma County, AZ and sells power subject to a 25-year PPA with Pacific Gas and Electric, with 22 years remaining on that contract. The seven utility-scale solar farms in the Utah Solar Portfolio are owned by the following entities: Four Brothers Capital, LLC, Iron Springs Capital, LLC, and Granite Mountain Capital, LLC. These utility-scale solar farms achieved commercial operations in 2016, sell power subject to 20-year PPAs with PacifiCorp, a subsidiary of Berkshire Hathaway and are part of a tax equity structure with Dominion Solar Projects III, Inc., or Dominion, through which the Company is entitled to receive 50% of cash to be distributed, as further described below.distributed. The Company paid cash consideration of $132$128 million, including $2which includes $3 million of final net working capital.capital adjustment received by the Company from NRG. The acquisition of the March 2017 Drop Down Assets was funded with cash on hand. The Company recorded the acquired interests as equity method investments. The Company also assumed non-recourse debt of $41 million and $287 million on Agua Caliente Borrower 2 LLC and the Utah Solar Portfolio, respectively, as further described in Note 10, Long-term Debt, as well as its pro-rata share of non-recourse project-level debt of Agua Caliente Solar LLC.
The assets and liabilities transferred to the Company relate to interests under common control by NRG and were recorded at historical cost in accordance with ASC 805-50, Business Combination - Related Issues. The difference between the cash paid and the historical value of the entities' equity of $8 million was recorded as an adjustment to NRG's noncontrolling interest.contributed capital. Since the transaction constituted a transfer of entities under common control, the accounting guidance requires retrospective combination of the entities for all periods presented as if the combination has been in effect from the beginning of the financial statement period or from the date the entities were under common control (if later than the beginning of the financial statement period). Accordingly, in connection with the retrospective adjustment of prior periods, the Company adjusted its financial statements to reflect its results of operations, financial position and cash flows as if it recorded its interests in the Agua Caliente Borrower 2 LLC on January 1, 2016, and its interests in the Utah Solar Portfolio on November 2, 2016.
The following is a summary of assets and liabilities transferred in connection with the acquisition of the March 2017 Drop Down Assets as of March 27, 2017:
 (In millions)
Assets: 
Cash$6
Equity investment in projects456
   Total assets acquired462
Liabilities: 
Debt (Current and non-current) (a)
320
Other current and non-current liabilities3
   Total liabilities assumed323
      Net assets acquired$139
(a)Net of $8 million of debt issuance costs.
2016 Acquisitions
CVSR Drop Down — Prior to September 1, 2016, the Company had a 48.95% interest in CVSR, which was accounted for as an equity method investment. On September 1, 2016, the Company acquired from NRG the remaining 51.05% interest of CVSR Holdco LLC, which indirectly owns the CVSR solar facility, or the CVSR Drop Down, for total cash consideration of $78.5 million, plus an immaterial working capital adjustment. The acquisition was funded with cash on hand. The Company also assumed additional debt of $496 million, which represents 51.05% of the CVSR project level debt and 51.05% of the notes issued under the CVSR Holdco Financing Agreement, as of the closing date. The acquisition was funded with cash on hand.
The assets and liabilities transferred to the Company relaterelated to interests under common control by NRG and were recorded at historical cost in accordance with ASC 805-50, Business Combinations - Related Issues. The difference between the cash paid and historical value of the CVSR Drop Down of $112 million, as well as $6 million of AOCL, was recorded as a distribution to NRG with the offset to contributed capital. Because the transaction constituted a transfer of net assets under common control, the guidance requires retrospective combination of the entities for all periods presented as if the combination has been in effect since the inception of common control. In connection with the retrospective adjustment of prior periods, the Company now consolidates


CVSR and 100% of its debt, consisting of $771 million of project level debt and $200 million of notes issued under the CVSR Holdco Financing Agreement as of September 1, 2016. In addition, the Company has removed the equity method investment from all prior periods and adjusted its financial statements to reflect its results of operations, financial position and cash flows as if it had consolidated CVSR from the beginning of the financial statement period.
2015 Acquisitions
November 2015 Drop Down Assets from NRG — On November 3, 2015, the Company acquired the November 2015 Drop Down Assets, a portfolio of 12 wind facilities totaling 814 net MW, from NRG for cash consideration of $207 million. The Company was responsible for its pro-rata share of non-recourse project debt of $193 million and noncontrolling interest associated with a tax equity structure of $159 million (as of the acquisition date).
The Company funded the acquisition with borrowings from its revolving credit facility. The assets and liabilities transferred to the Company relate to interests under common control by NRG and were recorded at historical cost. The difference between the cash paid and historical value of the entities' equity was recorded as a distribution from NRG with the offset to contributed capital.
Desert Sunlight — On June 29, 2015, the Company acquired 25% of the membership interest in Desert Sunlight Investment Holdings, LLC, which owns two solar photovoltaic facilities that total 550 MW, located in Desert Center, California from EFS Desert Sun, LLC, an affiliate of GE Energy Financial Services for a purchase price of $285 million. Power generated by the facilities is sold to Southern California Edison and Pacific Gas and Electric under long-term PPAs with approximately 20 years and 25 years of remaining contract life, respectively. The Company accounts for its 25% investment as an equity method investment.
Spring Canyon — On May 7, 2015, the Company acquired a 90.1% interest in Spring Canyon II, a 32 MW wind facility, and Spring Canyon III, a 28 MW wind facility, each located in Logan County, Colorado, from Invenergy Wind Global LLC. The purchase price was funded with cash on hand. Power generated by Spring Canyon II and Spring Canyon III is sold to Platte River Power Authority under long-term PPAs, each with approximately 24 years of remaining contract life.
University of Bridgeport Fuel Cell— On April 30, 2015, the Company completed the acquisition of the University of Bridgeport Fuel Cell project in Bridgeport, Connecticut from FuelCell Energy, Inc. The project added an additional 1.4 MW of thermal capacity to the Company's portfolio, with a 12-year contract, with the option for a 7-year extension. The acquisition is reflected in the Company's Thermal segment.
January 2015 Drop Down Assets from NRG — On January 2, 2015, the Company acquired the following projects from NRG: (i) Laredo Ridge, an 80 MW wind facility located in Petersburg, Nebraska, (ii) Tapestry, which includes Buffalo Bear, a 19 MW wind facility in Buffalo, Oklahoma; Taloga, a 130 MW wind facility in Putnam, Oklahoma; and Pinnacle, a 55 MW wind facility in Keyser, West Virginia, and (iii)  Walnut Creek, a 485 MW natural gas facility located in City of Industry, California, for total cash consideration of $489 million, including $9 million for working capital, plus assumed project-level debt of $737 million. The Company funded the acquisition with cash on hand and drawings under its revolving credit facility. The assets and liabilities transferred to the Company relate to interests under common control by NRG and were recorded at historical cost. The difference between the cash paid and the historical value of the entities' equity of $61 million was recorded as a distribution to NRG and reduced the balance of its contributed capital.


                                    


Note 4 — Property, Plant and Equipment
The Company’s major classes of property, plant, and equipment were as follows:
December 31, 2017 December 31, 2016 Depreciable LivesDecember 31, 2018 December 31, 2017 Depreciable Lives
(In millions) (In millions) 
Facilities and equipment$6,289
 $6,339
 2 - 45 Years$6,638
 $6,291
 2 - 45 Years
Land and improvements166
 167
 171
 166
 
Construction in progress (a)
34
 24
 26
 238
 
Total property, plant and equipment6,489
 6,530
 6,835
 6,695
 
Accumulated depreciation(1,285) (976) (1,590) (1,285) 
Net property, plant and equipment$5,204
 $5,554
 $5,245
 $5,410
 
 
(a) As of December 31, 20172018 and 2016,2017, construction in progress includes $24$6 million and $20$24 million of capital expenditures that relate to prepaid long-term service agreements in the Conventional segment, respectively.
The Company recorded long-lived asset impairments during the yearsyear ended December 31, 2017, and 2016, as further described in Note 9, Asset Impairments.
Note 5 — Investments Accounted for by the Equity Method and Variable Interest Entities
Equity Method Investments
The following table summarizes the Company's equity method investments as of December 31, 2017:2018:
Name Economic Interest Investment Balance Economic Interest Investment Balance
 (In millions) (In millions)
Utah Solar Portfolio (a)
 50% $345 50% $317
Desert Sunlight(e) 25% 272 25% 264
GenConn(b)
 50% 102 50% 98
Agua Caliente Borrower 2 16% 92
Agua Caliente Solar(e)
 16% 90
Elkhorn Ridge(c)
 66.7% 73 66.7% 59
San Juan Mesa(c)
 75% 66 75% 57
NRG DGPV Holdco 1 LLC (d)
 95% 76
NRG DGPV Holdco 2 LLC (d)
 95% 61
NRG DGPV Holdco 3 LLC (d)
 99% 39
NRG RPV Holdco 1 LLC(d)
 95% 58
DGPV Holdco 1 LLC (d)
 95% 81
DGPV Holdco 2 LLC (d)
 95% 63
DGPV Holdco 3 LLC (d)
 99% 116
RPV Holdco 1 LLC(d)
 95% 29
Avenal(e) 50% (6) 50% (2)
Total equity investments in affiliates $1,178
 $1,172
 
(a) Economic interest based on cash to be distributed. Four Brothers Solar, LLC, Granite Mountain Holdings, LLC and Iron Springs Holdings, LLC are tax equity structures and VIEs. The related allocations are described below.
(b) GenConn is a variable interest entity.
(c) San Juan Mesa and Elkhorn Ridge are part of the Wind TE Holdco tax equity structure, as described below. San Juan Mesa and Elkhorn Ridge are owned 75% and 66.7%, respectively, by Wind TE Holdco. The Company owns 100% of the Class B interests in Wind TE Holdco.
(d) Economic interest based on cash to be distributed. NRG DGPV Holdco 1 LLC, NRG DGPV Holdco 2 LLC, NRG DGPV Holdco 3 LLC and NRG RPV Holdco 1 LLC are tax equity structures and VIEs. The related allocations are described below.
(e) Entities that have PPAs with PG&E. On January 29, 2019, PG&E filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code.  The Company has non-recourse project-level debt, and in some cases holding company debt, related to each of its subsidiaries that sell their output to PG&E under long-term PPAs.  The PG&E bankruptcy filing is an event of default under the related financing agreements, and as a result, the respective lenders under these arrangements may accelerate the repayment of these debt balances.  In addition, the event of default may have an impact on the Company’s ability to distribute cash from the project-level cash accounts to the parent entities.  The Company continues to operate the projects in the normal course of business and is currently in the process of negotiating forbearance agreements with the related lenders. 


As of December 31, 20172018 and 2016,2017, the Company had $57$87 million and $51$57 million, respectively, of undistributed earnings from its equity method investments.
The Company acquired its interest in Desert Sunlight on June 30, 2015, for $285 million, which resulted in a difference between the purchase price and the basis of the acquired assets and liabilities of $171 million. The difference is attributable to the fair value of the property, plant and equipment and power purchase agreements. In addition, the difference between the basis of the acquired assets and liabilities and the purchase price for the Utah Solar Portfolio (Four Brothers Solar, LLC, Granite Mountain Holdings, LLC and Iron Springs Holdings, LLC) of $106 million is attributable to the fair value of the property, plant and equipment.


The Company is amortizing the related basis differences to equity in earnings (losses) over the related useful life of the underlying assets acquired.
Non-recourse project-level debt of unconsolidated affiliates
The Company's pro-rata share of non-recourse debt held by unconsolidated affiliates was $777$878 million as of December 31, 2017.2018. This included $432 million attributable to Desert Sunlight, Agua Caliente Solar, and Avenal, the unconsolidated affiliates that sell output to PG&E under long-term PPAs.


The following tables present summarized financial information for the Company's significant equity method investments:
 Year Ended December 31,
 2017 2016 2015
Income Statement Data:(In millions)
GenConn     
Operating revenues$71
 $72
 $78
Operating income36
 38
 40
Net income26
 26
 28
Desert Sunlight     
Operating revenues207
 211
 206
Operating income127
 129
 124
Net income80
 80
 73
Utah Solar Portfolio (a)
     
Operating revenues75
 13
 —
Operating income (loss)18
 (6) (1)
Net income (loss)18
 (6) (1)
DGPV entities (b)
     
Operating revenues37
 14
 1
Operating income7
 2
 —
Net loss(3) —
 —
RPV Holdco     
Operating revenues16
 13
 4
Operating income3
 2
 (6)
Net income (loss)3
 2
 (6)
      
   As of December 31,
   2017 2016
Balance Sheet Data:  (In millions)
GenConn    
Current assets $38
 $36
Non-current assets 374
 389
Current liabilities 18
 16
Non-current liabilities 189
 196
Desert Sunlight    
Current assets 133
 281
Non-current assets 1,350
 1,401
Current liabilities 64
 64
Non-current liabilities 1,003
 1,043
Utah Solar Portfolio (a)
    
Current assets 13
 20
Non-current assets 1,090
 1,105
Current liabilities 5
 14
Non-current liabilities 24
 38
DGPV entities (b)
    
Current assets 74
 44
Non-current assets 671
 562
Current liabilities 83
 112
Non-current liabilities 216
 23
Redeemable Noncontrolling Interest 44
 28
RPV Holdco    
Current assets 3
 15
Non-current assets 183
 191
Current liabilities —
 11
Non-current liabilities 7
 7
Redeemable Noncontrolling Interest  16
—
—


 Year Ended December 31,
 2018 2017 2016
Income Statement Data:(In millions)
GenConn     
Operating revenues$65
 $71
 $72
Operating income32
 36
 38
Net income22
 26
 26
Desert Sunlight     
Operating revenues208
 207
 211
Operating income129
 127
 129
Net income84
 80
 80
DGPV entities (a)
     
Operating revenues69
 37
 14
Operating income23
 7
 2
Net income (loss)11
 (3) —
RPV Holdco     
Operating revenues14
 16
 13
Operating income—
 3
 2
Net income—
 3
 2
Other (b)
     
Operating revenues249
 247
 193
Operating income103
 89
 71
Net income$75
 $56
 $38
      
   As of December 31,
   2018 2017
Balance Sheet Data:  (In millions)
GenConn    
Current assets $43
 $38
Non-current assets 358
 374
Current liabilities 22
 18
Non-current liabilities 182
 189
Desert Sunlight    
Current assets 133
 133
Non-current assets 1,298
 1,350
Current liabilities 58
 64
Non-current liabilities 962
 1,003
DGPV entities (a)
    
Current assets 79
 74
Non-current assets 784
 671
Current liabilities 84
 83
Non-current liabilities 314
 216
Redeemable Noncontrolling Interest —
 44
RPV Holdco    
Current assets 2
 3
Non-current assets 173
 183
Current liabilities 1
 —
Non-current liabilities 8
 7
Redeemable Noncontrolling Interest 26
 16
Other (b)
    
Current assets 148
 139
Non-current assets 2,511
 2,621
Current liabilities 58
 60
Non-current liabilities $889
 $932
 
(a)Utah Solar Portfolio was acquired by NRG on November 2, 2016.
(b) Includes DGPV Holdco 1, DGPV Holdco 2 and DGPV Holdco 3
(b) Includes Agua Caliente, Utah Solar Portfolio, Avenal, Elkhorn Ridge and San Juan Mesa




Variable Interest Entities, or VIEs
Entities that are Consolidated
NRG Wind TE HoldcoThe Company has a controlling financial interest in certain entities which have been identified as VIEs under ASC 810, — Consolidations, or ASC 810. These arrangements are primarily related to tax equity arrangements entered into with third parties in order to monetize certain tax credits associated with wind facilities and are further described below.
Buckthorn Renewables, LLC —As described in Note 3, Business Acquisitions, on August 1, 2017,March 30, 2018, the Company acquired from NRG the remaining 25%100% of NRG’s interest in NRG Wind TE Holdco. NRG Wind TE Holdcoa 154 MW construction-stage utility-scale solar generation project, Buckthorn Renewables, LLC, which owns 100% interest in Buckthorn Solar Portfolio, LLC, which in turn owns 100% of the Class B membership interests in Buckthorn Holdings, LLC. Buckthorn Holdings, LLC is a VIE and thetax equity fund, which is a variable interest entity that is consolidated by Buckthorn Solar Portfolio, LLC. The Company is the primary beneficiary, through its position as managing member, and indirectly consolidates NRG Wind TE Holdco.Buckthorn Holdings, LLC through Buckthorn Solar Portfolio, LLC. The Class A interests of NRG Wind TE Holdco are owned bymember is a tax equity investor or TE Investor, who receives 99% of allocations of taxable income and other items until the flip point, which occurs when the TE Investor obtains a specified return onmade its initial investment,contribution of $19 million on March 30, 2018, which is reflected as noncontrolling interest on the Company’s consolidated balance sheet. The project achieved substantial completion in May 2018, at which time the allocations to the TE Investor change to 8.53%. The Company generally receives 100%remaining tax equity contributions of CAFD until the flip point, at which time the allocations to the Company of CAFD change to 91.47%. If the flip point has not occurred by a specified date, 100% of CAFD is allocated to the TE Investor until the flip point occurs.$80 million were funded. The Company utilizes the HLBV method to determine the net income or loss allocated to the tax equity investor noncontrolling interest. The Company recorded $55 million of loss attributable to noncontrolling interest in Buckthorn Renewables, LLC during the period ended December 31, 2018.
Wind TE Holdco — As of December 31, 2018, Wind TE Holdco was a VIE and the Company, as the holder of Class B shares and the primary beneficiary through its position as managing member consolidated Wind TE Holdco. The Class A shares of Wind TE Holdco were owned by a tax equity investor, who received 99% of allocations of taxable income and other items. On January 2, the Company bought out 100% of the Class A membership interests from the TE Investor, for cash consideration of $19 million.
On August 30, 2018, Wind TE Holdco, entered into a partnership with Clearway Renew LLC, an indirect subsidiary of CEG, in order to facilitate the repowering of wind facilities of the two of its indirect subsidiaries, Elbow Creek Wind Project LLC and Wildorado Wind LLC. Wind TE Holdco contributed its interests in the two facilities and Clearway Renew LLC contributed a turbine supply agreement, including title to certain components that qualify for production tax credits. Clearway Renew LLC paid a total of $35 million to the service provider, which was recorded to other non current assets on the Company's consolidated balance sheets as of December 31, 2018. Wind TE Holdco is the managing member of Repowering Partnership LLC and consolidates the entity, which is a VIE. Clearway Renew LLC is entitled to allocations of 21% of income, which is reflected in Wind TE Holdco’s noncontrolling interest.interests.
Alta TE Holdco — On June 30, 2015, the Company sold an economic interest in Alta TE Holdco to a financial institution in order to monetize certain cash and tax attributes, primarily PTCs. The financial institution, or Alta Investor, receives 99% of allocations of taxable income and other items until the flip point, which occurs when the Alta Investor obtains a specified return on its initial investment, at which time the allocations to the Alta Investor change to 5%. The Company receives 94.34% until the flip point, at which time the allocations to the Company of CAFD will change to 97.12%, unless the flip point will not have occurred by a specified date, which would result in 100% of CAFD allocated to the Alta Investor until the flip point occurs. Alta TE Holdco is a VIE and the Company is the primary beneficiary through its position as managing member, and therefore consolidates Alta TE Holdco, with the Alta Investor's interest shown as noncontrolling interest. The Company utilizes the HLBV method to determine the net income or loss allocated to the noncontrolling interest.
Spring Canyon — The Company holds a 90.1% of the Class B interests in Spring Canyon II, a 32 MW wind facility, and Spring Canyon III, a 28 MW wind facility, each located in Logan County, Colorado, and Invenergy Wind Global LLC owns 9.9% of the Class B interests. The projects are financed with a partnership flip tax-equity structure with a financial institution, who owns the Class A interests, to monetize certain cash and tax attributes, primarily PTCs. Until the flip point, the Class A member receives a variable percentage of cash distributions based on the projects’ production level during the prior year. The Class A member received 34.81% of the cash distributions and the Company and Invenergy received 65.19% during the period ended December 31, 2017. After the flip point, cash distributions are allocated 5% to the Class A member and 95% to the Company and Invenergy. Spring Canyon is a VIE and the Company is the primary beneficiary through its position as managing member, and therefore consolidates Spring Canyon. The Class A member and Invenergy's interests are shown as noncontrolling interest. The Company utilizes the HLBV method to determine the net income or loss allocated to the Class A member. Net income or loss attributable to the Class B interests is allocated to Invenergy's noncontrolling interest based on its 9.9% ownership interest.


