GLOSSARY

When the following terms and abbreviations appear in the text of this report, they have the meanings indicated below.



~~ARO~~2019 Form 10-K						Vistra's annual report on Form 10-K for the year ended December 31, 2019, filed with the SEC on February 28, 2020
Ambit						Ambit Holdings, LLC, and/or its subsidiaries (d/b/a Ambit), depending on context
ARO						asset retirement and mining reclamation obligation
CAA						Clean Air Act
CAISO						The California Independent System Operator
~~CCGT~~CARES Act						Coronavirus Aid, Relief, and Economic Security Act
CCGT						combined cycle gas turbine
~~CME~~CFTC						U.S. Commodity Futures Trading Commission
CME						Chicago Mercantile Exchange
CO₂						carbon dioxide
CPUC						California Public Utilities Commission
Crius						Crius Energy Trust and/or its subsidiaries, depending on context
Dynegy						Dynegy Inc., and/or its subsidiaries, depending on context
Dynegy Energy Services						Dynegy Energy Services, LLC and Dynegy Energy Services (East), LLC ~~(d/~~(each d/b/a Dynegy, Better Buy Energy, Brighten Energy, Honor Energy and ~~Brighten Energy)~~True Fit Energy, respectively), indirect, wholly owned subsidiaries of Vistra, ~~Energy,~~ that are REPs in certain areas of MISO and PJM, respectively, and are engaged in the retail sale of electricity to residential and business customers.
EBITDA						earnings (net income) before interest expense, income taxes, depreciation and amortization
Effective Date						October 3, 2016, the date our predecessor completed its reorganization under Chapter 11 of the U.S. Bankruptcy Code
Emergence						emergence of our predecessor from reorganization under Chapter 11 of the U.S. Bankruptcy Code as subsidiaries of a newly formed company, Vistra, ~~Energy,~~ on the Effective Date
EPA						U.S. Environmental Protection Agency
ERCOT						Electric Reliability Council of Texas, Inc.
ESS						energy storage system
Exchange Act						Securities Exchange Act of 1934, as amended
FERC						U.S. Federal Energy Regulatory Commission
GAAP						generally accepted accounting principles
~~GWh~~GHG						~~gigawatt-hours~~greenhouse gas
GWh						gigawatt-hours
Homefield Energy						Illinois Power Marketing Company (d/b/a Homefield Energy), an indirect, wholly owned subsidiary of Vistra, ~~Energy,~~ a REP in certain areas of MISO that is engaged in the retail sale of electricity to municipal customers
ICE						~~IntercontinentalExchange~~Intercontinental Exchange
~~IRS~~IRC						Internal Revenue Code of 1986, as amended
IRS						U.S. Internal Revenue Service
ISO						~~Independent System Operator~~independent system operator
ISO-NE						~~Independent System Operator~~ISO New England Inc.
LIBOR						London Interbank Offered Rate, an interest rate at which banks can borrow funds, in marketable size, from other banks in the London interbank market
load						demand for electricity
LTSA						long-term service agreements for plant maintenance
Luminant						subsidiaries of Vistra ~~Energy~~ engaged in competitive market activities consisting of electricity generation and wholesale energy sales and purchases as well as commodity risk management

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market heat rate						Heat rate is a measure of the efficiency of converting a fuel source to electricity. Market heat rate is the implied relationship between wholesale electricity prices and natural gas prices and is calculated by dividing the wholesale market price of electricity, which is based on the price offer of the marginal supplier (generally natural gas plants), by the market price of natural gas.
Merger						the merger of Dynegy with and into Vistra, ~~Energy,~~ with Vistra ~~Energy~~ as the surviving corporation
Merger Agreement						the Agreement and Plan of Merger, dated as of October 29, 2017, by and between Vistra ~~Energy~~ and Dynegy ~~as it may be amended or modified from time to time~~
Merger Date						April 9, 2018, the date Vistra ~~Energy~~ and Dynegy completed the transactions contemplated by the Merger Agreement
MISO						Midcontinent Independent System Operator, Inc.
MMBtu						million British thermal units

~~Table of Contents~~


Moody's
~~Moody's~~	Moody's Investors Service, Inc. (a credit rating agency)
MWMSHA		~~megawatts~~U.S. Mine Safety and Health Administration
~~MWh~~MW		megawatts
MWh		megawatt-hours
NELP		Northeast Energy, LP, a joint venture between Dynegy Northeast Generation GP, Inc. and Dynegy Northeast Associates LP, Inc., both indirect subsidiaries of Vistra, and certain subsidiaries of NextEra Energy, Inc. NELP indirectly owned Bellingham NEA facility and the Sayreville facility.
NELP Transaction		a transaction among Dynegy Northeast Generation GP, Inc., Dynegy Northeast Associates LP, Inc. and certain subsidiaries of NextEra Energy, Inc. wherein the indirect subsidiaries of Vistra redeemed their ownership interest in NELP partnership in exchange for 100% ownership interest in NJEA, the entity which owns the Sayreville facility.
NERC		North American Electric Reliability Corporation
NJEA		North Jersey Energy Associates, a Limited Partnership
NO_X		nitrogen oxide
NRC		U.S. Nuclear Regulatory Commission
~~NYMEX~~NYISO		New York Independent System Operator, Inc.
NYMEX		the New York Mercantile Exchange, a commodity derivatives exchange
~~NYISO~~OPEB		~~New York Independent System Operator~~
~~OPEB~~	postretirement employee benefits other than pensions
Parent		Vistra ~~Energy~~ Corp.
PJM		PJM Interconnection, LLC
Plan of Reorganization		Third Amended Joint Plan of Reorganization filed by the parent company of our predecessor in August 2016 and confirmed by the U.S. Bankruptcy Court for the District of Delaware in August 2016 solely with respect to our predecessor
PrefCo		Vistra Preferred Inc.
PrefCo Preferred Stock Sale		as part of the ~~Spin-Off,~~tax-free spin-off from Energy Future Holdings Corp., executed pursuant to the Plan of Reorganization on the Effective Date by our predecessor, the contribution of certain of the assets of our predecessor and its subsidiaries by a subsidiary of TEX Energy LLC to PrefCo in exchange for all of PrefCo's authorized preferred stock, consisting of 70,000 shares, par value $0.01 per share
~~PUCT~~Public Power		Public Power, LLC (d/b/a Public Power), an indirect, wholly owned subsidiary of Vistra, a REP in certain areas of PJM, NYISO, ISO-NE and MISO that is engaged in the retail sale of electricity to residential and business customers
PUCT		Public Utility Commission of Texas
REP		retail electric provider
RCT		Railroad Commission of Texas, which among other things, has oversight of lignite mining activity in Texas
RTO		regional transmission organization
S&P		Standard & Poor's Ratings (a credit rating agency)
SEC		U.S. Securities and Exchange Commission
Securities Act		Securities Act of 1933, as amended
SO₂		sulfur dioxide

iii

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Tax Matters Agreement						Tax Matters Agreement, dated as of the Effective Date, by and among Energy Future Holdings Corp. (EFH Corp.), Energy Future Intermediate Holding Company LLC, EFIH Finance Inc. and EFH Merger Co. LLC
TCEH						Texas Competitive Electric Holdings Company LLC, a direct, wholly owned subsidiary of Energy Future Competitive Holdings Company LLC, and, prior to the Effective Date, the parent company of our predecessor, depending on context, that were engaged in electricity generation and wholesale and retail energy market activities, and whose major subsidiaries included Luminant and TXU Energy
TCEQ						Texas Commission on Environmental Quality
TRA						Tax ~~Receivable~~Receivables Agreement, containing certain rights (TRA Rights) to receive payments from Vistra ~~Energy~~ related to certain tax benefits, including ~~those it~~benefits realized as a result of certain transactions entered into at Emergence (see Note 8 to the Financial Statements)
~~TWh~~TRE						~~terawatt-hours~~Texas Reliability Entity, Inc., an independent organization that develops reliability standards for the ERCOT region and monitors and enforces compliance with NERC standards and monitors compliance with ERCOT protocols
~~TXU~~TriEagle Energy						~~TXU~~TriEagle Energy, ~~Retail Company LLC,~~LP (d/b/a TriEagle Energy, TriEagle Energy Services, Eagle Energy, Energy Rewards, Power House Energy and Viridian Energy), an indirect, wholly owned subsidiary of Vistra, a REP in certain areas of ERCOT and PJM that is engaged in the retail sale of electricity to residential and business customers
TWh						terawatt-hours
TXU Energy						TXU Energy Retail Company LLC (d/b/a TXU), an indirect, wholly owned subsidiary of Vistra that is a REP in competitive areas of ERCOT and is engaged in the retail sale of electricity to residential and business customers
U.S.						United States of America
U.S. Gas & Electric						U.S. Gas and Electric, Inc. (d/b/a USG&E, Illinois Gas & Electric and ILG&E), an indirect, wholly owned subsidiary of Vistra, a REP in certain areas of PJM, NYISO, ISO-NE and MISO that is engaged in the retail sale of electricity to residential and business customers
Value Based Brands						Value Based Brands LLC (d/b/a 4Change, 4Change Energy and Express Energy), an indirect, wholly owned subsidiary of Vistra ~~Energy~~ that is a REP in competitive areas of ERCOT and is engaged in the retail sale of electricity to residential and business customers
Vistra ~~Energy~~						Vistra ~~Energy~~ Corp. and/or its subsidiaries, depending on ~~context~~context. Effective July 2, 2020, Vistra Energy Corp. changed its name to Vistra Corp.
Vistra Intermediate						Vistra Intermediate Company LLC, a direct, wholly owned subsidiary of Vistra ~~Energy~~
Vistra Operations						Vistra Operations Company LLC, an indirect, wholly owned subsidiary of Vistra ~~Energy~~ that is the issuer of certain series of notes (see Note 11 to the Financial Statements) and borrower under the Vistra Operations Credit Facilities
Vistra Operations Credit Facilities						Vistra Operations Company LLC's ~~$6.523~~$5.311 billion senior secured financing facilities (see Note 11 to the Financial Statements).

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PART I. FINANCIAL INFORMATION


~~Item 1.~~	~~FINANCIAL STATEMENTS~~

Item 1.FINANCIAL STATEMENTS

VISTRA ~~ENERGY~~ CORP.

CONDENSED CONSOLIDATED STATEMENTS OF ~~CONSOLIDATED INCOME (LOSS)~~OPERATIONS

(Unaudited) (Millions of Dollars, Except Per Share Amounts)


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Operating revenues (Note 5)	$	2,509	$	2,832	$	5,367	$	5,755
Fuel, purchased power costs and delivery fees	(1,029)		(1,139)		(2,362)		(2,600)
Operating costs	(412)		(370)		(792)		(755)
Depreciation and amortization	(455)		(384)		(875)		(790)
Selling, general and administrative expenses	(236)		(210)		(488)		(392)

Impairment of long-lived assets (Note 18)	—		—		(84)		—
Operating income	377		729		766		1,218
Other income (Note 18)	5		13		12		39
Other deductions (Note 18)	(4)		(2)		(35)		(5)
Interest expense and related charges (Note 18)	(141)		(274)		(440)		(495)
Impacts of Tax Receivable Agreement (Note 8)	(6)		33		(14)		36
Equity in earnings of unconsolidated investment	1		3		4		10
Income before income taxes	232		502		293		803
Income tax expense (Note 7)	(68)		(148)		(84)		(225)
Net income	$	164	$	354	$	209	$	578
Net loss attributable to noncontrolling interest	2		2		13		3
Net income attributable to Vistra	$	166	$	356	$	222	$	581
Weighted average shares of common stock outstanding:
Basic	488,680,442		499,778,235		488,312,503		499,213,522
Diluted	490,468,735		507,500,383		490,709,932		507,248,920
Net income per weighted average share of common stock outstanding:
Basic	$	0.34	$	0.71	$	0.45	$	1.16
Diluted	$	0.34	$	0.70	$	0.45	$	1.15

Three Months Ended June 30,
Six Months Ended June 30,

2019
2018
2019
2018
Operating revenues (Note 5) $ 2,832

$ 2,574

$ 5,755

$ 3,338
Fuel, purchased power costs and delivery fees (1,139 )
(1,216 )
(2,600 )
(1,866 )
Operating costs (370 )
(386 )
(755 )
(580 )
Depreciation and amortization (384 )
(389 )
(790 )
(542 )
Selling, general and administrative expenses (210 )
(352 )
(392 )
(514 )
Operating income (loss) 729

231

1,218

(164 )
Other income (Note 19) 13

7

39

18
Other deductions (Note 19) (2 )
(1 )
(5 )
(3 )
Interest expense and related charges (Note 19) (274 )
(146 )
(495 )
(137 )
Impacts of Tax Receivable Agreement (Note 8) 33

(64 )
36

(82 )
Equity in earnings of unconsolidated investment 3

4

10

4
Income (loss) before income taxes 502

31

803

(364 )
Income tax (expense) benefit (Note 7) (148 )
74

(225 )
163
Net income (loss) $ 354

$ 105

$ 578

$ (201 )
Net loss attributable to noncontrolling interest 2

3

3

3
Net income (loss) attributable to Vistra Energy $ 356

$ 108

$ 581

$ (198 )
Weighted average shares of common stock outstanding:

Basic 499,778,235
526,332,862
499,213,522
477,662,016
Diluted 507,500,383
533,786,824
507,248,920
477,662,016
Net income (loss) per weighted average share of common stock outstanding:
Basic $ 0.71
$ 0.21
$ 1.16
$ (0.41 )
Diluted $ 0.70
$ 0.20
$ 1.15
$ (0.41 )

See Notes to the Condensed Consolidated Financial Statements.

CONDENSED CONSOLIDATED STATEMENTS OF ~~CONSOLIDATED~~ COMPREHENSIVE INCOME ~~(LOSS)~~

(Unaudited) (Millions of Dollars)


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Net income	$	164	$	354	$	209	$	578
Other comprehensive income, net of tax effects:
Effects related to pension and other retirement benefit obligations (net of tax benefit of $—, $—, $7 and $—)	1		—		(22)		1

Total other comprehensive income (loss)	1		—		(22)		1
Comprehensive income	$	165	$	354	$	187	$	579
Comprehensive loss attributable to noncontrolling interest	2		2		13		3
Comprehensive income attributable to Vistra	$	167	$	356	$	200	$	582

Three Months Ended June 30, Six Months Ended June 30,
2019 2018 2019 2018
Net income (loss) $ 354
$ 105
$ 578
$ (201 )
Other comprehensive income, net of tax effects:
Effects related to pension and other retirement benefit obligations (net of tax benefit of $— in all periods) —
—
1
1
Total other comprehensive income —
—
1
1
Comprehensive income (loss) $ 354
$ 105
$ 579
$ (200 )
Comprehensive loss attributable to noncontrolling interest 2
3
3
3
Comprehensive income (loss) attributable to Vistra Energy $ 356
$ 108
$ 582
$ (197 )

See Notes to the Condensed Consolidated Financial Statements.

VISTRA ENERGY CORP.
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
(Unaudited) (Millions of Dollars)

Six Months Ended June 30,

2019
2018

Cash flows — operating activities:

Net income (loss) $ 578

$ (201 )
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:

Depreciation and amortization 886

619
Deferred income tax (benefit) expense, net 217

(159 )
Unrealized net (gain) loss from mark-to-market valuations of commodities (703 )
199
Unrealized net (gain) loss from mark-to-market valuations of interest rate swaps 199

(86 )
Asset retirement obligation accretion expense 27

44
Impacts of Tax Receivable Agreement (Note 8) (36 )
82
Stock-based compensation 24

59
Other, net 73

(6 )
Changes in operating assets and liabilities:

Margin deposits, net 112

(61 )
Accrued interest 6

(74 )
Accrued taxes (67 )
(112 )
Accrued employee incentive (72 )
(31 )
Other operating assets and liabilities (362 )
(302 )
Cash provided by (used in) operating activities 882

(29 )
Cash flows — financing activities:

Issuances of long-term debt (Note 11) 4,600

—
Repayments/repurchases of debt (Note 11) (4,137 )
(1,338 )
Net borrowings under accounts receivable securitization program (Note 10) 91

—
Stock repurchase (Note 14) (457 )
(63 )
Dividends paid to stockholders (Note 14) (120 )
—
Debt tender offer and other financing fees (Note 11) (146 )
(46 )
Other, net (1 )
4
Cash used in financing activities (170 )
(1,443 )
Cash flows — investing activities:

Capital expenditures, including LTSA prepayments (247 )
(153 )
Nuclear fuel purchases (20 )
(28 )
Development and growth expenditures (36 )
(21 )
Cash acquired in the Merger —

445
Proceeds from sales of nuclear decommissioning trust fund securities (Note 19) 292

93
Investments in nuclear decommissioning trust fund securities (Note 19) (302 )
(103 )
Proceeds from sale of environmental allowances 31
—
Purchases of environmental allowances (138 ) (1 )
Other, net 21

10
Cash (used in) provided by investing activities (399 )
242

Net change in cash, cash equivalents and restricted cash 313

(1,230 )
Cash, cash equivalents and restricted cash — beginning balance 693

2,046
Cash, cash equivalents and restricted cash — ending balance $ 1,006

$ 816

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VISTRA CORP. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Millions of Dollars)
	Six Months Ended June 30,
	2020		2019
Cash flows — operating activities:
Net income	$	209	$	578
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	1,022		886
Deferred income tax expense, net	73		217

Impairment of long-lived assets (Note 18)	84		—
Loss on disposal of investment in NELP (Note 18)	29		—

Unrealized net gain from mark-to-market valuations of commodities	(123)		(703)
Unrealized net loss from mark-to-market valuations of interest rate swaps	192		199
Asset retirement obligation accretion expense	23		27
Impacts of Tax Receivable Agreement (Note 8)	14		(36)
Stock-based compensation	30		24
Other, net	55		73
Changes in operating assets and liabilities:
Margin deposits, net	58		112
Accrued interest	(6)		6
Accrued taxes	(59)		(67)
Accrued employee incentive	(70)		(72)
Other operating assets and liabilities	(222)		(362)
Cash provided by operating activities	1,309		882
Cash flows — investing activities:
Capital expenditures, including nuclear fuel purchases and LTSA prepayments	(588)		(303)
Proceeds from sales of nuclear decommissioning trust fund securities (Note 18)	224		292
Investments in nuclear decommissioning trust fund securities (Note 18)	(234)		(302)
Proceeds from sales of environmental allowances	88		31
Purchases of environmental allowances	(173)		(138)
Other, net	30		21
Cash used in investing activities	(653)		(399)
Cash flows — financing activities:
Issuances of long-term debt (Note 11)	—		4,600
Repayments/repurchases of debt (Note 11)	(756)		(4,137)
Net borrowings under accounts receivable securitization program (Note 10)	—		91
Borrowings under Revolving Credit Facility (Note 11)	925		—
Repayments under Revolving Credit Facility (Note 11)	(725)		—
Stock repurchase (Note 13)	—		(457)
Dividends paid to stockholders (Note 13)	(132)		(120)
Debt tender offer and other financing fees (Note 11)	(10)		(146)
Other, net	—		(1)
Cash used in financing activities	(698)		(170)
Net change in cash, cash equivalents and restricted cash	(42)		313
Cash, cash equivalents and restricted cash — beginning balance	475		693
Cash, cash equivalents and restricted cash — ending balance	$	433	$	1,006

See Notes to the Condensed Consolidated Financial Statements.

VISTRA ENERGY CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (Millions of Dollars)
June 30,
2019 December 31,
2018
ASSETS
Current assets:
Cash and cash equivalents $ 964
$ 636
Restricted cash (Note 19) 42
57
Trade accounts receivable — net (Note 19) 1,101
1,087
Inventories (Note 19) 476
412
Commodity and other derivative contractual assets (Note 16) 1,418
730
Margin deposits related to commodity contracts 253
361
Prepaid expense and other current assets 285
152
Total current assets 4,539
3,435
Investments (Note 19) 1,422
1,250
Investment in unconsolidated subsidiary (Note 19) 127
131
Property, plant and equipment — net (Note 19) 14,260
14,612
Operating lease right-of-use assets (Note 12) 34
—
Goodwill (Note 6) 2,082
2,068
Identifiable intangible assets — net (Note 6) 2,383
2,493
Commodity and other derivative contractual assets (Note 16) 124
109
Accumulated deferred income taxes 1,144
1,336
Other noncurrent assets 405
590
Total assets $ 26,520
$ 26,024
LIABILITIES AND EQUITY
Current liabilities:
Accounts receivable securitization program (Note 10) $ 430
$ 339
Long-term debt due currently (Note 11) 161
191
Trade accounts payable 782
945
Commodity and other derivative contractual liabilities (Note 16) 1,514
1,376
Margin deposits related to commodity contracts 8
4
Accrued income taxes 12
10
Accrued taxes other than income 115
182
Accrued interest 82
77
Asset retirement obligations (Note 19) 232
156
Operating lease liabilities (Note 12) 13
—
Other current liabilities 308
345
Total current liabilities 3,657
3,625
Long-term debt, less amounts due currently (Note 11) 11,193
10,874
Operating lease liabilities (Note 12) 40
—
Commodity and other derivative contractual liabilities (Note 16) 404
270
Accumulated deferred income taxes 10
10
Tax Receivable Agreement obligation (Note 8) 384
420
Asset retirement obligations (Note 19) 2,133
2,217
Identifiable intangible liabilities — net (Note 6) 331
401
Other noncurrent liabilities and deferred credits (Note 19) 464
340
Total liabilities 18,616
18,157

Table of Contents


VISTRA CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Millions of Dollars)
	June 30, 2020		December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	382	$	300
Restricted cash (Note 18)	27		147
Trade accounts receivable — net (Note 18)	1,272		1,365

Inventories (Note 18)	541		469
Commodity and other derivative contractual assets (Note 15)	1,350		1,333
Margin deposits related to commodity contracts	161		202
Prepaid expense and other current assets	304		298
Total current assets	4,037		4,114
Restricted cash (Note 18)	24		28
Investments (Note 18)	1,552		1,537
Investment in unconsolidated subsidiary (Note 18)	—		124
Property, plant and equipment — net (Note 18)	13,881		13,914
Operating lease right-of-use assets	44		44

Goodwill (Note 6)	2,568		2,553
Identifiable intangible assets — net (Note 6)	2,532		2,748
Commodity and other derivative contractual assets (Note 15)	277		136
Accumulated deferred income taxes	994		1,066
Other noncurrent assets	398		352
Total assets	$	26,307	$	26,616
LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings (Note 11)	$	550	$	350
Accounts receivable securitization program (Note 10)	450		450
Long-term debt due currently (Note 11)	337		277
Trade accounts payable	879		947
Commodity and other derivative contractual liabilities (Note 15)	1,546		1,529
Margin deposits related to commodity contracts	15		8
Accrued income taxes	10		1
Accrued taxes other than income	133		200
Accrued interest	144		151
Asset retirement obligations (Note 18)	138		141
Operating lease liabilities	11		14

Other current liabilities	418		506
Total current liabilities	4,631		4,574
Long-term debt, less amounts due currently (Note 11)	9,261		10,102
Operating lease liabilities	37		41

Commodity and other derivative contractual liabilities (Note 15)	599		396
Accumulated deferred income taxes	2		2
Tax Receivable Agreement obligation (Note 8)	468		455
Asset retirement obligations (Note 18)	2,314		2,097

VISTRA ENERGY CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (Millions of Dollars)
June 30,
2019 December 31,
2018
Commitments and Contingencies (Note 13)

Total equity (Note 14):
Common stock (par value — $0.01; number of shares authorized — 1,800,000,000)
(shares outstanding: June 30, 2019 — 476,166,856; December 31, 2018 — 493,215,309) 5
5
Additional paid-in-capital 8,909
9,329
Retained deficit (989 ) (1,449 )
Accumulated other comprehensive income (loss) (21 ) (22 )
Stockholders' equity 7,904
7,863
Noncontrolling interest in subsidiary —
4
Total equity 7,904
7,867
Total liabilities and equity $ 26,520
$ 26,024

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VISTRA CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Millions of Dollars)
	June 30, 2020		December 31, 2019
Other noncurrent liabilities and deferred credits (Note 18)	951		989
Total liabilities	18,263		18,656
Commitments and Contingencies (Note 12)
Total equity (Note 13):
Common stock (par value — $0.01; number of shares authorized — 1,800,000,000) (shares outstanding: June 30, 2020 — 488,772,572; December 31, 2019 — 487,698,111)	5		5
Treasury stock, at cost (shares: June 30, 2020 — 41,043,224; December 31, 2019 — 41,043,224)	(973)		(973)
Additional paid-in-capital	9,754		9,721
Retained deficit	(678)		(764)
Accumulated other comprehensive loss	(52)		(30)
Stockholders' equity	8,056		7,959
Noncontrolling interest in subsidiary	(12)		1
Total equity	8,044		7,960
Total liabilities and equity	$	26,307	$	26,616

See Notes to the Condensed Consolidated Financial Statements.

Table of Contents

VISTRA ~~ENERGY~~ CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


1.	~~BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES~~

1.BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

Description of Business

References in this report to "we," "our," "us" and "the Company" are to Vistra ~~Energy~~ and/or its subsidiaries, as apparent in the context. See Glossary for defined terms.

Vistra ~~Energy~~ is a holding company operating an integrated retail and electric power generation business primarily in markets throughout the U.S. Through our subsidiaries, we are engaged in competitive ~~electricity~~energy market activities including power generation, wholesale energy sales and purchases, commodity risk management and retail sales of electricity and natural gas to end users. Effective July 2, 2020, we changed our name from Vistra Energy Corp. to Vistra Corp. (Vistra) to distinguish from companies that are involved in exploring for, producing, refining, or transporting fossil fuels (many of which use "energy" in their names) and to better reflect our integrated business model, which combines a retail electricity and natural gas business focused on serving its customers with new and innovative products and services and an electric power generation business powering the communities we serve with safe, reliable power.

Vistra ~~Energy~~ has ~~six~~6 reportable segments: (i) Retail, (ii) ERCOT, (iii) PJM, (iv) NY/NE (comprising NYISO and ISO-NE), (v) MISO and (vi) Asset Closure. See Note 1817 for further information concerning reportable business segments.

~~Acquisition of Crius~~Ambit Transaction

On ~~July 15,~~November 1, 2019, an indirect, wholly owned subsidiary of Vistra ~~Energy~~ completed the acquisition of ~~the equity interests of two wholly owned subsidiaries of Crius that indirectly own the operating business of Crius (Crius~~Ambit (Ambit Transaction). Because the ~~Crius~~Ambit Transaction closed on ~~July 15,~~November 1, 2019, Vistra Energy's condensed consolidated financial statements and the notes related thereto for the period ending June 30, 2019 do not include the financial condition or the operating results of Crius and its subsidiaries. See Note 2 for a summary of the Crius Transaction.

~~Dynegy Merger Transaction~~

On the Merger Date, Vistra Energy and Dynegy completed the transactions contemplated by the Merger Agreement. Pursuant to the Merger Agreement, Dynegy merged with and into Vistra Energy, with Vistra Energy continuing as the surviving corporation. Because the Merger closed on April 9, 2018, Vistra Energy'sVistra's condensed consolidated financial statements and the notes related thereto do not include the financial condition or the operating results of ~~Dynegy~~Ambit and its subsidiaries prior to ~~April 9, 2018.~~November 1, 2019. See Note 2 for a summary of the ~~Merger transaction~~Ambit Transaction.

Crius Transaction

On July 15, 2019, an indirect, wholly owned subsidiary of Vistra completed the acquisition of the equity interests of two wholly owned subsidiaries of Crius that indirectly owned the operating business of Crius (Crius Transaction). Because the Crius Transaction closed on July 15, 2019, Vistra's condensed consolidated financial statements and the notes related thereto do not include the financial condition or the operating results of Crius and its subsidiaries prior to July 15, 2019. See Note 2 for a summary of the Crius Transaction.

COVID-19 Pandemic

In March 2020, the World Health Organization categorized the novel coronavirus (COVID-19) as a pandemic, and the President of the United States (the President) declared the COVID-19 outbreak a national emergency. The U.S. government has deemed electricity generation, transmission and distribution as “critical infrastructure” providing essential services during this global emergency. As a provider of critical infrastructure, Vistra has an obligation to provide critically needed power to homes, businesses, hospitals and other customers. Vistra remains focused on protecting the health and well-being of its employees and the communities in which it operates while assuring the continuity of its business ~~combination accounting.~~operations.

