NRG - Earnings call transcript Q4 2024

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Operator

Thank you for standing by, and welcome to NRG Energy, Inc.'s Fourth Quarter and Full Year 2024 Earnings Conference Call. [Operator Instructions]

I would now like to hand the call over to Kevin Cole, Head of Treasury and Investor Relations, to read the safe harbor and introduce the call.

Kevin Cole

Thank you. Good morning, and welcome to NRG Energy's Fourth Quarter and Full Year 2024 Earnings Guidance. being over is via phone call webcast. morning's broadcast the live and This presentation can under earnings the webcast and The and release of website Webcast. Investors our be at & www.nrg.com Presentations section in located

note obligation We upon that of urge review based this everyone today's which reasonable filings. to results Actual safe as to well these assumptions the factors We may as undertake forward-looking result presentation SEC to we no contain Please statements, law. that may a except are today's in date. as harbor be events, as update by believe in as discussion statements differ the risk future materially. our of required

to GAAP measures. will non-GAAP we refer addition, In both and financial

the today's GAAP please For information regarding and our presentation non-GAAP to directly refer measures, most financial to release. reconciliations measures earnings comparable and

the that, to and turn And Chair, now Coben, now President call with NRG's CEO. over I'll Larry

Lawrence Coben

morning, Kevin, you, and good everyone. Thank

Head Chung, provide Joining Consumer; available an Bruce will of and and me our Gaudette, today update who also and questions. data are Rasesh on our are Other the large on of of Business, our members strategy. Rob for call load NRG Head NRG center Patel, team CFO;

second marks disciplined our guidance year financial platform range This end our power operational our outperformance, our high the defining of NRG. a We strategy our of our year and XXXX execution. was the consecutive EPS reinforcing and behind the at Every raised business part for a record strength of performed momentum and level delivered of results. build. high continues the exceeded of to and

our CAGR you deliver XXXX at We plan the earnings through are growth on call. that by we well least XX% base to EPS provided last positioned

and that data and plan, center large our monetization market upside site we load power strategy. Beyond other from trends, significant see

projects intent by accelerate development with new and signing multiple multiple integrated natural upside of unlocking strengthen establishing on X.X letters by value. initiatives and our advancing gigawatts Texas. developers long-term fronts are by We generation brownfield These gas these platform our an in development data significant opportunities center partnership to create of

Slide priorities. results. delivered while We our strategic advancing performance X to key Turning record and XXXX financial

of share X% adjusted was than company's of history. XXXX. XX% cash the highest our and range Our exceeded everyone all on metrics, happen. free in growth that per the the guidance flow exceeded $X.XX increased teams key achieving to midpoint and We that EPS targets EBITDA across adjusted by before financial higher Kudos our made

results, and with milder delivered strength and maintenance Smart our commercial team much in million across business and results. margins $XXX in supported driving and these earnings power adjusted for East customer weather. value Strong year-over-year West, approximately higher of and year per margins by expanded planned platform natural and execution expanded asset drove operations integrated the in Texas Home. This and despite reflects in growth the our the gas East sales growth when expertise of the the customer also capturing

the For performance. achieved top-decile we consecutive year, safety ninth

introduced and targets X-year synergy our a achieved disclosures, plan. reporting our strengthened growth also We

We also initiatives. major continue to strategic advance

strong results Texas. of Base partnership plant Essentials supporting delivered power Our in announcement Home virtual X-gigawatt pilot a the

Cedar of track our projects gigawatts due brownfield XXXX. for with XXX-megawatt diligence. of considerable Texas diligence a Wharton in TEF X.X in on made was project selected Bayou also for and shovel-ready completion remains TEF X combined due on cycle X, in We progress development review. in recently TH those is

most X the eligible making remains slots for TEF is advanced capacity them projects, of secured state. site, Notably, in are third and Greens a Bayou turbines the option. are viable manufacturing all either on-site Our X or for these

excellence. laser-focused operational remain on We

improve and across leveraging our from this availability the enhance You of across our plant to operations and statistics consumer our service see AI customer business segments. board can to

also successfully provider. already have We its largest and the Texas market become retail Lubbock, entered

cornerstone strategy. remains we credit Disciplined ahead X% of of $X.X metrics returned our by a achieved In a capital schedule. increased billion XXXX, year and investment-grade allocation our to dividend shareholders,

Turning to Slide X.