Summarized financial information for the Company's consolidated VIEs consisted of the following as of December 31, 2017:2018:
(In millions)NRG Wind TE Holdco Alta TE Holdco Spring Canyon
Other current and non-current assets$172
 $17
 $2
Property, plant and equipment376
 436
 95
Intangible assets2
 262
 —
Total assets550
 715
 97
Current and non-current liabilities197
 9
 5
Total liabilities197
 9
 5
Noncontrolling interest9
 93
 60
Net assets less noncontrolling interests$344
 $613
 $32


(In millions)Wind TE Holdco Alta TE Holdco Spring Canyon Buckthorn Renewables, LLC
Other current and non-current assets$215
 $17
 $2
 $15
Property, plant and equipment346
 410
 91
 223
Intangible assets2
 249
 —
 —
Total assets563
 676
 93
 238
Current and non-current liabilities210
 9
 4
  
Total liabilities210
 9
 4
 135
Noncontrolling interest45
 63
 49
 43
Net assets less noncontrolling interests$308
 $604
 $40
 $60
Entities that are not Consolidated
The Company has interests in entities that are considered VIEs under ASC 810, Consolidation, but for which it is not considered the primary beneficiary.  The Company accounts for its interests in these entities under the equity method of accounting.
Utah Solar Portfolio Assets — As described in Note 3, Business Acquisitions, as part of the March 2017 Drop Down Assets acquisition, the Company acquired from NRG 100% of the Class A equity interests in the Utah Solar Portfolio, comprised of Four Brothers Solar, LLC, Granite Mountain Holdings, LLC, and Iron Springs Holdings, LLC. The Class B interests of the Utah Solar Portfolio are owned by a tax equity investor, or TE Investor, who receives 99% of allocations of taxable income and other items until the flip point, which occurs whenon the TE Investor obtains a specified returnlast day of the calendar month on which the Class B member does not have an agreed upon adjusted capital account deficit, but not prior to the 10th day after the five year anniversary of the last project to achieve its initial investment,placed in service date, at which time the allocations to the TE Investor change to 50%. The Company generally receives 50% of distributable cash throughout the term of the tax-equity arrangements. The three entities comprising the Utah Solar Portfolio are VIEs. As the Company is not the primary beneficiary, the Company uses the equity method of accounting to account for its interests in the Utah Solar Portfolio. The Company utilizes the HLBV method to determine its share of the income or losses in the investees.
NRG DGPV Holdco 1 LLC — The Company and NRGCEG are parties to the NRG DGPV Holdco 1 LLC partnership, or DGPV Holdco 1, the purpose of which is to own or purchase solar power generation projects and other ancillary related assets from NRG RenewClearway Energy Group LLC or its subsidiaries via intermediate funds. The Company owns approximately 4752 MW of distributed solar capacity, based on cash to be distributed, with a weighted average contract life of 1817 years. Under this partnership, the Company committed to fund up to $100 million of capital.
NRG DGPV Holdco 2 LLC — The Company and NRGCEG are parties to the NRG DGPV Holdco 2 LLC partnership, or DGPV Holdco 2, the purpose of which is to own or hold solar power generation projects as well as other ancillary related assets from NRG RenewClearway Energy Group LLC or its subsidiaries. The Company owns approximately 113 MW of distributed solar capacity, based on cash to be distributed, with a weighted average contract life of 2120 years.  Under this partnership, the Company committed to fund up to $60 million of capital.
NRG DGPV Holdco 3 LLC — On September 26, 2017,The Company and CEG are parties to the Company entered into an additional partnership with NRG by forming NRG DGPV Holdco 3 LLC partnership, or DGPV Holdco 3, in which the Company would invest up to $50 million in an operating portfolio of distributed solar assets, primarily comprised of community solar projects, developed by NRG.CEG. The Company owns approximately 4359 MW of distributed solar capacity, based on cash to be distributed, with a weighted average contract life of approximately 2021 years as of December 31, 2017.2018. In December 2018, the Company and CEG amended the DGPV Holdco 3 partnership agreement to increase the capital commitment of $50 million to $70 million. The Company had a $9 million payable due to DGPV Holdco 3 LLC as of December 31, 2018.
The Company's maximum exposure to loss is limited to its equity investment in DGPV Holdco 1, DGPV Holdco 2 and DGPV Holdco 3, which was $176$260 million on a combined basis.
NRG RPV Holdco 1 LLC — The Company and NRGCEG are parties to the NRG RPV Holdco 1 LLC partnership, or RPV Holdco, the purpose of which is to hold operating portfolios of residential solar assets developed by NRG's residential solar business, including: (i) an existing, unlevered portfolio of over 2,200 leases across nine states representing approximately 14 MW, based on cash to be distributed, with a weighted average remaining lease term of approximately 1514 years that was acquired outside of the partnership; and (ii) a tax equity-financed portfolio of approximately 5,400 leases representing approximately 30 MW, based on cash to be distributed, with a weighted average remaining lease term for the existing and new leases of approximately 1817 years. The Company has fully funded the partnership as of December 31, 2017.


The Company's maximum exposure to loss is limited to its equity investment, which was $58$29 million as of December 31, 2017.2018.

Note 6 — Fair Value of Financial Instruments
For cash and cash equivalents, restricted cash, accounts receivable — affiliate, accounts receivable, accounts payable, current portion of accounts payable — affiliate, accrued expenses and other liabilities, 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 amounts and fair values of the Company’s recorded financial instruments not carried at fair market value are as follows:
As of December 31, 2017 As of December 31, 2016As of December 31, 2018 As of December 31, 2017
Carrying Amount Fair Value Carrying Amount Fair ValueCarrying Amount Fair Value Carrying Amount Fair Value
(In millions)(In millions)
Assets:              
Notes receivable, including current portion$13
 $13
 $30
 $30
$—
 $—
 $13
 $13
Liabilities:              
Long-term debt, including current portion — affiliate618
 618
 618
 608
259
 257
 618
 618
Long-term debt, including current portion — external$5,281
 $5,297
 $5,516
 $5,500
$5,779
 $5,681
 $5,450
 $5,466
Fair Value Accounting under ASC 820
ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows:
Level 1—quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date.
Level 2—inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.
Level 3—unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date.
In accordance with ASC 820, the Company determines the level in the fair value hierarchy within which each fair value measurement in its entirety falls, based on the lowest level input that is significant to the fair value measurement.
The fair value of the Company's publicly-traded long-term debt is based on quoted market prices and is classified as Level 2 within the fair value hierarchy. The fair value of debt securities, non-publicly traded long-term debt, affiliate debt and certain notes receivable of the Company are based on expected future cash flows discounted at market interest rates, or current interest rates for similar instruments with equivalent credit quality and are classified as Level 3 within the fair value hierarchy. The following table presents the level within the fair value hierarchy for long-term debt, including current portion as of December 31, 20172018 and 2016:2017:
 As of December 31, 2017 As of December 31, 2016
 Level 2 Level 3 Level 2 Level 3
 (In millions)
Long-term debt, including current portion$870
 $5,045
 $833
 $5,275
 As of December 31, 2018 As of December 31, 2017
 Level 2 Level 3 Level 2 Level 3
 (In millions)
Long-term debt, including current portion$1,358
 $4,580
 $870
 $5,214


Recurring Fair Value Measurements
The Company records its derivative assets and liabilities at fair market value on its consolidated balance sheet. The following table presents 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:
As of December 31, 2017 As of December 31, 2016As of December 31, 2018 As of December 31, 2017
 
Fair Value (a)
 
Fair Value (a)
 
Fair Value (a)
Fair Value (a)
 
Fair Value (a)
(In millions) Level 2 Level 1 Level 2Level 2 Level 2
Derivative assets:         
Commodity contracts $1
 $1
 $1
Commodity contracts (b)
$—
 $1
Interest rate contracts 1
 —
 1
11
 1
Total assets $2
 1
 2
$11
 $2
Derivative liabilities:         
Commodity contracts $1
 —
 1
Commodity contracts (b)
$—
 1
Interest rate contracts 47
 —
 78
21
 48
Total liabilities $48
 $—
 $79
$21
 $49
 
(a) There were no derivative assets or liabilities classified as Level 1 as of December 31, 2017. There were no derivative assets or liabilities classified Level 3 as of December 31, 20172018 and 2016.2017.
(b) The fair value of commodities was not material as of December 31, 2018.


Derivative Fair Value Measurements
The Company's contracts are non-exchange-traded and valued using prices provided by external sources. For the Company’s energy markets, management receives quotes from multiple sources. To the extent that multiple quotes are received, the prices reflect the average of the bid-ask mid-point prices obtained from all sources believed to provide the most liquid market for the commodity.
The fair value of each contract is discounted using a risk free interest rate. In addition, a credit reserve is applied to reflect credit risk, which for interest rate swaps, is calculated based on credit default swaps utilizing the bilateral method. For commodities, to the extent that NRG'sthe Company'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'sits own default swap rate. For 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 the liabilities or that a market participant would be willing to pay for the assets. As of December 31, 2017,2018, the credit reserve resulted in a $1 million increase in fair value in interest expense.was not material. It is possible that future market prices could vary from those used in recording assets and liabilities and such variations could be material.
Concentration of Credit Risk
In addition to the credit risk discussion as disclosed in Note 2, Summary of Significant Accounting Policies, the following item is a discussion of the concentration of credit risk for the Company's financial instruments. Credit risk relates to the risk of loss resulting from non-performance or non-payment by counterparties pursuant to the terms of their contractual obligations. The Company monitors and manages credit risk through credit policies that include: (i) an established credit approval process; (ii) daily monitoring of counterparties' credit limits; (iii) the use of credit mitigation measures such as margin, collateral, prepayment arrangements, or volumetric limits; (iv) the use of payment netting agreements; and (v) the use of master netting agreements that allow for the netting of positive and negative exposures of various contracts associated with a single counterparty. Risks surrounding counterparty performance and credit could ultimately impact the amount and timing of expected cash flows. The Company seeks to mitigate counterparty risk by having a diversified portfolio of counterparties.
Counterparty credit exposure includes credit risk exposure under certain long-term agreements, including solar and other PPAs. As external sources or observable market quotes are not available to estimate such exposure, the Company estimates the exposure related to 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, 2017,2018, credit risk exposure to these counterparties attributable to the Company's ownership interests was approximately $2.7$2.3 billion for the next five years. The majority of these power contracts are with utilities with strong credit quality and public utility commission or other regulatory support. However, such regulated utility counterparties can be impacted by changes in government regulations, which the Company is unable to predict.


As previously described, on January 29, 2019, PG&E filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code.  Certain subsidiaries of the Company sell the output of their facilities to PG&E under long-term PPAs, including interests in 6 solar facilities totaling 480 MW and Marsh Landing with a capacity of 720 MW.   The Company consolidates three of the solar facilities and Marsh Landing and records its interest in the other solar facilities as equity method investments. The Company had $17 million in accounts receivable for its consolidated projects as of December 31, 2018. All of these amounts were collected in January 2019.

Note 7 — Accounting for Derivative Instruments and Hedging Activities
ASC 815 requires the Company to recognize all derivative instruments on the balance sheet as either assets or liabilities and to measure them at fair value each reporting period unless they qualify for a NPNS exception. The Company may elect to designate certain derivatives as cash flow hedges, if certain conditions are met, and defer the change in fair value of the derivatives to accumulated OCI/OCL, until the hedged transactions occur and are recognized in earnings. For derivatives that are not designated as cash flow hedges or do not qualify for hedge accounting treatment, the changes in the fair value will be immediately recognized in earnings. Certain derivative instruments may qualify for the NPNS exception and are therefore exempt from fair value accounting treatment. ASC 815 applies to the Company's energy related commodity contracts and interest rate swaps.


Energy-Related Commodities
To manage the commodity price risk associated with its competitive supply activities and the price risk associated with wholesale power sales, the Company may enter into derivative hedging instruments, namely, forward contracts that commit the Company to sell energy commodities or purchase fuels/electricity in the future. The objectives for entering into derivatives contracts designated as hedges include fixing the price for a portion of anticipated future electricity sales and fixing the price of a portion of anticipated fuel/electricity purchases for the operation of its subsidiaries. As of December 31, 2017,2018, the Company had forward contracts for the purchase of fuel commodities relating to the forecasted usage of the Company’s district energy centers extending through 2020 and electricity contracts to supply retail power to the Company's district energy centers extending through 2020. At December 31, 2017,2018, these contracts were not designated as cash flow or fair value hedges.
Also, as of December 31, 2017,2018, the Company had other energy-related contracts that did not meet the definition of a derivative instrument or qualified for the NPNS exception and were therefore exempt from fair value accounting treatment as follows:
Power tolling contractspurchase agreements through 2039,2043, and
Natural gas transportation contracts through 2028.
Interest Rate Swaps
The Company is exposed to changes in interest rates through the issuance of variable rate debt. In order to manage interest rate risk, it enters into interest rate swap agreements.
As of December 31, 20172018, the Company had interest rate derivative instruments on non-recourse debt extending through 2036,2041, a portion of which are designated as cash flow hedges.
Volumetric Underlying Derivative Transactions
The following table summarizes the net notional volume buy/(sell) of the Company's open derivative transactions broken out by commodity as of December 31, 20172018 and 2016:2017:
 Total Volume Total Volume
 December 31, 2017 December 31, 2016 December 31, 2018 December 31, 2017
CommodityUnits (In millions)Units (In millions)
Natural GasMMBtu 2
 3
MMBtu 1
 2
InterestDollars $1,940
 $2,090
Dollars $1,862
 $2,050
                                    


Fair Value of Derivative Instruments
The following table summarizes the fair value within the derivative instrument valuation on the balance sheet:
Fair ValueFair Value
Derivative Assets (a)
 Derivative Liabilities
Derivative Assets (a)
 Derivative Liabilities
December 31, 2017 December 31, 2016 December 31, 2017 December 31, 2016December 31, 2018 December 31, 2017 December 31, 2018 December 31, 2017
(In millions)(In millions)
Derivatives Designated as Cash Flow Hedges:              
Interest rate contracts current$—
 $—
 $4
 $26
$2
 $—
 $1
 $4
Interest rate contracts long-term1
 1
 9
 39
3
 1
 6
 9
Total Derivatives Designated as Cash Flow Hedges1
 1
 13
 65
5
 1
 7
 13
Derivatives Not Designated as Cash Flow Hedges:              
Interest rate contracts current—
 —
 12
 6
1
 —
 3
 13
Interest rate contracts long-term—
 —
 22
 7
5
 —
 11
 22
Commodity contracts current(b)1
 2
 1
 1
—
 1
 —
 1
Total Derivatives Not Designated as Cash Flow Hedges1
 2
 35
 14
6
 1
 14
 36
Total Derivatives$2
 $3
 $48
 $79
$11
 $2
 $21
 $49
 
(a) Derivative Asset balances classified as current are included within the prepayments and other current assets line item of the Consolidated Balance Sheet. Derivative Asset balances classified
(b) The fair value of commodities was not material as long-term are included within the other non-current assets line item of the Consolidated Balance Sheet.December 31, 2018
The Company has elected to present derivative assets and liabilities on the balance sheet on a trade-by-trade basis and does not offset amounts at the counterparty master agreement level. As of December 31, 20172018 and 2016,2017, there was no outstanding collateral paid or received. As of December 31, 2018, the commodity balances were not material. The following tables summarize the offsetting of derivatives by counterparty master agreement level:

Gross Amounts Not Offset in the Statement of Financial PositionGross Amounts Not Offset in the Statement of Financial Position
As of December 31, 2017Gross Amounts of Recognized Assets/Liabilities Derivative Instruments Net Amount
Commodity contracts:(In millions)
Derivative assets$1
 $—
 $1
Derivative liabilities(1) —
 (1)
Total commodity contracts—
 —
 —
As of December 31, 2018Gross Amounts of Recognized Assets/Liabilities Derivative Instruments Net Amount
Interest rate contracts:          
Derivative assets1
 (1) —
$11
 $(1) $10
Derivative liabilities(47) 1
 (46)(21) 1
 (20)
Total interest rate contracts(46) —
 (46)(10) —
 (10)
Total derivative instruments$(46) $—
 $(46)$(10) $—
 $(10)
Gross Amounts Not Offset in the Statement of Financial PositionGross Amounts Not Offset in the Statement of Financial Position
As of December 31, 2016Gross Amounts of Recognized Assets/Liabilities Derivative Instruments Net Amount
As of December 31, 2017Gross Amounts of Recognized Assets/Liabilities Derivative Instruments Net Amount
Commodity contracts:(In millions)(In millions)
Derivative assets$2
 $—
 $2
$1
 $—
 $1
Derivative liabilities(1) —
 (1)(1) —
 (1)
Total commodity contracts1
 —
 1
—
 —
 —
Interest rate contracts:          
Derivative assets1
 (1) —
1
 (1) —
Derivative liabilities(78) 1
 (77)(48) 1
 (47)
Total interest rate contracts(77) —
 (77)(47) —
 (47)
Total derivative instruments$(76) $—
 $(76)$(47) $—
 $(47)
                                    


Accumulated Other Comprehensive Loss
The following table summarizes the effects on the Company’s accumulated OCL balance attributable to interest rate swaps designated as cash flow hedge derivatives:
Year ended December 31,Year ended December 31,
2017 2016 20152018 2017 2016
(In millions)(In millions)
Accumulated OCL beginning balance$(86) $(99) $(82)$(69) $(86) $(99)
Reclassified from accumulated OCL to income due to realization of previously deferred amounts17
 17
 17
15
 17
 17
Mark-to-market of cash flow hedge accounting contracts—
 (4) (34)9
 —
 (4)
Accumulated OCL ending balance(69) (86) (99)(45) (69) (86)
Accumulated OCL attributable to noncontrolling interests(1) (1) (1)(1) (1) (1)
Accumulated OCL attributable to NRG Yield LLC$(68) $(85) $(98)
Accumulated OCL attributable to Clearway Energy LLC$(44) $(68) $(85)
Losses expected to be realized from OCL during the next 12 months$15
    $9
    
Amounts reclassified from accumulated OCL into income are recorded to interest expense.
Accounting guidelines require a high degree of correlation between the derivative and the hedged item throughout the period in order to qualify as a cash flow hedge. As of December 31, 2016, the Company's regression analysis for Viento Funding II interest rate swaps, while positively correlated, did not meet the required threshold for cash flow hedge accounting. As a result, the Company de-designated the Viento Funding II cash flow hedges as of December 31, 2016, and will prospectively mark these derivatives to market through the income statement.
The Company's regression analysis for Marsh Landing, Walnut Creek and Avra Valley interest rate swaps, while positively correlated, no longer contain matching terms for cash flow hedge accounting. As a result, the Company voluntarily de-designated the Marsh Landing, Walnut Creek and Avra Valley cash flow hedges as of April 28, 2017, and will prospectively mark these derivatives to market through the income statement.
Impact of Derivative Instruments on the Statements of Income
The Company has interest rate derivative instruments that are not designated as cash flow hedges. The effect of interest rate hedges is recorded to interest expense. For the years ended December 31, 2018, 2017 2016 and 20152016 the impact to the consolidated statements of income was a gain of $7$15 million, gain of $6 million and a loss of $2 million and a gain of $17 million, respectively.
A portion of the Company’s derivative commodity contracts relates to its Thermal Business for the purchase of fuel/electricity commodities based on the forecasted usage of the thermal district energy centers. Realized gains and losses on these contracts are reflected in the costs that are permitted to be billed to customers through the related customer contracts or tariffs and, accordingly, no gains or losses are reflected in the consolidated statements of income for these contracts.
In 2015, commodity contracts also hedged the forecasted sale of power for the Elbow Creek until the start of the PPA with NRG Power Marketing LLC, or Power Marketing, with effective date of November 1, 2015. The effect of these commodity hedges was recorded to operating revenues. For the year ended December 31, 2015, the impact to the consolidated statements of income was an unrealized loss of $2 million.
See Note 6, Fair Value of Financial Instruments, for a discussion regarding concentration of credit risk.