The Company's condensed consolidated financial statements reflect estimates and assumptions made by management that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenue and expenses during the reporting periods presented. The Company considered the impact of COVID-19 on the assumptions and estimates used and determined that there have been no material adverse impacts on the Company's results of operations for the three or six months ended June 30, 2020.

In response to the global pandemic related to COVID-19, the President signed into law the CARES Act on March 27, 2020. See Note 7 for a summary of certain anticipated tax-related impacts of the CARES Act to the Company.

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Basis of Presentation

The condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and on the same basis as the audited financial statements included in our ~~annual report on~~2019 Form ~~10-K~~10-K. The condensed consolidated financial information herein reflects all adjustments which are, in the opinion of management, necessary to fairly state the results for the ~~year ended December 31, 2018. Adjustments (consisting~~interim periods presented. All such adjustments are of a normal ~~recurring accruals) necessary for a fair presentation of the results of operations and financial position have been included therein.~~nature. All intercompany items and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with U.S. GAAP have been omitted pursuant to the rules and regulations of the SEC. Because the condensed consolidated interim financial statements do not include all of the information and footnotes required by U.S. GAAP, they should be read in conjunction with the audited financial statements and related notes contained in our ~~annual report on~~2019 Form ~~10-K for the year ended December 31, 2018.~~10-K. The results of operations for an interim period may not give a true indication of results for a full year. All dollar amounts in the financial statements and tables in the notes are stated in millions of U.S. dollars unless otherwise indicated.

Use of Estimates

Preparation of financial statements requires estimates and assumptions about future events that affect the reporting of assets and liabilities at the balance sheet dates and the reported amounts of revenue and expense, including fair value measurements, estimates of expected obligations, ~~judgment~~judgments related to the potential timing of events and other estimates. In the event estimates and/or assumptions prove to be different from actual amounts, adjustments are made in subsequent periods to reflect more current information.

~~Leases~~

At the inception of a contract we determine if it is or contains a lease, which involves the contract conveying the right to control the use of explicitly or implicitly identified property, plant, or equipment for a period of time in exchange for consideration.

Right-of-use (ROU) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date of the underlying lease based on the present value of lease payments over the lease term. We use our secured incremental borrowing rate based on the information available at the lease commencement date to determine the present value of lease payments. Operating leases are included in operating lease ROU assets, operating lease liabilities (current) and operating lease liabilities (noncurrent) on our condensed consolidated balance sheet. Finance leases are included in property, plant and equipment, other current liabilities and other noncurrent liabilities and deferred credits on our condensed consolidated balance sheet. Lease term includes options to extend or terminate the lease when it is reasonably certain that we will exercise the option. We have elected the practical expedient which permits us to not reassess under the new standard our prior conclusion about lease classification and initial direct costs. We have also elected the practical expedient to not separate lease and non-lease components for a majority of the lease asset classes. We have also elected the hindsight practical expedient to determine the lease term.

~~Leases with an initial lease term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term.~~

~~We also present lessor sublease income on a net basis against the related lessee lease expense.~~

Adoption of ~~New~~ Accounting Standards

~~Leases~~ ~~— On January 1,~~In December 2019, ~~we adopted~~the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) ~~2016-02,~~2019-12, ~~Leases~~Simplifying the Accounting for Income Taxes (Topic ~~842)~~740). The ASU enhances and ~~all~~simplifies various aspects of the income tax accounting guidance including the elimination of certain exceptions related ~~amendments (new lease standard) using the modified retrospective method with the cumulative-effect adjustment~~ to the ~~opening balance~~approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of ~~retained earnings~~deferred tax liabilities for ~~all contracts outstanding at the time~~outside basis differences. The new guidance also simplifies aspects of ~~adoption. The comparative information has not been restated and continues to be reported under~~ the accounting ~~standards~~for franchise taxes and enacted changes in ~~effect~~tax laws or rates and clarifies the accounting for ~~those periods.~~transactions that result in a step-up in the tax basis of goodwill. We ~~expect~~adopted all provisions of this ASU in the first quarter of 2020, and it did not have a material impact ~~of the adoption of the new lease standard to be immaterial to~~on our net income on an ongoing basis. The impact of adopting the new lease standard primarily relates to recognition of lease liabilities and ROU assets for all leases classified as operating leases. Under the new lease standard, each ROU asset will be amortized over the lease term and liability settled at the end of the lease term.financial statements.

~~We recognized the effect of initially applying the new lease standard by recording ROU assets of $85 million and lease liabilities of $123 million in our condensed consolidated balance sheet.~~

~~As of January 1, 2019, the cumulative effect of the changes made to our condensed consolidated balance sheet for the adoption of the new lease standard was as follows:~~

December 31, 2018 Adoption of New Lease Standard
January 1,
2019
Impact on condensed consolidated balance sheet:
Assets
Property, plant and equipment — net $ 14,612
$ 15
$ 14,627
Operating lease right-of-use assets —
70
70
Prepaid expense and other current assets 152
(2 ) 150
Accumulated deferred income taxes 1,336
1
1,337
Liabilities
Other current liabilities 345
(1 ) 344
Operating lease liabilities —
109
109
Identifiable intangible liabilities 401
(36 ) 365
Other noncurrent liabilities and deferred credits 340
14
354
Equity
Retained deficit (1,449 ) (2 ) (1,451 )

~~See Note 12 for the disclosures required by the new lease standard.~~

~~Changes in Accounting Standards~~

In August 2018, the ~~Financial Accounting Standards Board (FASB)~~FASB issued ASU 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement. ~~The ASU will be effective for fiscal years beginning after December 15, 2019 and early adoption is permitted.~~ The ASU removes disclosure requirements for (a) the reasons for transfers between Level 1 and Level 2, (b) the policy for timing of transfers between levels and (c) the valuation processes for Level 3. The ASU ~~will require~~requires new disclosures around (a) the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and (b) the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. We ~~are currently evaluating the impact of~~adopted this ASU ~~on our disclosures.~~in the first quarter of 2020, and the updated disclosures are included in Note 14.

In August 2018, the FASB issued ASU 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. ~~The ASU will be effective for fiscal years beginning after December 15, 2019 and early adoption is permitted.~~ The ASU requires a customer in a cloud hosting arrangement that is a service contract to determine which implementation costs to capitalize and which costs to expense based on the project stage of the implementation. The ASU also requires the customer to expense the capitalized implementation costs over the term of the hosting arrangement. The customer is required to apply the existing impairment and abandonment guidance on the capitalized implementation costs. We ~~are currently evaluating~~adopted this ASU in the ~~impact~~first quarter of ~~this ASU~~2020, and it did not have a material impact on our financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses. The ASU requires organizations to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. We adopted this ASU in the first quarter of 2020, and it did not have a material impact on our financial statements.

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Changes in Accounting Standards

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The ASU provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another rate that is expected to be discontinued. The amendments in the ASU are effective for all entities as of March 12, 2020 through December 31, 2022. The adoption of this guidance did not have a material impact on our financial statements.

In March 2020, the SEC amended Rule 3-10 of Regulation S-X regarding financial disclosure requirements for registered debt offerings involving subsidiaries as either issuers or guarantors and affiliates whose securities are pledged as collateral. This new guidance narrows the circumstances that require separate financial statements of subsidiary issuers and guarantors and streamlines the alternative disclosures required in lieu of those statements. This rule is effective January 4, 2021 with earlier adoption permitted. We elected to adopt this rule in the first quarter of 2020. Accordingly, summarized financial information has been presented only for the issuer and guarantors of the Company's registered debt securities, and the location of the required disclosures has been moved outside the Notes to the Consolidated Financial Statements and is provided in Part I, Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations under Financial Condition - Guarantor Summary Financial Information.

2. ~~ACQUISITION OF CRIUS, DYNEGY~~ACQUISITIONS, MERGER TRANSACTION AND BUSINESS COMBINATION ACCOUNTING

Ambit Transaction

On November 1, 2019 (Ambit Acquisition Date), Volt Asset Company, Inc., an indirect, wholly owned subsidiary of ~~Crius~~Vistra, completed the Ambit Transaction. Ambit is an energy retailer selling both electricity and natural gas products to residential and small business customers in 17 states. Vistra funded the purchase price of $555 million (including cash acquired and net working capital) using cash on hand. All of Ambit's outstanding debt was repaid from the purchase price at closing and not assumed by Vistra.

Crius Transaction

On July 15, 2019 ~~(Acquisition~~(Crius Acquisition Date), Vienna Acquisition B.C. Ltd., an indirect, wholly owned subsidiary of Vistra, ~~Energy,~~ completed the acquisition of the equity interests of two wholly owned subsidiaries of Crius that indirectly own the operating business of Crius. Crius is an energy retailer selling both electricity and natural gas products to residential and small business customers in 19 ~~states~~states. Vistra funded the purchase price of $400 million (including $382 million for outstanding trust units) using cash on hand. In addition, Vistra assumed $140 million of outstanding debt and acquired $26 million of cash at the ~~District~~closing of ~~Columbia.~~the Crius Transaction.

~~The~~Ambit and Crius Business Combination Accounting

We believe the Ambit Transaction ~~is expected to~~has (i) ~~reduce~~augmented Vistra's existing retail marketing capabilities with additional direct selling capability and a proprietary technology platform, (ii) reduced risk and ~~expand~~aided expansion into higher margin channels by improving ~~Vistra Energy's~~Vistra's match of its generation to load profile due to a high degree of overlap of Vistra's generation fleet with ~~Vistra Energy's~~Ambit's approximately 11 TWh of annual load, primarily in ERCOT and PJM and (iii) enhanced the integrated value proposition through collateral and transaction efficiencies, particularly via Ambit's retail electric portfolio.

We believe the Crius Transaction has (i) reduced risk and aided expansion into higher margin channels by improving Vistra's match of its generation to load profile due to a high degree of overlap of Vistra's generation fleet with Crius' approximately ~~11.6~~10 TWh of annual electricity load, (ii) ~~establish~~established a platform for ~~future~~ growth by leveraging ~~Vistra Energy's~~Vistra's existing retail marketing capabilities and Crius' experienced team and (iii) ~~enhance~~enhanced the integrated value proposition through collateral and transaction efficiencies, particularly via Crius' retail electric portfolio.

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~~The~~Each of the Ambit Transaction and Crius Transaction, respectively, is being accounted for in accordance with ASC 805, Business Combinations (ASC 805), with identifiable assets acquired and liabilities assumed recorded at their estimated fair values on the ~~Acquisition Date. Due to the limited time between the~~Ambit Acquisition Date and ~~this filing, our purchase price allocation for the assets acquired and the liabilities assumed in the Merger has not been completed.~~Crius Acquisition Date, respectively. The combined results of operations ~~of Crius will be~~are reported in our condensed consolidated financial statements beginning as of the respective Ambit Acquisition Date and Crius Acquisition Date. ~~Vistra Energy funded~~A summary of the techniques used to estimate the fair value of the identifiable assets and liabilities, as well as their classification within the fair value hierarchy (see Note 14), is listed below:

•Working capital was valued using available market information (Level 2).

•Acquired derivatives were valued using the methods described in Note 14 (Level 2 or Level 3).

•Acquired retail customer relationship was valued based on discounted cash flow analysis of acquired customers and estimated attrition rates (Level 3).

•Crius' long-term debt was valued using a market approach (Level 2).

The following table summarizes the allocation of the purchase price ~~of approximately $400 million (including $380 million for outstanding trust units) using cash on hand and assumption of Crius' net debt of approximately $111 million. Our initial accounting for~~to the ~~purchase price allocation~~fair value amounts recognized for the assets acquired and ~~the~~ liabilities assumed related to the Ambit Transaction and Crius Transaction, respectively, as of the Ambit Acquisition Date and Crius Acquisition Date, respectively. The Ambit Transaction purchase price was $555 million (including cash acquired and net working capital), and the Crius Transaction purchase price was $400 million. The Ambit Transaction purchase price allocation is ongoing and is dependent upon final valuation determinations, which have not been completed. The Ambit Transaction preliminary values included below represent our current best estimates for identifiable intangible assets, goodwill and net working capital. The Ambit Transaction purchase price allocation is preliminary and each of the values included below may change materially based upon the receipt of more detailed information, additional analyses and completed valuations. The final purchase price allocation was completed in the second quarter of 2020 for the Crius Transaction and ~~the supplemental pro forma financial results is currently underway and~~ will be ~~presented~~completed no later than the third quarter of ~~2019.~~2020 for the Ambit Transaction.


Ambit Transaction Preliminary Purchase Price Allocation and Crius Transaction Final Purchase Price Allocation
	Ambit Transaction						Crius Transaction
	Updated Preliminary Purchase Price Allocation		Measurement Period Adjustments recorded through June 30, 2020		Final Purchase Price Allocation		Measurement Period Adjustments recorded through June 30, 2020
Cash and cash equivalents	$	49	$	—	$	26	$	—
Net working capital	35		6		(9)		(42)
Accumulated deferred income taxes	—		—		—		(36)
Identifiable intangible assets	230		(33)		317		23
Goodwill	243		29		243		38
Commodity and other derivative contractual assets	23		—		18		—
Other noncurrent assets	13		—		17		(3)
Total assets acquired	593		2		612		(20)
Identifiable intangible liabilities	—		—		2		(34)
Long-term debt, including amounts due currently	—		—		140		—
Commodity and other derivative contractual liabilities	28		—		40		—
Accumulated deferred income taxes	—		—		14		14
Other noncurrent liabilities and deferred credits	10		2		16		—
Total liabilities assumed	38		2		212		(20)
Identifiable net assets acquired	$	555	$	—	$	400	$	—

Dynegy Merger Transaction

On the Merger Date, Vistra ~~Energy~~ and Dynegy completed the transactions contemplated by the Merger Agreement. Pursuant to the Merger Agreement, Dynegy merged with and into Vistra, ~~Energy,~~ with Vistra ~~Energy~~ continuing as the surviving corporation. The Merger was intended to qualify as a tax-free reorganization under the ~~Internal Revenue Code, as amended,~~IRC, so that none of Vistra, ~~Energy,~~ Dynegy or any of the Dynegy stockholders would recognize any gain or loss in the transaction, except that Dynegy stockholders could recognize a gain or loss with respect to cash received in lieu of fractional shares of ~~Vistra Energy's~~Vistra's common stock. Vistra ~~Energy~~ is the acquirer for both federal tax and accounting purposes.

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~~At the closing of~~On the Merger Date, each issued and outstanding share of Dynegy common stock, par value $0.01 per share, other than shares owned by Vistra ~~Energy~~ or its subsidiaries, held in treasury by Dynegy or held by a subsidiary of Dynegy, was automatically converted into 0.652 shares of common stock, par value $0.01 per share, of Vistra ~~Energy~~ (the Exchange Ratio), except that cash was paid in lieu of fractional shares, which resulted in Vistra ~~Energy~~ issuing 94,409,573 shares of Vistra ~~Energy~~ common stock to the former Dynegy stockholders, as well as converting stock options, equity-based awards, tangible equity units and warrants. The total number of Vistra ~~Energy~~ shares outstanding at the close of the Merger was 522,932,453 shares. Dynegy stock options and equity-based awards outstanding immediately prior to the Merger Date were generally automatically converted upon completion of the Merger into stock options and equity-based awards, respectively, with respect to ~~Vistra Energy's~~Vistra's common stock, after giving effect to the Exchange Ratio.

~~Dynegy Business Combination Accounting~~

We believe the Merger has provided and continues to provide significant strategic benefits and opportunities to Vistra Energy, including increased scale and market diversification, rebalanced asset portfolio and improved earnings and cash flow. The Merger was accounted for in accordance with ASC 805, ~~Business Combinations~~ (ASC 805), with identifiable assets acquired and liabilities assumed recorded at their estimated fair values on the Merger Date. The combined results of operations are reported in our consolidated financial statements beginning as of the Merger Date. A summary of the techniques used to estimate the fair value of the identifiable assets and liabilities, as well as their classification within the fair value hierarchy (see Note 15), is listed below:

~~Working capital was valued using available market information (Level 2).~~

Acquired property, plant and equipment was valued using a combination of an income approach and a market approach. The income approach utilized a discounted cash flow analysis based upon a debt-free, free cash flow model (Level 3).

~~Acquired derivatives were valued using the methods described in Note 15 (Level 1, Level 2 or Level 3).~~

Contracts with terms that were not at current market prices were also valued using a discounted cash flow analysis (Level 3). The cash flows generated by the contracts were compared with their cash flows based on current market prices with the resulting difference discounted to present value and recorded as either an intangible asset or liability.

~~Long-term debt was valued using a market approach (Level 2).~~


•	~~AROs were recorded in accordance with ASC 410,~~ ~~Asset Retirement and Environmental Obligations~~ ~~(Level 3).~~

The following table summarizes the consideration paid and the final allocation of the purchase price to the fair value amounts recognized for the assets acquired and liabilities assumed related to the Merger as of the Merger Date. Based on the opening price of Vistra Energy common stock on the Merger Date, the purchase price was approximately $2.3 billion. During the three months ended March 31, 2019, the purchase price allocation was completed. During the period from April 9, 2018 through March 31, 2019, we updated the initial purchase price allocation with final valuations by increasing property, plant and equipment by $173 million, decreasing intangible assets by $36 million, increasing goodwill by $175 million, decreasing accounts receivable, inventory, prepaid expenses and other current assets by $10 million, increasing accumulated deferred tax asset by $127 million, decreasing other noncurrent assets by $113 million, increasing trade accounts payable and other current liabilities by $89 million, increasing other noncurrent liabilities by $177 million, increasing asset retirement obligations, including amounts due currently, by $56 million, as well as other minor adjustments. The valuation revisions were a result of updated inputs used in determining the fair value of the acquired assets and liabilities.

Dynegy shares outstanding as of April 9, 2018 (in millions) 144.8
Exchange Ratio 0.652
Vistra Energy shares issued for Dynegy shares outstanding (in millions) 94.4
Opening price of Vistra Energy common stock on April 9, 2018 $ 19.87
Purchase price for common stock $ 1,876
Fair value of equity component of tangible equity units $ 369
Fair value of outstanding stock compensation awards attributable to pre-combination service $ 26
Fair value of outstanding warrants $ 2
Total purchase price $ 2,273

Final Purchase Price Allocation
Cash and cash equivalents $ 445
Trade accounts receivables, inventories, prepaid expenses and other current assets 853
Property, plant and equipment 10,535
Accumulated deferred income taxes 518
Identifiable intangible assets 351
Goodwill 175
Other noncurrent assets 419
Total assets acquired 13,296
Trade accounts payable and other current liabilities 733
Commodity and other derivative contractual assets and liabilities, net 422
Asset retirement obligations, including amounts due currently 475
Long-term debt, including amounts due currently 8,919
Other noncurrent liabilities 469
Total liabilities assumed 11,018
Identifiable net assets acquired 2,278
Noncontrolling interest in subsidiary 5
Total purchase price $ 2,273

Acquisition costs incurred in the Merger totaled less than $1 million and $50 million for the three months ended June 30, 2019 and 2018, respectively, and less than $1 million and $52 million for the six months ended June 30, 2019 and 2018, respectively.

3. DEVELOPMENT OF GENERATION FACILITIES

~~Unaudited Pro Forma Financial Information~~ — The following unaudited pro forma financial information for the six months ended June 30, 2018 assumes that the Merger occurred on January 1, 2018. The unaudited pro forma financial information is provided for information purposes only and is not necessarily indicative of the results of operations that would have occurred had the Merger been completed on January 1, 2018, nor is the unaudited pro forma financial information indicative of future results of operations, which may differ materially from the pro forma financial information presented here.

Six Months
Ended
June 30, 2018
Revenues $ 4,789
Net loss $ (439 )
Net loss attributable to Vistra Energy $ (435 )
Net loss attributable to Vistra Energy per weighted average share of common stock outstanding — basic $ (0.83 )
Net loss attributable to Vistra Energy per weighted average share of common stock outstanding — diluted $ (0.83 )

The unaudited pro forma financial information presented above includes adjustments for incremental depreciation and amortization as a result of the fair value determination of the net assets acquired, interest expense on debt assumed in the Merger, effects of the Merger on tax expense (benefit), changes in the expected impacts of the tax receivable agreement due to the Merger, and other related adjustments.


3.	~~ACQUISITION AND DEVELOPMENT OF GENERATION FACILITIES~~

Battery Energy Storage Projects

We have completed the construction of our first battery energy storage system (ESS). In October 2018, we were awarded a $1 million grant from the TCEQ for our battery ESS at our Upton 2 solar facility. The grant is part of the Texas Emissions Reduction Plan. The 10 MW lithium-ion ESS captures excess solar energy produced during the day and releases the energy in late afternoon and early evening, when demand is highest. The Upton 2 battery ESS became operational in December 2018.

Oakland — In June 2019, East Bay Community Energy (EBCE) signed a ten-year contract to receive resource adequacy capacity from the planned development of a 20 MW battery ESS at our Oakland Power Plant site in California. ~~The~~In April 2020, the project received necessary approvals from EBCE and from Pacific Gas and Electric Company (PG&E), and the contract ~~is now pending utility review~~was amended to increase the capacity of the planned development to a 36.25 MW battery ESS. In April 2020, the concurrent local area reliability service agreement to ensure grid reliability as part of the Oakland Clean Energy Initiative was signed and ~~signature and will then be~~ sent to the California Public Utilities Commission (CPUC) for approval. The battery ESS project is expected to enter commercial operations by January 2022.

Moss Landing — In June 2018, we announced that, subject to approval by the CPUC, we would enter into a 20-year resource adequacy contract with ~~Pacific Gas and Electric Company (PG&E)~~PG&E to develop a 300 MW battery ESS at our Moss Landing Power Plant site in ~~California.~~California (Moss Landing Phase I). PG&E filed its application with the CPUC in June 2018 and the CPUC approved the resource adequacy contract in November 2018. At June 30, ~~2019,~~2020, we had accumulated approximately ~~$15~~$315 million in construction work-in-process for ~~this~~Moss Landing Phase I. Under the contract, PG&E will pay us a fixed monthly resource adequacy payment, while we will receive the energy revenues and incur the costs from dispatching and charging the ESS. We anticipate the Moss Landing ~~battery ESS~~Phase I will commence commercial operations byin the fourth quarter of 2020. PG&E filed for Chapter 11 bankruptcy protection in January 2019. IfIn November 2019, the ~~terms~~bankruptcy court approved PG&E's motion requesting approval of the assumption of the resource adequacy contract ~~are not honored by PG&E or~~subject to the CPUC approving the terms of an amendment to the resource adequacy contract, ~~is rejected through~~and the CPUC approved the terms of the amendment in January 2020. PG&E emerged from bankruptcy ~~process, we could have future impairment losses.~~protection in July 2020.

~~Upton 2 Solar Development~~

In May ~~2017,~~2020, we ~~acquired~~announced that, subject to approval by the ~~rights~~CPUC, we would enter into a 10-year resource adequacy contract with PG&E to develop ~~construct~~an additional 100 MW battery ESS at our Moss Landing Power Plant site (Moss Landing Phase II). PG&E filed its application with the CPUC in May 2020, and ~~operate~~ a ~~utility scale solar photovoltaic power generation~~decision is expected to be received by the end of the third quarter of 2020. Assuming the receipt of CPUC approval, we anticipate Moss Landing Phase II will commence commercial operations in the third quarter of 2021.

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4. RETIREMENT OF GENERATION FACILITIES

MISO— In September 2019, we announced the settlement of a lawsuit alleging violations of opacity and particulate matter limits at our Edwards facility in ~~Upton County, Texas (Upton 2).~~Bartonville, Illinois. As part of ~~this project,~~the settlement, which was approved by the U.S. District Court for the Central District of Illinois in November 2019, we ~~entered a turnkey engineering, procurement and construction agreement to construct~~will retire the ~~approximately 180 MW facility. During 2017 and 2018, we spent approximately $231 million related to this project primarily for progress payments under~~Edwards facility by the ~~engineering, procurement and construction agreement and the acquisition~~end of ~~the development rights. The facility began test operations in March 2018 and commercial operations began in June 2018.~~


4.	~~RETIREMENT OF GENERATION FACILITIES~~

2022 (see Note 12). In August ~~2018,~~2019, we ~~filed a notice of suspension of operation with PJM and other mandatory regulatory notifications related to~~announced the planned retirement of our 51 MW Northeastern Power Company waste coal facility in McAdoo, Pennsylvania (Northeastern Facility). We decided to retire the Northeastern Facility due to its uneconomic operations and financial outlook. Following the receipt of regulatory approvals, the Northeastern Facility was retired in October 2018. The decision to retire the Northeastern Facility did not result in a material impact to the financial statements, and the operational results of the Northeastern Facility are included in our Asset Closure segment.

~~Two of our non-operated, jointly held~~4 power plants ~~acquired~~ in the Merger, for which our proportional generation capacity was 883 MW, were retired in May 2018. These units were retired as previously scheduled. No gain or loss was recorded in conjunction with the retirement of these units, and the operational results of these facilities are included in our Asset Closure segment. The following table details the units retired.

Name Location Fuel Type Net Generation Capacity (MW) Ownership Interest Date Units Taken Offline
Killen Manchester, Ohio Coal 204
33% May 31, 2018
Stuart Aberdeen, Ohio Coal 679
39% May 24, 2018
Total 883

~~In January and February 2018, we retired three power plants~~Illinois with a total installed nameplate generation capacity of ~~4,167~~2,068 MW. We ~~decided~~retired these units due to changes in the Illinois multi-pollutant standard rule (MPS rule) that require us to retire ~~these units because they were projected to be uneconomic based on then current market conditions and would have faced significant environmental costs associated with operating such units.~~approximately 2,000 MW of generation capacity (see Note 12). In ~~the case~~light of the ~~Sandow~~provisions of the Federal Power Act and the FERC regulations thereunder, the affected subsidiaries of Vistra identified the retired units by analyzing the ~~decision also reflected~~economics of each of our Illinois plants and designating the ~~execution of a contract termination agreement pursuant to which the Company and Alcoa agreed to an early settlement of a long-standing power and mining agreement.~~least economic units for retirement. Expected plant retirement expenses of $47 million, driven by severance costs, were accrued in the ~~third and fourth quarter of 2017 and, as a result, no retirement expenses were recorded related to these facilities in the~~ three ~~and six~~ months ended ~~June~~September 30, ~~2018.~~2019 and were included primarily in operating costs of our Asset Closure segment. In August 2019, we remeasured our pension and OPEB plans resulting in an increase to the benefit obligation liability of $21 million, pretax other comprehensive loss of $18 million and curtailment expense of $3 million recognized as other deductions in our condensed consolidated statements of operations. The ~~operational~~following table details the units in Illinois totaling 2,653 MW that have been or will be retired. Operational results ~~of these facilities~~for retired plants are included in ~~our~~the Asset Closure segment, which is engaged in the decommissioning and reclamation of retired plants and mines. ~~The following table details the units retired.~~

Name

Location

Fuel Type

Net Generation Capacity (MW)

Number of Units

Dates Units Retired or
Expected Retirement Date

Coffeen

Coffeen, IL

Coal

915

November 1, 2019

Duck Creek

Canton, IL

Coal

425

December 15, 2019

Havana

Havana, IL

Coal

434

November 1, 2019

Hennepin

Hennepin, IL

Coal

294

November 1, 2019

Edwards

Bartonville, IL

Coal

585

By the end of 2022

Total

2,653

Name Location (all in the state of Texas) Fuel Type Installed Nameplate Generation Capacity (MW) Number of Units Date Units Taken Offline
Monticello Titus County Lignite/Coal 1,880
3 January 4, 2018
Sandow Milam County Lignite 1,137
2 January 11, 2018
Big Brown Freestone County Lignite/Coal 1,150
2 February 12, 2018
Total 4,167
7

Table of factors, including the market price of our stock, general market and economic conditions, applicable legal requirements and compliance with the terms of our debt agreements and the Tax Matters Agreement.Contents

Debt Activity

We have stated our objective is to reduce our consolidated net ~~leverage from current levels to approximately 2.5x net debt/EBITDA.~~leverage. We also intend to continue to simplify and optimize our capital structure, maintain adequate liquidity and pursue opportunities to refinance our long-term debt to extend maturities and/or reduce ongoing interest expense. In ~~the second quarter of~~ 2019 and 2020, we completed several transactions, including the redemption and repayment of all previously outstanding senior notes issued by Parent, that we believe, in the aggregate, advanced all of these goals. While the premiums, fees and expenses that we paid in connection with these transactions resulted in an increase in our total debt as of June 30, 2019 relative to March 31, 2019, we expect the ongoing free cash flow savings will offset this increase over the next few years. See Note 11 to the Financial Statements for details of our long-term debt activity and Note 10 to the Financial Statements for details of the accounts receivable securitization program.

~~Issuance of Vistra Operations Senior Secured Notes~~ — In June 2019, Vistra Operations issued and sold $2.0 billion aggregate principal amount of senior secured notes (Senior Secured Notes), consisting of $1.2 billion aggregate principal amount of 3.55% senior secured notes due 2024 at a price to the public of 99.807% of their face value and $800 million aggregate principal amount of 4.30% senior secured notes due 2029 at a price to the public of 99.784% of their face value in an offering to eligible purchasers under Rule 144A and Regulation S under the Securities Act (Senior Secured Notes Offering). Net proceeds from the Senior Secured Notes Offering totaling $1.976 billion, together with cash on hand, were used to prepay certain amounts outstanding and accrued interest (together with fees and expenses) under the Vistra Operations Credit Facilities' Term Loan B Facility described below.

The indenture governing the Senior Secured Notes (as may be amended or supplemented from time to time, the Senior Secured Indenture) provides for the full and unconditional guarantee by the Guarantor Subsidiaries of the punctual payment of the principal of, premium, if any, interest on and all other amounts due under the Senior Secured Notes and the Senior Secured Notes Indenture. The Senior Secured Indenture further provides that the Senior Secured Notes will be secured by a first-priority security interest in the same collateral that is pledged for the benefit of the lenders under the Vistra Operations Credit Facilities, which consists of a substantial portion of the property, assets and rights owned by Vistra Operations and the Guarantor Subsidiaries, as well as the stock of Vistra Operations, which is held by Vistra Intermediate. The collateral securing the Senior Secured Notes will be released if Vistra Operations' senior, unsecured long-term debt securities obtain an investment grade rating from two out of the three rating agencies, subject to reversion if such rating agencies withdraw the investment grade rating of the Issuer's senior, unsecured long-term debt securities or downgrade such rating below investment grade.

~~Issuance of Vistra Operations 5.00% Senior Notes Due 2027~~ — In June 2019, Vistra Operations issued and sold $1.3 billion aggregate principal amount of 5.00% senior unsecured notes due 2027 in an offering to eligible purchasers under Rule 144A and Regulation S under the Securities Act (the June 2019 Notes Offering). Net proceeds from the sale of senior notes totaling approximately $1.287 billion, together with cash on hand, were used to pay the purchase price and accrued interest (together with fees and expenses) required in connection with (i) the June 2019 Tender Offer described below and (ii) the redemption of approximately $306 million of our outstanding 7.375% senior unsecured notes due 2022 and approximately $87 million of our outstanding 7.625% senior unsecured notes due 2024 in July 2019.

~~June 2019 Tender Offer~~ — In June 2019, Vistra Energy used the net proceeds from the June 2019 Notes Offering to fund a cash tender offer (the June 2019 Tender Offer) to purchase for cash $845 million aggregate principal amount of certain notes assumed in the Merger, including $173 million of 7.375% senior unsecured notes due 2022 and $672 million of 7.625% senior unsecured notes due 2024.

~~Repayment of Certain Term Loans Under the Vistra Operations Credit Facilities~~ — In June 2019, Vistra Operations used the net proceeds from Senior Secured Notes Offering described above to repay $889 million under the Term Loan B-1 Facility, the entire amount outstanding of $977 million under the Term Loan B-2 Facility and $134 million under the Term Loan B-3 Facility.

~~2019 Amendments to Vistra Operations Credit Facilities~~ — In March 2019 and May 2019, the Credit Facilities Agreement was amended whereby aggregate commitments under the Revolving Credit Facility were increased from $2.5 billion to $2.725 billion. The letter of credit sub-facility was also increased from $2.3 billion to $2.35 billion.

~~Issuance of Vistra Operations 5.625% Senior Notes Due 2027~~ — In February 2019, Vistra Operations issued and sold $1.3 billion aggregate principal amount of 5.625% senior unsecured notes due 2027 in an offering to eligible purchasers under Rule 144A and Regulation S under the Securities Act (the February 2019 Notes Offering). Net proceeds from the sale of the senior notes totaling approximately $1.287 billion, together with cash on hand, were used to pay the purchase price and accrued interest (together with fees and expenses) required in connection with (i) the February 2019 Tender Offer described below, (ii) the redemption of approximately $35 million aggregate principal amount of our 7.375% senior unsecured notes due 2022 and (iii) the redemption of the remaining approximately $25 million aggregate principal amount of our outstanding 8.034% senior unsecured notes due 2024.

~~February 2019 Tender Offer~~ — In February 2019, Vistra Energy used the net proceeds from the February 2019 Notes Offering to fund a cash tender offer (the February 2019 Tender Offer) to purchase for cash approximately $1.193 billion aggregate principal amount of 7.375% senior unsecured notes due 2022 that we assumed in the Merger.

~~Bond Repurchase Program~~ — In November 2018, the Board authorized a bond repurchase program under which up to $200 million principal amount of outstanding Vistra Energy senior unsecured notes could be repurchased. Through June 30, 2019, $119 million aggregate principal amount of senior unsecured notes had been repurchased under the program. No repurchases were made in the six months ended June 30, 2019.

In July 2019, the Board authorized up to $1.0 billion to repay or repurchase any outstanding debt of the Company or its subsidiaries, with this authority superseding the previously authorized bond repurchase program.

~~Accounts Receivable Securitization Program~~ — In August 2018, TXU Energy Receivables Company LLC (RecCo), a wholly-owned subsidiary of TXU Energy, and Vistra Energy entered into an accounts receivable financing facility (Receivables Facility). In April 2019, the terms of the Receivable Facility were amended to include Dynegy Energy Services, and the Receivables Facility provided RecCo with the ability to borrow up to $450 million at June 30, 2019. In July 2019, the Receivables Facility was renewed through July 2020 with the ability to borrow up to $600 million until the settlement date in November 2019 (in order to align with the peak retail season), after which the program will revert to $450 million.

~~Issuance of Vistra Operations 5.500% Senior Notes Due 2026~~ — In August 2018, Vistra Operations issued and sold $1 billion aggregate principal amount of the 5.500% senior unsecured notes due 2026 in an offering to eligible purchasers under Rule 144A and Regulation S under the Securities Act (the 2018 Notes Offering). Net proceeds from the sale of the senior unsecured notes totaling approximately $990 million, together with cash on hand and cash received from the funding of the accounts receivable securitization program described above, were used to pay the purchase price and accrued interest (together with fees and expenses) required in connection with the 2018 Tender Offers described below.

~~2018 Tender Offers~~ — In August 2018, Vistra Energy used the net proceeds from the 2018 Notes Offering, proceeds from the accounts receivable securitization program and cash on hand to fund cash tender offers to purchase for cash $1.542 billion of senior unsecured notes assumed in the Merger (the 2018 Tender Offers).

~~2018 Amendment to Vistra Operations Credit Facilities~~ ~~— In June 2018, the Credit Facilities Agreement was amended. Among other things, the amendment included the following updated terms:~~

Aggregate commitments under the Revolving Credit Facility were increased from $860 million to $2.5 billion. The letter of credit sub-facility was also increased from $715 million to $2.3 billion. The maturity date of the Revolving Credit Facility was extended from August 4, 2021 to June 14, 2023. Pricing terms for the Revolving Credit Facility were reduced from LIBOR plus an applicable margin of 2.25% to LIBOR plus an applicable margin of 1.75%. Pricing terms for letters of credit issued under the Revolving Credit Facility were reduced from 2.25% to 1.75%.

~~Pricing terms for the Term Loan B-1 Facility were reduced from LIBOR plus an applicable margin of 2.50% to LIBOR plus an applicable margin of 2.00%.~~

Borrowings under the new Term Loan B-3 Facility of $2.050 billion principal amount were used to repay borrowings under the credit agreement that Vistra Energy assumed from Dynegy in connection with the Merger.

~~Borrowings under the Term Loan C Facility of $500 million were repaid using $500 million of cash from collateral accounts used to backstop letters of credit.~~

~~Redemption of Debt~~ — In May 2018, $850 million aggregate principal amount of outstanding 6.75% Senior Notes due 2019 was redeemed at a redemption price of 101.688% of the aggregate principal amount, plus accrued and unpaid interest to but not including the date of redemption.

Power Price, Natural Gas Price and Market Heat Rate Exposure

~~Taking together forward wholesale, retail electricity sales and other retail customer considerations and all other~~Estimated hedging ~~positions~~levels for generation volumes in ERCOT, at June 30, 2019, we had effectively hedged an estimated 98% and 100% of the natural gas price exposure related to our overall ERCOT business for 2019 and 2020, respectively. These percentages assume conversion of generation positions based on market heat rates and an estimate of natural gas generally being on the margin 70% to 90% of the time in the ERCOT market. Additionally, taking into consideration our overall heat rate exposure and related hedging positions in ERCOT at June 30, 2019, we had effectively hedged 95% and 70% of the heat rate exposure to our overall business for 2019 and 2020, respectively. We make the distinction between natural gas price exposure and heat rate exposure for the ERCOT market because of the high percentage of time natural gas is on the margin and the availability of traded products in ERCOT to hedge heat rate directly. Generation volumes hedged in PJM, NYISO, ISO-NE, MISO and CAISO at June 30, ~~2019~~2020 were as follows:


	2020		2021
Nuclear/Renewable/Coal Generation:
ERCOT	100	%	83	%
PJM	100	%	97	%
MISO	100	%	80	%
Gas Generation:
ERCOT	100	%	53	%
PJM	99	%	51	%
NYISO/ISO-NE	95	%	83	%
CAISO	100	%	80	%

2019 2020
PJM 93 % 78 %
NYISO/ISO-NE 100 % 53 %
MISO/CAISO 79 % 55 %

The following sensitivity table provides approximate estimates of the potential impact of movements in ~~natural gas~~power prices and ~~market~~spark spreads (the difference between the power revenue and fuel expense of natural gas-fired generation as calculated using an assumed heat ~~rates~~rate of 7.2 MMBtu/MWh) on realized pretax earnings (in millions) taking into account the hedge positions noted ~~in the paragraph~~ above for the periods presented. The residual gas position is calculated based on two steps: first, calculating the difference between actual heat rates of our natural gas generation units and the assumed 7.2 heat rate used to calculate the sensitivity to spark spreads; and second, calculating the residual natural gas exposure that is not already included in the gas generation spark spread sensitivity shown in the table below. The estimates related to price sensitivity are based on our expected generation, ~~and retail positions,~~ related hedges and forward prices as of June 30, ~~2019.~~2020.


	Balance 2020 (a)		2021
ERCOT:
Nuclear/Renewable/Coal Generation: $2.50/MWh increase in power price	$	1	$	22
Nuclear/Renewable/Coal Generation: $2.50/MWh decrease in power price	$	—	$	(18)
Gas Generation: $1.00/MWh increase in spark spread	$	1	$	20
Gas Generation: $1.00/MWh decrease in spark spread	$	—	$	(17)
Residual Natural Gas Position: $0.25/MMBtu increase in natural gas price	$	3	$	(27)
Residual Natural Gas Position: $0.25/MMBtu decrease in natural gas price	$	(3)	$	15
PJM:
Coal Generation: $2.50/MWh increase in power price	$	2	$	3
Coal Generation: $2.50/MWh decrease in power price	$	—	$	—
Gas Generation: $1.00/MWh increase in spark spread	$	1	$	16
Gas Generation: $1.00/MWh decrease in spark spread	$	—	$	(14)
Residual Natural Gas Position: $0.25/MMBtu increase in natural gas price	$	—	$	(1)
Residual Natural Gas Position: $0.25/MMBtu decrease in natural gas price	$	—	$	1
NYISO/ISO-NE:
Gas Generation: $1.00/MWh increase in spark spread	$	1	$	3
Gas Generation: $1.00/MWh decrease in spark spread	$	—	$	(1)
Residual Natural Gas Position: $0.25/MMBtu increase in natural gas price	$	1	$	—
Residual Natural Gas Position: $0.25/MMBtu decrease in natural gas price	$	(1)	$	—

Table of Contents



	~~Balance 2019 (a)~~	~~2020~~
~~ERCOT:~~
~~$0.50/MMBtu increase in natural gas price (b)~~	~~$ ~20~~	~~$ ~50~~
~~$0.50/MMBtu decrease in natural gas price (b)~~	~~$ ~(15)~~	~~$ ~(40)~~
~~1.0/MMBtu/MWh increase in market heat rate (c)~~	~~$ ~15~~	~~$ ~95~~
~~1.0/MMBtu/MWh decrease in market heat rate (c)~~	~~$ ~(15)~~	~~$ ~(85)~~
~~PJM:~~
~~$0.50/MMBtu increase in natural gas price (d)~~	~~$ ~20~~	~~$ ~55~~
~~$0.50/MMBtu decrease in natural gas price (d)~~	~~$ ~(15)~~	~~$ ~(40)~~
~~1.0/MMBtu/MWh increase in market heat rate (e)~~	~~$ ~10~~	~~$ ~50~~
~~1.0/MMBtu/MWh decrease in market heat rate (e)~~	~~$ ~(10)~~	~~$ ~(35)~~
~~NYISO/ISO-NE:~~
~~$0.50/MMBtu increase in natural gas price (d)~~	~~$ ~5~~	~~$ ~45~~
~~$0.50/MMBtu decrease in natural gas price (d)~~	~~$ ~—~~	~~$ ~(35)~~
~~1.0/MMBtu/MWh increase in market heat rate (f)~~	~~$ ~5~~	~~$ ~45~~
~~1.0/MMBtu/MWh decrease in market heat rate (f)~~	~~$ ~—~~	~~$ ~(30)~~
~~MISO/CAISO:~~
~~$0.50/MMBtu increase in natural gas price (d)~~	~~$ ~30~~	~~$ ~100~~
~~$0.50/MMBtu decrease in natural gas price (d)~~	~~$ ~(15)~~	~~$ ~(80)~~
~~1.0/MMBtu/MWh increase in market heat rate (g)~~	~~$ ~10~~	~~$ ~50~~
~~1.0/MMBtu/MWh decrease in market heat rate (g)~~	~~$ ~(10)~~	~~$ ~(40)~~


	Balance 2020 (a)		2021
MISO/CAISO:
Coal Generation: $2.50/MWh increase in power price	$	2	$	10
Coal Generation: $2.50/MWh decrease in power price	$	—	$	(6)
Gas Generation: $1.00/MWh increase in spark spread	$	—	$	1
Gas Generation: $1.00/MWh decrease in spark spread	$	—	$	(1)
Residual Natural Gas Position: $0.25/MMBtu increase in natural gas price	$	—	$	2
Residual Natural Gas Position: $0.25/MMBtu decrease in natural gas price	$	—	$	(2)

___________


~~(a)~~	~~Balance of 2019 is from August 1, 2019 through December 31, 2019.~~


~~(b)~~	~~Based on Houston Ship Channel natural gas prices at June 30, 2019.~~


~~(c)~~	~~Based on ERCOT North Hub around-the-clock heat rates at June 30, 2019.~~


~~(d)~~	~~Based on NYMEX natural gas prices at June 30, 2019.~~


~~(e)~~	~~Based on AEP Dayton Hub, Northern Illinois Hub and PJM West Hub around-the-clock heat rates at June 30, 2019.~~


~~(f)~~	~~Based on Massachusetts Hub and NYISO Zone C around-the-clock heat rates at June 30, 2019.~~


~~(g)~~	~~Based on Indiana Hub and NP15 around-the-clock heat rates at June 30, 2019.~~

(a)Balance of 2020 is from July 1, 2020 through December 31, 2020.

~~Environmental Matters~~

~~— See Note 13 to Financial Statements for a discussion~~Table of ~~greenhouse gas emissions, regional haze, state implementation plan and other recent EPA actions as well as related litigation.~~Contents

RESULTS OF OPERATIONS

Consolidated Financial Results — Three and Six Months Ended June 30, ~~2019~~2020 Compared to Three and Six Months Ended June 30, ~~2018~~2019


	Three Months Ended June 30,						Favorable (Unfavorable) $ Change			Six Months Ended June 30,					Favorable (Unfavorable) $ Change
	2020		2019						2020			2019
Operating revenues	$	2,509	$	2,832	$	(323)	$	5,367		$	5,755		$	(388)
Fuel, purchased power costs and delivery fees	(1,029)		(1,139)		110		(2,362)			(2,600)			238
Operating costs	(412)		(370)		(42)		(792)			(755)			(37)
Depreciation and amortization	(455)		(384)		(71)		(875)			(790)			(85)
Selling, general and administrative expenses	(236)		(210)		(26)		(488)			(392)			(96)

Impairment of long-lived assets	—		—		—		(84)			—			(84)
Operating income	377		729		(352)		766			1,218			(452)
Other income	5		13		(8)		12			39			(27)
Other deductions	(4)		(2)		(2)		(35)			(5)			(30)
Interest expense and related charges	(141)		(274)		133		(440)			(495)			55
Impacts of Tax Receivable Agreement	(6)		33		(39)		(14)			36			(50)
Equity in earnings of unconsolidated investment	1		3		(2)		4			10			(6)
Income before income taxes	232		502		(270)		293			803			(510)
Income tax expense	(68)		(148)		80		(84)			(225)			141
Net income	$	164	$	354	$	(190)	$	209		$	578		$	(369)


	Three Months Ended June 30, 2020
	Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		Eliminations / Corporate and Other		Vistra Consolidated
Operating revenues	$	1,956	$	865	$	412	$	131	$	121	$	—	$	(976)	$	2,509
Fuel, purchased power costs and delivery fees	(1,468)		(223)		(204)		(58)		(85)		—		1,009		(1,029)
Operating costs	(28)		(196)		(94)		(31)		(45)		(9)		(9)		(412)
Depreciation and amortization	(82)		(130)		(165)		(48)		(9)		—		(21)		(455)
Selling, general and administrative expenses	(146)		(20)		(15)		(12)		(14)		(5)		(24)		(236)


Operating income (loss)	232		296		(66)		(18)		(32)		(14)		(21)		377
Other income	—		3		1		—		1		—		—		5
Other deductions	—		(2)		(1)		—		—		—		(1)		(4)
Interest expense and related charges	(3)		2		(1)		—		(1)		—		(138)		(141)
Impacts of Tax Receivable Agreement	—		—		—		—		—		—		(6)		(6)
Equity in earnings of unconsolidated investment	—		—		1		—		—		—		—		1
Income (loss) before income taxes	229		299		(66)		(18)		(32)		(14)		(166)		232
Income tax expense	—		—		—		—		—		—		(68)		(68)
Net income (loss)	$	229	$	299	$	(66)	$	(18)	$	(32)	$	(14)	$	(234)	$	164

Table of Contents

Three Months Ended June 30,
Favorable (Unfavorable)
$ Change
Six Months Ended June 30,
Favorable (Unfavorable)
$ Change
2019 2018 2019 2018
Operating revenues $ 2,832
$ 2,574
$ 258
$ 5,755
$ 3,338
$ 2,417
Fuel, purchased power costs and delivery fees (1,139 ) (1,216 ) 77
(2,600 ) (1,866 ) (734 )
Operating costs (370 ) (386 ) 16
(755 ) (580 ) (175 )
Depreciation and amortization (384 ) (389 ) 5
(790 ) (542 ) (248 )
Selling, general and administrative expenses (210 ) (352 ) 142
(392 ) (514 ) 122
Operating income (loss) 729
231
498
1,218
(164 ) 1,382
Other income 13
7
6
39
18
21
Other deductions (2 ) (1 ) (1 ) (5 ) (3 ) (2 )
Interest expense and related charges (274 ) (146 ) (128 ) (495 ) (137 ) (358 )
Impacts of Tax Receivable Agreement 33
(64 ) 97
36
(82 ) 118
Equity in earnings of unconsolidated investment 3
4
(1 ) 10
4
6
Income (loss) before income taxes 502
31
471
803
(364 ) 1,167
Income tax (expense) benefit (148 ) 74
(222 ) (225 ) 163
(388 )
Net income (loss) $ 354
$ 105
$ 249
$ 578
$ (201 ) $ 779

Three Months Ended June 30, 2019
Retail ERCOT PJM NY/NE MISO
Asset
Closure
Eliminations / Corporate and Other
Vistra
Energy Consolidated
Operating revenues $ 1,421
$ 1,671
$ 686
$ 254
$ 246
$ —
$ (1,446 ) $ 2,832
Fuel, purchased power costs and delivery fees (1,828 ) (299 ) (265 ) (100 ) (120 ) —
1,473
(1,139 )
Operating costs (11 ) (174 ) (86 ) (25 ) (54 ) (12 ) (8 ) (370 )
Depreciation and amortization (59 ) (128 ) (134 ) (39 ) (3 ) —
(21 ) (384 )
Selling, general and administrative expenses (104 ) (23 ) (16 ) (12 ) (34 ) (4 ) (17 ) (210 )
Operating income (loss) (581 ) 1,047
185
78
35
(16 ) (19 ) 729
Other income —
8
—
—
2
1
2
13
Other deductions —
(2 ) —
—
—
—
—
(2 )
Interest expense and related charges (4 ) 3
(3 ) (1 ) (2 ) —
(267 ) (274 )
Impacts of Tax Receivable Agreement —
—
—
—
—
—
33
33
Equity in earnings of unconsolidated investment —
—
1
2
—
—
—
3
Income (loss) before income taxes (585 ) 1,056
183
79
35
(15 ) (251 ) 502
Income tax expense —
—
—
—
—
—
(148 ) (148 )
Net income (loss) $ (585 ) $ 1,056
$ 183
$ 79
$ 35
$ (15 ) $ (399 ) $ 354


	Three Months Ended June 30, 2019
	Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		Eliminations / Corporate and Other		Vistra Consolidated
Operating revenues	$	1,421	$	1,671	$	686	$	254	$	188	$	58	$	(1,446)	$	2,832
Fuel, purchased power costs and delivery fees	(1,828)		(299)		(265)		(100)		(78)		(42)		1,473		(1,139)
Operating costs	(11)		(174)		(86)		(25)		(34)		(32)		(8)		(370)
Depreciation and amortization	(59)		(128)		(134)		(39)		(3)		—		(21)		(384)
Selling, general and administrative expenses	(104)		(23)		(16)		(12)		(27)		(11)		(17)		(210)


Operating income (loss)	(581)		1,047		185		78		46		(27)		(19)		729
Other income	—		8		—		—		2		1		2		13
Other deductions	—		(2)		—		—		—		—		—		(2)
Interest expense and related charges	(4)		3		(3)		(1)		(2)		—		(267)		(274)
Impacts of Tax Receivable Agreement	—		—		—		—		—		—		33		33
Equity in earnings of unconsolidated investment	—		—		1		2		—		—		—		3
Income (loss) before income taxes	(585)		1,056		183		79		46		(26)		(251)		502
Income tax expense	—		—		—		—		—		—		(148)		(148)
Net income (loss)	$	(585)	$	1,056	$	183	$	79	$	46	$	(26)	$	(399)	$	354

Three Months Ended June 30, 2018
Retail ERCOT PJM NY/NE MISO
Asset
Closure
Eliminations / Corporate and Other
Vistra
Energy Consolidated
Operating revenues $ 1,454
$ 1,327
$ 485
$ 187
$ 257
$ 21
$ (1,157 ) $ 2,574
Fuel, purchased power costs and delivery fees (1,566 ) (337 ) (239 ) (108 ) (133 ) (10 ) 1,177
(1,216 )
Operating costs (9 ) (182 ) (82 ) (25 ) (76 ) (6 ) (6 ) (386 )
Depreciation and amortization (80 ) (108 ) (125 ) (49 ) (3 ) —
(24 ) (389 )
Selling, general and administrative expenses (102 ) (20 ) (15 ) (12 ) (14 ) (4 ) (185 ) (352 )
Operating income (loss) (303 ) 680
24
(7 ) 31
1
(195 ) 231
Other income 15
8
—
—
—
1
(17 ) 7
Other deductions —
(2 ) —
—
—
—
1
(1 )
Interest expense and related charges —
(7 ) (2 ) (1 ) —
—
(136 ) (146 )
Impacts of Tax Receivable Agreement —
—
—
—
—
—
(64 ) (64 )
Equity in earnings of unconsolidated investment —
—
1
3
—
—
—
4
Income before income taxes (288 ) 679
23
(5 ) 31
2
(411 ) 31
Income tax benefit —
—
—
—
—
—
74
74
Net income (loss) $ (288 ) $ 679
$ 23
$ (5 ) $ 31
$ 2
$ (337 ) $ 105

InOur operating segments delivered strong operating performance with a disciplined focus on cost management, while generating and selling essential electricity in a safe and reliable manner during a period of significant economic disruption. Our performance reflected the ~~second quarter~~stability of ~~2019, we continued with~~ our balanced capital allocation program, refinancing approximately $2.9 billion of debt, which lowered interest rates and extended maturities, and returning approximately $212 million to stockholders through share repurchases. Our integrated ~~energy company produced results during the quarter as expected, with our retail segment delivering strong margins during the period while our largely hedged, in-the-money~~model, including a diversified generation fleet, ~~operated safely~~retail and ~~reliably.~~ commercial and hedging activities in support of our integrated business, to produce results in line with expectations and significant cash from operations despite general uncertainty in the overall economy.

Consolidated results ~~increased $249~~decreased $190 million to net income of ~~$354~~$164 million in the three months ended June 30, ~~2019~~2020 compared to the three months ended June 30, ~~2018.~~2019. The change in results ~~was~~is driven by ~~an $80~~a $519 million ~~increase~~decrease in unrealized net ~~income~~(gains) losses on hedging transactions.

For the three months ended June 30, 2020 and 2019, operating costs increased $42 million to $412 million primarily driven by increased LTSA costs and incremental expense related to our COVID-19 response.

For the three months ended June 30, 2020 and 2019, selling, general and administrative expense increased by $26 million, primarily due to the increased expense resulting from the acquisition of Crius in ~~our ERCOT~~July 2019 and ~~Retail segments (including $46 million~~Ambit in ~~increased unrealized gains in those segments) and $248 million increase in PJM, NY/NE, and MISO segments, partially offset by increases in interest expense and tax expense.~~November 2019.

Interest expense and related charges ~~increased $128~~decreased $133 million to ~~$274~~$141 million in the three months ended June 30, ~~2019~~2020 compared to the three months ended June 30, ~~2018 and reflected~~2019 driven by a ~~$144~~$101 million ~~increase~~decrease in unrealized mark-to-market losses on interest rate swaps ~~partially offset by~~and a ~~$12~~$33 million decrease in interest paid/accrued reflecting ~~repayments~~the reduction in higher interest Vistra senior unsecured notes through the Redemptions and ~~repurchases of long-term debt.~~Tender Offers in 2019 and 2020. See Note 1918 to the Financial Statements.

For the three months ended June 30, ~~2019, the Impacts of the Tax Receivable Agreement totaled income of $33 million~~2020 and reflected a gain due to the decrease in forecasted taxable income over the projected life of the TRA of $48 million, partially offset by accretion expense of $15 million. For the three months ended June 30, 2018,2019, the Impacts of the Tax Receivable Agreement totaled expense of ~~$64~~$6 million and ~~reflected a loss due to changes in the timing~~income of ~~estimated payments and new multistate tax impacts resulting from the Merger of $46~~$33 million, ~~and accretion expense of $18 million.~~respectively. See Note 8 to the Financial Statements for discussion of the impacts of the Tax Receivable Agreement Obligation.