Note 8 — Intangible Assets
Intangible Assets — The Company's intangible assets as of December 31, 20172018 and 20162017 primarily reflect intangible assets established from its business acquisitions and are comprised of the following:
PPAs — Established predominantly with the acquisitions of the Alta Wind Portfolio, Walnut Creek, Tapestry and Laredo Ridge, these represent the fair value of the PPAs acquired. These are amortized, generally on a straight-line basis, over the term of the PPA.
Leasehold Rights — Established with the acquisition of the Alta Wind Portfolio, this represents the fair value of contractual rights to receive royalty payments equal to a percentage of PPA revenue from certain projects. These are amortized on a straight-line basis.
Customer relationships — Established with the acquisition of NRG Energy Center Phoenix and NRG Energy Center


Omaha, these intangibles represent the fair value at the acquisition date of the businesses' customer base. The customer relationships are amortized to depreciation and amortization expense based on the expected discounted future net cash flows by year.
Customer contracts — Established with the acquisition of NRG Energy Center Phoenix, these intangibles represent the fair value at the acquisition date of contracts that primarily provide chilled water, steam and electricity to its customers. These contracts are amortized to revenues based on expected volumes.
•
Emission Allowances — These intangibles primarily consist of SO2 and NOx emission allowances established with the El Segundo and Walnut Creek acquisitions. These emission allowances are held-for-use and are amortized to cost of


operations, with NOx allowances amortized on a straight-line basis and SO2 allowances amortized based on units of production.
Development rights — Arising primarily from the acquisition of solar businesses in 2010 and 2011, these intangibles are amortized to depreciation and amortization expense on a straight-line basis over the estimated lifeand SO2 allowances amortized based on units of the related project portfolio.
production.
Other — Consists primarily of a) the acquisition date fair value of the contractual rights to a ground lease for South Trent and to utilize certain interconnection facilities for Blythe, as well as land rights acquired in connection with the acquisition of Elbow Creek.Creek, and b) development rights related to certain solar businesses acquired in 2010 and 2011.
The following tables summarize the components of intangible assets subject to amortization:
Year ended December 31, 2017PPAs Leasehold Rights Customer
Relationships		 Customer Contracts Emission Allowances Development
Rights		 Other Total
(In millions)   
January 1, 2017$1,286
 $86
 $66
 $15
 $9
 $3
 $6
 $1,471
Asset impairments (a)
(6) —
 —
 —
 —
 —
 —
 (6)
December 31, 20171,280
 86
 66
 15
 9
 3
 6
 1,465
Less accumulated amortization(205) (13) (5) (8) (3) (1) (2) (237)
Net carrying amount$1,075
 $73
 $61
 $7
 $6
 $2
 $4
 $1,228
Year ended December 31, 2018PPAs Leasehold Rights Customer
Relationships		 Customer Contracts Emission Allowances Other Total
(In millions)   
December 31, 2018$1,280
 $86
 $66
 $15
 $9
 $8
 $1,464
Less accumulated amortization(269) (18) (7) (9) (2) (3) (308)
Net carrying amount$1,011
 $68
 $59
 $6
 $7
 $5
 $1,156
Year ended December 31, 2017PPAs Leasehold Rights Customer
Relationships		 Customer Contracts Emission Allowances Other Total
(In millions) 
January 1, 2017$1,286
 $86
 $66
 $15
 $9
 $9
 $1,471
Asset Impairments (a)
(6) —
 —
 —
 —
 —
 (6)
December 31, 20171,280
 86
 66
 15
 9
 9
 1,465
Less accumulated amortization(205) (13) (5) (8) (3) (3) (237)
Net carrying amount$1,075
 $73
 $61
 $7
 $6
 $6
 $1,228
 
(a) $6 million of asset impairments relate to one of the November 2017 Drop Down Assets that was recorded by NRG during the quarter ended September 30, 2017, as further described in Note 9, Asset Impairments.
Year ended December 31, 2016PPAs Leasehold Rights Customer
Relationships		 Customer Contracts Emission Allowances Development
Rights		 Other Total
(In millions) 
January 1, 2016$1,286
 $86
 $66
 $15
 $15
 $3
 $6
 $1,477
Other—
 —
 —
 —
 (6) —
 —
 (6)
December 31, 20161,286
 86
 66
 15
 9
 3
 6
 1,471
Less accumulated amortization(143) (9) (4) (7) (2) (1) (2) (168)
Net carrying amount$1,143
 $77
 $62
 $8
 $7
 $2
 $4
 $1,303
The Company recorded amortization expense of $71 million during each ofthe years ended December 31, 2018, 2017 and 2016, and $56 million during the year ended December 31, 2015.2016. Of these amounts, $70 million for each of the years ended December 31, 2018, 2017 and 2016 and $55 million for the year ended December 31, 2015, were recorded to contract amortization expense and reduced operating revenues in the consolidated statements of operations. The Company estimates the future amortization expense for its intangibles to be $71 million for the next five years through 2022.2023.
Out-of-market contracts — The out-of-market contract liability represents the out-of-market value of the PPAs for the Blythe solar project and Spring Canyon wind projects and the out-of-market value of the land lease for Alta Wind XI, LLC, as of their respective acquisition dates. The Blythe solar project's liability of $7 million was recorded to other non-current liabilities on the consolidated balance sheet and is amortized to revenue in the consolidated statements of income on a units-of-production basis over the twenty-year term of the agreement. Spring Canyon's liability of $3 million was recorded to other non-current liabilities and is amortized to revenue on a straight-line basis over the twenty-five year term of the agreement. The Alta Wind XI, LLC's liability of $5 million was recorded to other non-current liabilities and is amortized as a reduction to cost of operations on a straight-line basis over the thirty-four year term of the land lease. At December 31, 2017,2018, accumulated amortization of out-of-market contracts was $4 million and amortization expense was $1 million for each of the years ended December 31, 20172018 and 2016.2017.



Note 9 — Asset Impairments
During the fourth quarter ended December 31,of 2017, as the Company updated its estimated cash flows in connection with the preparation and review of the Company's annual budget, the Company determined that the cash flows for Elbow Creek, located in Texas, and the Forward project, located in Pennsylvania, were below the carrying value of the related assets, primarily driven by continued declining merchant power prices in post-contract periods, and that the assets were considered impaired. The fair value of the facilities was determined using an income approach by applying a discounted cash flow methodology to the long-term budgets for each respective plant. The income approach utilized estimates of discounted future cash flows, which were Level 3 fair value measurement and include key inputs, such as forecasted power prices, operations and maintenance expense, and discount rates. The Company measured the impairment loss as the difference between the carrying amount and the fair value of the assets and recorded impairment losses of $26 million and $5 million for Elbow Creek and Forward, respectively.
Additionally, during the quarter ended September 30, 2017, in connection with the preparation of the model for sale of the November 2017 Drop Down Assets, it was identified that undiscounted cash flows were lower than the book value of certain SPP funds and NRG recorded an impairment expense of $13 million, $8 million of which relates to property, plant, and equipment and $5 million to PPAs, as described in Note 8, Intangible Assets. In accordance with the guidance for transfer of assets under common


control, the impairment is reflected in the Company's consolidated statements of operations for the period ended December 31, 2017.2018.
During the fourth quarter of 2016, as the Company updated its estimated cash flows in connection with the preparation and review of the Company's annual budget, the Company determined that the cash flows for the Elbow Creek and Goat Wind projects and the Forward project were below the carrying value of the related assets, primarily driven by declining merchant power prices in post-contract periods, and that the assets were considered impaired. These projects were acquired in connection with the acquisition of the November 2015 Drop Down Assets and were recorded as part of the Renewables segment of the Company. The projects were recorded at historical cost at acquisition date as they were related to interests under common control by NRG. The fair value of the facilities was determined using an income approach by applying a discounted cash flow methodology to the long-term budgets for each respective plant. The income approach utilized estimates of discounted future cash flows, which were Level 3 fair value measurement and include key inputs, such as forecasted power prices, operations and maintenance expense, and discount rates. The Company measured the impairment loss as the difference between the carrying amount and the fair value of the assets and recorded impairment losses of $117 million, $60 million and $6 million for Elbow Creek, Goat Wind, and Forward, respectively.
Other Impairments — During the fourth quartersquarter of 2016, and 2015, NRG recorded impairment losses of approximately $2 million and $1 million, respectively, related to the projects that were part of the November 2017 Drop Down Assets. Since the acquisition by the Company of the November 2017 Drop Down Assets related to transfer of assets under common control, these impairments were reflected in the Company's consolidated statements of operations for the periods ending December 31, 2016 and 2015.2016.

                                    


Note 10 — Long-term Debt
The Company's borrowings, including short term and long term portions consisted of the following:
 December 31, 2017 December 31, 2016 
Interest rate % (a)
 Letters of Credit Outstanding at December 31, 2017December 31, 2018 December 31, 2017 
Interest rate % (a)
 Letters of Credit Outstanding at December 31, 2018
 (In millions, except rates)  (In millions, except rates)  
Long-term debt - affiliate, due 2019$215
 $337
 3.580  
Long-term debt - affiliate, due 202044
 281
 3.325  
2024 Senior Notes500
 500
 5.375  
2025 Senior Notes600
 —
 5.750  
2026 Senior Notes $350
 $350
 5.000  350
 350
 5.000  
2024 Senior Notes 500
 500
 5.375  
Long-term debt - affiliate, due 2020 281
 281
 3.325  
Long-term debt - affiliate, due 2019 337
 337
 3.580  
NRG Yield LLC and NRG Yield Operating LLC Revolving Credit Facility, due 2019 (b)
 55
 —
 L+2.500 74
Clearway Energy LLC and Clearway Energy Operating LLC Revolving Credit Facility, due 2019 (b)
—
 55
 L+1.75 41
Project-level debt:           
Agua Caliente Borrower 2, due 2038 41
 —
 5.430 17
Alpine, due 2022 135
 145
 L+1.750 16
Agua Caliente Borrower 2, due 2038 (c)
39
 41
 5.430 17
Alpine, due 2022 (c)
127
 135
 L+1.750 16
Alta Wind I - V lease financing arrangements, due 2034 and 2035 926
 965
 5.696 - 7.015 119
886
 926
 5.696 - 7.015 44
CVSR, due 2037 746
 771
 2.339 - 3.775 —
CVSR Holdco Notes, due 2037 194
 199
 4.680 13
Buckthorn Solar, due 2025132
 169
 L+1.750 26
CVSR, due 2037 (c)
720
 746
 2.339 - 3.775 —
CVSR Holdco Notes, due 2037 (c)
188
 194
 4.680 13
El Segundo Energy Center, due 2023 400
 443
 L+1.75 - L+2.375 102
352
 400
 L+1.75 - L+2.375 138
Energy Center Minneapolis, due 2025 83
 96
 5.950 —
Energy Center Minneapolis Series D Notes, due 2031 125
 125
 3.550 —
Energy Center Minneapolis Series C, D, E, F, G, H Notes, due 2025-2037328
 208
 various —
Laredo Ridge, due 2028 95
 100
 L+1.875 10
89
 95
 L+1.875 10
Marsh Landing, due 2023 318
 370
 L+1.875 22
Kansas South, due 2030 (c)
26
 29
 L+2.00 2
Marsh Landing, due 2023 (c)
263
 318
 L+2.125 60
South Trent Wind, due 202050
 53
 L+1.625  
Tapestry, due 2021 162
 172
 L+1.625 20
151
 162
 L+1.625 20
Utah Solar Portfolio, due 2022 278
 287
 various 13
267
 278
 various 13
Viento, due 2023 163
 178
 L+3.00 27
146
 163
 L+2.00 26
Walnut Creek, due 2023 267
 310
 L+1.625 41
222
 267
 L+1.75 74
Other 443
 505
 various 38
343
 361
 various 24
Subtotal project-level debt 4,376
 4,666
  4,329
 4,545
  
Total debt 5,899
 6,134
  6,038
 6,068
  
Less current maturities (306) (323)  (529) (339)  
Less net debt issuance costs (54) (65)  (61) (62)  
Total long-term debt $5,539
 $5,746
  $5,448
 $5,667
  
 
(a) As of December 31, 2017,2018, L+ equals 3 month LIBOR plus x%, except for Viento, due 2023 and Kansas South, due 2030, where L + equals 6 month LIBOR plus 3.00%2.00% and Utah Solar Portfolio, where L+equals 1 month LIBOR plus x%.
(b) Applicable rate is determined by the borrower leverage ratio, as defined in the credit agreement.
(c)On January 29, 2019, PG&E filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code.  The Company has non-recourse project-level debt, and in some cases holding company debt, related to each of its subsidiaries that sell their output to PG&E under long-term PPAs.  The PG&E bankruptcy filing is an event of default under the related financing agreements, and as a result, the respective lenders under these arrangements may accelerate the repayment of these debt balances.  In addition, the event of default may have an impact on the Company’s ability to distribute cash from the project-level cash accounts to the parent entities.  The Company continues to operate the projects in the normal course of business and is currently in the process of negotiating forbearance agreements with the related lenders. 

The financing arrangements listed above contain certain covenants, including financial covenants, that the Company is required to be in compliance with during the term of the respective arrangement. As of December 31, 20172018, the Company was in compliance with all of the required covenants.
NRG Yield Operating LLC 2026 Senior Notes
On August 18, 2016, Yield Operating LLC issued $350 million of senior unsecured notes, or the 2026 Senior Notes. The 2026 Senior Notes bear interest at 5.00% and mature on September 15, 2026. Interest on the notes is payable semi-annually on March 15 and September 15 of each year. The 2026 Senior Notes are senior unsecured obligations of Yield OperatingClearway Energy LLC and are guaranteed by the Company, and by certain of Yield Operating LLC's wholly owned current and future subsidiaries. A portion of the proceeds of the 2026 Senior Notes were used to repay the Company's revolving credit facility during 2016, as described below.


Yield, Inc. 2020 Convertible Senior Notes and Related Intercompany Note
On June 29, 2015, Yield, Inc. closed on its offering of $288 million aggregate principal amount of 3.25% Convertible Senior Notes due 2020, or the 2020 Convertible Notes. The 2020 Convertible Notes are convertible, under certain circumstances, into Yield, Inc.'s Class C common stock, cash or a combination thereof at an initial conversion price of $27.50 per Class C common share, which is equivalent to a conversion rate of approximately 36.3636 shares of Class C common stock per $1,000 principal amount of 2020 Convertible Notes. The Company and Yield Operating LLC provided a guarantee to Yield, Inc. with respect to the 2020 Convertible Notes. In addition, Yield Operating LLC and Yield, Inc. entered into an intercompany borrowing arrangement, under which Yield Operating LLC received $281 million of the proceeds of the 2020 Convertible Notes. The intercompany note bears interest at a rate of 3.325% and matures in 2020.
Yield, Inc. 2019 Convertible Senior Notes and Related Intercompany Note
During the first quarter of 2014, Yield, Inc. closed on its offering of $345 million aggregate principal amount of 3.50% Convertible Senior Notes due 2019, or the 2019 Convertible Notes. The 2019 Convertible Notes were convertible, under certain circumstances, into Yield, Inc.’s Class A common stock, cash or a combination thereof at an initial conversion price of $46.55 per Class A common share, which is equivalent to a conversion rate of approximately 42.9644 shares of Class A common stock per $1,000 principal amount of 2019 Convertible Notes in accordance with the terms of the related indenture. The Company and Yield Operating LLC provided a guarantee to Yield, Inc. with respect to the 2019 Convertible Notes. In addition, Yield Operating and Yield, Inc. entered into an intercompany borrowing arrangement, under which Yield Operating borrowed $337 million of the proceeds of the 2019 Convertible Notes. The intercompany note bears interest at a rate of 3.580% and matures in 2019.
NRG Yield LLC and NRG YieldClearway Energy Operating LLC Revolving Credit Facility
The Company borrowed $55 million from the revolving credit facility during the year ended December 31, 2017 for general corporate needs as well as to fund dividend payments.



On April 30, 2018, the Company closed on the refinancing of the revolving credit facility, which extended the maturity of the facility to April 28, 2023, and decreased the Company's overall cost of borrowing from L+2.50% to L+1.75%. The applicable rate is determined by the borrower leverage ratio, as defined in the credit agreement, and was L+1.75% as of December 31, 2018. The facility will continue to be used for general corporate purposes including financing of future acquisitions and posting letters of credit.
On October 9, 2018, the Company used its proceedsterminated certain letters of credit relating to certain project PPAs in exchange for a one-time payment, which reduced the outstanding letters of credit under the revolving credit facility. As of $97.5 millionDecember 31, 2018 from the CVSR Holdco Financing Arrangement, a portion of its proceeds from the issuance of the 2026 Senior Notes, as well as its cash on hand to repay the, there were no outstanding borrowings under the revolving credit facility duringand the year ended December 31, 2016.Company had $41 million of letters of credit outstanding.
Bridge Credit Agreement
On February 6,August 31, 2018, NRG Yieldthe Company entered into a senior unsecured 364-day bridge credit agreement, or the Bridge Credit Agreement, which provided total borrowings of up to a maximum amount of $1.5 billion at a rate per annum equal to LIBOR or a base rate plus an applicable margin equal to 3.00% in the case of LIBOR loans and 2.00% in the case of base rate loans.
In October 2018, the Company reduced the lenders' commitments under the bridge agreement from $1.5 billion to $867.5 million following the offering of the 2025 Senior Notes and the convertible notes tender offer results, each described below. On October 31, 2018, the Company terminated the Bridge Credit Agreement.
2025 Senior Notes
On October 1, 2018, Clearway Energy Operating LLC issued $600 million of senior unsecured notes, or the 2025 Senior Notes. The 2025 Senior Notes bear interest at 5.750% and mature on October 15, 2025. Interest on the 2025 Senior Notes is payable semi-annually on April 15 and October 15 of each year, and interest payments will commence on April 15, 2019. The 2025 Senior Notes are unsecured obligations of Clearway Energy Operating LLC and NRG Yieldare guaranteed by Clearway Energy LLC amendedand by certain of Clearway Energy Operating LLC's wholly owned current and future subsidiaries. The proceeds from the revolving credit facility2025 Senior Notes were partially used to modifyrepay the "change2019 Convertible Notes.
2019 Convertible Notes Open Market Repurchases
In August 2018, the Company repurchased an aggregate principal amount of control" provisions to permit the consummation$16 million of the NRG Transaction, and also to permit NRG Yield2019 Convertible Notes in open market transactions. The repurchases were funded through a partial repayment of the intercompany note between Clearway Energy Operating LLC NRG Yieldand Clearway Energy, Inc., which was reduced by $16 million.
In January 2019, the Company repurchased an additional aggregate principal amount of $50 million of the 2019 Convertible Notes in open market transactions. The repurchase was funded through a partial repayment of the intercompany note between Clearway Energy Operating LLC and certain subsidiariesClearway Energy, Inc., which was reduced by $50 million.
2019 Convertible Notes and 2020 Convertible Notes Tender Offer
On September 10, 2018, pursuant to incur upthe 2019 Convertible Notes and the 2020 Convertible Notes indentures, Clearway Energy, Inc. delivered to $1.5 billionthe holders of unsecured indebtedness in orderthe 2019 Convertible Notes and the 2020 Convertible Notes a fundamental change notice and offer to repurchase any and all of the 2019 Convertible Notes and 2020 Convertible Notes for cash at a price equal to 100% of the principal amount of the Convertible Notes plus any accrued and unpaid interest. The tender offer expired on October 9, 2018. An aggregate principal amount of $109 million of the 2019 Convertible Notes and $243 million of the 2020 Convertible Notes were tendered on or make other required cash payments, in each case if applicable, with respectprior to NRG Yieldthe expiration date and accepted by the Company for purchase. After the expiration of the tender offer, $216 million aggregate principal amount of the intercompany note due 2019 remained outstanding and $44 million aggregate principal amount of the intercompany note due 2020 remained outstanding as of December 31, 2018. The 2019 Convertible Notes matured on February 1, 2019 and Clearway Energy, Inc. paid off the remaining balance of an aggregate principal amount of $170 million, which was funded through the payment of the remaining balance of the intercompany note due 2019 between Clearway Energy Operating LLC’s outstanding senior notesLLC and NRG Yield's outstanding convertible notes in connection with the NRG Transaction.Clearway Energy, Inc..


Project - level Debt
Energy Center Minneapolis Series E, F, G, H Notes
On June 19, 2018, Energy Center Minneapolis LLC, a subsidiary of the Company, entered into an amended and restated Thermal note purchase and private shelf agreement under which it authorized the issuance of the Series E Notes, Series F Notes, Series G Notes, and Series H Notes, as further described in the table below:
(In millions) Amount Interest Rate
Energy Center Minneapolis Series E Notes, due 2033 $70
 4.80%
Energy Center Minneapolis Series F Notes, due 2033 10
 4.60%
Energy Center Minneapolis Series G Notes, due 2035 
 83
 5.90%
Energy Center Minneapolis Series H Notes, due 2037 40
 4.83%
Total proceeds $203
  
Repayment of Energy Center Minneapolis Series C Notes, due 2025 (83) 5.95%
Net borrowings $120
  
The proceeds from the sale of the Series E Notes and the Series F Notes were utilized to finance the acquisition of the UPMC Thermal Project as described in Note 3, Business Acquisitions. The Series G Notes were used to refinance the Series C Notes as noted above in the table. The Series H Notes were used to make a dividend to Clearway Energy Operating LLC.
The amended and restated Thermal note purchase and private shelf agreement also established a private shelf facility for the future issuance of notes in the amount of $40 million.
Buckthorn Solar Drop Down Asset Debt
As part of the Buckthorn Solar Drop Down Asset acquisition, as further described in Note 3, Business Acquisitions, the Company assumed non-recourse debt of $183 million relating to Buckthorn Solar Portfolio, LLC as of the date of the acquisition, March 30, 2018. The assumed debt consisted of a construction loan and an Investment Tax Credits, or ITC, bridge loan, both at an interest rate of LIBOR plus 1.75%. On May 31, 2018, $132 million of non-recourse debt was converted to a term loan with an expected maturity of May 2025, and the remainder of the non-recourse debt was repaid with the final contribution from the Class A member in the amount of $80 million upon the project reaching substantial completion in May 2018.
Buckthorn Solar entered into a series of fixed for floating interest rate swaps that would fix the interest rate for a minimum of 80% of the outstanding notional amount. All interest rate swap payments by Buckthorn Solar and its counterparties are made quarterly and LIBOR is determined in advance of each interest period.
November 2017 Drop Down Assets Debt
As part of the November 2017 Drop Down acquisition, the Company assumed non-recourse debt of $26 million relating to certain SPP funds. The assumed debt consisted of the following: a) a term loan under a credit agreement with a bank, with a maturity date of December 31, 2038 and interest rate of 4.69%. The credit agreement includes a letter of credit supporting debt service requirements and a letter of credit in support of the PPA; b) and financing obligation in connection with a sale-leaseback transaction with a bank for a period through March 31, 2032. The company will accrete the financing obligation over the lease term based on the lease's implicit interest rate of 8%.