For the three months ended June 30, 2020, income tax expense totaled $68 million and the effective tax rate was 29.3%. For the three months ended June 30, 2019, income tax expense totaled $148 million and the effective tax rate was 29.5%. ~~For the three months ended June 30, 2018, income tax benefit totaled $74 million and the effective tax rate was (238.7)%.~~ See Note 7 to the Financial Statements for reconciliation of the effective rates to the U.S. federal statutory rate.

Table of Contents

Six Months Ended June 30, 2019
Retail ERCOT PJM NY/NE MISO
Asset
Closure
Eliminations / Corporate and Other
Vistra
Energy Consolidated
Operating revenues $ 2,806
$ 2,625
$ 1,391
$ 599
$ 500
$ —
$ (2,166 ) $ 5,755
Fuel, purchased power costs and delivery fees (3,024 ) (633 ) (581 ) (329 ) (272 ) —
2,239
(2,600 )
Operating costs (22 ) (359 ) (169 ) (50 ) (118 ) (21 ) (16 ) (755 )
Depreciation and amortization (118 ) (259 ) (265 ) (104 ) (7 ) —
(37 ) (790 )
Selling, general and administrative expenses (205 ) (39 ) (28 ) (22 ) (57 ) (9 ) (32 ) (392 )
Operating income (loss) (563 ) 1,335
348
94
46
(30 ) (12 ) 1,218
Other income —
20
—
—
3
1
15
39
Other deductions —
(4 ) —
—
—
—
(1 ) (5 )
Interest expense and related charges (8 ) 5
(5 ) (1 ) (3 ) —
(483 ) (495 )
Impacts of Tax Receivable Agreement —
—
—
—
—
—
36
36
Equity in earnings of unconsolidated investment —
—
3
7
—
—
—
10
Income (loss) before income taxes (571 ) 1,356
346
100
46
(29 ) (445 ) 803
Income tax expense —
—
—
—
—
—
(225 ) (225 )
Net income (loss) $ (571 ) $ 1,356
$ 346
$ 100
$ 46
$ (29 ) $ (670 ) $ 578


	Six Months Ended June 30, 2020
	Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		Eliminations / Corporate and Other		Vistra Consolidated
Operating revenues	$	3,864	$	1,731	$	1,060	$	417	$	263	$	—	$	(1,968)	$	5,367
Fuel, purchased power costs and delivery fees	(3,014)		(494)		(481)		(231)		(159)		—		2,017		(2,362)
Operating costs	(58)		(393)		(167)		(54)		(88)		(18)		(14)		(792)
Depreciation and amortization	(162)		(253)		(303)		(97)		(20)		—		(40)		(875)
Selling, general and administrative expenses	(301)		(39)		(41)		(25)		(26)		(12)		(44)		(488)

Impairment of long-lived assets	—		—		—		—		(84)		—		—		(84)
Operating income (loss)	329		552		68		10		(114)		(30)		(49)		766
Other income	—		4		—		1		4		1		2		12
Other deductions	—		(3)		(14)		(15)		—		(2)		(1)		(35)
Interest expense and related charges	(6)		4		(3)		(1)		(1)		—		(433)		(440)
Impacts of Tax Receivable Agreement	—		—		—		—		—		—		(14)		(14)
Equity in earnings of unconsolidated investment	—		—		2		2		—		—		—		4
Income (loss) before income taxes	323		557		53		(3)		(111)		(31)		(495)		293
Income tax expense	—		—		—		—		—		—		(84)		(84)
Net income (loss)	$	323	$	557	$	53	$	(3)	$	(111)	$	(31)	$	(579)	$	209


	Six Months Ended June 30, 2019
	Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		Eliminations / Corporate and Other		Vistra Consolidated
Operating revenues	$	2,806	$	2,625	$	1,391	$	599	$	357	$	143	$	(2,166)	$	5,755
Fuel, purchased power costs and delivery fees	(3,024)		(633)		(581)		(329)		(171)		(101)		2,239		(2,600)
Operating costs	(22)		(359)		(169)		(50)		(68)		(71)		(16)		(755)
Depreciation and amortization	(118)		(259)		(265)		(104)		(7)		—		(37)		(790)
Selling, general and administrative expenses	(205)		(39)		(28)		(22)		(44)		(22)		(32)		(392)


Operating income (loss)	(563)		1,335		348		94		67		(51)		(12)		1,218
Other income	—		20		—		—		3		1		15		39
Other deductions	—		(4)		—		—		—		—		(1)		(5)
Interest expense and related charges	(8)		5		(5)		(1)		(3)		—		(483)		(495)
Impacts of Tax Receivable Agreement	—		—		—		—		—		—		36		36
Equity in earnings of unconsolidated investment	—		—		3		7		—		—		—		10
Income (loss) before income taxes	(571)		1,356		346		100		67		(50)		(445)		803
Income tax benefit	—		—		—		—		—		—		(225)		(225)
Net income (loss)	$	(571)	$	1,356	$	346	$	100	$	67	$	(50)	$	(670)	$	578

Table of Contents

Six Months Ended June 30, 2018
Retail ERCOT PJM NY/NE MISO
Asset
Closure
Eliminations / Corporate and Other
Vistra
Energy Consolidated
Operating revenues $ 2,426
$ 794
$ 485
$ 187
$ 257
$ 49
$ (860 ) $ 3,338
Fuel, purchased power costs and delivery fees (1,601 ) (627 ) (239 ) (108 ) (133 ) (36 ) 878
(1,866 )
Operating costs (13 ) (347 ) (82 ) (25 ) (76 ) (30 ) (7 ) (580 )
Depreciation and amortization (157 ) (173 ) (125 ) (49 ) (3 ) —
(35 ) (542 )
Selling, general and administrative expenses (200 ) (56 ) (15 ) (12 ) (14 ) (5 ) (212 ) (514 )
Operating income (loss) 455
(409 ) 24
(7 ) 31
(22 ) (236 ) (164 )
Other income 29
20
—
—
—
2
(33 ) 18
Other deductions —
(3 ) —
—
—
—
—
(3 )
Interest expense and related charges (1 ) (15 ) (2 ) (1 ) —
—
(118 ) (137 )
Impacts of Tax Receivable Agreement —
—
—
—
—
—
(82 ) (82 )
Equity in earnings of unconsolidated investment —
—
1
3
—
—

4
Income (loss) before income taxes 483
(407 ) 23
(5 ) 31
(20 ) (469 ) (364 )
Income tax benefit —
—
—
—
—
—
163
163
Net income (loss) $ 483
$ (407 ) $ 23
$ (5 ) $ 31
$ (20 ) $ (306 ) $ (201 )

~~In the six months ended June 30, 2019, we refinanced approximately $4.2 billion of debt and returned approximately $726 million to stockholders through share repurchases.~~ Our operating segments delivered strong operating performance with a disciplined focus on cost management, while generating and selling essential electricity in a safe and reliable ~~manner.~~ manner during a period of significant economic disruption. Our performance reflected the stability of our integrated model, including a diversified generation fleet, retail and commercial and hedging activities in support of our integrated business, to produce results in line with expectations and significant cash from operations of $1.309 billion for the six months ended June 30, 2020 despite general uncertainty in the overall economy.

Consolidated results ~~increased $779~~decreased $369 million to net income of ~~$578~~$209 million in the six months ended June 30, ~~2019~~2020 compared to the six months ended June 30, ~~2018.~~2019. The change in results ~~was~~is driven by a ~~$709~~$580 million ~~increase~~decrease in ~~net income in our ERCOT and Retail segments (including $547 million in increased~~ unrealized gains on hedging transactions, an $84 million impairment of assets related to our Joppa/EEI coal plant and a $29 million loss on disposal of our equity method investment in ~~those segments)~~Northeast Energy, LP (NELP). See Note 18 to the Financial Statements.

For the six months ended June 30, 2020 and ~~$443~~2019, operating costs increased $37 million ~~in net income added in~~to $792 million primarily driven by increased LTSA costs and incremental expense related to our ~~PJM, NY/NE~~COVID-19 response.

For the six months ended June 30, 2020 and ~~MISO segments~~2019, selling, general and administrative expense increased by $96 million, primarily due to the ~~Merger, partially offset by increases~~increased expense resulting from the acquisition of Crius in ~~interest expense~~July 2019 and ~~tax expense.~~Ambit in November 2019 and a nonrecurring charge of approximately $10 million related to gross receipts taxes.

Interest expense and related charges ~~increased $358~~decreased $55 million to ~~$495~~$440 million in the six months ended June 30, ~~2019~~2020 compared to the six months ended June 30, ~~2018~~2019 driven by a $56 million decrease in interest paid/accrued reflecting the reduction in higher interest Vistra senior unsecured notes through the Redemptions and ~~reflected~~Tender Offers in 2019 and 2020 and a ~~$285~~$7 million ~~increase~~decrease in unrealized mark-to-market losses on interest rate ~~swaps and an $89 million increase in interest paid/accrued reflecting long-term debt assumed in the Merger, partially offset by debt extinguishment gains of $10 million in 2019.~~swaps. See Note 1918 to the Financial Statements.

For the six months ended June 30, ~~2019, the Impacts of the Tax Receivable Agreement totaled income of $36 million~~2020 and reflected a gain due to adjustments to forecasted taxable income and higher net operating losses acquired in the Merger of $67 million, partially offset by accretion expense of $31 million. For the six months ended June 30, 2018,2019, the Impacts of the Tax Receivable Agreement totaled expense of ~~$82~~$14 million and ~~reflected a loss due to changes in the timing of estimated payments and new multistate tax impacts resulting from the Merger of $46 million and accretion expense~~income of $36 ~~million.~~million, respectively. See Note 8 to the Financial Statements for discussion of the impacts of the Tax Receivable Agreement Obligation.

For the six months ended June 30, 2020, income tax expense totaled $84 million and the effective tax rate was 28.7%. For the six months ended June 30, 2019, income tax expense totaled $225 million and the effective tax rate was 28.0%. ~~For the six months ended June 30, 2018, income tax benefit totaled $163 million and the effective tax rate was 44.8%.~~ See Note 7 to the Financial Statements for reconciliation of the effective rates to the U.S. federal statutory rate.

Discussion of Adjusted EBITDA

Non-GAAP Measures — In analyzing and planning for our business, we supplement our use of GAAP financial measures with non-GAAP financial measures, including EBITDA and Adjusted EBITDA as performance measures. These non-GAAP financial measures reflect an additional way of viewing aspects of our business that, when viewed with our GAAP results and the accompanying reconciliations to corresponding GAAP financial measures included in the tables below, may provide a more complete understanding of factors and trends affecting our business. These non-GAAP financial measures should not be relied upon to the exclusion of GAAP financial measures and are, by definition, an incomplete understanding of Vistra ~~Energy~~ and must be considered in conjunction with GAAP measures. In addition, non-GAAP financial measures are not standardized; therefore, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. We strongly encourage investors to review our consolidated financial statements and publicly filed reports in their entirety and not rely on any single financial measure.

EBITDA and Adjusted EBITDA — We believe EBITDA and Adjusted EBITDA provide meaningful representations of our operating performance. We consider EBITDA as another way to measure financial performance on an ongoing basis. Adjusted EBITDA is meant to reflect the operating performance of our segments for the period presented. We define EBITDA as earnings (loss) before interest expense, income tax expense (benefit) and depreciation and amortization expense. We define Adjusted EBITDA as EBITDA adjusted to exclude (i) gains or losses on the sale or retirement of certain assets, (ii) the impacts of mark-to-market changes on derivatives, ~~related to our portfolio,~~ (iii) the impact of impairment charges, (iv) certain amounts associated with fresh-start reporting, acquisitions, dispositions, transition costs or restructurings, (v) non-cash compensation expense, (vi) impacts from the Tax Receivable Agreement and (vii) other material nonrecurring or unusual items.

Because EBITDA and Adjusted EBITDA are financial measures that management uses to allocate resources, determine our ability to fund capital expenditures, assess performance against our peers, and evaluate overall financial performance, we believe they provide useful information for ~~our shareholders.~~investors.

Table of Contents

When EBITDA or Adjusted EBITDA is discussed in reference to performance on a consolidated basis, the most directly comparable GAAP financial measure to EBITDA and Adjusted EBITDA is Net income (loss).

Adjusted EBITDA — Three and Six Months Ended June 30, ~~2019~~2020 Compared to Three and Six Months Ended June 30, ~~2018~~2019


	Three Months Ended June 30,						Favorable (Unfavorable) $ Change			Six Months Ended June 30,					Favorable (Unfavorable) $ Change
	2020		2019						2020			2019
Net income	$	164	$	354	$	(190)	$	209		$	578		$	(369)
Income tax expense	68		148		(80)		84			225			(141)
Interest expense and related charges (a)	141		274		(133)		440			495			(55)
Depreciation and amortization (b)	472		399		73		912			824			88
EBITDA before Adjustments	845		1,175		(330)		1,645			2,122			(477)
Unrealized net (gain) loss resulting from hedging transactions	2		(517)		519		(123)			(703)			580

Fresh start/purchase accounting impacts	30		20		10		34			33			1
Impacts of Tax Receivable Agreement	6		(33)		39		14			(36)			50

Non-cash compensation expenses	17		11		6		30			24			6
Transition and merger expenses	—		27		(27)		19			44			(25)
Impairment of long-lived assets	—		—		—		84			—			84
Loss on disposal of investment in NELP	1		—		1		29			—			29
COVID-19-related expenses (c)	12		—		12		14			—			14
Other, net	3		9		(6)		3			10			(7)
Adjusted EBITDA	$	916	$	692	$	224	$	1,749		$	1,494		$	255

____________

(a)Includes unrealized mark-to-market net losses on interest rate swaps of $18 million and $119 million for the three months ended June 30, 2020 and 2019, respectively, and $192 million and $199 million for the six months ended June 30, 2020 and 2019, respectively.

(b)Includes nuclear fuel amortization in the ERCOT segment of $17 million and $15 million for the three months ended June 30, 2020 and 2019, respectively, and $37 million and $34 million for the six months ended June 30, 2020 and 2019, respectively.

(c)Includes material and supplies and other incremental costs related to our COVID-19 response.

Table of Contents

Three Months Ended June 30,
Favorable (Unfavorable)
$ Change
Six Months Ended June 30,
Favorable (Unfavorable)
$ Change
2019 2018 2019 2018
Net income (loss) $ 354
$ 105
$ 249
$ 578
$ (201 ) $ 779
Income tax expense (benefit) 148
(74 ) 222
225
(163 ) 388
Interest expense and related charges 274
146
128
495
137
358
Depreciation and amortization (a) 399
409
(10 ) 824
582
242
EBITDA before Adjustments 1,175
586
589
2,122
355
1,767
Unrealized net (gain) loss resulting from hedging transactions (517 ) (216 ) (301 ) (703 ) 199
(902 )
Fresh start/purchase accounting impacts 20
25
(5 ) 33
35
(2 )
Impacts of Tax Receivable Agreement (33 ) 64
(97 ) (36 ) 82
(118 )
Non-cash compensation expenses 11
42
(31 ) 24
48
(24 )
Transition and merger expenses 27
156
(129 ) 44
184
(140 )
Other, net 9
1
8
10
(4 ) 14
Adjusted EBITDA $ 692
$ 658
$ 34
$ 1,494
$ 899
$ 595


	Three Months Ended June 30, 2020
	Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		Eliminations / Corporate and Other		Vistra Consolidated
Net income (loss)	$	229	$	299	$	(66)	$	(18)	$	(32)	$	(14)	$	(234)	$	164
Income tax expense	—		—		—		—		—		—		68		68
Interest expense and related charges (a)	3		(2)		1		—		1		—		138		141
Depreciation and amortization (b)	82		147		165		48		9		—		21		472
EBITDA before Adjustments	314		444		100		30		(22)		(14)		(7)		845
Unrealized net (gain) loss resulting from hedging transactions	81		(190)		67		33		14		—		(3)		2

Fresh start/purchase accounting impacts	5		(2)		12		7		8		—		—		30
Impacts of Tax Receivable Agreement	—		—		—		—		—		—		6		6

Non-cash compensation expenses	—		—		—		—		—		—		17		17
Transition and merger expenses	1		(4)		—		—		—		—		3		—
Loss on disposal of investment in NELP	—		—		1		—		—		—		—		1
COVID-19-related expenses (c)	—		9		2		—		1		—		—		12
Other, net	—		3		1		2		2		1		(6)		3
Adjusted EBITDA	$	401	$	260	$	183	$	72	$	3	$	(13)	$	10	$	916

____________

~~(a)~~

(a)Includes $18 million of unrealized mark-to-market net losses on interest rate swaps.

(b)Includes nuclear fuel amortization of $17 million in ERCOT segment.

(c)Includes material and supplies and other incremental costs related to our COVID-19 response.


	Three Months Ended June 30, 2019
	Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		Eliminations / Corporate and Other		Vistra Consolidated
Net income (loss)	$	(585)	$	1,056	$	183	$	79	$	46	$	(26)	$	(399)	$	354
Income tax expense	—		—								—		148		148
Interest expense and related charges (a)	4		(3)		3		1		2		—		267		274
Depreciation and amortization (b)	59		143		134		39		3		—		21		399
EBITDA before Adjustments	(522)		1,196		320		119		51		(26)		37		1,175
Unrealized net (gain) loss resulting from hedging transactions	797		(1,047)		(163)		(32)		(65)		—		(7)		(517)

Fresh start/purchase accounting impacts	15		(1)		2		1		3		1		(1)		20
Impacts of Tax Receivable Agreement	—		—		—		—		—		—		(33)		(33)

Non-cash compensation expenses	—		—		—		—		—		—		11		11
Transition and merger expenses	—		5		1		1		17		—		3		27
Other, net	3		3		7		2		5		—		(11)		9
Adjusted EBITDA	$	293	$	156	$	167	$	91	$	11	$	(25)	$	(1)	$	692

____________

(a)Includes $119 million of unrealized mark-to-market net losses on interest rate swaps.

(b)Includes nuclear fuel amortization ~~in the ERCOT segment~~ of $15 million in ERCOT segment.

Table of Contents


	Six Months Ended June 30, 2020
	Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		Eliminations / Corporate and Other		Vistra Consolidated
Net income (loss)	$	323	$	557	$	53	$	(3)	$	(111)	$	(31)	$	(579)	$	209
Income tax expense	—		—		—		—		—		—		84		84
Interest expense and related charges (a)	6		(4)		3		1		1		—		433		440
Depreciation and amortization (b)	162		290		303		97		20		—		40		912
EBITDA before Adjustments	491		843		359		95		(90)		(31)		(22)		1,645
Unrealized net (gain) loss resulting from hedging transactions	202		(371)		1		12		24		—		9		(123)

Fresh start/purchase accounting impacts	8		(5)		14		7		10		—		—		34
Impacts of Tax Receivable Agreement	—		—		—		—		—		—		14		14

Non-cash compensation expenses	—		—		—		—		—		—		30		30
Transition and merger expenses	6		(2)		7		—		—		—		8		19
Impairment of long-lived assets	—		—		—		—		84		—		—		84
Loss on disposal of investment in NELP	—		—		14		15		—		—		—		29
COVID-19-related expenses (c)	—		9		2		1		1		—		1		14
Other, net	5		3		4		2		2		1		(14)		3
Adjusted EBITDA	$	712	$	477	$	401	$	132	$	31	$	(30)	$	26	$	1,749

____________

(a)Includes $192 million of unrealized mark-to-market net losses on interest rate swaps.

(b)Includes nuclear fuel amortization of $37 million in ERCOT segment.

(c)Includes material and supplies and other incremental costs related to our COVID-19 response.


	Six Months Ended June 30, 2019
	Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		Eliminations / Corporate and Other		Vistra Consolidated
Net income (loss)	$	(571)	$	1,356	$	346	$	100	$	67	$	(50)	$	(670)	$	578
Income tax expense	—		—		—		—		—		—		225		225
Interest expense and related charges (a)	8		(5)		5		1		3		—		483		495
Depreciation and amortization (b)	118		293		265		104		7		—		37		824
EBITDA before Adjustments	(445)		1,644		616		205		77		(50)		75		2,122
Unrealized net (gain) loss resulting from hedging transactions	961		(1,298)		(255)		(38)		(50)		—		(23)		(703)

Fresh start/purchase accounting impacts	29		—		(5)		3		6		2		(2)		33
Impacts of Tax Receivable Agreement	—		—		—		—		—		—		(36)		(36)

Non-cash compensation expenses	—		—		—		—		—		—		24		24
Transition and merger expenses	—		6		3		2		24		—		9		44
Other, net	5		8		9		5		10		1		(28)		10
Adjusted EBITDA	$	550	$	360	$	368	$	177	$	67	$	(47)	$	19	$	1,494

____________

(a)Includes $199 million of unrealized mark-to-market net losses on interest rate swaps.

(b)Includes nuclear fuel amortization of $34 million in ERCOT segment.

Table of Contents

Retail Segment — Three and Six Months Ended June 30, 2020 Compared to Three and Six Months Ended June 30, 2019


	Three Months Ended June 30,								Favorable (Unfavorable) Change				Six Months Ended June 30,						Favorable (Unfavorable) Change
	2020			2019								2020				2019
Operating revenues:
Revenues in ERCOT	$	1,426		$	1,110		$	316	$	2,697			$	2,157			$	540
Revenues in Northeast/Midwest	540			315			225		1,180				663				517
Amortization expense	(5)			(10)			5		(8)				(19)				11
Other revenues	(5)			6			(11)		(5)				5				(10)
Total operating revenues	1,956			1,421			535		3,864				2,806				1,058
Fuel, purchased power costs and delivery fees:
Purchases from affiliates	(948)			(689)			(259)		(1,902)				(1,360)				(542)
Unrealized net gains (losses) on hedging activities with affiliates	(76)			(803)			727		(195)				(968)				773
Unrealized net gains (losses) on hedging activities	—			—			—		(2)				2				(4)
Delivery fees	(448)			(346)			(102)		(877)				(694)				(183)
Other costs (a)	4			10			(6)		(38)				(4)				(34)
Total fuel, purchased power costs and delivery fees	(1,468)			(1,828)			360		(3,014)				(3,024)				10









Net income (loss)	$	229		$	(585)		$	814	$	323			$	(571)			$	894










Adjusted EBITDA	$	401		$	293		$	108	$	712			$	550			$	162
Retail sales volumes (GWh):
Retail electricity sales volumes:
Sales volumes in ERCOT	13,184			10,693			2,491		24,974				20,476				4,498
Sales volumes in Northeast/Midwest	8,320			6,012			2,308		17,537				12,563				4,974
Total retail electricity sales volumes	21,504			16,705			4,799		42,511				33,039				9,472
Weather (North Texas average) - percent of normal (b):
Cooling degree days	93.0		%	81.0		%			95.0		%		79.0		%
Heating degree days	153.0		%	107.0		%			88.0		%		111.0		%

____________

(a)For the three and six months ended June 30, 2020, includes third-party fuel and power purchases of ($5) million and $37 million, respectively.

(b)Weather data is obtained from Weatherbank, Inc. For the three and six months ended June 30, 2020, normal is defined as the average over the 10-year period from June 2010 to June 2019. For the three and six months ended June 30, 2019, normal is defined as the average over the 10-year period from June 2009 to June 2018.

Table of Contents

Net income increased by $814 million to $229 million and ~~$20 million for the three months ended June 30, 2019 and 2018, respectively, and $34 million and $40 million for the six months ended June 30, 2019 and 2018, respectively.~~

Three Months Ended June 30, 2019
Retail ERCOT PJM NY/NE MISO
Asset
Closure
Eliminations / Corporate and Other
Vistra
Energy Consolidated
Net income (loss) $ (585 )
$ 1,056

$ 183

$ 79

$ 35
$ (15 ) $ (399 ) $ 354
Income tax expense —

—

—

—

—
—
148
148
Interest expense and related charges 4

(3 )
3

1

2
—
267
274
Depreciation and amortization (a) 59

143

134

39

3
—
21
399
EBITDA before Adjustments (522 )
1,196

320

119

40
(15 ) 37
1,175
Unrealized net (gain) loss resulting from hedging transactions 797

(1,047 )
(163 )
(32 )
(65 ) —
(7 ) (517 )
Fresh start/purchase accounting impacts 15

(1 )
2

1

4
—
(1 ) 20
Impacts of Tax Receivable Agreement —

—

—

—

—
—
(33 ) (33 )
Non-cash compensation expenses —

—

—

—

—
—
11
11
Transition and merger expenses —

5

1

1

17
—
3
27
Other, net 3

3

7

2

5
—
(11 ) 9
Adjusted EBITDA $ 293

$ 156

$ 167

$ 91

$ 1
$ (15 ) $ (1 ) $ 692

~~___________~~


~~(a)~~	~~Includes nuclear fuel amortization of $15 million in ERCOT segment.~~

Three Months Ended June 30, 2018
Retail ERCOT PJM NY/NE MISO
Asset
Closure
Eliminations / Corporate and Other
Vistra
Energy Consolidated
Net income (loss) $ (288 ) $ 679
$ 23
$ (5 ) $ 31
$ 2
$ (337 ) $ 105
Income tax benefit —
—

—
(74 ) (74 )
Interest expense and related charges —
7
2
1

—
136
146
Depreciation and amortization (a) 80
128
125
49
3
—
24
409
EBITDA before Adjustments (208 ) 814
150
45
34
2
(251 ) 586
Unrealized net (gain) loss resulting from hedging transactions 462
(667 ) (1 ) 22
(32 ) —
—
(216 )
Fresh start accounting impacts 15
(2 ) (1 ) 4
8
1
—
25
Impacts of Tax Receivable Agreement —
—
—
—
—
—
64
64
Non-cash compensation expenses —
—
—
—
—
—
42
42
Transition and merger expenses —
2
1
—
3
2
148
156
Other, net (9 ) (4 ) 5
3
5
—
1
1
Adjusted EBITDA $ 260
$ 143
$ 154
$ 74
$ 18
$ 5
$ 4
$ 658

~~____________~~


~~(a)~~	~~Includes nuclear fuel amortization of $20 million in ERCOT segment.~~

Six Months Ended June 30, 2019
Retail ERCOT PJM NY/NE MISO
Asset
Closure
Eliminations / Corporate and Other
Vistra
Energy Consolidated
Net income (loss) $ (571 )
$ 1,356

$ 346

$ 100

$ 46
$ (29 ) $ (670 ) $ 578
Income tax expense —

—

—

—

—
—
225
225
Interest expense and related charges 8

(5 )
5

1

3
—
483
495
Depreciation and amortization (a) 118

293

265

104

7
—
37
824
EBITDA before Adjustments (445 )
1,644

616

205

56
(29 ) 75
2,122
Unrealized net (gain) loss resulting from hedging transactions 961

(1,298 )
(255 )
(38 )
(50 ) —
(23 ) (703 )
Fresh start/purchase accounting impacts 29

—

(5 )
3

8
—
(2 ) 33
Impacts of Tax Receivable Agreement —

—

—

—

—
—
(36 ) (36 )
Non-cash compensation expenses —

—

—

—

—
—
24
24
Transition and merger expenses —

6

3

2

24
—
9
44
Other, net 5

8

9

5

10
1
(28 ) 10
Adjusted EBITDA $ 550

$ 360

$ 368

$ 177

$ 48
$ (28 ) $ 19
$ 1,494

~~____________~~


~~(a)~~	~~Includes nuclear fuel amortization of $34 million in ERCOT segment.~~

Six Months Ended June 30, 2018
Retail ERCOT PJM NY/NE MISO
Asset
Closure
Eliminations / Corporate and Other
Vistra
Energy Consolidated
Net income (loss) $ 483
$ (407 ) $ 23
$ (5 ) $ 31
$ (20 ) $ (306 ) $ (201 )
Income tax benefit —
—
—
—
—
—
(163 ) (163 )
Interest expense and related charges 1
15
2
1
—
—
118
137
Depreciation and amortization (a) 157
213
125
49
3
—
35
582
EBITDA before Adjustments 641
(179 ) 150
45
34
(20 ) (316 ) 355
Unrealized net (gain) loss resulting from hedging transactions (193 ) 403
(1 ) 22
(32 ) —
—
199
Fresh start accounting impacts 27
(4 ) (1 ) 4
8
1
—
35
Impacts of Tax Receivable Agreement —
—
—
—
—
—
82
82
Non-cash compensation expenses —
—
—
—
—
—
48
48
Transition and merger expenses —
4
1
—
3
2
174
184
Other, net (21 ) (12 ) 5
3
5
—
16
(4 )
Adjusted EBITDA $ 454
$ 212
$ 154
$ 74
$ 18
$ (17 ) $ 4
$ 899

~~____________~~


~~(a)~~	~~Includes nuclear fuel amortization of $40 million in ERCOT segment.~~

Adjusted EBITDA increased by ~~$34~~$108 million to ~~$692~~$401 million in the three months ended June 30, ~~2019~~2020 compared to the three months ended June 30, ~~2018.~~2019. Net income increased by $894 million to $323 million and Adjusted EBITDA increased by ~~$595~~$162 million to ~~$1.494 billion~~$712 million in the six months ended June 30, ~~2019~~2020 compared to the six months ended June 30, ~~2018.~~2019.