Agua Caliente Borrower 2, due 2038
On February 17, 2017, Agua Caliente Borrower 1 LLC, an indirect subsidiary of NRG, and Agua Caliente Borrower 2 LLC, issued $130 million of senior secured notes under the Agua Caliente Borrower 1 LLC and Agua Caliente Borrower 2 LLC financing agreement, or Agua Caliente Holdco Financing Agreement, that bear interest at 5.43% and mature on December 31, 2038. As described in Note 3, Business Acquisitions, on March 27, 2017, the Company acquired Agua Caliente Borrower 2 LLC from NRG as part of the March 2017 Drop Down Assets acquisition and assumed NRG's portion of senior secured notes under the Agua Caliente Holdco Financing Agreement. Agua Caliente Borrower 2 LLC holds $41held $39 million of the Agua Caliente Holdco debt as of December 31, 2017. 2018.
The debt is joint and several with respect to Agua Caliente Borrower 1 LLC and Agua Caliente Borrower 2 LLC and is secured by the equity interests of each borrower in the Agua Caliente solar facility.


Utah Solar Portfolio, due 2022
As part of the March 2017 Drop Down Assets acquisition, the Company assumed non-recourse debt of $287 million relating to the Utah Solar Portfolio at an interest rate of LIBOR plus 2.625%. The debt matures on December 16, 2022. The $287 million consisted of $222 million outstanding at the time of NRG's acquisition of the Utah Solar Portfolio on November 2, 2016, and additional borrowings of $65 million, net of debt issuance costs, incurred during 2016. The Company holds $278held $267 million of the Utah Solar Portfolio debt as of December 31, 2017.
Thermal Financing
On October 31, 2016, NRG Energy Center Minneapolis LLC, a subsidiary of the Company, received proceeds of $125 million from the issuance of 3.55% Series D notes due October 31, 2031, or the Series D Notes, and entered into a shelf facility for the anticipated issuance of an additional $70 million of Series E notes at a 4.80% fixed rate. The Series D Notes will be secured by substantially all of the assets of NRG Energy Center Minneapolis LLC. NRG Thermal LLC has guaranteed the indebtedness and its guarantee is secured by a pledge of the equity interests in all of NRG Thermal LLC’s subsidiaries. NRG Energy Center Minneapolis LLC distributed the proceeds of the Series D Notes to NRG Thermal LLC, which in turn distributed the proceeds to NRG Yield Operating LLC to be utilized for general corporate purposes, including potential acquisitions.
On March 16, 2017, NRG Energy Center Minneapolis LLC, a subsidiary of NRG Thermal LLC, amended the shelf facility of its existing Thermal financing arrangement to allow for the issuance of an additional $10 million of Series F notes at a 4.60% interest rate, or Series F Notes, increasing the total principal amount of notes available for issuance under the shelf facility to $80 million. The Series E and Series F Notes will be secured by substantially all of the assets of NRG Energy Center Minneapolis LLC. NRG Thermal LLC has guaranteed the indebtedness and its guarantee is secured by a pledge of the equity interests in all of NRG Thermal LLC’s subsidiaries.
CVSR Holdco Notes, due 2037
On July 15, 2016, CVSR Holdco, the indirect owner of the CVSR solar facility, issued $200 million of senior secured notes under the CVSR Holdco Financing Agreement, or 2037 CVSR Holdco Notes, that bear interest at 4.68% and mature on March 31, 2037.  Net proceeds were distributed to the Company and NRG based on their respective ownership as of July 15, 2016, and, accordingly, the Company received net proceeds of $97.5 million.
As described in Note 3, Business Acquisitions, on September 1, 2016, the Company acquired the remaining 51.05% of CVSR, and assumed additional debt of $496 million, which represents 51.05% of the CVSR project level debt and 51.05% of the 2037 CVSR Holdco Notes. In connection with the retrospective adjustment of prior periods, as described in Note 1, Nature of Business, the Company now consolidates CVSR and 100% of its debt, consisting of $771 million of project level debt and $200 million of 2037 CVSR Holdco Notes as of September 1, 2016.2018.
Interest Rate Swaps — Project Financings
Many of the Company's project subsidiaries entered into interest rate swaps, intended to hedge the risks associated with interest rates on non-recourse project level debt. These swaps amortize in proportion to their respective loans and are floating for fixed where the project subsidiary pays its counterparty the equivalent of a fixed interest payment on a predetermined notional value and will receive quarterly the equivalent of a floating interest payment based on the same notional value. All interest rate swap payments by the project subsidiary and its counterparty are made quarterly and the LIBOR is determined in advance of each interest period.




The following table summarizes the swaps, some of which are forward starting as indicated, related to the Company's project level debt as of December 31, 2017:2018:
 % of Principal Fixed Interest Rate Floating Interest Rate Notional Amount at December 31, 2017 (In millions) Effective Date Maturity Date % of Principal Fixed Interest Rate Floating Interest Rate Notional Amount at December 31, 2018 (In millions) Effective Date Maturity Date
Alpine 85% various
 3-Month LIBOR $115
 various various 85% various
 3-Month LIBOR $108
 various various
Avra Valley 85% 2.333% 3-Month LIBOR 46
 November 30, 2012 November 30, 2030 87% 2.333% 3-Month LIBOR 44
 November 30, 2012 November 30, 2030
AWAM 100% 2.47% 3-Month LIBOR 17
 May 22, 2013 May 15, 2031 100% 2.47% 3-Month LIBOR 16
 May 22, 2013 May 15, 2031
Blythe 75% 3.563% 3-Month LIBOR 13
 June 25, 2010 June 25, 2028 75% 3.563% 3-Month LIBOR 12
 June 25, 2010 June 25, 2028
Borrego 75% 1.125% 3-Month LIBOR 5
 April 3, 2013 June 30, 2020 75% 1.125% 3-Month LIBOR 3
 April 3, 2013 June 30, 2020
Buckthorn Solar 83% various
 3-Month LIBOR 109
 February 28, 2018 December 31, 2041
El Segundo 75% various
 3-Month LIBOR 340
 various various 85% various
 3-Month LIBOR 299
 various various
Kansas South 75% 2.368% 6-Month LIBOR 21
 June 28, 2013 December 31, 2030 75% 2.368% 6-Month LIBOR 20
 June 28, 2013 December 31, 2030
Laredo Ridge 75% 2.31% 3-Month LIBOR 75
 March 31, 2011 March 31, 2026 80% 2.31% 3-Month LIBOR 71
 March 31, 2011 March 31, 2026
Marsh Landing 75% 3.244% 3-Month LIBOR 295
 June 28, 2013 June 30, 2023 94% 3.244% 3-Month LIBOR 246
 June 28, 2013 June 30, 2023
Roadrunner 75% 4.313% 3-Month LIBOR 26
 September 30, 2011 December 31, 2029 75% 4.313% 3-Month LIBOR 24
 September 30, 2011 December 31, 2029
South Trent 75% 3.265% 3-Month LIBOR 40
 June 15, 2010 June 14, 2020 75% 3.265% 3-Month LIBOR 37
 June 15, 2010 June 14, 2020
South Trent 75% 4.95% 3-Month LIBOR 21
 June 30, 2020 June 14, 2028 75% 4.95% 3-Month LIBOR 21
 June 30, 2020 June 14, 2028
Tapestry 75% 2.21% 3-Month LIBOR 146
 December 30, 2011 December 21, 2021 90% 2.21% 3-Month LIBOR 136
 December 30, 2011 December 21, 2021
Tapestry 50% 3.57% 3-Month LIBOR 60
 December 21, 2021 December 21, 2029 50% 3.57% 3-Month LIBOR 60
 December 21, 2021 December 21, 2029
Utah Solar Portfolio 80% various
 1-Month LIBOR 223
 various September 30, 2036 80% various
 1-Month LIBOR 214
 various September 30, 2036
Viento Funding II 90% various
 6-Month LIBOR 148
 various various 91% various
 6-Month LIBOR 134
 various various
Viento Funding II 90% 4.985% 6-Month LIBOR 65
 July 11, 2023 June 30, 2028 90% 4.985% 6-Month LIBOR 65
 July 11, 2023 June 30, 2028
Walnut Creek Energy 75% various
 3-Month LIBOR 239
 June 28, 2013 May 31, 2023 90% various
 3-Month LIBOR 200
 June 28, 2013 May 31, 2023
WCEP Holdings 90% 4.003% 3-Month LIBOR 45
 June 28, 2013 May 31, 2023 100% 4.003% 3-Month LIBOR 43
 June 28, 2013 May 31, 2023
Total     $1,940
      $1,862
 


Annual Maturities
Annual payments based on the maturities of the Company's debt, for the years ending after December 31, 2017,2018, are as follows:
(In millions)(In millions)
2018$306
2019714
$529
2020650
405
2021455
447
2022653
646
2023389
Thereafter3,121
3,622
Total$5,899
$6,038

                                    


Note 11 — Members' Equity
The following table lists the distributions paid on the Company's Class A, Class B, Class C and Class D units during the year ended December 31, 2017:2018:
Fourth Quarter 2017 Third Quarter 2017 Second Quarter 2017 First Quarter 2017Fourth Quarter 2018 Third Quarter 2018 Second Quarter 2018 First Quarter 2018
Distributions per Class A and Class B units$0.288
 $0.28
 $0.27
 $0.26
$0.331
 $0.320
 $0.309
 $0.298
Distributions per Class C and Class D units$0.288
 $0.28
 $0.27
 $0.26
$0.331
 $0.320
 $0.309
 $0.298
On February 15, 2018,12, 2019, the Company declared a quarterly distribution on its Class A, Class B, Class C and Class D units of $0.298$0.20 per share payable on March 15, 2018.2019.
During 2018, 2017, 2016, and 2015,2016, the Company acquired the Drop Down Assets from NRG, as described in Note 3, Business Acquisitions. The difference between the cash paid and historical value of the acquired Drop Down Assets was recorded as a distribution to/contribution from NRG with the offset to contributed capital.  Prior to the date of acquisition, certain of the projects made distributions to NRG and NRG made contributions into certain projects.  These amounts are reflected within the Company’s statement of stockholders’members’ equity as changes in the contributed capital balance.

Note 12 — Segment Reporting
The Company’s segment structure reflects how management currently operates and allocates resources. The Company's businesses are segregated based on conventional power generation, renewable businesses which consist of solar and wind, and the thermal and chilled water business. The Corporate segment reflects the Company's corporate costs.costs and includes eliminating entries. The Company'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, and CAFD, as well as economic gross margin and net income (loss).


The Company generated more than 10% of its revenues from the following customers for the years ended December 31, 2018, 2017 2016 and 2015:2016:
2017 2016 20152018 2017 2016
CustomerConventional (%) Renewables (%) Conventional (%) Renewables (%) Conventional (%) Renewables (%)Conventional (%) Renewables (%) Conventional (%) Renewables (%) Conventional (%) Renewables (%)
SCE21% 20% 21% 21% 22% 17%20% 20% 21% 20% 21% 21%
PG&E12% 11% 12% 11% 12% 12%12% 11% 12% 11% 12% 11%
Year ended December 31, 2017Year ended December 31, 2018
(In millions)Conventional Generation Renewables Thermal Corporate TotalConventional Generation Renewables Thermal Corporate Total
Operating revenues(a)$336
 $501
 $172
 $—
 $1,009
$337
 $526
 $193
 $(3) $1,053
Cost of operations(a)77
 133
 116
 —
 326
62
 146
 127
 (3) 332
Depreciation and amortization103
 210
 21
 —
 334
101
 207
 23
 —
 331
Impairment losses—
 44
 —
 —
 44
General and administrative—
 —
 —
 19
 19
—
 —
 1
 19
 20
Acquisition-related transaction and integration costs—
 —
 —
 3
 3
—
 —
 —
 20
 20
Development costs—
 —
 2
 1
 3
Operating income (loss)156
 114
 35
 (22) 283
174
 173
 40
 (40) 347
Equity in earnings of unconsolidated affiliates12
 59
 —
 —
 71
11
 63
 —
 —
 74
Other income, net1
 2
 —
 1
 4
1
 4
 1
 2
 8
Loss on debt extinguishment—
 (3) —
 —
 (3)
Interest expense(49) (163) (10) (71) (293)(51) (154) (12) (77) (294)
Net Income (Loss)$120
 $9
 $25
 $(92) $62
135
 86
 29
 (115) 135
Less: Net loss attributable to noncontrolling interests—
 (104) —
 (1) (105)
Net Income (Loss) Attributable to Clearway Energy LLC$135
 $190
 $29
 $(114) $240
Balance Sheet        

        

Equity investment in affiliates$102
 $1,076
 $—
 $—
 $1,178
$98
 $1,074
 $—
 $—
 $1,172
Capital expenditures (a)
15
 4
 16
 —
 35
14
 26
 28
 —
 68
Total Assets$1,897
 $5,811
 $422
 $24
 $8,154
$1,788
 $5,836
 $516
 $308
 $8,448
 
(a) Inter-segment revenues and cost of operations include operations and maintenance fee revenue and related costs recorded in the Renewables segment.
(b) Includes accruals.


Year ended December 31, 2016Year ended December 31, 2017
(In millions)Conventional Generation Renewables Thermal Corporate TotalConventional Generation Renewables Thermal Corporate Total
Operating revenues$333
 $532
 $170
 $—
 $1,035
$336
 $501
 $172
 $—
 $1,009
Cost of operations66
 128
 114
 —
 308
77
 133
 116
 —
 326
Depreciation and amortization80
 203
 20
 —
 303
103
 210
 21
 —
 334
Impairment losses—
 185
 —
 —
 185
—
 44
 —
 —
 44
General and administrative—
 —
 —
 14
 14
—
 —
 —
 19
 19
Acquisition-related transaction and integration costs—
 —
 —
 1
 1
—
 —
 —
 3
 3
Operating income (loss)187
 16
 36
 (15) 224
156
 114
 35
 (22) 283
Equity in earnings of unconsolidated affiliates13
 47
 —
 —
 60
12
 59
 —
 —
 71
Other income, net1
 2
 —
 —
 3
1
 2
 —
 1
 4
Loss on debt extinguishment—
 (3) —
 —
 (3)
Interest expense(48) (151) (7) (66) (272)(49) (164) (10) (71) (294)
Net Income (Loss)$153
 $(86) $29
 $(81) $15
120
 8
 25
 (92) 61
Less: Net loss attributable to noncontrolling interests—
 (75) —
 —
 (75)
Net Income (Loss) Attributable to Clearway Energy LLC$120
 $83
 $25
 $(92) $136
Balance Sheet                  
Equity investments in affiliates$106
 $1,046
 $—
 $—
 $1,152
$102
 $1,076
 $—
 $—
 $1,178
Capital expenditures (a)
7
 2
 14
 —
 23
15
 181
 16
 —
 212
Total Assets$1,993
 $6,114
 $426
 $213
 $8,746
$1,897
 $6,017
 $422
 $24
 $8,360
 


(a) Includes accruals.
Year ended December 31, 2015Year ended December 31, 2016
(In millions)Conventional Generation Renewables Thermal Corporate TotalConventional Generation Renewables Thermal Corporate Total
Operating revenues$336
 $458
 $174
 $—
 $968
$333
 $532
 $170
 $—
 $1,035
Cost of operations59
 138
 126
 —
 323
66
 128
 114
 —
 308
Depreciation and amortization81
 203
 19
 —
 303
80
 203
 20
 —
 303
Impairment losses—
 1
 —
 —
 1
—
 185
 —
 —
 185
General and administrative—
 —
 —
 10
 10
—
 —
 —
 14
 14
Acquisition-related transaction and integration costs—
 —
 —
 3
 3
—
 —
 —
 1
 1
Operating income (loss)196
 116
 29
 (13) 328
187
 16
 36
 (15) 224
Equity in earnings of unconsolidated affiliates14
 17
 —
 —
 31
13
 47
 —
 —
 60
Other income, net1
 2
 —
 —
 3
1
 2
 —
 —
 3
Loss on debt extinguishment(7) (2) —
 —
 (9)
Interest expense(48) (151) (7) (52) (258)(48) (151) (7) (66) (272)
Net Income (Loss)$156
 $(18) $22
 $(65) $95
153
 (86) 29
 (81) 15
Less: Net loss attributable to noncontrolling interests—
 (111) —
 —
 (111)
Net Income (Loss) Attributable to Clearway Energy LLC$153
 $25
 $29
 $(81) $126

                                    


Note 13 — Related Party Transactions
In addition toRelated Party Transactions with CEG entities
Administrative Services Agreements by and between the transactionsCompany and relationships described elsewhereClearway Renewable Operation & Maintenance LLC (formerly NRG Renew Operation & Maintenance LLC)
Various wholly-owned subsidiaries of the Company in the notesRenewables segment are party to administrative services agreements with Clearway Renewable Operation & Maintenance LLC (formerly NRG Renew Operation & Maintenance LLC), or RENOM, a wholly-owned subsidiary of CEG, which provides Operation and Maintenance, O&M, services to these subsidiaries. The Company incurred total expenses for these services of $30 million, $23 million and $13 million for the consolidated financial statements,years ended December 31, 2018, 2017 and 2016, respectively. There was a balance of $6 million and $5 million due to RENOM as of December 31, 2018 and 2017, respectively.
CEG Master Services Agreements
Following the consummation of the GIP Transaction, Clearway Energy, Inc. along with Clearway Energy LLC and Clearway Energy Operating LLC entered into Master Services Agreements with CEG, pursuant to which CEG and certain subsidiaries of NRG provideits affiliates or third party service providers began providing certain services to the Company's project entities. Company,including operational and administrative services, which include human resources, information systems, external affairs, accounting, procurement and risk management services, and the Company began providing certain services to CEG, including accounting, internal audit, tax and treasury services, in exchange for the payment of fees in respect of such services.
Amounts due to NRGCEG or its subsidiaries are recorded as accounts payable —- affiliate and amounts due to the Company from NRGCEG and subsidiaries are recorded as accounts receivable —- affiliate inon the Company's consolidated balance sheet.
Related Party Transactions with NRG entities prior to the GIP Transaction
The disclosures below summarizefollowing transactions relate to the Company's materialperiod prior to sale of NRG's interest in CEG to GIP on August 31, 2018 and therefore were considered to be related party transactions with NRG and its subsidiaries that are included infor all the Company's operating revenues and operating costs.
Power Hedge Contracts by and between Renewable Entities and NRG Texas Power LLC
Certain NRG Wind TE Holdco entities, which are subsidiaries in the Renewables segment, entered into power hedge contracts with NRG Texas Power LLC, a subsidiary of NRG, and generated $16 million of revenue during the year ended Decemberperiods prior to August 31, 2015. Effective October 2015, Elbow Creek entered into a PPA with NRG Power Marketing LLC, or NRG Power Marketing, a wholly-owned subsidiary of NRG, as further described below, and the hedge agreement between Elbow Creek and NRG Texas Power LLC was terminated.2018:
Power Purchase Agreements (PPAs) between the Company and NRG Power Marketing
Elbow Creek and Dover are parties to PPAs with NRG Power Marketing and generate revenue under the PPAs, which are recorded to operating revenues in the Company's consolidated statements of operations. For the eight months ended August 31, 2018, Elbow Creek and Dover, collectively, generated revenues of $8 million. For the years ended December 31, 2017 and 2016, Elbow Creek and Dover, collectively, generated revenues of $8 million each year, and Dover generated revenues of $4$12 million and $5$13 million, respectively.
Energy Marketing Services Agreement by and between Thermal entities and NRG Power Marketing
NRG Energy Center Dover LLC, NRG Energy Center Minneapolis, NRG Energy Center Phoenix LLC, and NRG Energy Center Paxton LLC, or Thermal entities, are parties to Energy Marketing Services Agreements with NRG Power Marketing, a wholly-owned subsidiary of NRG. Under the agreements, NRG Power Marketing procures fuel and fuel transportation for the operation of Thermal entities. For the eight months ended August 31, 2018, the Thermal entities purchased $7 million of natural gas from NRG Power Marketing. The Thermal entities purchased a total of $9 million of natural gas during each of the years ended December 31, 2017 and 2016. During the year ended December 31, 2015 total purchases of natural gas under the agreement were $13 million.
Operation and Maintenance (O&M) Services Agreements by and between Company's subsidiaries and NRG
Certain of the Company's subsidiaries are party to O&M Services Agreements with NRG, pursuant to which NRG subsidiaries provide necessary and appropriate services to operate and maintain the subsidiaries' plant operations, businesses and thermal facilities. NRG is reimbursed for the provided services, as well as for all reasonable and related expenses and expenditures, and payments to third parties for services and materials rendered to or on behalf of the parties to the agreements. NRG is not entitled to any management fee or mark-up under the agreements. The fees incurred under these agreements was $27 million for the eight months ended August 31, 2018. The fees incurred under this agreement were $39 million and $36 million for the yearyears ended December 31, 2017 and $36 million for each year ended December 31, 2016, and 2015.
The Company had $13 million due to NRG for the services performed during the year ended December 31, 2017 under the O&M Agreements, $5 million of which was paid off as of March 1, 2018. The Company had $22 million due to NRG for the services performed during the year ended December 31, 2016 under the O&M Agreements.respectively.
O&M Services Agreements by and between GenConn and NRG
GenConn incurs fees under two O&M agreements with wholly-owned subsidiaries of NRG. For the eight months ended August 31, 2018, the aggregate fees incurred under the agreements were $4 million. The fees incurred under the agreements were $5 million during each year forof the years ended December 31, 2017 and 2016, and $4 million for the year ended December 31, 2015.2016.
                                    


Administrative Services Agreement by and between Marsh Landing and NRG West Coast LLC
On December 19, 2016, Marsh Landing entered intois a party to an administrative services agreement with NRG West Coast LLC, a wholly owned subsidiary of NRG. The administrative servicesCompany reimbursed costs under this agreement was previously between Marsh Landing and GenOn Energy Services, LLC, a wholly-owned subsidiary of NRG and was subsequently assigned to and assumed by NRG West Coast LLC.$11 million for the eight months ended August 31, 2018. The Company reimbursed costs under this agreement of approximately $15 million $14 million and $13$14 million for the years ended December 31, 2017 and 2016, respectively.
Project Administrative Services Agreement by and 2015, respectively. There was a balance of $1 million due tobetween ESEC and NRG West Coast LLC in accounts payable — affiliate as of December 31, 2017 and 2016.
Administrative Services Agreements by and between the CompanyDuring 2018, ESEC, NRG West Coast LLC and NRG Renew Operation & Maintenance LLC
Various wholly-owned subsidiaries of the Company in the Renewables segment are party to administrative services agreements with NRG Renew Operation & MaintenancePower Marketing LLC, or RENOM, a wholly-owned subsidiaryPML, entered into confirmation agreements under the Project Administration Services Agreement between ESEC and NRG West Coast LLC, whereby PML purchased California Carbon Allowances which ESEC could subsequently purchase for the purposes of NRG, which provides O&M services toESEC’s compliance with the California Cap-and-Trade Program. ESEC reimbursed costs under these subsidiaries. The Company incurred total expenses for these services in the amountagreements of $23 million, $13 million and $7$11 million for the yearseight months ended DecemberAugust 31, 2017, 2016 and 2015, respectively. There was a balance of $5 million due to RENOM as of December 31, 2017 and 2016.2018.
Management Services Agreement by and between the Company and NRG
Prior to the GIP Transaction, NRG providesprovided the Company with various operational, management, and administrative services, which include human resources, accounting, tax, legal, information systems, treasury, and risk management, as set forth in the Management Services Agreement. As of DecemberCosts incurred under this agreement were $7 million for the eight months ended August 31, 2017, the base management fee was approximately $8.5 million per year, subject to an inflation-based adjustment annually, at an inflation factor based on the year-over-year U.S. consumer price index. The fee is also subject to adjustments following the consummation of future acquisitions and as a result of a change in the scope of services provided under the Management Services Agreement. During the year ended December 31, 2017, the fee was increased by approximately $1 million per year, primarily due to the acquisition of the March 2017, August 2017 and November 2017 Drop Down Assets, as further described in Note 3, Business Acquisitions. In addition to the base management fee, the Company is also responsible for any expenses that are directly incurred and paid for by NRG on behalf of the Company.2018. Costs incurred under this agreement were approximately $10 million forduring each of the years ended December 31, 2017 and 2016, respectively. The costs incurred under the Management Services Agreement included certain direct expenses incurred by NRG on behalf of the Company in addition to the base management fee.
On August 31, 2018, in connection with the consummation of the GIP Transaction, the Company entered into a Termination Agreement with Clearway Energy LLC, Clearway Energy Operating LLC and $8 millionNRG terminating the Management Services Agreement, dated as of July 22, 2013, by and among the Company, Clearway Energy LLC, Clearway Energy Operating LLC and NRG.
Subsequent to the GIP Transaction, the Company entered into a Transition Services Agreement with NRG, or the NRG TSA, pursuant to which NRG or certain of its affiliates began providing transitional services to the Company following the consummation of the GIP Transaction, in exchange for the year ended December 31, 2015. There waspayment of a balancefee in respect of $4 millionsuch services. Expenses related to the NRG TSA are recorded in accounts payable — affiliate due to NRG asacquisition-related transaction and integration costs in the consolidated statements of December 31, 2017, which the Company paid off in January 2018.operations.
EPC Agreement by and between NECPECP and NRG
On October 31, 2016, NRG Business Services LLC, a subsidiary of NRG, and NECP,Energy Center Pittsburgh LLC, or ECP, a wholly owned subsidiary of the Company, entered into an EPC agreement for the construction of a 73 MWt district energy system for NECPECP to provide 150 kpph of steam, 6,750 tons of chilled water and 7.5 MW of emergency backup power service to UPMC Mercy. The initial term of the energy services agreement with UPMC Mercy will be for a period of twenty years from the service commencement date.  Pursuant toOn June 19, 2018, as discussed in Note 3, Business Acquisitions, ECP purchased the terms of the EPC agreement, NECP agreed to payUPMC Thermal Project assets from NRG Business Services LLC $79for cash consideration of $84 million, subject to adjustment basedworking capital adjustments. The Company paid an additional $3 million to NRG upon certain conditions in the EPC agreement, upon substantialfinal completion of the project. The project is expected to reach COD in the first half of 2018. As of December 31, 2017, the parties made a number of amendmentsJanuary 2019 pursuant to the EPC Agreement, based on customer change orders, to increase the capacity of the district energy system from 73 MWt to 80 MWt, which also increased the payment from $79 million to $88 million.agreement.
Note 14 — Commitments and Contingencies
Operating Lease Commitments
The Company leases certain facilities and equipment under operating leases, some of which include escalation clauses, expiring on various dates through 2048. The effects of these scheduled rent increases, leasehold incentives, and rent concessions are recognized on a straight-line basis over the lease term unless another systematic and rational allocation basis is more representative of the time pattern in which the leased property is physically employed. Lease expense under operating leases was $18 million, $17 million $15 million and $10$15 million for the years ended December 31, 2018, 2017 2016 and 2015,2016, respectively.
The Company's future


Future minimum lease commitments under operating leases are $9 million for each of the years ending after December 31, 2018 through 2022, and $151 million thereafter.are as follows:
Period

 (In millions)
2019$13
202013
202113
202213
202312
Thereafter207
Total$271

Gas and Transportation Commitments
The Company has entered into contractual arrangements to procure power, fuel and associated transportation services. For the years ended December 31, 2018, 2017 2016 and 2015,2016, the Company purchased $39 million, $34 million $32 million and $40$32 million, respectively, under such arrangements. As further described in Note 13 Related Party Transactions, these purchases include intercompany transactions through August 31, 2018 between certain Thermal entities and NRG Power Marketing under the Energy Marketing Services Agreements in the amount of $7 million for the eight months ended August 31, 2018 and $9 million forduring each of the years ended December 31, 2017 and 2016. Total intercompany purchases of natural gas under the agreement were $13 million for the year ended December 31, 2015.
As of December 31, 2017,2018, the Company's commitments under such outstanding agreements are estimated as follows:
Period(In millions)(In millions)
2018$11
20195
$11
20203
3
20213
3
20223
3
20233
Thereafter16
13
Total$41
$36
Contingencies
The Company's material legal proceedings are described below. The Company believes that it has valid defenses to these legal proceedings and intends to defend them vigorously. The Company records reserves for estimated losses from contingencies when information available indicates that a loss is probable and the amount of the loss, or range of loss, can be reasonably estimated. As applicable, the Company has established an adequate reserve for the matters discussed below. In addition, legal costs are expensed as incurred. Management assesses such matters based on current information and makes a judgment concerning its potential outcome, considering the nature of the claim, the amount and nature of damages sought and the probability of success. The Company is unable to predict the outcome of the legal proceedings below or reasonably estimate the scope or amount of any associated costs and potential liabilities. As additional information becomes available, management adjusts its assessment and estimates of such contingencies accordingly. Because litigation is subject to inherent uncertainties and unfavorable rulings or developments, it is possible that the ultimate resolution of the Company's liabilities and contingencies could be at amounts that are different from its currently recorded reserves and that such difference could be material.
In addition to the legal proceedings noted below, the Company and its subsidiaries are party to other litigation or legal proceedings arising in the ordinary course of business. In management's opinion, the disposition of these ordinary course matters will not materially adversely affect the Company's consolidated financial position, results of operations, or cash flows.
Braun v. NRG Yield, Inc. — Nebraska Public Power District Litigation
On April 19, 2016, plaintiffs filed a putative class action lawsuit against NRG Yield, Inc., the current and former members of its board of directors individually, and other parties in California Superior Court in Kern County, CA.  Plaintiffs allege various violationsJanuary 11, 2019, Nebraska Public Power District, or NPPD, sent written notice to certain of the Securities Act due toCompany’s subsidiaries which own the defendants’ alleged failure to disclose material facts related to lowLaredo Ridge and Elkhorn Ridge wind production prior to NRG Yield, Inc.'s June 22, 2015 Class C common stock offering.  Plaintiffs seek compensatory damages, rescission, attorney’s fees and costs. The defendants filed objections and a motion challenging jurisdiction on October 18, 2016. On December 1, 2017,projects alleging an event of default under each of the parties agreed to a stipulation which provides the plaintiffs' opposition is due on March 6, 2018power purchase agreements between NPPD and the defendants' reply is due on May 4, 2018.
Ahmed v. NRG Energy, Inc. and the NRG Yield Board of Directors — On September 15, 2016, plaintiffs filed a putative class action lawsuit against NRG Energy, Inc., the directors of NRG Yield, Inc., and other parties in the Delaware Chancery Court. The complaintprojects. NPPD alleges that Company moved forward with certain transactions without obtaining the defendants breached their respective fiduciary duties with regardconsent of NPPD. NPPD threatened to terminate the recapitalization of NRG Yield, Inc. common stock in 2015.applicable power purchase agreements by February 11, 2019 if the alleged default was not cured. The plaintiffs generally seek economic damages, attorney’s fees and injunctive relief. The defendantsCompany filed a motion to dismissfor a temporary restraining order and preliminary injunction in the lawsuit on December 21, 2016. Plaintiffs filed their objectionU.S. District Court for the District of Nebraska relating to the motion to dismiss on February 15, 2017. The defendants' reply was filed on March 24, 2017. The court heard oral argument on the defendants' motion to dismiss on June 20, 2017. On September 7, 2017, the court requested additional briefing which the parties provided on September 21, 2017. On December 11, 2017, the court dismissed the lawsuit with prejudice, thereby ending the case.
GenOn Noteholders' Lawsuit — On December 13, 2016, certain indenture trustees for an ad hoc group of holders, or the Noteholders, of the GenOn Energy, Inc., or GenOn, 7.875% Senior Notes due 2017, 9.500% Notes due 2018,Laredo Ridge project, and 9.875% Notes due 2020, and the GenOn Americas Generation, LLC 8.50% Senior Notes due 2021 and 9.125% Senior Notes due 2031, along with certain of the Noteholders, filed a complaintsimilar motion in the SuperiorDistrict Court of the State of Delaware against NRG and GenOn alleging
                                    


certain claimsof Knox County, Nebraska for the Elkhorn Ridge project, to enjoin NPPD from taking any actions related to the Services Agreementpower purchase agreements. On February 19, 2019, the U.S. District Court in the Laredo Ridge matter approved a stipulation between NRGthe parties to provide for an injunction preventing NPPD from terminating the PPA pending disposition of the litigation. On February 26, 2019, the Knox County District Court approved a similar stipulation relating to the Elkhorn Ridge project. The Company believes the allegations of NPPD are meritless and GenOn. On April 30, 2017, the Noteholders filed an amended complaint that asserts additional claims of fraudulent transfer, insider preference and breach of fiduciary duties. In addition to NRG and GenOn, the amended complaint names NRG Yield LLC and certain current and former officers and directors of GenOn as defendants. The plaintiffs, among other things, generally seek return of all monies paidCompany is vigorously defending its rights under the Services Agreement and any other damages that the court deems appropriate. On April 28, 2017, the bondholders filed an amended complaint adding the GenOn directors and officers as defendants and asserting claims that they breached certain fiduciary duties. Plaintiffs specifically allege that the transfer of Marsh Landing to NRG Yield LLC constituted a fraudulent transfer. On June 12, 2017, certain GenOn entities, NRG and certain holders of the GenOn and GenOn Americas Generation, LLC senior notes entered into a restructuring support and lock-up agreement. On December 14, 2017, a settlement agreement was entered into between GenOn and NRG which should ultimately resolve this lawsuit.power purchase agreements.




                                    


Note 15 — Unaudited Quarterly Data
Refer to Note 2, Summary of Significant Accounting Policies and Note 3, Business Acquisitions for a description of the effect of unusual or infrequently occurring events during the quarterly periods. Below is summarized unaudited quarterly financial data which includesfor the periods ending December 31, 2018 and 2017. The Company's historical financial results for the four quarters of the November 2017 Drop Down Assets Acquisition and its impact on every quarter of the 2017 and 2016 results, which were recast to include the November 2017results of the Buckthorn Solar Drop Down Assets, where applicable:Asset acquisition, which took place on March 30, 2018, and is further described in Note 3, Business Acquisitions. The Company originally recast its historical quarterly financial statements to include the result of the Buckthorn Drop Down Asset acquisition in its Form 10-Q for the period ended September 30, 2018. Additionally, the quarterly results for the period ended December 31, 2017, as presented below in the table, were recast to include the quarterly operating results of the Buckthorn Solar Drop Down Asset for the period ending December 31, 2017.
 Quarter Ended
 December 31, September 30, June 30, March 31,
 2017
 (In millions)
Operating Revenues$231
 $269
 $288
 $221
        
Operating Revenues (as previously reported)N/A
 265
 284
 218
ChangeN/A
 4
 4
 3
        
Operating Income19
 85
 124
 55
        
Operating Income (as previously reported)N/A
 95
 122
 54
ChangeN/A
 (10) 2
 1
        
Net (Loss) Income(38) 41
 59
 —
        
Net Income (as previously reported)N/A
 52
 57
 1
ChangeN/A
 $(11) $2
 $(1)
 Quarter Ended
 December 31, September 30, June 30, March 31,
 2018
 (In millions)
Operating Revenues$229
 $292
 $307
 $225
        
Operating Income54
 100
 144
 49
        
Net (Loss) Income(37) 64
 106
 2



 Quarter Ended
 December 31, September 30, June 30, March 31,
 2016
 (In millions)
Operating Revenues$235
 $276
 $287
 $237
        
Operating Revenues (as previously reported)232
 272
 283
 234
Change3
 4
 4
 3
        
Operating (Loss) Income(100) 120
 130
 74
        
Operating (Loss) Income (as previously reported)(99) 118
 128
 73
Change(1) 2
 2
 1
        
Net (Loss) Income(138) 68
 80
 5
        
Net (Loss) Income (as previously reported)(137) 67
 79
 6
Change$(1) $1
 $1
 $(1)
 Quarter Ended
 December 31, September 30, June 30, March 31,
 2017
 (In millions)
Operating Revenues$231
 $269
 $288
 $221
        
Operating Income20
 84
 125
 54
        
Net (Loss) Income(37)
(a) 
42
 56
 —

(a) The Company reported Net loss of $38 million for the quarter ending December 31, 2017, as previously reported in the Note 17 , Unaudited Quarterly Financial Data of its Form 2017 10-K. The recast results in the table above include $1 million of Net Income attributable to the Buckthorn Solar Drop Down Asset acquisition.
                                    


Note 16 — Condensed Consolidating Financial Information

As of December 31, 2017, Yield2018, Clearway Energy Operating LLC had outstanding $500 million of the 2024 Senior Notes, $600 million of the 2025 Senior Notes and $350 million of the 2026 Senior Notes, collectively Senior Notes, as described in Note 10, Long-term Debt. These Senior Notes are guaranteed by the Company, as well as certain of the Company's subsidiaries, or guarantor subsidiaries. These guarantees are both joint and several. The non-guarantor subsidiaries include the rest of the Company's subsidiaries, including the ones that are subject to project financing.
Unless otherwise noted below, each of the following guarantor subsidiaries fully and unconditionally guaranteed the Senior Notes as of December 31, 2017:2018:

NRG Yield LLC
Alta Wind 1-5 Holding Company, LLC
Alta Wind Company, LLC
NRGCentral CA Fuel Cell 1, LLC
Clearway Energy Center OmahaLLC
Clearway Energy Operating LLC
Clearway Solar Star LLC
DGPV Holding LLC
ECP Uptown Campus Holdings LLC
NRG Energy Center OmahaCaguas Holdings LLC
NYLD Fuel Cell Holdings LLC
Portfolio Solar I, LLC
RPV Holding LLC
Solar Flagstaff One LLC
Solar Iguana LLC
Solar Las Vegas MB 1 LLC
Solar Tabernacle LLC
South Trent Holdings LLC
SPP Asset Holdings, LLC
SPP Fund II Holdings, LLC
SPP Fund II, LLC
SPP Fund II-B, LLC
SPP Fund III, LLC
Thermal Canada Infrastructure Holdings LLC
Thermal Infrastructure Development Holdings LLC
UB Fuel Cell, LLC
NRG South Trent Holdings LLC
NRG Yield DGPV Holding LLC
NRG Yield RPV Holding LLC

YieldClearway Energy Operating LLC conducts much of its business through and derives much of its income from its subsidiaries. Therefore, its ability to make required payments with respect to its indebtedness and other obligations depends on the financial results and condition of its subsidiaries and YieldClearway Energy Operating LLC's ability to receive funds from its subsidiaries. There are no restrictions on the ability of any of the guarantor subsidiaries to transfer funds to YieldClearway Energy Operating LLC. However, there may be restrictions for certain non-guarantor subsidiaries.
On January 29, 2019, PG&E filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. PG&E is one of the Company's largest customers, representing approximately 23% of the Company's consolidated operating revenues during the year ended December 31, 2018 and 16% of total accounts receivable as of December 31, 2018, of which all has been collected as of January 31, 2019. The PG&E bankruptcy filing is an event of default under the related financing agreements which caused uncertainty around the timing of when certain project-level cash distributions will be available to the Company.  As of December 31, 2018, all project level cash balances for these subsidiaries were classified as restricted cash. None of the subsidiaries affected by the PG&E bankruptcy are guarantors of the Senior Notes as of December 31, 2018.
The following condensed consolidating financial information presents the financial information of YieldClearway Energy LLC, YieldClearway Energy Operating LLC, the issuer of the Senior Notes, the guarantor subsidiaries and the non-guarantor subsidiaries in accordance with Rule 3-10 under the SEC Regulation S-X. The financial information may not necessarily be indicative of results of operations or financial position had the guarantor subsidiaries or non-guarantor subsidiaries operated as independent entities.
In this presentation, YieldClearway Energy LLC consists of parent company operations. Guarantor subsidiaries and non-guarantor subsidiaries of YieldClearway Energy LLC are reported on an equity basis. For companies acquired, the fair values of the assets and liabilities acquired have been presented on a push-down accounting basis.