Three Months Ended
June 30, 2019
Compared to 2018

Six Months Ended
June 30, 2019
Compared to 2018
PJM, MISO and NY/NE segments acquired in the Merger $ 13
$ 347
Increase in ERCOT segment driven by higher realized prices 13
148
Increase in Retail segment driven by ERCOT margins 33
96
Change in Asset Closure segment driven by reduced operating results due to the retirement of facilities in first and second quarter of 2018 (20 ) (11 )
Corporate and Other (5 ) 15
Total $ 34
$ 595


	Three Months Ended June 30, 2020 Compared to 2019		Six Months Ended June 30, 2020 Compared to 2019

Higher margin primarily driven by the addition of Crius acquired in July 2019 and Ambit acquired in November 2019	151		$	252

Other driven by higher SG&A expense and bad debt expense primarily due to the addition of Crius and Ambit	(43)		(90)
Change in Adjusted EBITDA	$	108	$	162
Change in depreciation and amortization expenses driven by Crius/Ambit intangibles	(14)		(35)
Favorable impact of lower unrealized net losses on hedging activities	716		759
Lower transition and merger and other expenses	13		17
Change in net income (loss)	$	823	$	903

~~Retail Segment~~

Generation — Three ~~and~~ ~~Six~~ Months Ended June 30, ~~2019~~2020 Compared to Three ~~and~~ ~~Six~~ Months Ended June 30, ~~2018~~2019


	Three Months Ended June 30,
	ERCOT						PJM						NY/NE				MISO
	2020		2019		2020		2019		2020		2019		2020		2019
Operating revenues:
Electricity sales	$	205	$	228	$	211	$	240	$	67	$	124	$	57	$	86
Capacity revenue from ISO/RTO	—		—		15		53		10		72		4		8
Sales to affiliates	479		392		261		209		108		29		99		31
Rolloff of unrealized net gains (losses) representing positions settled in the current period	(22)		22		(4)		(6)		(20)		(13)		(10)		(4)
Unrealized net gains (losses) on hedging activities	17		393		(6)		64		(16)		38		5		35
Unrealized net gains (losses) on hedging activities with affiliates	185		635		(66)		126		(19)		6		(26)		36
Other revenues	1		1		1		—		1		(2)		(8)		(4)
Operating revenues	865		1,671		412		686		131		254		121		188
Fuel, purchased power costs and delivery fees:
Fuel for generation facilities and purchased power costs	(203)		(268)		(206)		(244)		(73)		(99)		(102)		(74)
Fuel for generation facilities and purchased power costs from affiliates	2		—		(2)		—		1		—		1		—
Unrealized (gains) losses from hedging activities	10		(3)		9		(21)		20		1		17		(2)
Unrealized net (gains) losses on hedging activities with affiliates	—		—		—		—		2		—		—		—
Ancillary and other costs	(32)		(28)		(5)		—		(8)		(2)		(1)		(2)
Fuel, purchased power costs and delivery fees	(223)		(299)		(204)		(265)		(58)		(100)		(85)		(78)










Net income (loss)	$	299	$	1,056	$	(66)	$	183	$	(18)	$	79	$	(32)	$	46












Adjusted EBITDA	$	260	$	156	$	183	$	167	$	72	$	91	$	3	$	11

Table of Contents

Three Months Ended June 30,
Favorable (Unfavorable)
Change
Six Months Ended June 30,
Favorable (Unfavorable)
Change
2019 2018 2019 2018
Operating revenues:
Revenues in ERCOT $ 1,091
$ 1,111
$ (20 ) $ 2,116
$ 2,059
$ 57
Revenues in Northeast/Midwest 315
336
(21 ) 663
336
327
Amortization expense (10 ) (15 ) 5
(19 ) (27 ) 8
Other revenues 25
22
3
46
58
(12 )
Total operating revenues 1,421
1,454
(33 ) 2,806
2,426
380
Fuel, purchased power costs and delivery fees:
Purchases from affiliates (689 ) (716 ) 27
(1,360 ) (1,061 ) (299 )
Unrealized net gains (losses) on hedging activities with affiliates (803 ) (463 ) (340 ) (966 ) 180
(1,146 )
Delivery fees (346 ) (383 ) 37
(694 ) (715 ) 21
Other costs 10
(4 ) 14
(4 ) (5 ) 1
Total fuel, purchased power costs and delivery fees (1,828 ) (1,566 ) (262 ) (3,024 ) (1,601 ) (1,423 )
Net income (loss) $ (585 ) $ (288 ) $ (297 ) $ (571 ) $ 483
$ (1,054 )
Adjusted EBITDA $ 293
$ 260
$ 33
$ 550
$ 454
$ 96
Retail sales volumes (GWh):
Retail electricity sales volumes:
Sales volumes in ERCOT 10,693
10,861
(168 ) 20,476
20,053
423
Sales volumes in Northeast/Midwest 6,012
6,319
(307 ) 12,563
6,319
6,244
Total retail electricity sales volumes 16,705
17,180
(475 ) 33,039
26,372
6,667
Weather (North Texas average) - percent of normal (a):
Cooling degree days 81.0 % 117.0 % 79.0 % 117.0 %
Heating degree days 107.0 % 209.0 % 111.0 % 106.0 %

~~____________~~


~~(a)~~	Weather data is obtained from Weatherbank, Inc. For the three and six months ended June 30, 2019, normal is defined as the average over the 10-year period from June 2009 to June 2018. For the three and six months ended June 30, 2018, normal is defined as the average over the 10-year period from June 2008 to June 2017.

Net loss increased by $297 million to $585 million and Adjusted EBITDA increased by $33 million to $293 million in the three months ended June 30, 2019 compared to the three months ended June 30, 2018. Net income of $483 million decreased by $1.054 billion to a net loss of $571 million and Adjusted EBITDA increased by $96 million to $550 million in the six months ended June 30, 2019 compared to the six months ended June 30, 2018.

Three Months Ended June 30, 2019
Compared to 2018

Six Months Ended
June 30, 2019
Compared to 2018
Favorable margins in ERCOT primarily due to favorable power prices $ 66
$ 135
Favorable margins in Midwest/NE 11
12
Unfavorable weather in ERCOT (38 ) (42 )
Other (6 ) (9 )
Change in Adjusted EBITDA $ 33
$ 96
Lower depreciation and amortization expenses driven by reduced amortization of the retail customer relationship 21
39
Unfavorable impact of unrealized net losses on hedging activities (335 ) (1,154 )
Higher other expenses (16 ) (35 )
Change in net income (loss) $ (297 ) $ (1,054 )

~~ERCOT Segment~~ — ~~Three and~~ ~~Six Months~~ ~~Ended June 30, 2019 Compared to Three and~~ ~~Six Months~~ ~~Ended June 30, 2018~~

Three Months Ended June 30,
Favorable (Unfavorable)
Change
Six Months Ended June 30,
Favorable (Unfavorable)
Change
2019 2018 2019 2018
Operating revenues:
Wholesale electricity sales $ 228
$ 254
$ (26 ) $ 587
$ 445
$ 142
Sales to affiliates 392
405
(13 ) 750
751
(1 )
Rolloff of unrealized net gains (losses) representing positions settled in the current period 22
131
(109 ) (9 ) 167
(176 )
Unrealized net gains (losses) from changes in fair value 393
102
291
515
(359 ) 874
Unrealized net gains (losses) on hedging activities with affiliates 635
435
200
781
(208 ) 989
Other revenues 1
—
1
1
(2 ) 3
Operating revenues $ 1,671
$ 1,327
$ 344
2,625
794
1,831
Fuel, purchased power costs and delivery fees:
Fuel for generation facilities and purchased power costs (268 ) (300 ) 32
(587 ) (555 ) (32 )
Unrealized (gains) losses from hedging activities (3 ) (2 ) (1 ) 11
(3 ) 14
Ancillary and other costs (28 ) (35 ) 7
(57 ) (69 ) 12
Fuel, purchased power costs and delivery fees (299 ) (337 ) 38
(633 ) (627 ) (6 )
Net income (loss) $ 1,056
$ 679
$ 377
$ 1,356
$ (407 ) $ 1,763
Adjusted EBITDA $ 156
$ 143
$ 13
$ 360
$ 212
$ 148
Production volumes (GWh):
Nuclear facilities 4,060
5,279
(1,219 ) 8,678
10,547
(1,869 )
Lignite and coal facilities 5,800
6,967
(1,167 ) 12,780
12,403
377
Natural gas facilities 8,939
8,030
909
17,330
14,421
2,909
Solar facilities 131
134
(3 ) 217
134
83
Capacity factors:
Nuclear facilities 80.8 % 105.1 % 86.9 % 105.6 %
Lignite and coal facilities 59.0 % 71.8 % 65.4 % 68.8 %
CCGT facilities 49.1 % 47.2 % 49.0 % 55.9 %
Market pricing:
Average ERCOT North power price ($/MWh) $ 25.09
$ 27.76
$ (2.67 ) $ 24.75
$ 26.59
$ (1.84 )

Net income increased by $377 million to $1.056 billion and Adjusted EBITDA increased by $13 million to $156 million in the three months ended June 30, 2019 compared to the three months ended June 30, 2018. Net loss of $407 million improved by $1.763 billion to net income of $1.356 billion and Adjusted EBITDA increased by $148 million to $360 million in the six months ended June 30, 2019 compared to the six months ended June 30, 2018.

Three Months Ended June 30, 2019
Compared to 2018

Six Months Ended
June 30, 2019
Compared to 2018
Favorable margins driven by higher realized power prices through hedging activities $ —
$ 114
Unfavorable margin in the quarter due to decreased nuclear production driven by outage timing, partially offset by higher realized power prices (5 ) —
Lower selling, general and administrative expenses due to lower shared services costs —
17
Insurance reimbursements for Comanche Peak 6
21
Impact of Forney outage in 2018 13
13
Other (1 ) (17 )
Change in Adjusted EBITDA $ 13
$ 148
Increased depreciation and amortization driven by facilities acquired in the Merger (15 ) (80 )
Favorable impact of unrealized net gains on hedging activities 380
1,701
Other (1 ) (6 )
Change in net income (loss) $ 377
$ 1,763

~~PJM Segment~~ — ~~Three and~~ ~~Six Months~~ ~~Ended June 30, 2019 Compared to Three and~~ ~~Six Months~~ ~~Ended June 30, 2018~~

Three Months Ended June 30,
Favorable (Unfavorable)
$ Change
Six Months Ended June 30,
Favorable (Unfavorable)
$ Change
2019 2018 2019 2018
Operating revenues:
Energy $ 240
$ 207
$ 33
$ 564
$ 207
$ 357
Capacity 53
119
(66 ) 120
119
1
Unrealized net gains on hedging activities 58
6
52
117
6
111
Sales to affiliates 209
168
41
431
168
263
Unrealized net gains (losses) on hedging activities with affiliates 126
(16 ) 142
159
(16 ) 175
Other revenues —
1
(1 ) —
1
(1 )
Operating revenues $ 686
$ 485
$ 201
$ 1,391
$ 485
$ 906
Fuel, purchased power costs and delivery fees:
Fuel for generation facilities and purchased power costs (244 ) (243 ) (1 ) (560 ) (243 ) (317 )
Fuel for generation facilities and purchased power costs from affiliates —
(6 ) 6
—
(6 ) 6
Unrealized gains (losses) from hedging activities (21 ) 11
(32 ) (21 ) 11
(32 )
Other costs —
(1 ) 1
—
(1 ) 1
Fuel, purchased power costs and delivery fees $ (265 ) $ (239 ) $ (26 ) $ (581 ) $ (239 ) $ (342 )
Net income $ 183
$ 23
$ 160
$ 346
$ 23
$ 323
Adjusted EBITDA $ 167
$ 154
$ 13
$ 368
$ 154
$ 214
Production volumes (GWh): 10,642
11,250
(608 ) 25,101
11,250
13,851
Capacity factors:
CCGT facilities 59.9 % 65.0 % 67.1 % 65.0 %
Coal facilities 35.6 % 48.7 % 50.6 % 48.7 %
Weather - percent of normal (a):
Cooling degree days 89.0 % 116.0 % 89.0 % 116.0 %
Heating degree days 83.0 % 117.0 % 98.0 % 117.0 %
Average Market On-Peak Power Prices ($/MWh) (b):
PJM West Hub $ 28.60
$ 39.81
$ 31.25
$ 39.81

AEP Dayton Hub $ 28.90
$ 40.04
$ 30.77
$ 40.04

Average natural gas price - TetcoM3 ($/MMBtu) (c) $ 2.21
$ 2.40
$ 2.77
$ 2.40


	Three Months Ended June 30,
	ERCOT									PJM									NY/NE						MISO
	2020			2019			2020			2019			2020			2019			2020			2019
Production volumes (GWh):
Natural gas facilities	7,525			8,939			9,291			7,936			2,995			3,687
Lignite and coal facilities	6,716			5,800			2,377			2,705									2,325			3,297
Nuclear facilities	4,551			4,060
Solar/Battery facilities	129			131
Capacity factors:
CCGT facilities	42.2		%	49.1		%	67.9		%	59.9		%	29.0		%	35.7		%
Lignite and coal facilities	68.3		%	59.0		%	31.3		%	35.6		%							33.4		%	47.4		%
Nuclear facilities	90.6		%	80.8		%
Weather - percent of normal (a):
Cooling degree days	96.0		%	92.0		%	99.0		%	89.0		%	105.0		%	80.0		%	106.0		%	86.0		%
Heating degree days	158.0		%	136.0		%	144.0		%	83.0		%	130.0		%	100.0		%	117.0		%	93.0		%
Market pricing:
Average ERCOT North power price ($/MWh)	$	16.45		$	25.09
Average NYMEX Henry Hub natural gas price ($/MMBTU)	$	1.65		$	2.51
Average Market On-Peak Power Prices ($MWh) (b):
PJM West Hub							$	20.80		$	28.60
AEP Dayton Hub							$	21.30		$	28.90
NYISO Zone C													$	16.29		$	21.80
Massachusetts Hub													$	20.32		$	27.21
Indiana Hub																			$	24.15		$	29.69
Northern Illinois Hub																			$	19.26		$	26.73
Average natural gas price (c):
TetcoM3 ($/MMBtu)							$	1.43		$	2.21
Algonquin Citygates ($/MMBtu)													$	1.51		$	2.33

____________

(a)Reflects cooling degree days or heating degree days for the region based on Weather Services International (WSI) data.

(b)Reflects the average of day-ahead quoted prices for the periods presented and does not necessarily reflect prices we realized.

(c)Reflects the average of daily quoted prices for the periods presented and does not reflect costs incurred by us.

Table of Contents

~~Net~~The following table presents changes in net income ~~increased by $160 million to $183 million~~(loss) and Adjusted EBITDA ~~increased by $13 million to $167 million in~~for the three months ended June 30, ~~2019~~2020 compared to the three months ended June 30, ~~2018. Net income~~2019.


	Three Months Ended June 30, 2020 Compared to 2019
	ERCOT		PJM		NY/NE		MISO

Favorable/(unfavorable) change in revenue net of fuel	$	128	$	12	$	(16)	$	9
Favorable/(unfavorable) change in other operating costs	(14)		5		1		(11)
Unfavorable change in selling. general and administrative expenses	(3)		—		(1)		(7)
Other	(7)		(1)		(3)		1
Change in Adjusted EBITDA	$	104	$	16	$	(19)	$	(8)
Favorable/(unfavorable) change in depreciation and amortization	4		(31)		(9)		(6)
Change in unrealized net (gains)/losses on hedging activities	(857)		(230)		(65)		(79)
Fresh start/purchase accounting impacts	(7)		(10)		(6)		(5)
Transition and merger expenses	9		1		1		17
Other (including interest)	(10)		5		1		3
Change in Net income (loss)	$	(757)	$	(249)	$	(97)	$	(78)

The change in ERCOT segment results was driven by improved realized margin through hedging activities and plant optimization efforts, partially offset by higher operating costs, lower insurance reimbursement and lower unrealized gains.

The change in PJM segment results was driven by lower unrealized hedging gains, lower capacity revenue and increased depreciation expense, partially offset by ~~$323 million to $346 million~~improved realized margin through hedging activities and ~~Adjusted EBITDA increased by $214 million to $368 million in the six months ended June 30, 2019 compared to the six months ended June 30, 2018.~~

Three Months Ended June 30, 2019
Compared to 2018

Six Months Ended
June 30, 2019
Compared to 2018
Favorable impact related to operations acquired in the Merger (a) $ —
$ 201
Increase in generation revenue net of fuel 86
86
Decrease in capacity revenue (66 ) (66 )
Increase in operating costs (5 ) (5 )
Other (2 ) (2 )
Adjusted EBITDA $ 13
$ 214
Increase in depreciation and amortization (9 ) (140 )
Unrealized net gains (losses) on hedging activities 162
254
Purchase accounting impacts (3 ) 4
Other (3 ) (9 )
Net income $ 160
$ 323

~~____________~~


~~(a)~~	~~Impact related to operations acquired in the Merger are the combined results for the first quarter of 2019, for which there is no comparable period for 2018 due to the Merger date of April 9, 2018.~~

plant optimization efforts.

The change in NY/NE ~~Segment~~segment results was driven by lower capacity revenue and higher unrealized losses, partially offset by improved realized margin through hedging activities and plant optimization efforts.

The change in MISO segment results was driven by lower unrealized hedging gains and higher operating costs.

Generation — ~~Three and~~ Six Months Ended June 30, ~~2019~~2020 Compared to ~~Three and~~ Six Months Ended June 30, ~~2018~~2019


	Six Months Ended June 30,
	ERCOT						PJM						NY/NE				MISO
	2020		2019		2020		2019		2020		2019		2020		2019
Operating revenues:
Electricity sales	$	470	$	587	$	439	$	564	$	140	$	375	$	127	$	228
Capacity revenue from ISO/RTO	—		—		30		120		35		152		9		18
Sales to affiliates	878		750		586		431		265		43		171		74
Rolloff of unrealized net gains (losses) representing positions settled in the current period	(64)		(9)		12		(15)		(21)		(34)		(26)		(20)
Unrealized net gains on hedging activities	193		515		17		132		6		60		20		44
Unrealized net gains (losses) on hedging activities with affiliates	254		781		(25)		159		(9)		6		(27)		22
Other revenues	—		1		1		—		1		(3)		(11)		(9)
Operating revenues	1,731		2,625		1,060		1,391		417		599		263		357
Fuel, purchased power costs and delivery fees:
Fuel for generation facilities and purchased power costs	(419)		(587)		(462)		(560)		(233)		(331)		(167)		(171)
Fuel for generation facilities and purchased power costs from affiliates	4		—		(4)		—		—		—		2		—
Unrealized (gains) losses from hedging activities	(12)		11		(5)		(21)		10		6		9		4

Table of Contents

Three Months Ended June 30,
Favorable (Unfavorable)
$ Change
Six Months Ended June 30,
Favorable (Unfavorable)
$ Change
2019 2018 2019 2018
Operating revenues:
Energy $ 124
$ 116
$ 8
$ 375
$ 116
$ 259
Capacity 72
82
(10 ) 152
82
70
Unrealized net gains (losses) on hedging activities 25
(20 ) 45
26
(20 ) 46
Sales to affiliates 29
16
13
43
16
27
Unrealized net gains (losses) on hedging activities with affiliates 6
(4 ) 10
6
(4 ) 10
Other revenues (2 ) (3 ) 1
(3 ) (3 ) —
Operating revenues $ 254
$ 187
$ 67
$ 599
$ 187
$ 412
Fuel, purchased power costs and delivery fees:
Fuel for generation facilities and purchased power costs (99 ) (107 ) 8
(331 ) (107 ) (224 )
Fuel for generation facilities and purchased power costs from affiliates —
(2 ) 2
—
(2 ) 2
Unrealized gains from hedging activities 1
2
(1 ) 6
2
4
Other costs (2 ) (1 ) (1 ) (4 ) (1 ) (3 )
Fuel, purchased power costs and delivery fees $ (100 ) $ (108 ) $ 8
$ (329 ) $ (108 ) $ (221 )
Net income $ 79
$ (5 ) $ 84
$ 100
$ (5 ) $ 105
Adjusted EBITDA $ 91
$ 74
$ 17
$ 177
$ 74
$ 103
Production volumes (GWh): 3,687
3,765
(78 ) 8,640
3,765
4,875
Capacity factors:
CCGT facilities 35.7 % 40.0 % 42.1 % 40.0 %
Weather - percent of normal (a):
Cooling degree days 80.0 % 103.0 % 80.0 % 103.0 %
Heating degree days 100.0 % 116.0 % 101.0 % 116.0 %
Average Market On-Peak Power Prices ($/MWh) (b):
NYISO Zone C $ 21.80
$ 31.03
$ 27.80
$ 31.03

Massachusetts Hub $ 27.21
$ 36.15
$ 37.42
$ 36.15

Average natural gas price - Algonquin Citygates ($/MMBtu) (c) $ 2.33
$ 3.31
$ 3.70
$ 3.31


	Six Months Ended June 30,
	ERCOT									PJM									NY/NE						MISO
	2020			2019			2020			2019			2020			2019			2020			2019
Unrealized (gains) losses from hedging activities with affiliates	—			—			—			—			2			—			—			—
Ancillary and other costs	(67)			(57)			(10)			—			(10)			(4)			(3)			(4)
Fuel, purchased power costs and delivery fees	(494)			(633)			(481)			(581)			(231)			(329)			(159)			(171)










Net income (loss)	$	557		$	1,356		$	53		$	346		$	(3)		$	100		$	(111)		$	67












Adjusted EBITDA	$	477		$	360		$	401		$	368		$	132		$	177		$	31		$	67
Production volumes (GWh):
Natural gas facilities	16,389			17,330			18,721			17,457			6,713			8,640
Lignite and coal facilities	12,279			12,780			5,203			7,644									5,193			7,977
Nuclear facilities	9,775			8,678
Solar/Battery facilities	208			217
Capacity factors:
CCGT facilities	46.6		%	49.0		%	70.1		%	67.1		%	32.7		%	42.1		%
Lignite and coal facilities	62.8		%	65.4		%	34.4		%	50.6		%							37.5		%	57.6		%
Nuclear facilities	97.8		%	86.9		%
Weather - percent of normal (a):
Cooling degree days	102.0		%	89.0		%	99.0		%	89.0		%	105.0		%	80.0		%	106.0		%	86.0		%
Heating degree days	81.0		%	110.0		%	91.0		%	98.0		%	92.0		%	101.0		%	89.0		%	99.0		%
Market pricing:
Average ERCOT North power price ($/MWh)	$	17.92		$	24.75
Average NYMEX Henry Hub natural gas price ($/MMBTU)	$	1.76		$	2.70
Average Market On-Peak Power Prices ($MWh) (b):
PJM West Hub							$	21.65		$	31.25
AEP Dayton Hub							$	21.84		$	30.77
NYISO Zone C													$	17.31		$	27.80
Massachusetts Hub													$	22.45		$	37.42
Indiana Hub																			$	24.40		$	31.81
Northern Illinois Hub																			$	20.25		$	28.31
Average natural gas price (c):
TetcoM3 ($/MMBtu)							$	1.60		$	2.77
Algonquin Citygates ($/MMBtu)													$	1.87		$	3.70

____________

(a)Reflects cooling degree days or heating degree days for the region based on Weather Services International (WSI) data.

(b)Reflects the average of day-ahead quoted prices for the periods presented and does not necessarily reflect prices we realized.

(c)Reflects the average of daily quoted prices for the periods presented and does not reflect costs incurred by us.

Table of Contents

~~Net loss of $5 million improved by $84 million to~~The following table presents changes in net income ~~of $79 million~~(loss) and Adjusted EBITDA increased by $17 million to $91 million in the three months ended June 30, 2019 compared to the three months ended June 30, 2018. Net loss of $5 million improved by $105 million to net income of $100 million and Adjusted EBITDA increased by $103 million to $177 million infor the six months ended June 30, ~~2019~~2020 compared to the six months ended June 30, ~~2018.~~2019.

Three Months Ended June 30, 2019
Compared to 2018

Six Months Ended
June 30, 2019
Compared to 2018
Favorable impact related to operations acquired in the Merger (a) $ —
$ 86
Increase in generation revenue net of fuel 28
28
Decrease in capacity revenue (10 ) (10 )
Other (1 ) (1 )
Adjusted EBITDA $ 17
$ 103
Decrease in depreciation and amortization 10
(55 )
Unrealized net gains (losses) on hedging activities 54
60
Purchase accounting impacts 3
1
Transition and merger expenses (1 ) (2 )
Other 1
(2 )
Net income $ 84
$ 105

~~____________~~


~~(a)~~	~~Impact related to operations acquired in the Merger are the combined results for the first quarter of 2019, for which there is no comparable period for 2018 due to the Merger date of April 9, 2018.~~


	Six Months Ended June 30, 2020 Compared to 2019
	ERCOT		PJM		NY/NE		MISO

Favorable/(unfavorable) change in revenue net of fuel	$	167	$	30	$	(39)	$	(8)
Favorable/(unfavorable) change in other operating costs	(24)		14		3		(19)
Unfavorable change in selling. general and administrative expenses	(6)		(3)		(3)		(12)
Other	(20)		(8)		(6)		3
Change in Adjusted EBITDA	$	117	$	33	$	(45)	$	(36)
Favorable/(unfavorable) change in depreciation and amortization	11		(38)		7		(13)
Change in unrealized net (gains)/losses on hedging activities	(927)		(256)		(50)		(74)
Fresh start/purchase accounting impacts	(3)		(19)		(4)		(4)
Transition and merger expenses	8		(4)		2		24
Impairment of long-lived assets	—		—		—		(84)
Loss on disposal of investment in NELP	—		(14)		(15)		—
Other (including interest)	(5)		5		2		9
Change in Net income (loss)	$	(799)	$	(293)	$	(103)	$	(178)

~~MISO Segment~~
—~~Three~~

The change in ERCOT segment results was driven by lower unrealized hedging gains and ~~Six Months~~ ~~Ended June 30, 2019 Compared to Three~~lower insurance reimbursement, partially offset by higher realized prices through hedging activities and plant optimization efforts.