As described in Note 3, Business Acquisitions, the Company completed the acquisition of the November 2017Buckthorn Solar Drop Down Assets, August 2017 Drop Down Assets, andAsset on March 2017 Drop Down Assets from NRG on November 1, 2017, August 1, 2017 and March 27, 2017, respectively.30, 2018. The guidance requires retrospective combination of the entities for all periods presented as if the combination has been in effect since the inception of common control. Accordingly, the Company prepared its condensed consolidating financial statements to reflect the transfers as if they had taken place from the beginning of the financial statements period.
The Company also completed the UPMC Thermal Project Asset Acquisition on June 19, 2018, which was an asset acquisition. The assets transferred to the Company relate to interests under common control by NRG and were recorded at book value in accordance with ASC 805-50, Business Combinations - Related Issues. The difference between the purchase price and book value of the assets was recorded as a distribution to NRG and decreased the balance of contributed capital. The acquisition was determined to be an asset acquisition and not a business combination, therefore no recast of the historical financial information was deemed necessary.
During the first six months of 2018, the Company added certain subsidiaries to the list of guarantors under the Senior Notes indentures, and as a result, the Company recast the historical financial statements to allow for the comparability between the reported periods as required by GAAP.
In addition, the condensed parent company financial statements are provided in accordance with Rule 12-04, Schedule I of Regulation S-X, as the restricted net assets of YieldClearway Energy LLC’s subsidiaries exceed 25 percent of the consolidated net assets of YieldClearway Energy LLC. These statements should be read in conjunction with the consolidated statements and notes thereto of NRG YieldClearway Energy LLC. For a discussion of YieldClearway Energy LLC's long-term debt, see Note 10, Long-term Debt. For a discussion of YieldClearway Energy LLC's commitments and contingencies, see Note 14, Commitments and Contingencies.
For a discussion of YieldClearway Energy LLC's distributions to Yield,Clearway Energy, Inc. and, NRG Energy, (and subsequent to August 31, 2018, CEG), see Note 11, Members' Equity.
In addition, Clearway Energy LLC’s cash and cash equivalents represents corporate cash held in overnight investment accounts and is used for general corporate purposes for Clearway LLC and Clearway Operating LLC.

                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the year endedYear Ended December 31, 20172018
NRG Yield LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries NRG Yield Operating LLC (Note Issuer) 
Eliminations(b)
 Consolidated
Clearway Energy LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries Clearway Energy Operating LLC (Senior Notes Issuer) 
Eliminations(b)
 Consolidated
(In millions)(In millions)
Operating Revenues                      
Total operating revenues$—
 $21
 $988
 $1
 $(1) $1,009
$—
 $11
 $1,042
 $3
 $(3) $1,053
Operating Costs and Expenses      —
          —
    
Cost of operations—
 14
 312
 1
 (1) 326
—
 3
 329
 3
 (3) 332
Depreciation and amortization—
 5
 329
 —
 —
 334
—
 6
 325
 —
 —
 331
Impairment losses—
 —
 44
 —
 —
 44
General and administrative—
 —
 —
 19
 —
 19
—
 —
 —
 20
 —
 20
Acquisition-related transaction and integration costs—
 —
 —
 3
 —
 3
—
 —
 —
 20
 —
 20
Development costs—
 —
 —
 3
 —
 3
Total operating costs and expenses—
 19
 685
 23
 (1) 726
—
 9
 654
 46
 (3) 706
Operating (Loss) Income—
 2
 303
 (22) —
 283
Operating Income (Loss)—
 2
 388
 (43) —
 347
Other Income (Expense)                      
Equity in earnings (losses) of consolidated affiliates136
 (16) —
 126
 (246) —
Equity in earnings of consolidated affiliates237
 —
 —
 224
 (461) —
Equity in earnings of unconsolidated affiliates—
 22
 21
 28
 —
 71
—
 43
 3
 28
 —
 74
Other income, net1
 —
 3
 —
 —
 4
3
 —
 5
 —
 —
 8
Loss on debt extinguishment—
 —
 (3) —
 —
 (3)
Interest expense—
 —
 (222) (71) —
 (293)—
 —
 (217) (77) —
 (294)
Total other income (expense), net137
 6
 (201) 83
 (246) (221)240
 43
 (209) 175
 (461) (212)
Net Income137
 8
 102
 61
 (246) 62
240
 45
 179
 132
 (461) 135
Less: Net loss attributable to noncontrolling interests—
 —
 (5) (75) 5
 (75)—
 —
 (69) (105) 69
 (105)
Net Income Attributable to NRG Yield LLC$137
 $8
 $107
 $136
 $(251) $137
Net Income Attributable to Clearway Energy LLC$240
 $45
 $248
 $237
 $(530) $240
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.
                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
For the year endedYear Ended December 31, 20172018
NRG Yield LLC (a)
 Guarantor Subsidiaries Non-Guarantor Subsidiaries 
NRG Yield Operating LLC
(Note Issuer)
 
Eliminations(b)
 Consolidated
Clearway Energy LLC (a)
 Guarantor Subsidiaries Non-Guarantor Subsidiaries 
Clearway Energy Operating LLC
(Note Issuer)
 
Eliminations(b)
 Consolidated
(In millions)(In millions)
Net Income$137
 $8
 $102
 $61
 $(246) $62
$240
 $45
 $179
 $132
 $(461) $135
Other Comprehensive Income                      
Unrealized gain on derivatives17
 1
 16
 17
 (34) 17
24
 1
 20
 24
 (45) 24
Other comprehensive income17
 1
 16
 17
 (34) 17
24
 1
 20
 24
 (45) 24
Comprehensive Income154
 9
 118
 78
 (280) 79
264
 46
 199
 156
 (506) 159
Less: Comprehensive loss attributable to noncontrolling interests—
 —
 (5) (75) 5
 (75)—
 —
 (69) (105) 69
 (105)
Comprehensive Income Attributable to NRG Yield LLC$154
 $9
 $123
 $153
 $(285) $154
Comprehensive Income Attributable to Clearway Energy LLC$264
 $46
 $268
 $261
 $(575) $264
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.
                                    



NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
December 31, 20172018

 
NRG Yield LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries NRG Yield Operating LLC
(Note Issuer)		 
Eliminations(b)
 Consolidated
Clearway Energy LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries Clearway Energy Operating LLC
(Senior Notes Issuer)		 
Eliminations(b)
 Consolidated
ASSETS (In millions)(In millions)
Current Assets                       
Cash and cash equivalents $22
 $—
 $124
 $—
 $—
 $146
$298
 $—
 $109
 $—
 $—
 $407
Restricted cash —
 —
 168
 —
 —
 168
—
 —
 176
 —
 —
 176
Accounts receivable — trade 1
 2
 92
 1
 —
 96
—
 1
 103
 —
 —
 104
Accounts receivable — affiliates8
 —
 —
 11
 (14) 5
Inventory —
 1
 38
 —
 —
 39
—
 —
 40
 

 

 40
Notes receivable — current —
 —
 13
 —
 —
 13
Prepayments and other current assets —
 —
 18
 1
 —
 19


 

 27
 2
 —
 29
Total current assets 23
 3
 453
 2
 —
 481
306
 1
 455
 13
 (14) 761
           
Property, plant and equipment, net —
 58
 5,146
 —
 —
 5,204
—
 65
 5,180
 —
 —
 5,245
Other Assets                       
Investment in consolidated subsidiaries 1,823
 460
 —
 3,177
 (5,460) —
1,676
 417
 —
 3,250
 (5,343) —
Equity investments in affiliates —
 233
 577
 368
 —
 1,178
—
 289
 522
 361
 —
 1,172
Intangible assets, net —
 55
 1,173
 —
 —
 1,228
—
 11
 1,145
 —
 —
 1,156
Derivative instruments—
 —
 8
 —
 —
 8
Other non-current assets —
 —
 63
 —
 —
 63
—
 —
 103
 3
 —
 106
Total other assets 1,823
 748
 1,813
 3,545
 (5,460) 2,469
1,676
 717
 1,778
 3,614
 (5,343) 2,442
Total Assets $1,846
 $809
 $7,412
 $3,547
 $(5,460) $8,154
$1,982
 $783
 $7,413
 $3,627
 $(5,357) $8,448
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.

                                    



NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(Continued)
December 31, 20172018
 
NRG Yield LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries NRG Yield Operating LLC
(Note Issuer)		 
Eliminations(b)
 Consolidated
Clearway Energy LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries Clearway Energy Operating LLC
(Senior Notes Issuer)		 
Eliminations(b)
 Consolidated
LIABILITIES AND MEMBERS' EQUITY (In millions)(In millions)
Current Liabilities                       
Current portion of long-term debt — external $—
 $—
 $306
 $—
 $—
 $306
$—
 $—
 $314
 $—
 $—
 $314
Current portion of long-term debt — affiliate—
 —
 —
 215
 —
 215
Accounts payable — trade —
 2
 25
 —
 —
 27
—
 1
 36
 8
 —
 45
Accounts payable — affiliate —
 5
 27
 16
 —
 48
—
 —
 23
 11
 (14) 20
Derivative instruments —
 —
 17
 —
 —
 17
—
 —
 4
 —
 —
 4
Accrued interest expense—
 —
 17
 27
 —
 44
Accrued expenses and other current liabilities —
 1
 61
 25
 —
 87
—
 —
 53
 4
 —
 57
Total current liabilities —
 8
 436
 41
 —
 485
—
 1
 447
 265
 (14) 699
Other Liabilities                       
Long-term debt — external —
 —
 4,025
 896
 —
 4,921
—
 —
 3,970
 1,434
 —
 5,404
Long-term debt — affiliate —
 —
 —
 618
 —
 618
—
 —
 —
 44
 —
 44
Derivative instruments —
 —
 31
 —
 —
 31
—
 —
 17
 —
 —
 17
Other non-current liabilities —
 —
 84
 7
 —
 91
—
 2
 92
 8
 —
 102
Total non-current liabilities —
 —
 4,140
 1,521
 —
 5,661
—
 2
 4,079
 1,486
 —
 5,567
Total Liabilities —
 8
 4,576
 1,562
 —
 6,146
—
 3
 4,526
 1,751
 (14) 6,266
Commitments and Contingencies                       
Members' Equity                       
Contributed capital 1,897
 863
 2,871
 2,097
 (5,831) 1,897
1,940
 804
 2,708
 1,930
 (5,442) 1,940
Retained earnings (accumulated deficit) 17
 (61) (21) (206) 288
 17
86
 (24) 108
 (210) 126
 86
Accumulated other comprehensive loss (68) (1) (71) (68) 140
 (68)(44) —
 (51) (44) 95
 (44)
Noncontrolling interest —
 —
 57
 162
 (57) 162
—
 —
 122
 200
 (122) 200
Total Members' Equity 1,846
 801
 2,836
 1,985
 (5,460) 2,008
1,982
 780
 2,887
 1,876
 (5,343) 2,182
Total Liabilities and Members’ Equity $1,846
 $809
 $7,412
 $3,547
 $(5,460) $8,154
$1,982
 $783
 $7,413
 $3,627
 $(5,357) $8,448
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.

                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the year endedYear Ended December 31, 20172018
 
NRG Yield LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries NRG Yield Operating LLC (Note Issuer) Consolidated 
Clearway Energy LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries Clearway Energy Operating LLC (Note Issuer) Consolidated
 (In millions) (In millions)
Net Cash Provided by (Used in) Operating Activities $—
 $58
 $529
 $(71) $516
 $—
 $23
 $550
 $(81) $492
Cash Flows from Investing Activities                    
Changes in investments in consolidated subsidiaries (15) —
 —
 15
 —
 361
 —
 —
 (361) —
Acquisition of business, net of cash acquired —
 —
 —
 (11) (11)
Acquisition of Drop Down Assets, net of cash acquired —
 —
 —
 (250) (250) —
 —
 —
 (126) (126)
Capital expenditures —
 (4) (27) —
 (31) —
 —
 (83) —
 (83)
Cash receipts from notes receivable —
 —
 17
 —
 17
 —
 —
 13
 —
 13
Return of investment from unconsolidated affiliates —
 10
 14
 23
 47
 —
 11
 20
 14
 45
Investments in unconsolidated affiliates —
 (64) (7) (2) (73) —
 (34) —
 —
 (34)
Other —
 —
 7
 —
 7
 —
 —
 11
 —
 11
Net Cash Provided by (Used in) Investing Activities (15) (58) 4
 (214) (283) 361
 (23) (39) (484) (185)
Cash Flows from Financing Activities                    
Net contributions from noncontrolling interests —
 —
 2
 11
 13
 —
 —
 97
 9
 106
Net distributions and return of capital to NRG prior to the acquisition of Drop Down Assets —
 —
 (13) (7) (20)
Transfer of funds under intercompany cash management arrangement (5) —
 (1) 6
 —
 —
 —
 4
 (4) —
Proceeds from the issuance of Class C units 33
 —
 —
 —
 33
 153
 —
 —
 —
 153
(Payments of) proceeds from distributions (202) —
 (220) 220
 (202) (238) —
 (400) 385
 (253)
Proceeds from the revolving credit facility —
 —
 —
 55
 55
 —
 —
 —
 35
 35
Payments for the revolving credit facility —
 —
 —
 (90) (90)
Payments of debt issuance costs —
 —
 (3) (11) (14)
Proceeds from issuance of long-term debt —
 —
 41
 —
 41
 —
 —
 227
 600
 827
Payments of debt issuance costs —
 —
 (4) —
 (4)
Payments for long-term debt — external —
 —
 (332) —
 (332) —
 —
 (443) —
 (443)
Payments for long-term debt — affiliate —
 —
 —
 (359) (359)
Net Cash (Used in) Provided by Financing Activities (174) —
 (527) 285
 (416) (85) —
 (518) 565
 (38)
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash (189) —
 6
 —
 (183)
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash 276
 —
 (7) —
 269
Cash, Cash Equivalents and Restricted Cash at Beginning of Period 211
 —
 286
 —
 497
 22
 —
 292
 —
 314
Cash, Cash Equivalents and Restricted Cash at End of Period $22
 $—
 $292
 $—
 $314
 $298
 $—
 $285
 $—
 $583
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.

                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the Year Ended December 31, 20162017
NRG Yield LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
NRG Yield Operating LLC
(Note Issuer) (c)
 
Eliminations(b) (c)
 Consolidated
Clearway Energy LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
Clearway Energy Operating LLC
(Note Issuer) (c)
 
Eliminations(b) (c)
 Consolidated
(In millions)(In millions)
Operating Revenues                      
Total operating revenues$—
 $22
 $1,013
 $1
 $(1) $1,035
$—
 $10
 $999
 $1
 $(1) $1,009
Operating Costs and Expenses                      
Cost of operations—
 14
 294
 1
 (1) 308
—
 2
 324
 1
 (1) 326
Depreciation and amortization—
 5
 298
 —
 —
 303
—
 6
 328
 —
 —
 334
Impairment losses—
 —
 185
 —
 —
 185
—
 12
 32
 —
 —
 44
General and administrative2
 —
 —
 12
 —
 14
—
 —
 —
 19
 —
 19
Acquisition-related transaction and integration costs—
 —
 —
 1
 —
 1
—
 —
 —
 3
 —
 3
Total operating costs and expenses2
 19
 777
 14
 (1) 811
—
 20
 684
 23
 (1) 726
Operating Income (Loss)(2) 3
 236
 (13) —
 224
—
 (10) 315
 (22) —
 283
Other Income (Expense)                      
Equity in earnings (losses) of consolidated affiliates128
 10
 —
 66
 (204) —
135
 (16) —
 125
 (244) —
Equity in earnings of unconsolidated affiliates—
 9
 21
 30
 —
 60
—
 22
 21
 28
 —
 71
Loss on debt extinguishment—
 (3) —
 —
 —
 (3)
Other income, net—
 —
 3
 —
 —
 3
1
 —
 3
 —
 —
 4
Interest expense—
 —
 (206) (66) —
 (272)—
 1
 (224) (71) —
 (294)
Total other income (expense)128
 19
 (182) 30
 (204) (209)136
 4
 (200) 82
 (244) (222)
Net Income126
 22
 54
 17
 (204) 15
Net Income (Loss)136
 (6) 115
 60
 (244) 61
Less: Net loss attributable to noncontrolling interests—
 —
 (1) (111) 1
 (111)—
 —
 (5) (75) 5
 (75)
Net Income Attributable to NRG Yield LLC$126
 $22
 $55
 $128
 $(205) $126
Net Income (Loss) Attributable to Clearway Energy LLC$136
 $(6) $120
 $135
 $(249) $136
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.
(c) Retrospectively adjusted as discussed in Note 1, Nature of Business.

                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
For the Year Ended December 31, 20162017

NRG Yield LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
NRG Yield Operating LLC
(Note Issuer) (c)
 
Eliminations(b) (c)
 Consolidated
Clearway Energy LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
Clearway Energy Operating LLC
(Note Issuer) (c)
 
Eliminations(b) (c)
 Consolidated
(In millions)(In millions)
Net Income$126
 $22
 $54
 $17
 $(204) $15
Net Income (Loss)$136
 $(6) $115
 $60
 $(244) $61
Other Comprehensive Income                      
Unrealized gain on derivatives13
 1
 10
 13
 (24) 13
17
 1
 16
 17
 (34) 17
Other comprehensive income13
 1
 10
 13
 (24) 13
17
 1
 16
 17
 (34) 17
Comprehensive Income139
 23
 64
 30
 (228) 28
Comprehensive Income (Loss)153
 (5) 131
 77
 (278) 78
Less: Comprehensive loss attributable to noncontrolling interests—
 —
 (1) (111) 1
 (111)—
 —
 (5) (75) 5
 (75)
Comprehensive Income Attributable to NRG Yield LLC$139
 $23
 $65
 $141
 $(229) $139
Comprehensive Income (Loss) Attributable to Clearway Energy LLC$153
 $(5) $136
 $152
 $(283) $153
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.
(c) Retrospectively adjusted as discussed in Note 1, Nature of Business.

                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
December 31, 20162017

 
NRG Yield LLC (a)(c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
NRG Yield Operating LLC
(Note Issuer) (c)
 
Eliminations(b)(c)
 Consolidated
Clearway Energy LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
Clearway Energy Operating LLC
(Note Issuer) (c)
 
Eliminations(b)(c)
 Consolidated
ASSETS (In millions)(In millions)
Current Assets                       
Cash and cash equivalents $211
 $—
 $110
 $—
 $—
 $321
$22
 $—
 $124
 $—
 $—
 $146
Restricted cash —
 —
 176
 —
 —
 176
—
 —
 168
 —
 —
 168
Accounts receivable — trade —
 2
 94
 —
 —
 96
—
 1
 93
 1
 —
 95
Accounts receivable — affiliates1
 —
 —
 —
 —
 1
Inventory —
 2
 37
 —
 —
 39
—
 —
 39
 —
 —
 39
Notes receivable — current —
 —
 16
 —
 —
 16
—
 —
 13
 —
 —
 13
Prepayments and other current assets —
 —
 21
 1
 —
 22
—
 —
 18
 1
 —
 19
Total current assets 211
 4
 454
 1
 —
 670
23
 1
 455
 2
 —
 481
                       
Property, plant and equipment, net —
 59
 5,495
 —
 —
 5,554
—
 59
 5,351
 —
 —
 5,410
Other Assets                       
Investment in consolidated subsidiaries 1,927
 527
 —
 3,272
 (5,726) —
1,844
 460
 —
 3,198
 (5,502) —
Equity investments in affiliates —
 171
 600
 381
 —
 1,152
—
 233
 577
 368
 —
 1,178
Intangible assets, net —
 56
 1,247
 —
 —
 1,303
—
 12
 1,216
 —
 —
 1,228
Derivative instruments—
 —
 1
 —
 —
 1
Other non-current assets —
 —
 66
 1
 —
 67
—
 —
 62
 —
 —
 62
Total other assets 1,927
 754
 1,913
 3,654
 (5,726) 2,522
1,844
 705
 1,856
 3,566
 (5,502) 2,469
Total Assets $2,138
 $817
 $7,862
 $3,655
 $(5,726) $8,746
$1,867
 $765
 $7,662
 $3,568
 $(5,502) $8,360
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.
(c) Retrospectively adjusted as discussed in Note 1, Nature of Business.