~~Six Months~~ ~~Ended June 30, 2018~~

Three Months Ended June 30,
Favorable (Unfavorable)
$ Change
Six Months Ended June 30,
Favorable (Unfavorable)
$ Change
2019 2018 2019 2018
Operating revenues:
Energy $ 113
$ 81
$ 32
$ 302
$ 81
$ 221
Capacity 11
29
(18 ) 24
29
(5 )
Unrealized net gains (losses) on hedging activities 31
(18 ) 49
24
(18 ) 42
Sales to affiliates 60
115
(55 ) 138
115
23
Unrealized net gains on hedging activities with affiliates 36
48
(12 ) 22
48
(26 )
Other revenues (5 ) 2
(7 ) (10 ) 2
(12 )
Operating revenues $ 246
$ 257
$ (11 ) $ 500
$ 257
$ 243
Fuel, purchased power costs and delivery fees:
Fuel for generation facilities and purchased power costs (116 ) (134 ) 18
(272 ) (134 ) (138 )
Fuel for generation facilities and purchased power costs from affiliates —
—
—
—
—
—
Unrealized gains (losses) from hedging activities (2 ) 2
(4 ) 4
2
2
Other costs (2 ) (1 ) (1 ) (4 ) (1 ) (3 )
Fuel, purchased power costs and delivery fees $ (120 ) $ (133 ) $ 13
$ (272 ) $ (133 ) $ (139 )
Net income $ 35
$ 31
$ 4
$ 46
$ 31
$ 15
Adjusted EBITDA $ 1
$ 18
$ (17 ) $ 48
$ 18
$ 30
Production volumes (GWh): 5,113
6,340
(1,227 ) 12,269
6,340
5,929
Capacity factors:
Coal facilities 44.5 % 60.6 % 53.8 % 60.6 %
Weather - percent of normal (a):
Cooling degree days 86.0 % 167.0 % 86.0 % 167.0 %
Heating degree days 93.0 % 113.0 % 99.0 % 113.0 %
Average Market On-Peak Power Prices ($/MWh) (b):
Indiana Hub $ 29.69
$ 38.91
$ 31.81
$ 38.91

Northern Illinois Hub $ 26.73
$ 31.76
$ 28.31
$ 31.76

~~____________~~


~~(a)~~	~~Reflects cooling degree days or heating degree days for the region based on Weather Services International (WSI) data.~~


~~(b)~~	~~Reflects the average of day-ahead quoted prices for the periods presented and does not necessarily reflect prices we realized.~~

~~Net income increased~~The change in PJM segment results was driven by ~~$4 million to $35 million~~lower unrealized hedging gains, lower capacity revenue and ~~Adjusted EBITDA decreased by $17 million to $1 million~~loss on disposal of equity method investment in ~~the three months ended June 30, 2019 compared~~NELP for 100% ownership of North Jersey Energy Associates (see Note 18 to the ~~three months ended June 30, 2018. Net income increased~~Financial Statements), partially offset by ~~$15 million to $46 million~~higher realized prices through hedging activities and ~~Adjusted EBITDA increased~~plant optimization efforts.

The change in NY/NE segment results was driven by ~~$30 million to $48 million~~lower capacity revenue and loss on disposal of equity method investment in ~~the six months ended June 30, 2019 compared~~NELP for 100% ownership of North Jersey Energy Associates (see Note 18 to the ~~six months ended June 30, 2018.~~Financial Statements).

Three Months Ended June 30, 2019
Compared to 2018

Six Months Ended
June 30, 2019
Compared to 2018
Favorable impact related to operations acquired in the Merger (a) $ —
$ 47
Decrease in generation revenue net of fuel (16 ) (16 )
Decrease in capacity revenue (18 ) (18 )
Decrease in operating costs 22
22
Increase in selling. general and administrative expenses (4 ) (4 )
Other (1 ) (1 )
Adjusted EBITDA $ (17 ) $ 30
Increase in depreciation and amortization —
(4 )
Unrealized net gains (losses) on hedging activities 33
18
Purchase accounting impacts 4
—
Transition and merger expenses (14 ) (21 )
Other (2 ) (8 )
Net income $ 4
$ 15
The change in MISO segment results was driven by lower unrealized hedging gains, higher operating costs and the impairment of the Joppa/EEI coal facility and related inventory.

~~____________~~


~~(a)~~	~~Impact related to operations acquired in the Merger are the combined results for the first quarter of 2019, for which there is no comparable period for 2018 due to the Merger date of April 9, 2018.~~

Asset Closure Segment —Three and Six Months Ended June 30, ~~2019~~2020 Compared to Three and Six Months Ended June 30, ~~2018~~2019


	Three Months Ended June 30,						Favorable (Unfavorable) Change			Six Months Ended June 30,					Favorable (Unfavorable) Change
	2020		2019						2020			2019
Operating revenues	$	—	$	58	$	(58)	$	—		$	143		$	(143)
Fuel, purchased power costs and delivery fees	—		(42)		42		—			(101)			101
Operating costs	(9)		(32)		23		(18)			(71)			53

Selling, general and administrative expenses	(5)		(11)		6		(12)			(22)			10


Operating loss	(14)		(27)		13		(30)			(51)			21
Other income	—		1		(1)		1			1			—
Other deductions	—		—		—		(2)			—			(2)


Loss before income taxes	(14)		(26)		12		(31)			(50)			19

Net loss	$	(14)	$	(26)	$	12	$	(31)		$	(50)		$	19






Adjusted EBITDA	$	(13)	$	(25)	$	12	$	(30)		$	(47)		$	17
Production volumes (GWh)	—		1,816		(1,816)		—			4,292			(4,292)

Three Months Ended June 30,
Favorable (Unfavorable)
Change
Six Months Ended June 30,
Favorable (Unfavorable)
Change
2019 2018 2019 2018
Operating revenues $ —
$ 21
$ (21 ) $ —
$ 49
$ (49 )
Fuel, purchased power costs and delivery fees —
(10 ) 10
—
(36 ) 36
Operating costs (12 ) (6 ) (6 ) (21 ) (30 ) 9
Selling, general and administrative expenses (4 ) (4 ) —
(9 ) (5 ) (4 )
Operating loss (16 ) 1
(17 ) (30 ) (22 ) (8 )
Other income 1
1
—
1
2
(1 )
Net loss $ (15 ) $ 2
$ (17 ) $ (29 ) $ (20 ) $ (9 )
Adjusted EBITDA $ (15 ) $ 5
$ (20 ) $ (28 ) $ (17 ) $ (11 )
Production volumes (GWh) —
445
(445 ) —
1,515
(1,515 )

Table of Contents

Results for the Asset Closure segment primarily reflect the retirement of the ~~Stuart~~Coffeen, Duck Creek, Havana and ~~Killen~~Hennepin plants in ~~May 2018 (acquired in the Merger), retirement of the Northeastern waste coal plant in October 2018~~November and ~~the retirement of the Monticello, Sandow and Big Brown plants in January and February 2018~~December 2019 (see Note 4 to the Financial Statements). Operating costs for the three and six months ended June 30, ~~2019~~2020 included ongoing costs associated with ~~closing these plants.~~the decommissioning and reclamation of retired plants and mines.

Energy-Related Commodity Contracts and Mark-to-Market Activities

The table below summarizes the changes in commodity contract assets and liabilities for the six months ended June 30, ~~2019~~2020 and ~~2018.~~2019. The net change in these assets and liabilities, excluding "other activity" as described below, reflects $123 million and $703 million in unrealized net gains for the six months ended June 30, 2020 and 2019, ~~and $199 million in unrealized net losses for the six months ended June 30, 2018,~~respectively, arising from mark-to-market accounting for positions in the commodity contract portfolio.

Six Months Ended June 30,
2019 2018
Commodity contract net asset (liability) at beginning of period $ (850 ) $ (96 )
Settlements/termination of positions (a) (76 ) 165
Changes in fair value of positions in the portfolio (b) 779
(364 )
Acquired commodity contracts in Merger (c) —
(452 )
Other activity (d) (73 ) 80
Commodity contract net asset (liability) at end of period $ (220 ) $ (667 )


	Six Months Ended June 30,
	2020		2019
Commodity contract net liability at beginning of period	$	(279)	$	(850)
Settlements/termination of positions (a)	(82)		(76)
Changes in fair value of positions in the portfolio (b)	205		779

Other activity (c)	7		(73)
Commodity contract net liability at end of period	$	(149)	$	(220)

____________

~~(a)~~

Represents reversals of previously recognized unrealized gains and losses upon settlement/termination (offsets realized gains and losses recognized in the settlement period). The six months ended June 30, 2019 and 2018 include reversals of $7 million and $17 million, respectively, of previously recorded unrealized gains related to Vistra Energy beginning balances. The six months ended June 30, 2019 and 2018 also include reversals of $13 million and $23 million, respectively, of previously recorded unrealized losses related to commodity contracts acquired in the Merger. Excludes changes in fair value in the month the position settled as well as amounts related to positions entered into, and settled, in the same month.


~~(b)~~	Represents unrealized net gains (losses) recognized, reflecting the effect of changes in fair value. Excludes changes in fair value in the month the position settled as well as amounts related to positions entered into, and settled, in the same month.


~~(c)~~	~~Includes fair value of commodity contracts acquired on the Merger Date (see Note 2 to the Financial Statements).~~


~~(d)~~	Represents changes in fair value of positions due to receipt or payment of cash not reflected in unrealized gains or losses. Amounts are generally related to premiums related to options purchased or sold as well as certain margin deposits classified as settlement for certain transactions executed on the CME.

(a)Represents reversals of previously recognized unrealized gains and losses upon settlement/termination (offsets realized gains and losses recognized in the settlement period). The six months ended June 30, 2020 and 2019 include reversals of $1 million of previously recorded unrealized losses and $7 million of previously recorded unrealized gains related to Vistra beginning balances, respectively. The six months ended June 30, 2020 and 2019 also include reversals of $21 million and $13 million, respectively, of previously recorded unrealized losses related to commodity contracts acquired in the Merger, Crius Transaction and Ambit Transaction. Excludes changes in fair value in the month the position settled as well as amounts related to positions entered into, and settled, in the same month.

(b)Represents unrealized net gains (losses) recognized, reflecting the effect of changes in fair value. Excludes changes in fair value in the month the position settled as well as amounts related to positions entered into, and settled, in the same month.

(c)Represents changes in fair value of positions due to receipt or payment of cash not reflected in unrealized gains or losses. Amounts are generally related to premiums related to options purchased or sold as well as certain margin deposits classified as settlement for certain transactions executed on the CME.

Maturity Table — The following table presents the net commodity contract liability arising from recognition of fair values at June 30, ~~2019,~~2020, scheduled by the source of fair value and contractual settlement dates of the underlying positions.


	Maturity dates of unrealized commodity contract net liability at June 30, 2020
	Less than 1 year		1-3 years		4-5 years		Excess of 5 years		Total
Prices actively quoted	$	108	$	(43)	$	(2)	$	—	$	63
Prices provided by other external sources	(247)		(78)		1		(2)		(326)
Prices based on models	39		39		21		15		114
Total	$	(100)	$	(82)	$	20	$	13	$	(149)

Maturity dates of unrealized commodity contract net liability at June 30, 2019
Source of fair value
Less than
1 year
1-3 years 4-5 years
Excess of
5 years
Total
Prices actively quoted $ (138 ) $ 43
$ (10 ) $ —
$ (105 )
Prices provided by other external sources (45 ) (74 ) —
—
(119 )
Prices based on models 60
4
(6 ) (54 ) 4
Total $ (123 ) $ (27 ) $ (16 ) $ (54 ) $ (220 )

Table of Contents

FINANCIAL CONDITION

Operating Cash Flows

Six Months Ended June 30, 2020 Compared to Six Months Ended June 30, 2019 ~~Compared to~~ ~~Six Months~~ ~~Ended June 30, 2018~~ — Cash provided by operating activities totaled $1.309 billion and $882 million infor the six months ended June 30, 2020 and 2019, ~~compared to cash used in operating activities of $29 million in the six months ended June 30, 2018.~~respectively. The favorable change of ~~$911~~$427 million was primarily driven by increased cash from operations ~~reflecting operations acquired in the Merger~~ and ~~an increase~~a decrease in cash ~~provided by~~ margin ~~deposits.~~deposits posted with third-parties.

Depreciation and amortization expense reported as a reconciling adjustment in the condensed consolidated statements of ~~condensed consolidated~~ cash flows exceeds the amount reported in the condensed consolidated statements of ~~condensed consolidated income (loss)~~operations by ~~$96~~$147 million and ~~$77~~$96 million for the six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively. The difference represented amortization of nuclear fuel, which is reported as fuel costs in the condensed consolidated statements of ~~consolidated income (loss)~~operations consistent with industry practice, and amortization of intangible net assets and liabilities that are reported in various other condensed consolidated statements of ~~condensed consolidated income (loss)~~operations line items including operating revenues and fuel and purchased power costs and delivery fees.

Investing Cash Flows

Cash used in investing activities totaled $653 million and $399 million for the six months ended June 30, 2020 and 2019, respectively. Capital expenditures totaled $588 million and $303 million for the six months ended June 30, 2020 and 2019, respectively. Cash used in investing activities for the six months ended June 30, 2020 and 2019 also reflected net purchases of environmental allowances of $85 million and $107 million, respectively. For the six months ended June 30, 2020 and 2019, capital expenditures consisted of:


	Six Months Ended June 30,
	2020		2019
Capital expenditures, including LTSA prepayments	$	297	$	247
Nuclear fuel purchases	$	36	$	20
Growth and development expenditures	$	255	$	36
Capital expenditures	$	588	$	303

Financing Cash Flows

Cash used in financing activities totaled $698 million and $170 million ~~and $1.443 billion in~~for the six months ended June 30, ~~2019~~2020 and ~~2018,~~2019, respectively. The ~~decrease in cash used in financing activities~~change was primarily driven by:

•the issuance of $4.6 billion principal amount of Vistra Operations senior secured and unsecured notes in 2019;

~~redemption in 2018 of $850~~•$500 million principal amount of outstanding of 5.875% senior ~~unsecured~~ notes ~~assumed~~redeemed in ~~the Merger;~~June 2020;

~~the amendment to~~•$100 million of term loans under the Vistra Operations Credit ~~Facilities~~Facility repaid in ~~2018, including the repayment~~March 2020, and

•$81 million principal amount of ~~$500 million~~outstanding of ~~term loans,~~8.000% senior notes redeemed in January 2020,

partially offset by:

•cash tender offers ~~in 2019~~ to purchase approximately $2.0 billion of senior unsecured notes assumed in the ~~Merger;~~Merger in 2019;

•repayment of approximately $2.0 billion of term loans under the Vistra Operations Credit Facilities in 2019;

•$~~100~~457 million in cash paid for share repurchases in 2019;

•$200 million increase in net short-term borrowings under the Revolving Credit Facility in 2020, and

•$136 million decrease in debt tender offer and other financing fees in ~~2019~~2020 compared to ~~2018;~~2019.

~~$394 million increase in cash paid for share repurchases in 2019 compared to 2018, and~~

~~$120 million of cash dividend paid to stockholders in the first quarter of 2019.~~

~~Investing Cash Flows~~

Cash used in investing activities totaled $399 million in the six months ended June 30, 2019 compared to cash provided by investing activities of $242 million in the six months ended June 30, 2018. Capital expenditures (including LTSA prepayments, nuclear fuel purchases and development and growth expenditures) totaled $303 million and $202 million in the six months ended June 30, 2019 and 2018, respectively. Cash used in investing activities in the six months ended June 30, 2019 also reflected net purchases of environmental allowances of $107 million. Cash provided by investing activities in the six months ended June 30, 2018 also reflected $445 million of cash acquired in the Merger (see Note 2 to the Financial Statements).

Debt Activity

See Note 11 to the Financial Statements for details of the Vistra Operations Credit Facilities and other long-term debt.

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Available Liquidity

The following table summarizes changes in available liquidity for the six months ended June 30, ~~2019:~~2020:


	June 30, 2020		December 31, 2019		Change
Cash and cash equivalents	$	382	$	300	$	82
Vistra Operations Credit Facilities — Revolving Credit Facility	1,287		1,426		(139)

Total available liquidity	$	1,669	$	1,726	$	(57)

June 30, 2019 December 31, 2018 Change
Cash and cash equivalents $ 964
$ 636
$ 328
Vistra Operations Credit Facilities — Revolving Credit Facility 2,173
1,135
1,038
Total available liquidity $ 3,137
$ 1,771
$ 1,366

The ~~$1.366 billion increase~~$57 million decrease in available liquidity infor the six months ended June 30, ~~2019~~2020 was primarily driven by cash from operations, $500 million of new Alternate LOC Facilities, $225 million of additional available capacity under the Revolving Credit Facility and decreased letters of credit postings, partially offset by $457 million in cash paid for share repurchases, $303$588 million of capital expenditures (including LTSA prepayments, nuclear fuel and development and growth expenditures), ~~$146~~$500 million principal amount of outstanding 5.875% senior notes redeemed in ~~debt tender offer~~June 2020, $100 million of term loans under the Vistra Operations Credit Facility repaid in March 2020, $81 million principal amount of outstanding of 8.000% senior notes redeemed in January 2020 and ~~other financing fees and $120~~$132 million in dividends paid to ~~shareholders.~~shareholders, partially offset by cash from operations.

Based upon our current internal financial forecasts, we believe that we will have sufficient liquidity to fund our anticipated cash requirements, including those related to our capital allocation initiatives, through at least the next 12 months. Our operational cash flows tend to be seasonal and weighted toward the second half of the year.

Liquidity Effects of Commodity Hedging and Trading Activities

We have entered into commodity hedging and trading transactions that require us to post collateral if the forward price of the underlying commodity moves such that the hedging or trading instrument we hold has declined in value. We use cash, letters of credit and other forms of credit support to satisfy such collateral posting obligations. See Note 11 to the Financial Statements for discussion of the Vistra Operations Credit Facilities.

Exchange cleared transactions typically require initial margin (i.e., the upfront cash and/or letter of credit posted to take into account the size and maturity of the positions and credit quality) in addition to variation margin (i.e., the daily cash margin posted to take into account changes in the value of the underlying commodity). The amount of initial margin required is generally defined by exchange rules. Clearing agents, however, typically have the right to request additional initial margin based on various factors, including market depth, volatility and credit quality, which may be in the form of cash, letters of credit, a guaranty or other forms as negotiated with the clearing agent. Cash collateral received from counterparties is either used for working capital and other business purposes, including reducing borrowings under credit facilities, or is required to be deposited in a separate account and restricted from being used for working capital and other corporate purposes. With respect to over-the-counter transactions, counterparties generally have the right to substitute letters of credit for such cash collateral. In such event, the cash collateral previously posted would be returned to such counterparties, which would reduce liquidity in the event the cash was not restricted.

At June 30, ~~2019,~~2020, we received or posted cash and letters of credit for commodity hedging and trading activities as follows:

•$~~253~~161 million in cash has been posted with counterparties as compared to ~~$361~~$202 million posted at December 31, ~~2018;~~2019;

•$815 million in cash has been received from counterparties as compared to $4$8 million received at December 31, ~~2018;~~2019;

•$~~896 million~~1.117 billion in letters of credit have been posted with counterparties as compared to ~~$1.185~~$1.150 billion posted at December 31, ~~2018,~~2019, and

•$517 million in letters of credit have been received from counterparties as compared to ~~$12~~$17 million received at December 31, ~~2018.~~2019.

Income Tax Payments

In the next 12 months, we do not expect to make federal income tax payments due to ~~Vistra Energy's forecasted loss position in 2018. In February 2019, we received a refund~~Vistra's use of ~~$21 million related to Vistra Energy's 2017 federal tax return.~~NOL carryforwards. We expect to make approximately $55 million in state income tax payments, ~~of approximately $26~~offset by $13 million in state tax refunds, and no$1 million in TRA payments in the next 12 months. ~~There~~In addition, we expect to receive approximately $129 million in AMT refundable credits in the next 12 months.

For the six months ended June 30, 2020, we received a refund of $37 million related to alternative minimum tax credits claimed on Dynegy tax returns. For the six months ended June 30, 2020, there were no federal income tax payments, ~~and $30~~$5 million in state income tax payments ~~for the six months ended June 30, 2019. There were $58 million in income tax payments in the six months ended June 30, 2018.~~and no TRA payments.

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Financial Covenants

The Credit Facilities Agreement includes a covenant, solely with respect to the Revolving Credit Facility and solely during a compliance period (which, in general, is applicable when the aggregate revolving borrowings and issued revolving letters of credit (in excess of $300 million) exceed 30% of the revolving commitments), that requires the consolidated ~~first lien~~first-lien net leverage ratio not exceed 4.25 to 1.00. ~~Although the period ended~~As of June 30, ~~2019 was not a compliance period,~~2020, we ~~would have been~~were in compliance with this financial ~~covenant if it was required to be tested at such date.~~covenant.

See Note 11 to the Financial Statements for discussion of other covenants related to the Vistra Operations Credit Facilities.

Collateral Support Obligations

The RCT has rules in place to assure that parties can meet their mining reclamation obligations. In September 2016, the RCT agreed to a collateral bond of up to $975 million to support Luminant's reclamation obligations. The collateral bond is effectively a first lien on all of Vistra Operations' assets (which ranks pari passu with the Vistra Operations Credit Facilities) that contractually enables the RCT to be paid (up to $975 million) before the other ~~first lien~~first-lien lenders in the event of a liquidation of our assets. Collateral support relates to land mined or being mined and not yet reclaimed as well as land for which permits have been obtained but mining activities have not yet begun and land already reclaimed but not released from regulatory obligations by the RCT, and includes cost contingency amounts.

The PUCT has rules in place to assure adequate creditworthiness of each REP, including the ability to return customer deposits, if necessary. Under these rules, at June 30, ~~2019,~~2020, Vistra ~~Energy~~ has posted letters of credit in the amount of ~~$55~~$59 million with the PUCT, which is subject to adjustments.

The ~~RTOs/ISOs~~ISOs/RTOs we operate in have rules in place to assure adequate creditworthiness of parties that participate in the markets operated by those ~~RTOs/ISOs.~~ISOs/RTOs. Under these rules, Vistra ~~Energy~~ has posted collateral support totaling ~~$225~~$383 million in the form of letters of credit, $10 million in the form of a surety bond and $1$2 million of cash at June 30, ~~2019~~2020 (which is subject to daily adjustments based on settlement activity with the ~~RTOs/ISOs)~~ISOs/RTOs).

Material Cross Default/Acceleration Provisions

Certain of our contractual arrangements contain provisions that could result in an event of default if there was a failure under financing arrangements to meet payment terms or to observe covenants that could result in an acceleration of payments due. Such provisions are referred to as "cross default" or "cross acceleration" provisions.

A default by Vistra Operations or any of its restricted subsidiaries in respect of certain specified indebtedness in an aggregate amount in excess of $300 million may result in a cross default under the Vistra Operations Credit Facilities. Such a default would allow the lenders to accelerate the maturity of outstanding balances (approximately ~~$3.8~~$3.1 billion at June 30, ~~2019)~~2020) including $550 million of cash borrowings under the Revolving Credit Facility) under such facilities.

Each of Vistra Operations' (or its subsidiaries') commodity hedging agreements and interest rate swap agreements that are secured with a lien on its assets on a pari passu basis with the Vistra Operations Credit Facilities lenders contains a cross default provision. An event of a default by Vistra Operations or any of its subsidiaries relating to indebtedness equal to or above a threshold defined in the applicable agreement that results in the acceleration of such debt, would give such counterparty under these hedging agreements the right to terminate its hedge or interest rate swap agreement with Vistra Operations (or its applicable subsidiary) and require all outstanding obligations under such agreement to be settled.

Under (i) the Vistra ~~Operations'~~Operations Senior Unsecured Indentures and the Vistra Operations Senior Secured Indenture, a default under any document evidencing indebtedness for borrowed money by Vistra Operations or any Guarantor Subsidiary for failure to pay principal when due at final maturity or that results in the acceleration of such indebtedness in an aggregate amount of $300 million or more, or (ii) as of June 30, 2020, with respect to the ~~Vistra Energy~~8.125% Senior Unsecured ~~Indentures (except with respect to the Consent Senior Notes),~~Indenture, a default under any document evidencing indebtedness for borrowed money by Vistra ~~Energy~~ or any Guarantor Subsidiary for failure to pay principal when due at final maturity or that results in the acceleration of such indebtedness in an aggregate amount of $100 million or more, may ~~result~~have resulted in a cross default under the Vistra Operations Senior Unsecured Notes, the Senior Secured Notes, the ~~Vistra Energy Senior Unsecured Notes (except with respect to the Consent Senior Notes),~~8.125% senior notes, the Vistra Operations Credit Facilities, the Receivables Facility, the Alternate LOC Facilities, and other current or future documents evidencing any indebtedness for borrowed money by the applicable borrower or issuer, as the case may be, and the applicable Guarantor Subsidiaries party thereto.

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Additionally, we enter into energy-related physical and financial contracts, the master forms of which contain provisions whereby an event of default or acceleration of settlement would occur if we were to default under an obligation in respect of borrowings in excess of thresholds, which may vary by contract.

The Receivables Facility contains a cross default provision. The cross default provision applies, among other instances, if Vistra Operations, the performance guarantor, fails to make a payment of principal or interest on any indebtedness that is outstanding in a principal amount of at least $300 million, or, in the case of TXU Energy, the originator and servicer, in a principal amount of at least $50 million, or if other events occur or circumstances exist under such indebtedness which give rise to a right of the debtholder to accelerate such indebtedness, or if such indebtedness becomes due before its stated maturity. If this cross-default provision is triggered, a termination event under the Receivables Facility would occur and the Receivables Facility may be terminated.

Under the Alternate LOC Facilities, a default under any document evidencing indebtedness for borrowed money by Vistra Operations or any Guarantor Subsidiary for failure to pay principal when due at final maturity or that results in the acceleration of such indebtedness in an aggregate amount of $300 million or more, may result in a termination of the Alternate LOC Facilities.

~~Guarantees~~Guarantor Summary Financial Information

As of June 30, 2020, our 8.125% senior notes were guaranteed by substantially all of our wholly owned subsidiaries. The following tables summarize the combined financial information of (i) Vistra Corp. (Parent), which is the ultimate parent company and issuer of the senior notes with effect as of the Merger Date, on a stand-alone, unconsolidated basis and (ii) the guarantor subsidiaries of Vistra (Guarantor Subsidiaries). The Guarantor Subsidiaries consist of the wholly owned subsidiaries, which jointly, severally, fully and unconditionally, guarantee the payment obligations under the senior notes. See Note 11 to the Financial Statements for discussion of the senior notes and Note 13 to the Financial Statements for discussion of dividend restrictions of Vistra Operations (a guarantor subsidiary of Vistra) and Parent.

This financial information should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto of Vistra. Transactions between the Parent and the Guarantor Subsidiaries have been eliminated. The inclusion of Vistra's subsidiaries as Guarantor Subsidiaries in the summary financial information is determined as of the most recent balance sheet date presented.

The Parent files a consolidated U.S. federal income tax return. All consolidated income tax expense or benefits and deferred tax assets and liabilities are included in the Guarantor summary financial information presented below.


	Six Months Ended June 30, 2020
Revenues	$	5,130
Operating income	$	829
Net income	$	274
Net income attributable to Vistra	$	274


	June 30, 2020			June 30, 2020
Current assets	$	3,303	Current liabilities	$	3,741
Noncurrent assets	21,798		Noncurrent liabilities	13,432
Total assets	$	25,101	Total liabilities	$	17,173
			Noncontrolling interest	$	(12)

Guarantees

See Note 12 to the Financial Statements for discussion of guarantees.

OFF–BALANCE SHEET ARRANGEMENTS

~~We do not~~As of June 30, 2020, we have no off-balance sheet arrangements which are expected to have any ~~off-balance sheet arrangements.~~material impact on our financial condition, results of operations or liquidity.

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COMMITMENTS AND CONTINGENCIES

See Note 1312 to the Financial Statements for discussion of commitments and contingencies.

CHANGES IN ACCOUNTING STANDARDS

See Note 1 to the Financial Statements for discussion of changes in accounting standards.


~~Item 3.~~	~~QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK~~

Item 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the risk that in the normal course of business we may experience a loss in value due to changes in market conditions that affect economic factors such as commodity prices, interest rates and counterparty credit. Our exposure to market risk is affected by several factors, including the size, duration and composition of our energy and financial portfolio, as well as the volatility and liquidity of markets.

Risk Oversight

We manage the commodity price, counterparty credit and commodity-related operational risk related to the competitive energy business within limitations established by senior management and in accordance with overall risk management ~~policies.~~framework established and overseen by the Company's board of directors (Board) and the sustainability and risk committee of the Board, as applicable. Interest rate risk is managed centrally by our treasury function. Market risks are monitored by risk management groups that operate independently of the wholesale commercial operations, utilizing defined practices and analytical methodologies. These techniques measure the risk of change in value of the portfolio of contracts and the hypothetical effect on this value from changes in market conditions and include, but are not limited to, position reporting and review, Value at Risk (VaR) methodologies and stress test scenarios. Key risk control activities include, but are not limited to, transaction review and approval (including credit review), operational and market risk measurement, transaction authority oversight, validation of transaction capture, market price validation and reporting, and portfolio valuation and reporting.

Commodity Price Risk

Our business is subject to the inherent risks of market fluctuations in the price of electricity, natural gas and other energy-related products it markets or purchases. We actively manage the portfolio of generation assets, fuel supply and retail sales load to mitigate the near-term impacts of these risks on results of operations. Similar to other participants in the market, we cannot fully manage the long-term value impact of structural declines or increases in natural gas and power prices.

In managing energy price risk, we enter into a variety of market transactions including, but not limited to, short- and long-term contracts for physical delivery, exchange-traded and over-the-counter financial contracts and bilateral contracts with customers. Activities include hedging, the structuring of long-term contractual arrangements and proprietary trading. We continuously monitor the valuation of identified risks and adjust positions based on current market conditions.

VaR Methodology — A VaR methodology is used to measure the amount of market risk that exists within the portfolio under a variety of market conditions. The resultant VaR produces an estimate of a portfolio's potential for loss given a specified confidence level and considers, among other things, market movements utilizing standard statistical techniques given historical and projected market prices and volatilities.

Parametric processes are used to calculate VaR and are considered by management to be the most effective way to estimate changes in a portfolio's value based on assumed market conditions for liquid markets. The use of this method requires a number of key assumptions, such as use of (i) an assumed confidence level, (ii) an assumed holding period (i.e., the time necessary for management action, such as to liquidate positions) and (iii) historical estimates of volatility and correlation data. The table below details a VaR measure related to various portfolios of contracts.

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VaR for Underlying Generation Assets and Energy-Related Contracts — This measurement estimates the potential loss in value, due to changes in market conditions, of all underlying generation assets and contracts, based on a 95% confidence level and an assumed holding period of 60 ~~days for a~~days. The forward period ~~through December 2020 for~~covered by this calculation includes the ~~six months ended June 30, 2019~~current and ~~December 2019 for~~subsequent calendar year at the ~~year ended December 31, 2018.~~time of calculation.


	Six Months Ended June 30, 2020		Year Ended December 31, 2019
Month-end average VaR	$	281	$	263
Month-end high VaR	$	361	$	520
Month-end low VaR	$	205	$	103

Six Months
Ended
June 30, 2019 Year Ended December 31, 2018
Month-end average VaR: $ 368
$ 182
Month-end high VaR: $ 520
$ 267
Month-end low VaR: $ 199
$ 65

The ~~increase~~VaR risk measures in 2020 were primarily comparable to the ~~month-end~~prior year. Month-end high VaR ~~risk measure~~was lower in ~~2019 is primarily driven by an increase~~2020 due to lower prices and a decrease in volatility in ERCOT ~~during~~as compared to the prior year.

Interest Rate Risk

At June 30, ~~2019,~~2020, the potential reduction of annual pretax earnings over the next twelve months due to a one percentage-point (100 basis points) increase in floating interest rates on long-term debt totaled approximately $5$13 million, taking into account the interest rate swaps discussed in Note 11 to Financial Statements.

Credit Risk

Credit risk relates to the risk of loss associated with nonperformance by counterparties. We minimize credit risk by evaluating potential counterparties, monitoring ongoing counterparty risk and assessing overall portfolio risk. This includes review of counterparty financial condition, current and potential credit exposures, credit rating and other quantitative and qualitative credit criteria. We also employ certain risk mitigation practices, including utilization of standardized master agreements that provide for netting and setoff rights, as well as credit enhancements such as margin deposits and customer deposits, letters of credit, parental guarantees and surety bonds. See Note 1615 to the Financial Statements for further discussion of this exposure.

Bankruptcies -— We are party to (i) certain gas transportation agreements with PG&E and (ii) a long-term ~~renewable power purchase agreement~~resource adequacy contract with PG&E in connection with the Moss Landing battery storage project, which was originally approved by the California Public Utilities Commission (CPUC) in November 2018. PG&E filed for Chapter 11 bankruptcy protection in January 2019. In November 2019, the bankruptcy court approved PG&E's motion requesting approval of the assumption of the resource adequacy contract subject to the CPUC approving the terms of an amendment to the resource adequacy contract, and the CPUC approved the terms of the amendment in January 2020. PG&E emerged from bankruptcy protection in July 2020.

As of June 30, ~~2019,~~2020, we had no outstanding accounts receivable from PG&E and accordingly, we have not recorded a reserve related to the pre-petition receivables. While our assumptions and conclusions may change, we could have future impairment losses or ~~specifically with respect to the gas transportation agreements,~~ be required to seek alternative, higher-cost fuel transportation methods if any of the terms of the ~~contracts~~gas transportation agreements are not honored by PG&E or the ~~contracts~~gas transportation agreements are rejected through the bankruptcy process.

Credit Exposure — Our gross credit exposure (excluding collateral impacts) associated with retail and wholesale trade accounts receivable and net derivative assets arising from commodity contracts and hedging and trading activities totaled ~~$1.131~~$1.394 billion at June 30, ~~2019.~~2020.

At June 30, ~~2019,~~2020, Retail segment credit exposure totaled ~~$742 million,~~$1.020 billion, including ~~$730 million~~$1.009 billion of trade accounts receivable and ~~$12~~$11 million related to derivative assets. Cash deposits and letters of credit held as collateral for these receivables totaled ~~$35~~$78 million, resulting in a net exposure of ~~$707~~$942 million. ~~We believe the risk of material loss (after consideration of bad debt allowances) from nonperformance by these customers is unlikely based upon historical experience.~~ Allowances for uncollectible accounts receivable are established for the potential loss from nonpayment by these customers based on historical experience, market or operational conditions and changes in the financial condition of large business customers.

At June 30, ~~2019,~~2020, aggregate ERCOT, PJM, NY/NE and MISO segments credit exposure totaled ~~$389~~$374 million including ~~$235~~$316 million related to derivative assets and ~~$154~~$58 million of trade accounts receivable, after taking into account master netting agreement provisions but excluding collateral impacts.

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Including collateral posted to us by counterparties, our net ERCOT, PJM, NY/NE and MISO segments exposure was ~~$381~~$365 million, substantially all of which is with investment grade customers as seen in the following table that presents the distribution of credit exposure at June 30, ~~2019.~~2020. Credit collateral includes cash and letters of credit but excludes other credit enhancements such as guarantees or liens on assets.


	Exposure Before Credit Collateral		Credit Collateral		Net Exposure
Investment grade	$	348	$	7	$	341
Below investment grade or no rating	26		2		24
Totals	$	374	$	9	$	365

Exposure
Before Credit
Collateral

Credit
Collateral

Net
Exposure
Investment grade $ 347
$ —
$ 347
Below investment grade or no rating 42
8
34
Totals $ 389
$ 8
$ 381

Significant ~~(10%~~(i.e., 10% or greater) concentration of credit exposure exists with ~~two~~three counterparties, which represented an aggregate ~~$162~~$218 million, or ~~43%~~60%, of the total net exposure. We view exposure to these counterparties to be within an acceptable level of risk tolerance due to the counterparties' credit ratings, each of which is rated as investment grade, the counterparties' market role and deemed creditworthiness and the importance of our business relationship with the counterparties. An event of default by one or more counterparties could subsequently result in termination-related settlement payments that reduce available liquidity if amounts such as margin deposits are owed to the counterparties or delays in receipts of expected settlements owed to us.

Contracts classified as "normal" purchase or sale and non-derivative contractual commitments are not marked-to-market in the financial statements and are excluded from the detail above. Such contractual commitments may contain pricing that is favorable considering current market conditions and therefore represent economic risk if the counterparties do not perform.

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FORWARD-LOOKING STATEMENTS

This report and other presentations made by us contain "forward-looking statements." All statements, other than statements of historical facts, that are included in this report, or made in presentations, in response to questions or otherwise, that address activities, events or developments that may occur in the future, including (without limitation) such matters as activities related to our financial or operational projections, capital allocation, capital expenditures, liquidity, dividend policy, business strategy, competitive strengths, goals, future acquisitions or dispositions, development or operation of power generation assets, market and industry developments and the growth of our businesses and operations (often, but not always, through the use of words or phrases such as "intends," "plans," "will likely," "unlikely," "expected," "anticipated," "estimated," "should," "may," "projection," "target," "goal," "objective" and "outlook"), are forward-looking statements. Although we believe that in making any such forward-looking statement our expectations are based on reasonable assumptions, any such forward-looking statement involves uncertainties and risks and is qualified in its entirety by reference to the discussion under Part II, Item ~~1A.~~1A Risk Factors and Part I, Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations in this quarterly report on Form 10-Q and the following important factors, among others, that could cause our actual results to differ materially from those projected in or implied by such forward-looking statements:

•the actions and decisions of judicial and regulatory authorities;

•prohibitions and other restrictions on our operations due to the terms of our agreements;

•prevailing federal, state and local governmental policies and regulatory actions, including those of the legislatures and other government actions of states in which we operate, the U.S. Congress, the FERC, the ~~North American Electric Reliability Corporation,~~NERC, the ~~Texas Reliability Entity, Inc.,~~TRE, the public utility commissions of states and locales in which we operate, CAISO, ERCOT, ISO-NE, MISO, NYISO, PJM, the RCT, the NRC, the EPA, the environmental regulatory bodies of states in which we operate, the ~~U.S. Mine Safety and Health Administration~~MSHA and the ~~U.S. Commodity Futures Trading Commission,~~CFTC, with respect to, among other things:


◦	~~allowed prices;~~


◦	~~industry, market and rate structure;~~


◦	~~purchased power and recovery of investments;~~


◦	~~operations of nuclear generation facilities;~~


◦	~~operations of fossil-fueled generation facilities;~~


◦	~~operations of mines;~~


◦	~~acquisition and disposal of assets and facilities;~~


◦	~~development, construction and operation of facilities;~~


◦	~~decommissioning costs;~~


◦	~~present or prospective wholesale and retail competition;~~


◦	~~changes in federal, state and local tax laws, rates and policies, including additional regulation, interpretations, amendments, or technical corrections to The Tax Cuts and Jobs Act of 2017;~~


◦	changes in and compliance with environmental and safety laws and policies, including National Ambient Air Quality Standards, the Cross-State Air Pollution Rule, the Mercury and Air Toxics Standard, regional haze program implementation and greenhouse gas and other climate change initiatives, and


◦	~~clearing over-the-counter derivatives through exchanges and posting of cash collateral therewith;~~

▪allowed prices;

▪industry, market and rate structure;

▪purchased power and recovery of investments;

▪operations of nuclear generation facilities;

▪operations of fossil-fueled generation facilities;

▪operations of mines;

▪acquisition and disposal of assets and facilities;

▪development, construction and operation of facilities;

▪decommissioning costs;

▪present or prospective wholesale and retail competition;

▪changes in federal, state and local tax laws, rates and policies, including additional regulation, interpretations, amendments, or technical corrections to The Tax Cuts and Jobs Act of 2017;

▪changes in and compliance with environmental and safety laws and policies, including the Coal Combustion Residuals Rule, National Ambient Air Quality Standards, the Cross-State Air Pollution Rule, the Mercury and Air Toxics Standard, regional haze program implementation and GHG and other climate change initiatives, and

▪clearing over-the-counter derivatives through exchanges and posting of cash collateral therewith;

•expectations regarding, or impacts of, environmental matters, including costs of compliance, availability and adequacy of emission credits, and the impact of ongoing proceedings and potential regulations or changes to current regulations, including those relating to climate change, air emissions, cooling water intake structures, coal combustion byproducts, and other laws and regulations that we are, or could become, subject to, which could increase our costs, result in an impairment of our assets, cause us to limit or terminate the operation of certain of our facilities, or otherwise have a negative financial effect;

•legal and administrative proceedings and settlements;

•general industry trends;

•economic conditions, including the impact of anany recession or economic downturn;

•pandemics (including COVID-19), weather conditions ~~including~~(including drought and limitations on access to ~~water,~~water), and other natural phenomena, and the financial and operational impacts related thereto;

•acts of sabotage, wars or terrorist or cybersecurity threats or activities;

•risk of contract performance claims by us or our counterparties, and risks of, or costs associated with, pursuing or defending such claims;

•our ability to collect trade receivables from ~~counterparties;~~counterparties in the amount or at the time expected, if at all;

•our ability to attract, retain and ~~retain profitable~~profitably serve customers;

•our ability to profitably serve our customers;

•restrictions on competitive retail ~~pricing;~~pricing or direct-selling businesses;

•adverse publicity associated with our retail products or direct selling businesses, including our ability to address the marketplace and regulators regarding our compliance with applicable laws;

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•changes in wholesale electricity prices or energy commodity prices, including the price of natural gas;

•changes in prices of transportation of natural gas, coal, fuel oil and other refined products;

•sufficiency of, access to, and costs associated with coal, fuel oil, and natural gas inventories and transportation and storage thereof;

•changes in the ability of vendors to provide or deliver commodities as needed;

•beliefs and assumptions about the benefits of state- or federal-based subsidies to our market competition, and the corresponding impacts on us, including if such subsidies are disproportionately available to our competitors;

•the effects of, or changes to, market design and the power and capacity procurement processes in the markets in which we operate;

•changes in market heat rates in the CAISO, ERCOT, ISO-NE, MISO, NYISO and PJM electricity markets;

•our ability to effectively hedge against unfavorable commodity prices, including the price of natural gas, market heat rates and interest rates;

•population growth or decline, or changes in market supply or demand and demographic patterns, particularly in ERCOT, MISO and PJM;

•our ability to mitigate forced outage risk, including managing risk associated with Capacity Performance in PJM and performance incentives in ISO-NE;

•efforts to identify opportunities to reduce congestion and improve busbar power prices;

•access to adequate transmission facilities to meet changing demands;

•changes in interest rates, commodity prices, rates of inflation or foreign exchange rates;

•changes in operating expenses, liquidity needs and capital expenditures;

•commercial bank market and capital market conditions and the potential impact of disruptions in U.S. and international credit markets;

•access to capital, the attractiveness of the cost and other terms of such capital and the success of financing and refinancing efforts, including availability of funds in capital markets;

•our ability to maintain prudent financial ~~leverage;~~leverage and achieve our capital allocation objectives;

•our ability to generate sufficient cash flow to make principal and interest payments in respect of, or refinance, our debt obligations;

•our expectation that we will continue to pay a comparable cash dividend on a quarterly basis;

•our ability to implement our growth strategy, including the completion and integration of mergers, acquisitions and/or joint venture activity and identification and completion of sales and divestitures activity;

•competition for new energy development and other business opportunities;

•inability of various counterparties to meet their obligations with respect to our financial instruments;

•counterparties' collateral demands and other factors affecting our liquidity position and financial condition;

•changes in technology (including large scale electricity storage) used by and services offered by us;

•changes in electricity transmission that allow additional power generation to compete with our generation assets;

•our ability to attract and retain qualified employees;

•significant changes in our relationship with our employees, including the availability of qualified personnel, and the potential adverse effects if labor disputes or grievances were to ~~occur;~~occur or changes in laws or regulations relating to independent contractor status;

•changes in assumptions used to estimate costs of providing employee benefits, including medical and dental benefits, pension and other postretirement employee benefits, and future funding requirements related thereto, including joint and several liability exposure under ERISA;

•hazards customary to the industry and the possibility that we may not have adequate insurance to cover losses resulting from such hazards;

•the impact of our obligations under the TRA;

•our ability to optimize our assets through targeted investment in cost-effective technology enhancements and operations performance initiatives;

•our ability to effectively and efficiently plan, prepare for and execute expected asset retirements and reclamation obligations and the impacts thereof;

•our ability to successfully complete the integration of ~~the~~ businesses ofacquired by Vistra ~~Energy and Dynegy and our ability to successfully capture the full amount of projected synergies relating to the Merger;~~

~~our ability to successfully integrate the Crius business~~ and our ability to successfully capture the full amount of projected operational and financial synergies relating to ~~the Crius Transaction,~~such transactions, and

•actions by credit rating agencies.

Table of Contents

Any forward-looking statement speaks only at the date on which it is made, and except as may be required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict them. In addition, we may be unable to assess the impact of any such event or condition or the extent to which any such event or condition, or combination of events or conditions, may cause results to differ materially from those contained in or implied by any forward-looking statement. As such, you should not unduly rely on such forward-looking statements.

INDUSTRY AND MARKET INFORMATION

Certain industry and market data and other statistical information used throughout this report are based on independent industry publications, government publications, reports by market research firms or other published independent sources, including certain data published by CAISO, ERCOT, ISO-NE, MISO, NYISO, PJM, the environmental regulatory bodies of states in which we operate and NYMEX. We did not commission any of these publications, reports or other sources. Some data is also based on good faith estimates, which are derived from our review of internal surveys, as well as the independent sources listed above. Industry publications, reports and other sources generally state that they have obtained information from sources believed to be reliable, but do not guarantee the accuracy and completeness of such information. While we believe that each of these studies, publications, reports and other sources is reliable, we have not independently investigated or verified the information contained or referred to therein and make no representation as to the accuracy or completeness of such information. Forecasts are particularly likely to be inaccurate, especially over long periods of time, and we do not know what assumptions were used in preparing such forecasts. Statements regarding industry and market data and other statistical information used throughout this report involve risks and uncertainties and are subject to change based on various factors.


~~Item 4.~~	~~CONTROLS AND PROCEDURES~~

Item 4.CONTROLS AND PROCEDURES

An evaluation was performed under the supervision and with the participation of our management, including the principal executive officer and principal financial officer, of the effectiveness of the design and operation of the disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15a-15(e) of the Exchange Act) in effect at June 30, 2020. On the ~~end~~Ambit Acquisition Date, we completed the Ambit Transaction. Vistra is currently in the process of integrating certain processes, technology and operations of Ambit, and will continue to evaluate the ~~current period included in this quarterly report on Form 10-Q.~~impact of any related changes to the internal control over financial reporting. Based on the evaluation performed, our principal executive officer and principal financial officer concluded that the disclosure controls and procedures were effective. During the fiscal quarter covered by this quarterly report on Form 10-Q, other than the changes resulting from the Ambit Transaction, there have been no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(e) and 15a-15(e) of the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Furthermore, with respect to the fiscal quarter covered by this quarterly report on Form 10-Q, we have not experienced any material impact to our internal controls over financial reporting due to the COVID-19 pandemic. We are continually monitoring and assessing the design and operating effectiveness of our internal controls in light of the COVID-19 situation and the fact that the majority of our employees that do not work in our power generation facilities are working remotely.

Table of Contents

PART II. OTHER INFORMATION


~~Item 1.~~	~~LEGAL PROCEEDINGS~~

Item 1.LEGAL PROCEEDINGS

Reference is made to the discussion in Note 1312 to the Financial Statements regarding legal proceedings.


~~Item 1A.~~	~~RISK FACTORS~~

Item 1A.RISK FACTORS

There have been no material changes to ~~the~~our risk factors ~~discussed~~disclosed in ~~Part I, Item 1A.~~our 2019 Form 10-K, except as set forth below.

The outbreak of COVID-19, or the future outbreak of any other highly infectious or contagious diseases, could have a material and adverse effect on our business, financial condition, and results of operations.

The outbreak of the COVID-19 pandemic has adversely impacted economic activity and conditions worldwide, and we are responding to the outbreak by taking steps to mitigate the potential risks to us posed by its spread.We continue to examine the impacts of the pandemic on our workforce, liquidity, reliability, cybersecurity, customers, suppliers, along with other macroeconomic conditions and cannot currently predict whether COVID-19 will have a material impact on our results of operations, financial condition, and cash flows.

Because we are deemed a critical infrastructure provider that provides a critical service to our customers, we must keep our employees who operate our businesses safe and minimize unnecessary risk of exposure.We have updated and implemented our company-wide pandemic plan to address specific aspects of the COVID-19 pandemic.This plan guides our emergency response, business continuity, and the precautionary measures we are taking on behalf of employees and the public.We will continue to monitor developments affecting both our workforce and our customers, and we will take additional precautions that we determine are necessary in order to mitigate the impacts.In particular, we have taken extra precautions for our employees who work in the field and for employees who continue to work in our facilities including requiring, for both employees and contractors, social distancing where possible and requiring the use of appropriate personal protective equipment in certain circumstances.We have implemented work-from-home policies and other safety measures where appropriate, including, but not limited to, temperature testing at all of our locations for employees, contractors, and other essential visitors and closing our facilities to non-essential visitors.While our systems and operations remain vulnerable to cyber-attacks and other disruptions due in part to the fact that a portion of our workforce continues to work remotely, we have implemented physical and cyber-security measures to ensure that our systems remain functional in order to both serve our operational needs with a remote workforce and keep them running to ensure uninterrupted service to our customers.We will continue to review and modify our plans as conditions change.

Measures to control the spread of COVID-19, including restrictions on travel, public gatherings, and certain business operations, have affected the demand for the products and services of many businesses in the areas in which we operate and disrupted supply chains around the world.The full scope and extent of the impacts of COVID-19 on our operations are unknown at this time.However, COVID-19 or another pandemic could have material and adverse effects on our results of operations, financial condition and cash flows due to, among other factors, a protracted slowdown of broad sectors of the economy, changes in demand or supply for commodities, significant changes in legislation or regulatory policy to address the pandemic (including moratoriums or conditions or disconnections and limits or restrictions or late fees), reduced demand for electricity (particularly from commercial and industrial customers), increased late or uncollectible customer payments, and the inability of the Company's contractors, suppliers, and other business partners to fulfill their contractual obligations.

Despite our efforts to manage these impacts to the Company, their ultimate impact also depends on factors beyond our knowledge or control, including the duration and severity of this outbreak as well as third-party actions taken to contain its spread and mitigate its public health effects.To the extent COVID-19 adversely affects our business and financial results, it may also have the effect of hastening, heightening, or increasing the negative impacts of, many of the other risks described in this Risk Factors section and in our ~~annual report on~~2019 Form 10-K for the year ended December 31, 2018. Our business operations could also be affected by additional factors that are not presently known to us or that we currently consider to be immaterial to our operations.10-K.

Table of Contents


~~Item 2.~~	~~UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS~~

Item 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table provides information about our repurchase of equity securities that are registered by us pursuant to Section 12 of the Exchange Act during the quarter ended June 30, ~~2019.~~2020.


	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of a Publicly Announced Program	Maximum Dollar Amount of Shares that may yet be Purchased under the Program (in millions)
April 1 - April 30, 2020	—	$	—	—	$	332
May 1 - May 31, 2020	—	$	—	—	$	332
June 1 - June 30, 2020	—	$	—	—	$	332
For the quarter ended June 30, 2020	—	$	—	—	$	332

Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of a Publicly Announced Program Maximum Dollar Amount of Shares that may yet be Purchased under the Program (in millions)
April 1 - April 30, 2019 1,711,887
$ 26.17
1,711,887
$ 691
May 1 - May 31, 2019 3,352,842
$ 24.92
3,352,842
$ 608
June 1 - June 30, 2019 3,493,983
$ 23.81
3,493,983
$ 524
For the quarter ended June 30, 2019 8,558,712
$ 24.72
8,558,712
$ 524

In June 2018, we announced that the Board had authorized a share repurchase program under which up to $500 million of our outstanding common stock may be purchased, and in November 2018, we announced that the Board had authorized an incremental share repurchase program under which up to $1.250 billion of our outstanding stock may be purchased, resulting in an aggregate $1.750 billion share repurchase ~~program. We intend~~program (Share Repurchase Program). The Share Repurchase Program has no set expiration date and will continue until complete or terminated by the Board. At June 30, 2020, $332 million was available for additional repurchases under the Share Repurchase Program. See Note 13 to ~~implement~~ the ~~program opportunistically from time to time in 2019 and 2020.~~Financial Statements for more information concerning the Share Repurchase Program.

~~Shares~~Any purchases of shares of the Company's stock will be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions, pursuant to plans complying with ~~Rule 10b5-1 and 10b-18 under~~ the Exchange Act ~~of 1934~~ or by other means in accordance with federal securities laws. The actual timing, number and value of shares repurchased under the Share Repurchase Program or otherwise will be determined at our discretion and will depend on a number of factors, including our capital allocation priorities, the market price of our stock, general market and economic conditions, applicable legal requirements and compliance with the terms of our debt ~~agreements.~~agreements and the Tax Matters Agreement.

Item 3.DEFAULTS UPON SENIOR SECURITIES


~~Item 3.~~	~~DEFAULTS UPON SENIOR SECURITIES~~

None.

Item 4. MINE SAFETY DISCLOSURES


~~Item 4.~~	~~MINE SAFETY DISCLOSURES~~

Vistra ~~Energy~~ currently owns and operates, or is in the process of reclaiming, 12 surface lignite coal mines in Texas to provide fuel for its electricity generation facilities. Vistra ~~Energy~~ also owns or leases, and is in the process of reclaiming, two waste-to-energy surface facilities in Pennsylvania. These mining operations are regulated by the ~~U.S. Mine Safety and Health Administration (MSHA)~~MSHA under the Federal Mine Safety and Health Act of 1977, as amended (the Mine Act), as well as other federal and state regulatory agencies such as the RCT and Office of Surface Mining. The MSHA inspects U.S. mines, including ~~Vistra Energy's~~Vistra's mines, on a regular basis, and if it believes a violation of the Mine Act or any health or safety standard or other regulation has occurred, it may issue a citation or order, generally accompanied by a proposed fine or assessment. Such citations and orders can be contested and appealed, which often results in a reduction of the severity and amount of fines and assessments and sometimes results in dismissal. Disclosure of MSHA citations, orders and proposed assessments are provided in Exhibit 95.1 to this quarterly report on Form 10-Q.

Item 5.OTHER INFORMATION

None

Table of Contents

Item 6. EXHIBITS

(a) Exhibits filed or furnished as part of Part II are:


Exhibits	Previously Filed With File Number*	As Exhibit

(3(i))	Articles of Incorporation

3.1	001-38086 Form 8-K (filed May 4, 2020)	3.1	—	Restated Certificate of Incorporation of Vistra Energy Corp.

3.2	001-38086 Form 8-K (filed June 29, 2020)	3.1	—	Certificate of Amendment to Restated Certificate of Incorporation of Vistra Corp., effective July 2, 2020

(3(ii))	Bylaws

3.2	001-38086 Form 8-K (filed June 29, 2020)	3.2	—	Restated Bylaws of Vistra Corp., effective July 2, 2020

(4)	Instruments Defining the Rights of Security Holders, Including Indentures

4.1	001-38086 Form 8-K (filed July 16, 2020)	4.1	—	Fifth Amendment to Receivables Purchase Agreement, dated as of July 13, 2020, among TXU Energy Receivables Company LLC, as seller, TXU Energy Retail Company LLC, as servicer, Vistra Operations Company LLC, as performance guarantor, certain purchaser agents and purchasers named therein and Credit Agricole Corporate and Investment Bank, as administrator





(31)	Rule 13a-14(a) / 15d-14(a) Certifications

31.1	**		—	Certification of Curtis A. Morgan, principal executive officer of Vistra Corp., pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2	**		—	Certification of David A. Campbell, principal financial officer of Vistra Corp., pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(32)	Section 1350 Certifications

32.1	***		—	Certification of Curtis A. Morgan, principal executive officer of Vistra Corp., pursuant to U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2	***		—	Certification of David A. Campbell, principal financial officer of Vistra Corp., pursuant to U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(95)	Mine Safety Disclosures

95.1	**		—	Mine Safety Disclosures

Table of Contents

~~Item 5.~~Exhibits

~~OTHER INFORMATION~~

~~None~~

Previously Filed With File Number*

Exhibit


~~Item 6.~~			~~EXHIBITS~~

XBRL Data Files

~~(a)~~

~~Exhibits filed or furnished as part of Part II are:~~

Exhibits Previously Filed With File Number*
As
Exhibit

(4) Instruments Defining the Rights of Security Holders, Including Indentures

4.1
001-38086
Form 8-K
(filed June 17, 2019)
4.1 —
Indenture, dated as of June 11, 2019, between Vistra Operations Company LLC, as Issuer, the and Wilmington Trust, National Association, as Trustee.

4.2
001-38086
Form 8-K
(filed June 17, 2019)
4.2 —
Supplemental Indenture for 3.55% Senior Secured Notes due 2024 and 4.30% Senior Secured Notes Due 2029, dated as of June 11, 2019, among Vistra Operations Company LLC, as Issuer, the Subsidiary Guarantors (as defined therein), and Wilmington Trust, National Association, as Trustee.