                                    



NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(Continued)
December 31, 20162017

 
NRG Yield LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
NRG Yield Operating LLC
(Note Issuer) (c)
 
Eliminations (b) (c)
 Consolidated
Clearway Energy LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
Clearway Energy Operating LLC
(Note Issuer) (c)
 
Eliminations (b) (c)
 Consolidated
LIABILITIES AND MEMBERS' EQUITY (In millions)(In millions)
Current Liabilities                       
Current portion of long-term debt — external $—
 $—
 $323
 $—
 $—
 $323
$—
 $—
 $339
 $—
 $—
 $339
Accounts payable — trade —
 2
 18
 3
 —
 23
—
 —
 46
 —
 —
 46
Accounts payable — affiliate —
 7
 15
 18
 —
 40
—
 —
 33
 16
 —
 49
Derivative instruments —
 —
 33
 —
 —
 33
—
 —
 18
 —
 —
 18
Accrued interest expense—
 —
 16
 22
 —
 38
Accrued expenses and other current liabilities —
 1
 60
 24
 —
 85


 

 46
 3
 

 49
Total current liabilities —
 10
 449
 45
 —
 504
—
 —
 498
 41
 —
 539
Other Liabilities           

          

Long-term debt — external —
 —
 4,289
 839
 —
 5,128
—
 —
 4,153
 896
 —
 5,049
Long-term debt — affiliate —
 —
 —
 618
 —
 618
—
 —
 —
 618
 —
 618
Accounts payable — affiliate —
 —
 9
 —
 —
 9
Derivative instruments —
 —
 46
 —
 —
 46
—
 —
 31
 —
 —
 31
Other non-current liabilities —
 —
 77
 —
 —
 77
—
 2
 85
 7
 —
 94
Total non-current liabilities —
 —
 4,421
 1,457
 —
 5,878
—
 2
 4,269
 1,521
 —
 5,792
Total Liabilities —
 10
 4,870
 1,502
 —
 6,382
—
 2
 4,767
 1,562
 —
 6,331
Commitments and Contingencies                       
Members' Equity                       
Contributed capital 2,179
 874
 2,972
 2,155
 (6,001) 2,179
1,919
 822
 2,934
 2,119
 (5,875) 1,919
Retained earnings (accumulated deficit) 44
 (65) 43
 (143) 165
 44
16
 (58) (25) (207) 290
 16
Accumulated other comprehensive loss (85) (2) (87) (85) 174
 (85)(68) (1) (71) (68) 140
 (68)
Noncontrolling interest —
 —
 64
 226
 (64) 226
—
 —
 57
 162
 (57) 162
Total Members' Equity 2,138
 807
 2,992
 2,153
 (5,726) 2,364
1,867
 763
 2,895
 2,006
 (5,502) 2,029
Total Liabilities and Members’ Equity $2,138
 $817
 $7,862
 $3,655
 $(5,726) $8,746
$1,867
 $765
 $7,662
 $3,568
 $(5,502) $8,360
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.
(c) Retrospectively adjusted as discussed in Note 1, Nature of Business.


                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 31, 20162017
 
NRG Yield LLC (a) (b)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (b)
 
NRG Yield Operating LLC (Note Issuer) (b)
 Consolidated 
Clearway Energy LLC (a)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (b)
 
Clearway Energy Operating LLC (Note Issuer)
 Consolidated
    
Net Cash Provided by (Used in) Operating Activities $—
 $62
 $554
 $(39) $577
 $—
 $51
 $537
 $(71) $517
Cash Flows from Investing Activities                    
Changes in investments in consolidated subsidiaries 325
 —
 (21) (304) —
 (15) —
 —
 15
 —
Acquisition of Drop Down Assets —
 —
 —
 (77) (77) —
 —
 —
 (250) (250)
Capital expenditures —
 —
 (20) —
 (20) —
 —
 (190) —
 (190)
Cash receipts from notes receivable —
 —
 17
 —
 17
 —
 —
 17
 —
 17
Return of investment from unconsolidated affiliates —
 16
 —
 12
 28
 —
 10
 14
 23
 47
Investments in unconsolidated affiliates —
 (80) (3) —
 (83) —
 (64) (7) (2) (73)
Other —
 —
 4
 —
 4
 —
 —
 7
 —
 7
Net Cash Used in Investing Activities 325
 (64) (23) (369) (131) (15) (54) (159) (214) (442)
Cash Flows from Financing Activities        
  
        
  
Transfer of funds under intercompany cash management arrangement 44
 2
 —
 (46) —
 (5) —
 (1) 6
 —
Net contributions from noncontrolling interests —
 —
 —
 5
 5
 —
 —
 2
 11
 13
Net distributions and return of capital to NRG prior to the acquisition of Drop Down Assets —
 —
 (174) (10) (184) —
 30
 (46) (7) (23)
Proceeds from the issuance of Class C units 33
 —
 —
 —
 33
(Payments of) proceeds from distributions (173) —
 (420) 420
 (173) (202) —
 (220) 220
 (202)
Proceeds from the revolving credit facility —
 —
 —
 60
 60
 —
 —
 —
 55
 55
Payments for the revolving credit facility —
 —
 —
 (366) (366)
Proceeds from the issuance of long-term debt - external —
 —
 390
 350
 740
 —
 —
 210
 —
 210
Payments of debt issuance costs —
 —
 (10) (5) (15) —
 —
 (12) —
 (12)
Payments for long-term debt — external —
 —
 (269) —
 (269) —
 (36) (296) —
 (332)
Net Cash Provided by (Used in) Financing Activities (129) 2
 (483) 408
 (202) (174) (6) (363) 285
 (258)
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash 196
 —
 48
 —
 244
 (189) (9) 15
 —
 (183)
Cash, Cash Equivalents and Restricted Cash at Beginning of Period 15
 —
 238
 —
 253
 211
 9
 277
 —
 497
Cash, Cash Equivalents and Restricted Cash at End of Period $211
 $—
 $286
 $—
 $497
 $22
 $—
 $292
 $—
 $314
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) Retrospectively adjusted as discussed in Note 1, Nature of Business.

                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the Year Ended December 31, 20152016
NRG Yield LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
NRG Yield Operating LLC (Note Issuer) (c)
 
Eliminations(b) (c)
 Consolidated
Clearway Energy LLC (a)
 Other Guarantor Subsidiaries Non-Guarantor Subsidiaries 
Clearway Energy Operating LLC (Note Issuer)
 
Eliminations(b)
 Consolidated
(In millions)(In millions)
Operating Revenues                      
Total operating revenues$—
 $21
 $937
 $10
 $—
 $968
$—
 $10
 $1,025
 $1
 $(1) $1,035
Operating Costs and Expenses                      
Cost of operations—
 14
 309
 —
 —
 323
—
 3
 305
 1
 (1) 308
Depreciation and amortization—
 4
 299
 —
 —
 303
—
 5
 298
 —
 —
 303
Impairment losses—
 —
 1
 —
 —
 1
—
 2
 183
 —
 —
 185
General and administrative—
 —
 —
 10
 —
 10
2
 —
 —
 12
 —
 14
Acquisition-related transaction and integration costs—
 —
 —
 3
 —
 3
—
 —
 —
 1
 —
 1
Total operating costs and expenses—
 18
 609
 13
 —
 640
2
 10
 786
 14
 (1) 811
Operating Income (Loss)—
 3
 328
 (3) —
 328
Operating (Loss) Income(2) —
 239
 (13) —
 224
Other Income (Expense)                      
Equity in earnings (losses) of consolidated affiliates157
 (43) —
 125
 (239) —
Equity in earnings of consolidated affiliates128
 10
 —
 66
 (204) —
Equity in (losses) earnings of unconsolidated affiliates—
 (2) 8
 25
 —
 31
—
 9
 21
 30
 —
 60
Other income, net—
 —
 3
 —
 —
 3
—
 —
 3
 —
 —
 3
Loss on debt extinguishment—
 —
 (9) —
 —
 (9)
Interest expense—
 —
 (206) (52) —
 (258)—
 (2) (204) (66) —
 (272)
Total other income (expense), net157
 (45) (204) 98
 (239) (233)128
 17
 (180) 30
 (204) (209)
Net Income (Loss)157
 (42) 124
 95
 (239) 95
Net Income126
 17
 59
 17
 (204) 15
Less: Net loss attributable to noncontrolling interests—
 —
 (2) (62) 2
 (62)—
 —
 (1) (111) 1
 (111)
Net Income (Loss) Attributable to NRG Yield LLC$157
 $(42) $126
 $157
 $(241) $157
Net Income Attributable to Clearway Energy LLC$126
 $17
 $60
 $128
 $(205) $126
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.
(c) Retrospectively adjusted as discussed in Note 1, Nature of Business.

                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
For the Year Ended December 31, 20152016

 
NRG Yield LLC (a) (c)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (c)
 
NRG Yield Operating LLC
(Note Issuer) (c)
 
Eliminations (b) (c)
 Consolidated
 (In millions)
Net Income (Loss)$157
 $(42) $124
 $95
 $(239) $95
Other Comprehensive Loss           
Unrealized loss on derivatives(16) —
 (16) (17) 32
 (17)
Other comprehensive loss(16) —
 (16) (17) 32
 (17)
Comprehensive Income (Loss)141
 (42) 108
 78
 (207) 78
Less: Comprehensive loss attributable to noncontrolling interests—
 —
 (2) (63) 2
 (63)
Comprehensive Income (Loss) Attributable to NRG Yield LLC$141
 $(42) $110
 $141
 $(209) $141
 
Clearway Energy LLC (a)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries 
 
Clearway Energy Operating LLC
(Senior Notes Issuer)
 
Eliminations (b)
 Consolidated
 (In millions)
Net Income$126
 $17
 $59
 $17
 $(204) $15
Other Comprehensive Income           
Unrealized gain on derivatives13
 1
 10
 13
 (24) 13
Other comprehensive income13
 1
 10
 13
 (24) 13
Comprehensive Income139
 18
 69
 30
 (228) 28
Less: Comprehensive loss attributable to noncontrolling interests—
 —
 (1) (111) 1
 (111)
Comprehensive Income Attributable to Clearway Energy LLC$139
 $18
 $70
 $141
 $(229) $139
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) All significant intercompany transactions have been eliminated in consolidation.
(c) Retrospectively adjusted as discussed in Note 1, Nature of Business.


                                    


NRG YIELDCLEARWAY ENERGY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 31, 20152016

         
NRG Yield LLC (a) (b)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries (b)
 
NRG Yield Operating LLC (Note Issuer) (b)
 Consolidated
Clearway Energy LLC (a)
 Other Guarantor Subsidiaries 
Non-Guarantor Subsidiaries 
 
Clearway Energy Operating LLC (Note Issuer)
 Consolidated
(In millions)(In millions)
Net Cash Provided by (Used in) Operating Activities$—
 $19
 $423
 $(18) $424
$—
 $67
 $549
 $(39) $577
Cash Flows from Investing Activities                  
Changes in investments in consolidated subsidiaries(464) —
 285
 179
 —
325
 —
 (21) (304) —
Acquisition of businesses, net of cash acquired—
 —
 —
 (37) (37)
Acquisition of Drop Down Assets, net of cash acquired—
 —
 —
 (698) (698)—
 —
 —
 (77) (77)
Capital expenditures—
 —
 (29) —
 (29)—
 —
 (20) —
 (20)
Cash receipts from notes receivable—
 —
 17
 —
 17
—
 —
 17
 —
 17
Return of investment from unconsolidated affiliates—
 —
 —
 42
 42
—
 16
 —
 12
 28
Investments in unconsolidated affiliates—
 (28)—
—
 (374) (402)—
 (80) (3) —
 (83)
Other—
 —
 9
 —
 9
—
 —
 4
 —
 4
Net Cash (Used in) Provided by Investing Activities(464) (28) 282
 (888) (1,098)325
 (64) (23) (369) (131)
Cash Flows from Financing Activities                  
Transfer of funds under intercompany cash management arrangement(309) 9
 —
 300
 —
44
 2
 —
 (46) —
Net contributions from noncontrolling interests—
 —
 —
 122
 122
—
 —
 —
 5
 5
Net distributions and return of capital to NRG prior to the acquisition of Drop Down Assets—
 —
 (79) —
 (79)—
 (3) (171) (10) (184)
Proceeds from the issuance of Class C units599
 —
 —
 —
 599
(Payments of) proceeds from distributions(139) —
 (392) 392
 (139)(173) —
 (420) 420
 (173)
Proceeds from the revolving credit facility—
 —
 —
 551
 551
—
 —
 —
 60
 60
Payments for the revolving credit facility—
 —
 —
 (245) (245)—
 —
 —
 (366) (366)
Proceeds from issuance of long-term debt — external—
 —
 6
 —
 6
—
 —
 390
 350
 740
Proceeds from issuance of long-term debt — affiliate—
 —
 —
 281
 281
Payments for long-term debt — external—
 —
 (241) (494) (735)—
 (3) (266) —
 (269)
Payment of debt issuance costs—
 —
 (6) (1) (7)—
 —
 (10) (5) (15)
Net Cash Provided by (Used in) Financing Activities151
 9
 (712) 906
 354
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash(313) —
 (7) —
 (320)
Net Cash (Used in) Provided by Financing Activities(129) (4) (477) 408
 (202)
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash196
 (1) 49
 —
 244
Cash, Cash Equivalents and Restricted Cash at Beginning of Period328
 —
 245
 —
 573
15
 10
 228
 —
 253
Cash, Cash Equivalents and Restricted Cash at End of Period$15
 $—
 $238
 $—
 $253
$211
 $9
 $277
 $—
 $497
 
(a) Shown separately from the other guarantors in lieu of preparing Schedule I pursuant to the requirements of Rule 5-04(c) of Regulation S-X.
(b) Retrospectively adjusted as discussed in Note 1, Nature of Business.

                                    


EXHIBIT INDEX
Number Description Method of Filing
2.1 
Purchase and Sale Agreement, dated as of May 5, 2014, by and between NRG Gas Development Company, LLC and NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 2.1 to NRG Yield,Clearway Energy, Inc.’s Current Report on Form 8-K filed on May 9, 2014.
2.2 
Purchase and Sale Agreement, dated as of May 5, 2014, by and between NRG Solar PV LLC and NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 2.2 to NRG Yield,Clearway Energy, Inc.’s Current Report on Form 8-K filed on May 9, 2014.
2.3 
Purchase and Sale Agreement, dated as of May 5, 2014, by and between NRG Solar PV LLC and NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 2.3 to NRG Yield,Clearway Energy, Inc.’s Current Report on Form 8-K filed on May 9, 2014.
2.4 
Purchase and Sale Agreement, dated June 3, 2014, by and among NRG Yield, Inc., NRG Yield Operating LLC, Terra-Gen Finance Company, LLC, NTD AWAM Holdings, LLC, CHIPS Alta Wind X Holding Company, LLC and CHIPS Alta Wind XI Holding Company, LLC.
 Incorporated herein by reference to Exhibit 10.1 to NRG Yield,Clearway Energy, Inc.’s Current Report on Form 8-K filed on June 9, 2014.
2.5 
Purchase and Sale Agreement, dated as of November 4, 2014, by and between NRG Wind LLC and NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 2.1 to NRG Yield,Clearway Energy, Inc.’s Current Report on Form 8-K filed on November 7, 2014.
2.6 
Purchase and Sale Agreement, dated as of November 4, 2014, by and between NRG Arroyo Nogales LLC and NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 2.2 to NRG Yield,Clearway Energy, Inc.’s Current Report on Form 8-K filed on November 7, 2014.
2.7*^ 
Purchase and Sale Agreement, dated as of June 17, 2015, by and between EFS Desert Sun, LLC and NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 2.1 to NRG Yield,Clearway Energy, Inc.’s Quarterly Report on Form 10-Q filed on August 4, 2015.
2.8 
Purchase and Sale Agreement, dated as of September 17, 2015, by and between NRG Energy Gas & Wind Holdings, Inc. and NRG Yield Operating LLC.

 
Incorporated herein by reference to Exhibit 2.1 to NRG Yield,Clearway Energy, Inc.’s Current Report on Form 8-K filed on September 21, 2015.

2.9 
Purchase and Sale Agreement, dated as of August 8, 2016, between NRG Solar CVSR Holdings 2 LLC and NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 2.1 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K, filed on August 9, 2016.
2.10* 
Purchase and Sale Agreement, dated as of February 6, 2018, by and between NRG Gas Development Company, LLC and NRG Yield Operating LLC.

 
Incorporated herein by reference to Exhibit 2.10 to NRG Yield,Clearway Energy, Inc.'s Annual Report on Form 10-K, filed on March 1, 2018.

3.1 
Certificate of Formation of NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 3.01(a) to the Company's Registration Statement on Form S-4 filed on April 13, 2015.
3.2 
Certificate of Amendment of Certificate of Formation of NRG Yield Operating LLC.
 Incorporated herein by reference to Exhibit 3.01(b) to the Company's Registration Statement on Form S-4 filed on April 13, 2015.
3.3 
SecondThird Amended and Restated Limited Liability Company Agreement of NRG YieldClearway Energy Operating LLC.
 Incorporated herein by reference to Exhibit 3.02 to the Company's Registration Statement on Form S-4 filed on April 13, 2015.Filed herewith.
3.4 
Certificate of Formation of NRG Yield LLC.
 Incorporated herein by reference to Exhibit 3.03(a) to the Company's Registration Statement on Form S-4 filed on April 13, 2015.
3.5 
Certificate of Amendment of Certificate of Formation of NRG Yield LLC.
 Incorporated herein by reference to Exhibit 3.03(b) to the Company's Registration Statement on Form S-4 filed on April 13, 2015.
3.6 
ThirdFourth Amended and Restated Limited Liability Company Agreement of NRG Yield LLC, dated as of May 14, 2015.August 31, 2018, by and between NRG Yield, Inc. and Zephyr Renewables LLC.

 
Incorporated herein by reference to Exhibit 10.410.6 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on May 15, 2015.September 5, 2018.

4.1 
Indenture, dated August 5, 2014, among NRG Yield Operating LLC, the guarantors named therein and Law Debenture Trust Company of New York.
 Incorporated herein by reference to Exhibit 4.1 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on August 5, 2014.
                                    


4.2 
Form of 5.375% Senior Note due 2024.
 Incorporated herein by reference to Exhibit 4.2 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on August 5, 2014.
4.3 
Registration Rights Agreement, dated August 5, 2014,October 1, 2018, among NRG YieldClearway Energy Operating LLC, the guarantors named therein and Merrill Lynch, Pierce, Fenner & Smith Incorporated,RBC Capital Markets, LLC, as representative of the initial purchasers.

 
Incorporated herein by reference to Exhibit 4.3 to NRG Yield, Inc.'sthe Company's Current Report on Form 8-K filed on August 5, 2014.October 2, 2018.

4.4 
Supplemental Indenture, dated as of November 7, 2014, among NRG Yield Operating LLC, the guarantors named therein and Law Debenture Trust Company of New York.
 Incorporated herein by reference to Exhibit 4.1 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on November 13, 2014.
4.5 
Supplemental Indenture, dated as of February 25, 2015, among NRG Yield Operating LLC, the guarantors named therein and Law Debenture Trust Company of New York.
 Incorporated herein by reference to Exhibit 4.1 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on February 27, 2015.
4.6 
Third Supplemental Indenture, dated as of April 10, 2015, among NRG Yield Operating LLC, NRG Yield LLC, the other guarantors named therein and Law Debenture Trust Company of New York.
 Incorporated herein by reference to Exhibit 4.07 to the Company's Registration Statement on Form S-4 filed on April 13, 2015.
4.7 
Fourth Supplemental Indenture, dated as of May 8, 2015, among NRG Yield Operating LLC, the guarantors named therein and Law Debenture Trust Company of New York.
 Incorporated herein by reference to Exhibit 4.1 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on May 8, 2015.
4.8 
Indenture, dated June 29, 2015, among NRG Yield, Inc., NRG Yield Operating LLC and NRG Yield LLC, as Guarantors, and Wilmington Trust, National Association, as Trustee.
 Incorporated herein by reference to Exhibit 4.1 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on June 29, 2015.
4.9 
Form of 3.25% Convertible Senior Note due 2020.

 
Incorporated herein by reference to Exhibit 4.2 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on June 29, 2015.
2015.
4.10 
Indenture, dated August 18, 2016, among NRG Yield Operating LLC, the guarantors named therein and Law Debenture Trust Company of New York.
 Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K, filed on August 18, 2016.
4.11 
Form of 5.000% Senior Note due 2026.

 Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K, filed on August 18, 2016.
4.12 
Registration Rights Agreement, dated August 18, 2016, among NRG Yield Operating LLC, the guarantors named therein and J.P. Morgan Securities LLC, as representative of the initial purchasers.
 Incorporated herein by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K, filed on August 18, 2016.
4.13 
Fifth Supplemental Indenture, dated as of January 29, 2018, among NRG Yield Operating LLC, the guarantors named therein and Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

 Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K, filed on January 31, 2018.
4.14
Sixth Supplemental Indenture, dated as of June 12, 2018, among NRG Yield Operating LLC, the guarantors named therein and Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

Incorporated herein by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on June 12, 2018.

4.15 
Supplemental Indenture, dated as of January 29, 2018, among NRG Yield Operating LLC, the guarantors named therein and the Delaware Trust Company (as successor in interest to 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 January 31, 2018.

10.14.16 
Amended and Restated Registration Rights Agreement,Second Supplemental Indenture, dated as of May 14, 2015, by and between NRG Energy, Inc. andJune 12, 2018, among NRG Yield Inc.Operating LLC, the guarantors named therein and Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

 
Incorporated herein by reference to Exhibit 10.24.2 to NRG Yield, Inc.'sthe Company's Current Report on Form 8-K filed on May 15, 2015.June 12, 2018.

10.24.17 
Amended and Restated Exchange Agreement,Seventh Supplemental Indenture, dated as of May 14, 2015, by andJuly 17, 2018, among NRG Energy, Inc., NRG Yield Inc.Operating LLC, the guarantors named therein and NRG Yield LLC.Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

 
Incorporated herein by reference to Exhibit 10.14.3 to NRG Yield, Inc.'s Currentthe Company's Quarterly Report on Form 8-K10-Q filed on May 15, 2015.August 2, 2018.