4.3
001-38086
Form 8-K
(filed June 17, 2019)
4.3 —
Form of Rule 144A Global Security for 3.55% Senior Notes due 2024 (included in Exhibit 4.2).

4.4
001-38086
Form 8-K
(filed June 17, 2019)
4.4 —
Form of Rule 144A Global Security for 4.30% Senior Notes due 2029 (included in Exhibit 4.2).

4.5
001-38086
Form 8-K
(filed June 17, 2019)
4.5 —
Form of Regulation S Global Security for 3.55% Senior Notes due 2024 (included in Exhibit 4.2).

4.6
001-38086
Form 8-K
(filed June 17, 2019)
4.6 —
Form of Regulation S Global Security for 4.30% Senior Notes due 2029 (included in Exhibit 4.2).

4.7
001-38086
Form 8-K
(filed June 24, 2019)
4.1 —
Indenture for 5.00% Senior Notes due 2027, dated as of June 21, 2019, among Vistra Operations Company LLC, as Issuer, the Subsidiary Guarantors (as defined therein), and Wilmington Trust, National Association, as Trustee.

4.8
001-38086
Form 8-K
(filed June 24, 2019)
4.2 —
Form of Rule 144A Global Security for 5.00% Senior Notes due 2027 (included in Exhibit 4.1).

4.9
001-38086
Form 8-K
(filed June 24, 2019)
4.3 —
Form of Regulation S Global Security for 5.00% Senior Notes due 2027 (included in Exhibit 4.1).

4.10
001-38086
Form 8-K
(filed April 5, 2019)
4.1 —
First Amendment to Purchase and Sale Agreement, dated as of April 1, 2019, among TXU Energy Retail Company LLC, Dynegy Energy Services, LLC, and Dynegy Energy Services (East), LLC, each as an originator, and TXU Energy Receivables Company LLC, as purchaser

4.11
001-38086
Form 8-K
(filed April 5, 2019)
4.2 —
First Amendment to Receivables Purchase Agreement, dated as of April 1, 2019, among TXU Energy Receivables Company LLC, as seller, TXU Energy Retail Company LLC, as servicer, Vistra Operations Company LLC, as performance guarantor, certain purchaser agents and purchasers named therein and Credit Agricole Corporate and Investment Bank, as administrator

4.12 ** —
Second Amendment to Purchase and Sale Agreement, dated as of June 3, 2019, among TXU Energy Retail Company LLC, Dynegy Energy Services, LLC, and Dynegy Energy Services (East), LLC, each as an originator, and TXU Energy Receivables Company LLC, as purchaser

Exhibits Previously Filed With File Number*
As
Exhibit

4.13 ** —
Second Amendment to Receivables Purchase Agreement, dated as of June 3, 2019, among TXU Energy Receivables Company LLC, as seller, TXU Energy Retail Company LLC, as servicer, Vistra Operations Company LLC, as performance guarantor, certain purchaser agents and purchasers named therein and Credit Agricole Corporate and Investment Bank, as administrator

4.14
001-38086
Form 8-K
(filed July 19, 2019)
4.1 —
Third Amendment to Purchase and Sale Agreement, dated as of July 15, 2019, among TXU Energy Retail Company LLC, Dynegy Energy Services, LLC, and Dynegy Energy Services (East), LLC, each as an originator, and TXU Energy Receivables Company LLC, as purchaser

4.15
001-38086
Form 8-K
(filed July 19, 2019)
4.2 —
Third Amendment to Receivables Purchase Agreement, dated as of July 15, 2019, among TXU Energy Receivables Company LLC, as seller, TXU Energy Retail Company LLC, as servicer, Vistra Operations Company LLC, as performance guarantor, certain purchaser agents and purchasers named therein and Credit Agricole Corporate and Investment Bank, as administrator

(10) Material Contracts

10.1
001-38086
Form 8-K
(filed May 29, 2019)
10.1 —
Ninth Amendment to Credit Agreement, dated May 29, 2019, by and among Vistra Operations Company LLC, Vistra Intermediate Company LLC, the other Credit Parties (as defined in the Vistra Operations Credit Agreement) party thereto, Sun Trust Bank, as incremental Revolving Loan Lender, and Credit Suisse AG, Cayman Island Branch, as Administrative Agent and Collateral Agent

10.2
001-38086
Form 8-K
(filed June 7, 2019)
10.1 —
Purchase Agreement, dated June 4, 2019, by and among Vistra Operations Company LLC and Citigroup Global Markets Inc., on behalf of itself and the several Initial Purchasers named in Schedule I to the Purchase Agreement

10.3
001-38086
Form 8-K
(filed June 7, 2019)
10.2 —
Purchase Agreement, dated June 6, 2019, by and among Vistra Operations Company LLC and Goldman Sachs & Co. LLC, on and behalf of itself and the several Initial Purchasers named in Schedule I to the Purchase Agreement

10.4
001-38086
Form 8-K
(filed May 23, 2019)
10.1 —
Amended and Restated 2016 Omnibus Incentive Plan, effective as of May 20, 2019

10.5
001-38086
Form 10-Q (Quarter ended March 31, 2019)
(filed May 3, 2019)
10.5 —
Amended and Restated Employment Agreement, dated May 1, 2019, between the Company and James A. Burke

10.6
001-38086
Form 8-K
(filed May 28, 2019)
10.1 —
Employment Agreement, dated May 28, 2019, by and between the Company and David Campbell

(31) Rule 13a-14(a) / 15d-14(a) Certifications

31.1 ** —
Certification of Curtis A. Morgan, principal executive officer of Vistra Energy Corp., pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2 ** —
Certification of David A. Campbell, principal financial officer of Vistra Energy Corp., pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(32) Section 1350 Certifications

32.1 *** —
Certification of Curtis A. Morgan, principal executive officer of Vistra Energy Corp., pursuant to U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

~~Exhibits~~101.INS

Previously Filed With File Number***

~~Exhibit~~

—

The following financial information from Vistra Corp.'s Quarterly Report on Form 10-Q for the period ended June 30, 2020 formatted in Inline XBRL (Extensible Business Reporting Language) includes: (i) the Condensed Consolidated Statements of Operations, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Statements of Cash Flows, (iv) the Condensed Consolidated Balance Sheets and (v) the Notes to the Condensed Consolidated Financial Statements

~~32.2~~

~~***~~

—

~~Certification of David A. Campbell, principal financial officer of Vistra Energy Corp., pursuant to U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002~~

101.SCH

—

XBRL Taxonomy Extension Schema Document

~~(95)~~

~~Mine Safety Disclosures~~

101.CAL

—

XBRL Taxonomy Extension Calculation Linkbase Document

~~95.1~~

—

~~Mine Safety Disclosures~~

101.DEF

—

XBRL Taxonomy Extension Definition Linkbase Document

~~XBRL Data Files~~

101.LAB

—

XBRL Taxonomy Extension Label Linkbase Document

~~101.INS~~

—

101.PRE

—

XBRL Taxonomy Extension Presentation Linkbase Document

104

—

The ~~XBRL Instance Document~~Cover Page Interactive Data File does not appear in ~~the Interactive Data File~~Exhibit 104 because its XBRL tags are embedded within the Inline XBRL ~~document.~~

~~101.SCH~~

—

~~XBRL Taxonomy Extension Schema Document~~

~~101.CAL~~

—

~~XBRL Taxonomy Extension Calculation Document~~

~~101.DEF~~

—

~~XBRL Taxonomy Extension Definition Document~~

~~101.LAB~~

—

~~XBRL Taxonomy Extension Labels Document~~

~~101.PRE~~

—

~~XBRL Taxonomy Extension Presentation Document~~document

____________________


*	~~Incorporated herein by reference~~


**	~~Filed herewith~~


~~***~~	~~Furnished herewith~~

* Incorporated herein by reference

** Filed herewith

*** Furnished herewith

**** Indicates a management contract or compensatory plan or arrangement.

Table of Contents

SIGNATURE

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.

Vistra Corp.

By:

~~Vistra Energy Corp.~~

~~By:~~

/s/ CHRISTY DOBRY

Name:

Christy Dobry

Title:

Vice President and Controller

(Principal Accounting Officer)

Date: August 5, 2020

~~Date:~~ ~~August 2, 2019~~



Delaware				36-4833255
(State or other jurisdiction of incorporation or organization)				(I.R.S. Employer Identification No.)

6555 Sierra Drive	Irving,	Texas	75039	(214)	812-4600
(Address of Principal Executive Offices) (Zip Code)				(Registrant's telephone number, including area code)


		PAGE
GLOSSARY		ii
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Statements of ~~Consolidated Income (Loss)~~Operations — Three and Six Months Ended June 30 , 2020 and 2019 ~~and 2018~~	1
	Condensed Consolidated Statements of ~~Consolidated~~ Comprehensive Income ~~(Loss)~~ — Three and Six Months Ended June 30 , 2020 and 2019 ~~and 2018~~	1
	Condensed Consolidated Statements of ~~Consolidated~~ Cash Flows — Six Months Ended June ~~30, 2019~~ 3 0 , 2020 and ~~2018~~2019	2
	Condensed Consolidated Balance Sheets — June 30 ~~2019~~, 2020 and December 31, ~~2018~~2019	3
	Notes to Condensed Consolidated Financial Statements	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	6247
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	8770
Item 4.	Controls and Procedures	9275
PART II.	OTHER INFORMATION	9376
Item 1.	Legal Proceedings	9376
Item 1A.	Risk Factors	9376
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	9377
Item 3.	Defaults Upon Senior Securities	9377
Item 4.	Mine Safety Disclosures	9477
Item 5.	Other Information	9477
Item 6.	Exhibits	9577
SIGNATURE		9880


6.Balance at December 31, 2019	~~GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS AND LIABILITIES~~$	2,553
Measurement period adjustments recorded in connection with the Ambit Transaction	29
Measurement period adjustments recorded in connection with the Crius Transaction	(14)
Balance at June 30, 2020	$	2,568


	June 30, 2019			December 31, 2018				June 30, 2020		December 31, 2019
Vistra Operations Credit Facilities	$	3,798		$	5,813		Vistra Operations Credit Facilities	$	2,586	$	2,700
Vistra Operations Senior Secured Notes:							Vistra Operations Senior Secured Notes:
3.550% Senior Secured Notes, due July 15, 2024	1,200			—			3.550% Senior Secured Notes, due July 15, 2024	1,500		1,500
3.700% Senior Secured Notes, due January 30, 2027							3.700% Senior Secured Notes, due January 30, 2027	800		800
4.300% Senior Secured Notes, due July 15, 2029	800			—			4.300% Senior Secured Notes, due July 15, 2029	800		800
Total Vistra Operations Senior Secured Notes	2,000			—			Total Vistra Operations Senior Secured Notes	3,100		3,100
Vistra Operations Senior Unsecured Notes:							Vistra Operations Senior Unsecured Notes:
5.500% Senior Notes, due September 1, 2026	1,000			1,000
5.625% Senior Notes, due February 15, 2027	1,300			—
5.000% Senior Notes, due July 31, 2027	1,300			—
5.500% Senior Unsecured Notes, due September 1, 2026							5.500% Senior Unsecured Notes, due September 1, 2026	1,000		1,000
5.625% Senior Unsecured Notes, due February 15, 2027							5.625% Senior Unsecured Notes, due February 15, 2027	1,300		1,300
5.000% Senior Unsecured Notes, due July 31, 2027							5.000% Senior Unsecured Notes, due July 31, 2027	1,300		1,300
Total Vistra Operations Senior Unsecured Notes	3,600			1,000			Total Vistra Operations Senior Unsecured Notes	3,600		3,600
Vistra Energy Senior Unsecured Notes:
7.375% Senior Notes, due November 1, 2022	306			1,707
5.875% Senior Notes, due June 1, 2023	500			500
7.625% Senior Notes, due November 1, 2024	475			1,147
8.034% Senior Notes, due February 2, 2024	—			25
8.000% Senior Notes, due January 15, 2025	81			81
8.125% Senior Notes, due January 30, 2026	166			166
Total Vistra Energy Senior Unsecured Notes	1,528			3,626
Vistra Senior Unsecured Notes:							Vistra Senior Unsecured Notes:
5.875% Senior Unsecured Notes, due June 1, 2023							5.875% Senior Unsecured Notes, due June 1, 2023	—		500
8.000% Senior Unsecured Notes, due January 15, 2025							8.000% Senior Unsecured Notes, due January 15, 2025	—		81
8.125% Senior Unsecured Notes, due January 30, 2026 (a)							8.125% Senior Unsecured Notes, due January 30, 2026 (a)	166		166
Total Vistra Senior Unsecured Notes							Total Vistra Senior Unsecured Notes	166		747
Other:							Other:
7.000% Amortizing Notes, due July 1, 2019	8			24
Forward Capacity Agreements	222			236			Forward Capacity Agreements	101		161
Equipment Financing Agreements	114			120			Equipment Financing Agreements	91		99
Mandatorily redeemable subsidiary preferred stock (a)	70			70
8.82% Building Financing due semiannually through February 11, 2022 (b)	18			21			8.82% Building Financing due semiannually through February 11, 2022 (b)	13		15
Other							Other	4		12
Total other long-term debt	432			471			Total other long-term debt	209		287
Unamortized debt premiums, discounts and issuance costs (c)	(4		)	155			Unamortized debt premiums, discounts and issuance costs (c)	(63)		(55)
Total long-term debt including amounts due currently	11,354			11,065			Total long-term debt including amounts due currently	9,598		10,379
Less amounts due currently	(161		)	(191		)	Less amounts due currently	(337)		(277)
Total long-term debt less amounts due currently	$	11,193		$	10,874		Total long-term debt less amounts due currently	$	9,261	$	10,102


		June 30, 2019								June 30, 2020
Vistra Operations Credit Facilities	Maturity Date	Facility Limit		Cash Borrowings		Available Capacity		Vistra Operations Credit Facilities	Maturity Date	Facility Limit		Cash Borrowings		Available Capacity
Revolving Credit Facility (a)	June 14, 2023	$	2,725	$	—	$	2,173	Revolving Credit Facility (a)	June 14, 2023	$	2,725	$	550	$	1,287
Term Loan B-1 Facility	August 4, 2023	1,897		1,897		—
Term Loan B-3 Facility	December 31, 2025	1,901		1,901		—		Term Loan B-3 Facility	December 31, 2025	2,586		2,586		—
Total Vistra Operations Credit Facilities		$	6,523	$	3,798	$	2,173	Total Vistra Operations Credit Facilities		$	5,311	$	3,136	$	1,287



☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



	December 31, 2018			Adoption of New Lease Standard			January 1, 2019
Impact on condensed consolidated balance sheet:
Assets
Property, plant and equipment — net	$	14,612		$	15		$	14,627
Operating lease right-of-use assets	—			70			70
Prepaid expense and other current assets	152			(2		)	150
Accumulated deferred income taxes	1,336			1			1,337
Liabilities
Other current liabilities	345			(1		)	344
Operating lease liabilities	—			109			109
Identifiable intangible liabilities	401			(36		)	365
Other noncurrent liabilities and deferred credits	340			14			354
Equity
Retained deficit	(1,449		)	(2		)	(1,451		)



Dynegy shares outstanding as of April 9, 2018 (in millions)	144.8
Exchange Ratio	0.652
Vistra Energy shares issued for Dynegy shares outstanding (in millions)	94.4
Opening price of Vistra Energy common stock on April 9, 2018	$	19.87
Purchase price for common stock	$	1,876
Fair value of equity component of tangible equity units	$	369
Fair value of outstanding stock compensation awards attributable to pre-combination service	$	26
Fair value of outstanding warrants	$	2
Total purchase price	$	2,273



Final Purchase Price Allocation
Cash and cash equivalents	$	445
Trade accounts receivables, inventories, prepaid expenses and other current assets	853
Property, plant and equipment	10,535
Accumulated deferred income taxes	518
Identifiable intangible assets	351
Goodwill	175
Other noncurrent assets	419
Total assets acquired	13,296
Trade accounts payable and other current liabilities	733
Commodity and other derivative contractual assets and liabilities, net	422
Asset retirement obligations, including amounts due currently	475
Long-term debt, including amounts due currently	8,919
Other noncurrent liabilities	469
Total liabilities assumed	11,018
Identifiable net assets acquired	2,278
Noncontrolling interest in subsidiary	5
Total purchase price	$	2,273



	Six Months Ended June 30, 2018
Revenues	$	4,789
Net loss	$	(439	)
Net loss attributable to Vistra Energy	$	(435	)
Net loss attributable to Vistra Energy per weighted average share of common stock outstanding — basic	$	(0.83	)
Net loss attributable to Vistra Energy per weighted average share of common stock outstanding — diluted	$	(0.83	)



Name	Location (all in the state of Texas)	Fuel Type	Installed Nameplate Generation Capacity (MW)	Number of Units	Date Units Taken Offline
Monticello	Titus County	Lignite/Coal	1,880	3	January 4, 2018
Sandow	Milam County	Lignite	1,137	2	January 11, 2018
Big Brown	Freestone County	Lignite/Coal	1,150	2	February 12, 2018
Total			4,167	7


~~(a)~~	~~Includes $538 million of unrealized net gains from mark-to-market valuations of commodity positions. See Note 18 for unrealized net gains (losses) by segment.~~


	Three Months Ended June 30, 2018																								Three Months Ended June 30, 2019
	Retail			ERCOT		PJM			NY/NE			MISO			Asset Closure			CAISO/Eliminations			Consolidated				Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		CAISO/Eliminations		Consolidated
Revenue from contracts with customers:																								Revenue from contracts with customers:
Retail energy charge in ERCOT	$	1,111		$	—	$	—		$	—		$	—		$	—		$	—		$	1,111		Retail energy charge in ERCOT	$	1,091	$	—	$	—	$	—	$	—	$	—	$	—	$	1,091
Retail energy charge in Northeast/Midwest	336			—		—			—			—			—			—			336			Retail energy charge in Northeast/Midwest	315		—		—		—		—		—		—		315

Wholesale generation revenue from ISO/RTO	—			208		367			118			180			15			13			901			Wholesale generation revenue from ISO/RTO	—		188		130		81		33		43		22		497
Capacity revenue	—			—		119			82			29			10			11			251
Capacity revenue from ISO/RTO																								Capacity revenue from ISO/RTO	—		—		53		72		8		3		—		136
Revenue from other wholesale contracts	—			50		8			6			12			—			2			78			Revenue from other wholesale contracts	—		52		87		6		40		1		4		190
Total revenue from contracts with customers	1,447			258		494			206			221			25			26			2,677			Total revenue from contracts with customers	1,406		240		270		159		81		47		26		2,229
Other revenues:																								Other revenues:
Intangible amortization	(15		)	—		—			(2		)	(6		)	—			—			(23		)	Intangible amortization	(10)		—		—		(1)		(4)		—		1		(14)
Hedging and other revenues (a)	22			229		(161		)	(29		)	(121		)	(25		)	5			(80		)	Hedging and other revenues (a)	25		404		81		61		15		11		20		617
Affiliate sales	—			840		152			12			163			21			(1,188		)	—			Affiliate sales	—		1,027		335		35		96		—		(1,493)		—
Total other revenues	7			1,069		(9		)	(19		)	36			(4		)	(1,183		)	(103		)	Total other revenues	15		1,431		416		95		107		11		(1,472)		603
Total revenues	$	1,454		$	1,327	$	485		$	187		$	257		$	21		$	(1,157	)	$	2,574		Total revenues	$	1,421	$	1,671	$	686	$	254	$	188	$	58	$	(1,446)	$	2,832


~~(a)~~	~~Includes $203 million of unrealized net gains from mark-to-market valuations of commodity positions. See Note 18 for unrealized net gains (losses) by segment.~~


5.	~~REVENUE~~


~~(a)~~	~~Includes $697 million of unrealized net gains from mark-to-market valuations of commodity positions. See Note 18 for unrealized net gains (losses) by segment.~~


	Six Months Ended June 30, 2018																									Six Months Ended June 30, 2020
	Retail			ERCOT			PJM			NY/NE			MISO			Asset Closure			CAISO/Eliminations			Consolidated				Retail		ERCOT		PJM		NY/NE		MISO		Asset Closure		CAISO/Eliminations		Consolidated
Revenue from contracts with customers:																									Revenue from contracts with customers:
Retail energy charge in ERCOT	$	2,059		$	—		$	—		$	—		$	—		$	—		$	—		$	2,059		Retail energy charge in ERCOT	$	2,665	$	—	$	—	$	—	$	—	$	—	$	—	$	2,665
Retail energy charge in Northeast/Midwest	336			—			—			—			—			—			—			336			Retail energy charge in Northeast/Midwest	1,180		—		—		—		—		—		—		1,180
Wholesale generation revenue from ISO/RTO	—			383			367			118			180			51			13			1,112			Wholesale generation revenue from ISO/RTO	—		174		148		58		17		—		46		443
Capacity revenue	—			—			119			82			29			10			11			251
Capacity revenue from ISO/RTO																									Capacity revenue from ISO/RTO	—		—		30		35		9		—		—		74
Revenue from other wholesale contracts	—			102			8			6			12			1			2			131			Revenue from other wholesale contracts	—		113		288		38		103		—		25		567
Total revenue from contracts with customers	2,395			485			494			206			221			62			26			3,889			Total revenue from contracts with customers	3,845		287		466		131		129		—		71		4,929
Other revenues:																									Other revenues:
Intangible amortization	(27		)	(1		)	—			(2		)	(6		)	—			—			(36		)	Intangible amortization	(8)		—		—		—		(11)		—		—		(19)
Hedging and other revenues (a)	58			(233		)	(161		)	(29		)	(121		)	(34		)	5			(515		)	Hedging and other revenues (a)	27		313		32		29		2		—		54		457
Affiliate sales	—			543			152			12			163			21			(891		)	—			Affiliate sales	—		1,131		562		257		143		—		(2,093)		—
Total other revenues	31			309			(9		)	(19		)	36			(13		)	(886		)	(551		)	Total other revenues	19		1,444		594		286		134		—		(2,039)		438
Total revenues	$	2,426		$	794		$	485		$	187		$	257		$	49		$	(860	)	$	3,338		Total revenues	$	3,864	$	1,731	$	1,060	$	417	$	263	$	—	$	(1,968)	$	5,367


~~(a)~~	~~Includes $208 million of unrealized net losses from mark-to-market valuations of commodity positions. See Note 18 for unrealized net gains (losses) by segment.~~


	June 30, 2020		December 31, 2019
Trade accounts receivable from contracts with customers — net	$	1,197	$	1,246
Other trade accounts receivable — net	75		119
Total trade accounts receivable — net	$	1,272	$	1,365


	June 30, 2020										December 31, 2019
Identifiable Intangible Asset	Gross Carrying Amount		Accumulated Amortization		Net		Gross Carrying Amount		Accumulated Amortization		Net
Retail customer relationship	$	2,087	$	1,302	$	785	$	2,078	$	1,151	$	927
Software and other technology-related assets	364		151		213		341		125		216
Retail and wholesale contracts	272		195		77		315		182		133
Contractual service agreements (a)	55		2		53		59		5		54
Other identifiable intangible assets (b)	45		17		28		40		15		25
Total identifiable intangible assets subject to amortization	$	2,823	$	1,667	1,156		$	2,833	$	1,478	1,355
Retail trade names (not subject to amortization)					1,374						1,391
Mineral interests (not currently subject to amortization)					2						2
Total identifiable intangible assets					$	2,532					$	2,748


~~(a)~~	At June 30, 2019, amounts related to contractual service agreements that have become liabilities due to amortization of the economic impacts of the intangibles have been removed from both the gross carrying amount and accumulated amortization.


~~(b)~~	~~Includes mining development costs and environmental allowances and credits.~~


Identifiable Intangible Liability	June 30, 2020		December 31, 2019
Contractual service agreements	$	127	$	110
Purchase and sale of power and capacity	92		100
Fuel and transportation purchase contracts	75		76
Total identifiable intangible liabilities	$	294	$	286



Identifiable Intangible Assets and Liabilities	Condensed Statements of Consolidated Income (Loss) Line	Three Months Ended June 30,				Six Months Ended June 30,
Identifiable Intangible Assets and Liabilities	Condensed Statements of Consolidated Income (Loss) Line	2019		2018		2019		2018
Retail customer relationship	Depreciation and amortization	$	55	$	77	$	111	$	150
Software and other technology-related assets	Depreciation and amortization	15		19		29		30
Retail and wholesale contracts/purchase and sale contracts	Operating revenues/fuel, purchased power costs and delivery fees	12		23		24		32
Other identifiable intangible assets	Operating revenues/fuel, purchased power costs and delivery fees/depreciation and amortization	15		2		39		3
Total amortization expense (a)		$	97	$	121	$	203	$	215


Identifiable Intangible Assets and Liabilities	Condensed Consolidated Statements of Operations	Three Months Ended June 30,						Six Months Ended June 30,
				2020		2019		2020		2019
Retail customer relationship	Depreciation and amortization	$	77	$	55	$	151	$	111
Software and other technology-related assets	Depreciation and amortization	21		15		38		29
Retail and wholesale contracts/purchase and sale/fuel and transportation contracts	Operating revenues/fuel, purchased power costs and delivery fees	13		12		15		24
Other identifiable intangible assets	Operating revenues/fuel, purchased power costs and delivery fees/depreciation and amortization	44		15		96		39
Total intangible asset expense (a)				$	155	$	97	$	300	$	203


~~(a)~~	Amounts recorded in depreciation and amortization totaled $72 million and $97 million for the three months ended June 30, 2019 and 2018, respectively, and $141 million and $182 million for the six months ended June 30, 2019 and 2018, respectively. Excludes contractual services agreements.


Year	Estimated Amortization Expense
2020	$	369
2021	$	257
2022	$	161
2023	$	116
2024	$	78


~~(a)~~	The minimum settlement amount of tangible equity units, or 15,207,600 shares in both the three and six months ended June 30, 2019 and 15,056,260 shares in both the three and six months ended June 30, 2018, are considered to be outstanding and are included in the computation of basic net income per share (see Note 14).


~~(a)~~	Shares of mandatorily redeemable preferred stock in PrefCo. This subsidiary preferred stock is accounted for as a debt instrument under relevant accounting guidance. At any time after October 3, 2019, Vistra Energy may redeem all or any portion of the preferred stock for a price per share equal to the preferred liquidation amount.


~~(b)~~	Obligation related to a corporate office space finance lease. This obligation will be funded by amounts held in an escrow account that is reflected in other noncurrent assets in our condensed consolidated balance sheets.


~~(c)~~	~~Includes impact of recording debt assumed in the Merger at fair value.~~


~~(a)~~	Facility to be used for general corporate purposes. Facility includes a $2.35 billion letter of credit sub-facility, of which $552 million of letters of credit were outstanding at June 30, 2019 and which reduce our available capacity.


	Notional Amount	Expiration Date	Rate Range
Swapped to fixed	$3,000	July 2023	3.67	%	-	3.91%
Swapped to variable	$700	July 2023	3.20	%	-	3.23%
Swapped to fixed	$720	February 2024	3.71	%	-	3.72%
Swapped to variable	$720	February 2024	3.20	%	-	3.20%
Swapped to fixed (a)	$3,000	July 2026	4.72	%	-	4.79%
Swapped to variable (a)	$700	July 2026	3.28	%	-	3.33%


Senior Secured Notes	Maturity Year	Interest Terms (Due Semiannually in Arrears)	June 2019 Senior Secured Notes Offerings (a)
3.550% Senior Secured Notes	2024	January 15 and July 15	$	1,200

4.300% Senior Secured Notes	2029	January 15 and July 15	800
Total senior secured notes			$	2,000
Net proceeds			$	1,976
Debt issuance and other fees (b)			$	20


Senior Unsecured Notes	Maturity Year	Interest Terms (Due Semiannually in Arrears)	February 2019 Senior Unsecured Notes Offering (a)		June 2019 Senior Unsecured Notes Offering (b)

5.625% Senior Unsecured Notes	2027	February 15 and August 15	1,300		—
5.000% Senior Unsecured Notes	2027	January 31 and July 31	—		1,300
Total			$	1,300	$	1,300
Net Proceeds			$	1,287	$	1,287
Debt issuance and other fees (c)			$	16	$	13