10.34.18 
Second Amended and Restated Right of First Offer Agreement,Third Supplemental Indenture, dated as of February 24, 2017, by and between NRG Energy, Inc. andJuly 17, 2018, among NRG Yield Inc.Operating LLC, the guarantors named therein and Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

 
Incorporated herein by reference to Exhibit 10.34.4 to NRG Yield, Inc.'s Annualthe Company's Quarterly Report on Form 10-K10-Q filed on February 28, 2017.
10.4August 2, 2018.
Management Services Agreement, dated as of July 22, 2013, by and between NRG Energy, Inc., NRG Yield, Inc., NRG Yield LLC and NRG Yield Operating LLC.
Incorporated herein by reference to Exhibit 10.4 to NRG Yield, Inc.'s Current Report on Form 8-K filed on July 26, 2013.
10.5
Trademark License Agreement, dated as of July 22, 2013, by and between NRG Energy, Inc. and NRG Yield, Inc.
Incorporated herein by reference to Exhibit 10.5 to NRG Yield, Inc.'s Current Report on Form 8-K filed on July 26, 2013.
10.6
Loan Guarantee Agreement, dated as of September 30, 2011, by and among High Plains Ranch II, LLC, as borrower, the U.S. Department of Energy, as guarantor, and the U.S. Department of Energy, as loan servicer.
Incorporated herein by reference to Exhibit 10.8 to NRG Yield, Inc.'s Draft Registration Statement on Form S-1 filed on February 13, 2013.
                                    


10.74.19 
Operation and Maintenance Agreement,Eighth Supplemental Indenture, dated as of January 31, 2011, byAugust 30, 2018, among NRG Yield Operating LLC, the guarantors named therein and between Avenal Solar Holdings LLC and NRG Energy Services LLC.Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

 
Incorporated herein by reference to Exhibit 10.114.1 to NRG Yield, Inc.'s Draft Registration Statementthe Company's Current Report on Form S-18-K filed on February 13, 2013.September 6, 2018.

10.84.20 
Asset Management Agreement,Fourth Supplemental Indenture, dated as of August 30, 2012, by2018, among NRG Yield Operating LLC, the guarantors named therein and between NRG Solar Avra Valley LLC and NRG Solar Asset Management LLC.Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

 
Incorporated herein by reference to Exhibit 10.124.2 to NRG Yield, Inc.'s Draft Registration Statementthe Company's Current Report on Form S-18-K filed on February 13, 2013.September 6, 2018.

10.94.21 
OperationIndenture, dated October 1, 2018, among Clearway Energy Operating LLC, the guarantors named therein and Maintenance Agreement, datedDelaware Trust Company, as of August 1, 2012, by and between NRG Energy Services LLC and NRG Solar Borrego I LLC.trustee.

 
Incorporated herein by reference to Exhibit 10.134.1 to NRG Yield, Inc.'s Draft Registration Statementthe Company's Current Report on Form S-18-K filed on February 13, 2013.October 2, 2018.

10.104.22 
Asset Management Agreement, dated asForm of March 15, 2012, by and between NRG Solar Alpine LLC and NRG Solar Asset Management LLC.5.750% Senior Notes due 2025

 
Incorporated herein by reference to Exhibit 10.144.2 to NRG Yield, Inc.'s Draft Registration Statementthe Company's Current Report on Form S-18-K filed on February 13, 2013.October 2, 2018.

10.114.23 
Operation and Maintenance Agreement,Ninth Supplemental Indenture, dated as of September 30, 2011, byOctober 25, 2018, among Clearway Energy Operating LLC, the guarantors named therein and between NRG Energy Services LLC and High Plains Ranch II, LLC.Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

 
Incorporated herein by reference to Exhibit 10.154.1 to NRG Yield, Inc.'s Draft Registration Statementthe Company's Current Report on Form S-18-K filed on February 13, 2013.October 31, 2018.

10.124.24 
Project Administration Agreement,Fifth Supplemental Indenture, dated as of August 16, 2010, byOctober 25, 2018, among Clearway Energy Operating LLC, the guarantors named therein and between South Trent Wind LLC and NRG Texas Power LLC.Delaware Trust Company (as successor in interest to Law Debenture Trust Company of New York).

 
Incorporated herein by reference to Exhibit 10.164.2 to NRG Yield, Inc.'s Draft Registration Statementthe Company's Current Report on Form S-18-K filed on February 13, 2013.October 31, 2018.

10.134.25 
Operation and Maintenance Agreement,First Supplemental Indenture, dated as of April 24, 2009, byOctober 25, 2018, among Clearway Energy Operating LLC, the guarantors named therein and between GenConn Devon LLC and Devon Power LLC.Delaware Trust Company.

 
Incorporated herein by reference to Exhibit 10.154.3 to NRG Yield, Inc.'s Registration Statementthe Registrant's Current Report on Form S-18-K filed on June 6, 2013.October 31, 2018.

10.1410.1 
OperationThird Amended and MaintenanceRestated Right of First Offer Agreement, dated as of April 24, 2009,August 31, 2018, by and between GenConn Middletown LLCNRG Yield, Inc. and Middletown Power LLC.NRG Energy, Inc.

 
Incorporated herein by reference to Exhibit 10.1610.5 to NRG Yield,Clearway Energy, Inc.'s Registration StatementCurrent Report on Form S-18-K filed on June 7, 2013.September 5, 2018.

10.1510.2.1 
Administrative ServicesRight of First Offer Agreement, dated as of April 2, 2009,August 31, 2018, by and between GenOn Energy Services,among NRG Yield, Inc., Zephyr Renewables LLC (formerly Mirant Services, LLC) and NRG Marsh Landing, LLC (formerly Mirant Marsh Landing, LLC.solely for purposes of Section 2.4, GIP III Zephyr Acquisition Partners, L.P.

 
Incorporated herein by reference to Exhibit 10.1710.3 to NRG Yield,Clearway Energy, Inc.'s Registration StatementCurrent Report on Form S-18-K filed on June 7, 2013.September 5, 2018.

10.1610.2.2 
FormFirst Amendment to Right of Indemnification Agreement.First Offer Agreement, dated February 14, 2019, by and between Clearway Energy Group LLC and Clearway Energy, Inc.

 
Incorporated herein by reference to Exhibit 10.2010.1 to Clearway Energy, Inc.'s Current Report on Form 8-K filed on February 14, 2019.

10.3
Master Services Agreement, dated as of August 31, 2018, by and among NRG Yield, Inc., NRG Yield LLC, NRG Yield Operating LLC and Zephyr Renewables LLC.

Incorporated herein by reference to Exhibit 10.1 to Clearway Energy, Inc.'s Registration StatementCurrent Report on Form S-1/A8-K filed on June 21, 2013.September 5, 2018.

10.17.110.4
Master Services Agreement, dated as of August 31, 2018, by and among Zephyr Renewables LLC, NRG Yield, Inc., NRG Yield LLC, and NRG Yield Operating LLC.

Incorporated herein by reference to Exhibit 10.2 to Clearway Energy, Inc.'s Current Report on Form 8-K filed on September 5, 2018.

10.5
Termination Agreement, dated as of August 31, 2018, by and among NRG Yield, Inc., NRG Yield LLC, NRG Yield Operating LLC and NRG Energy, Inc.

Incorporated herein by reference to Exhibit 10.9 to Clearway Energy, Inc.'s Current Report on Form 8-K filed on September 5, 2018.

10.6.1 
Amended and Restated Credit Agreement, dated April 25, 2014, by and among NRG Yield Operating LLC, NRG Yield LLC, Royal Bank of Canada, as Administrative Agent, the lenders party thereto, Royal Bank of Canada, Goldman Sachs Bank USA and Bank of America, N.A., as L/C Issuers and RBC Capital Markets as Sole Left Lead Arranger and Sole Left Lead Book Runner.
 Incorporated by reference to Exhibit 10.1 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K filed on April 28, 2014.
10.17.210.6.2 
First Amendment to Amended & Restated Credit Agreement, dated June 26, 2015, by and among NRG Yield Operating LLC, NRG Yield LLC, Royal Bank of Canada and the Lenders party thereto.

 
Incorporated herein by reference to Exhibit 10.9 to NRG Yield,Clearway Energy, Inc.'s Quarterly Report on Form 10-Q filed on August 4, 2015.

10.17.310.6.3 
Second Amendment to Amended & Restated Credit Agreement, dated February 6, 2018, by and among NRG Yield Operating LLC, NRG Yield LLC, the guarantors party thereto, Royal Bank of Canada, as Administrative Agent, and the lenders party thereto.

 
Incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 12, 2018.

10.18.1
Credit Agreement, dated as of August 23, 2011, among NRG West Holdings LLC, ING Capital LLC, Union Bank, N.A., Mizuho Corporate Bank, Ltd., RBS Securities Inc., Credit Agricole Corporate and Investment Bank, and each of lenders and issuing banks thereto.*
Incorporated herein by reference to Exhibit 10.2 to NRG Yield, Inc.'s Quarterly Report on Form 10-Q filed on August 7, 2014.
10.18.2
Amendment No. 1 to the Credit Agreement, dated October 7, 2011, by and between NRG West Holdings LLC and Credit Agricole Corporate and Investment Bank.
Incorporated herein by reference to Exhibit 10.3 to NRG Yield, Inc.'s Quarterly Report on Form 10-Q filed on August 7, 2014.
10.18.3
Amendment No. 2 to the Credit Agreement, dated February 29, 2012, by and between NRG West Holdings LLC and Credit Agricole Corporate and Investment Bank.
Incorporated herein by reference to Exhibit 10.4 to NRG Yield, Inc.'s Quarterly Report on Form 10-Q filed on August 7, 2014.
10.18.4
Amendment No. 3 to the Credit Agreement, dated as of January 27, 2014, by and between NRG West Holdings LLC and Credit Agricole Corporate and Investment Bank.
Incorporated herein by reference to Exhibit 10.6 to NRG Yield, Inc.'s Quarterly Report on Form 10-Q filed on August 4, 2015.
10.18.5
Amendment No. 4 to the Credit Agreement and Amendment No. 1 to the Collateral Agreement, dated as of May 16, 2014, by and between NRG West Holdings LLC, El Segundo Energy Center LLC and Credit Agricole Corporate and Investment Bank.
Incorporated herein by reference to Exhibit 10.7 to NRG Yield, Inc.'s Quarterly Report on Form 10-Q filed on August 4, 2015.

                                    


10.18.610.6.4 
Third Amendment No. 5 to theAmended and Restated Credit Agreement and Administrative Agent Resignation and Appointment Agreement, dated as of May 29, 2015,April 30, 2018, by and betweenamong NRG West HoldingsYield Operating LLC, NRG Yield LLC, the guarantors party thereto, Royal Bank of Canada, as Resigning Administrative Agent, JPMorgan Chase Bank, N.A., as Successor Administrative Agent, and ING Capital LLC.the lenders party thereto.

 
Incorporated herein by reference to Exhibit 10.810.1 to NRG Yield, Inc.'sthe Company's Quarterly Report on Form 10-Q filed on August 4, 2015.May 3, 2018.

10.19.110.6.5 
Fourth Amendment to Amended and Restated Credit Agreement, dated July 17, 2014,as of November 30, 2018, by and among NRG Marsh LandingClearway Energy Operating LLC, The RoyalClearway Energy LLC, the guarantors party thereto, JPMorgan Chase Bank, of Scotland Plc, Deutsche Bank Trust Company AmericasN.A., as administrative agent, and the lenders party thereto.

 
Incorporated herein by reference to Exhibit 10.510.1 to NRG Yield, Inc.'s Quarterlythe Company's Current Report on Form 10-Q8-K filed on August 7, 2014.December 6, 2018.

10.19.2
First Amendment to the Credit Agreement and Collateral Agency and Intercreditor Agreement, dated July 17, 2014, by and among NRG Marsh Landing LLC, The Royal Bank of Scotland Plc, Deutsche Bank Trust Company Americas and the lenders party thereto.
Incorporated herein by reference to Exhibit 10.6 to NRG Yield, Inc.'s Quarterly Report on Form 10-Q filed on August 7, 2014.
10.20^10.7^ 
Amended and Restated Limited Liability Company Agreement of NRG RPV Holdco 1 LLC, dated as of April 9, 2015.

 Incorporated herein by reference to Exhibit 10.1 to NRG Yield,Clearway Energy, Inc.'s Quarterly Report on Form 10-Q filed on August 4, 2015.
10.21^10.8^ 
Amended and Restated Limited Liability Company Agreement of NRG DGPV Holdco 1 LLC, dated as of May 8, 2015.

 Incorporated herein by reference to Exhibit 10.2 to NRG Yield,Clearway Energy, Inc.'s Quarterly Report on Form 10-Q filed on August 4, 2015.
10.22^10.9^ 
Amendment No. 1 to Amended and Restated Limited Liability Company Agreement of NRG RPV Holdco 1 LLC, dated as of March 1, 2016, by and between NRG Yield RPV Holding LLC and NRG Residential Solar Solutions LLC.
 
Incorporated herein by reference to Exhibit 10.1 to NRG Yield,Clearway Energy, Inc.'s Quarterly Report on Form 10-Q filed on May 5, 2016.

10.23^10.10^ 
Amendment No. 2 to Amended and Restated Limited Liability Company Agreement of NRG DGPV Holdco 1 LLC, dated as of March 1, 2016, by and among NRG Yield DGPV Holding LLC, NRG Renew DG Holdings LLC and NRG Renew LLC.
 
Incorporated herein by reference to Exhibit 10.2 to NRG Yield,Clearway Energy, Inc.'s Quarterly Report on Form 10-Q filed on May 5, 2016.

10.24^10.11^ 
Amended and Restated Limited Liability Company Agreement of NRG DGPV Holdco 2 LLC, dated as of March 1, 2016, by and among NRG Yield DGPV Holding LLC, NRG Renew DG Holdings LLC, and NRG Renew LLC.
 Incorporated herein by reference to Exhibit 10.3 to NRG Yield,Clearway Energy, Inc.'s Quarterly Report on Form 10-Q filed on May 5, 2016.
10.2510.12 
Amendment No. 2 to Amended and Restated Limited Liability Company Agreement of NRG RPV Holdco 1 LLC, dated as of August 5, 2016, by and between NRG Yield RPV Holding LLC and NRG Residential Solar Solutions LLC.
 
Incorporated herein by reference to Exhibit 10.1 to NRG Yield,Clearway Energy, Inc.'s Quarterly Report on Form 10-Q, filed on August 9, 2016.

10.26†10.13† 
Employment Agreement, dated as of May 6, 2016, between NRG Yield, Inc. and Christopher S. Sotos.

 Incorporated herein by reference to Exhibit 10.1 to NRG Yield,Clearway Energy, Inc.'s Current Report on Form 8-K/A, filed on August 9, 2016.
10.27†10.14† 
Amendment, dated January 1, 2018 to Employment Agreement between NRG Yield, Inc. and Christopher Sotos.

 Incorporated herein by reference to Exhibit 10.28 to NRG Yield,Clearway Energy, Inc.'s Annual Report on Form 10-K, filed on March 1, 2018.
10.28^10.15 
ConsentAssignment and IndemnityAssumption Agreement, datedeffective as of February 6, 2018, by and26, 2019, among NRGClearway Energy Inc., NRG Repowering HoldingsOperating LLC NRG Yield, Inc., and GIP III Zephyr Acquisition Partners, L.P., and NRG Yield Operating LLC (solely with respect to Sections E.5, E.6 and G.12).Carlsbad Holdings, LLC.

 
Incorporated herein by reference to Exhibit 10.34 to NRG Yield, Inc.'s Annual Report on Form 10-K, filed on March 1, 2018.

12.1
Computation of Ratio of Earnings to Fixed Charges.
Incorporated herein by reference to Exhibit 12.1 to the Company's Annual Report on Form 10-K, filed on March 1, 2018.Filed herewith.
21.1 
Subsidiaries of NRG YieldClearway Energy LLC.
 Incorporated herein by reference to Exhibit 21.1 to the Company's Annual Report on Form 10-K, filed on March 1, 2018.Filed herewith.
31.1 
Rule 13a-14(a)/15d-14(a) certification of Christopher S. Sotos.
 Filed herewith.
31.2 
Rule 13a-14(a)/15d-14(a) certification of Chad Plotkin.
 Filed herewith.
31.3 
Rule 13a-14(a)/15d-14(a) certification of David Callen.Mary-Lee Stillwell.
 Filed herewith.
32 
Section 1350 Certification.
 Furnished herewith.
101 INS XBRL Instance Document. Filed herewith.
101 SCH XBRL Taxonomy Extension Schema. Filed herewith.
101 CAL XBRL Taxonomy Extension Calculation Linkbase. Filed herewith.
101 DEF XBRL Taxonomy Extension Definition Linkbase. Filed herewith.
101 LAB XBRL Taxonomy Extension Label Linkbase. Filed herewith.
101 PRE XBRL Taxonomy Extension Presentation Linkbase. Filed herewith.



† Indicates exhibits that constitute compensatory plans or arrangements.
* This filing excludes schedules pursuant to Item 601(b)(2) of Regulation S-K, which the registrant agrees to furnish supplementary to the Securities and Exchange Commission upon request by the Commission.
^ 
Portions of this exhibit have been redacted and are subject to a confidential treatment request filed with the Secretary of the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.




                                    


Item 16 — Form 10-K Summary
None.
                                    



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
NRG YIELDCLEARWAY ENERGY LLC
(Registrant) 
 
   
 /s/ BRIAN E. CURCICHRISTOPHER S. SOTOS   
 Brian E. CurciChristopher S. Sotos 
 Corporate Secretary
Chief Executive Officer
(Principal Executive Officer)
 
 
Date: May 1, 2018February 28, 2019  
 
POWER OF ATTORNEY

Each person whose signature appears below constitutes and appoints Christopher S. Sotos, Kevin P. Malcarney and Michael A. Brown, each or any of them, such person's true and lawful attorney-in-fact and agent with full power of substitution and resubstitution for such person and in such person's name, place and stead, in any and all capacities, to sign any and all amendments to this report on Form 10-K, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing necessary or desirable to be done in and about the premises, as fully to all intents and purposes as such person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them or his or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
In accordance with the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant in the capacities indicated on February 28, 2019.

SignaturesTitle
/s/ CHRISTOPHER S. SOTOSPresident and Chief Executive Officer
Christopher S. Sotosof Clearway Energy LLC (Principal Executive Officer)
Date:February 28, 2019
/s/ CHAD PLOTKINSenior Vice President and Chief Financial Officer
Chad Plotkinof Clearway Energy LLC (Principal Financial Officer)
Date:February 28, 2019
/s/ MARY-LEE STILLWELLVice President and Chief Accounting Officer
Mary-Lee Stillwellof Clearway Energy LLC (Principal Accounting Officer)
Date:February 28, 2019
CLEARWAY ENERGY, INC.Sole Managing Member
/s/ CHRISTOPHER S. SOTOSPresident and Chief Executive Officer
Christopher S. Sotosof Clearway Energy, Inc.
Date:February 28, 2019










SignatureTitleDate
/s/ NATHANIEL ANSCHUETZDirector of Clearway Energy, Inc.February 28, 2019
Nathaniel AnschuetzSole Managing Member of Clearway Energy LLC
/s/ JONATHAN BRAMDirector of Clearway Energy, Inc.February 28, 2019
Jonathan BramSole Managing Member of Clearway Energy LLC
/s/ BRIAN FORDDirector of Clearway Energy, Inc.February 28, 2019
Brian FordSole Managing Member of Clearway Energy LLC
/s/ BRUCE MACLENNANDirector of Clearway Energy, Inc.February 28, 2019
Bruce MacLennanSole Managing Member of Clearway Energy LLC
/s/ FERRELL MCCLEAN  Director of Clearway Energy, Inc.February 28, 2019
Ferrell McCleanSole Managing Member of Clearway Energy LLC
Director of Clearway Energy, Inc.February 28, 2019
Daniel B. MoreSole Managing Member of Clearway Energy LLC
/s/ E. STANLEY O'NEALDirector of Clearway Energy, Inc.February 28, 2019
E. Stanley O'NealSole Managing Member of Clearway Energy LLC
/s/ CHRISTOPHER S. SOTOSDirector of Clearway Energy, Inc.February 28, 2019
Christopher S. SotosSole Managing Member of Clearway Energy LLC
/s/ SCOTT STANLEYDirector of Clearway Energy, Inc.February 28, 2019
Scott StanleySole Managing Member of Clearway Energy LLC

                                    


Supplemental Information to be Furnished with Reports Filed Pursuant to
Section 15(d) of the Act by Registrants Which Have Not Registered
Securities Pursuant to Section 12 of the Act
No annual report or proxy materials has been sent to securities holders and no such report or proxy material is to be furnished to securities holders subsequent to the filing of the annual report on this Form 10-K.


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