we X on building consecutive are our years continue of to well and We strong we're guidance, our delivering reaffirming are execution on growth plan. long-term positioned XXXX

business greater. the opportunities stronger is been Our than never ever, have and

earnings additional XX% least targeting As XXXX upside discussed considering opportunities. call, at in our before CAGR through November are EPS we

run and is next capital growth the Our $X.X by of base rate years. adjusted plan shareholders over billion in $XXX driven primarily returned X million to EBITDA

not agreements, this execution center strategy, are included to value data increase of in our of base portfolio. have These additional supply plan, power levers premium prices exposure plan. center rising and our to multiple that that include data expansion Beyond we purchase power site

for priorities XXXX Our are clear.

exceptional to our gap opportunities. power shareholders positioned will execute a valuation. plan, launch organic to advance our key upside With program, plant shareholder We close and foundation these value our drive capital growth virtual the and in place, are return to fair we strong

that, to strategy. and of center large hand Head Rob With Gaudette, data Business, on an for I'll our load update over NRG

Robert Gaudette

Larry. you, Thank

a cycle. to Turning real, of to accelerating data uniquely capture what the industrial by This exciting. is AI power and we electrification, start it's NRG shift to X. transformation believe Slide super positioned be expansion The demand the and this centers. value. is rapid the of It's and sector structural is undergoing power scaling driven fueling

our platform opportunities. partnerships and these strategic Our commercial significant natural and We're gas development capabilities solidify unlocking further are with our pairing to team leadership. power

data large few benefit you is from geared through market tightening. I'll portfolio to and of strategy and Over take our the how next significantly of markets. power state the load the our advancement slides, The center

growth. the years home, onshoring, data declines clear and entered and in transportation and power driven being oil that is of continued and era development. large-scale electrification growth unprecedented indicators we've surge a ahead. new acceleration the of expansion, wave increases. or an to This on Beginning Markets of It saw by sustained gas X. modest the demand are once center industrial significant only experiencing Slide is now point All even

ERCOT by to as forefront XX%, market. expanded costs, November, interconnection Since low the and and bring Texas forecast this demand framework the business-friendly of the power ability Texas has at quickly, PJM uniquely is nation's load projects scale. With positioned fastest-growing reinforcing energy to a ERCOT's are load growth. capture online regulatory large at

the a market also some is is of the signs Reserve key home now hubs most impact future. clear. new the tightening center comes to and data capacity The PJM market, in load country as on of established supply online. with the is tightening into the

act The will early growth impact to be opportunities supply-demand the will this driving planned, in positioned of ahead. We significantly where tightening like transformation. best dynamics. as project and new supply forward capture of structural and are forces stages even that remain The efficiently, every not While move optimize the this it we taking market shape, scale a still fraction would decisively we stand. companies

pace X on gigawatts to projections, of XX% of in is At short ERCOT In and consist the falls current gigawatts this X. solar, XX PJM. to is battery markets, in what demand with Turning capacity of is well keep queued needed while planned rising growth storage, over natural increasingly only capacity demand. accelerating or Slide intermittent gas Power becomes additions resources. as grid competitive dependent the of wind

The Compounding historically availability that challenge queue of is constraint quickly. This the never a will reach projects structural be completion. issue, generation. is X building essential a large the resolved the share not parts thermal of of primary in the limited

relief for First, short critical components, turbines expected supply flexible no with for and generation years remain new meaningful equipment come. in key other natural gas to

Second, components, and thermal already. EPC teams capacity the human are experienced at development firms

modular small dispatchable early viable capacity on as of cycle, commercially value earliest. flexible the and are development unlikely such still they're reactors With technologies continues before news the shrinking to reserve new other grow. generation existing While the in to at and be constraints XXXX margins, in

break this we're discussed XX. progress level. portfolio, these significant formed challenges. to we our them and and are ideally very can incorporate Last solutions on-site behind-the-meter and many then. spanning operations site priority. dedicated the sites attractive front-of-the-meter excited this into our development. down First, maximize fall power top-tier for premium we we're have now, trend near-term prioritizing at its highly Today, for highest Turning X categories: making we've generation, value positioned a for and premium These We are Slide of that agreements. discuss how since engineering high to and a with you them made year, Until commercial, They team locations to long-term we

multiple resources. and These out of gigawatts and major market gigawatts projects. are group, this scale, supporting Within dispatchable data large-scale the access offering as locations capable ideal some demand, center of super for capacity renewable top-tier hyperscalers, infrastructure for large-scale of new sites required hosts, stand

there are this of X.X discussions, primary opportunity in We focus near-term our of for execution. believe they and first are remain We engaged across gigawatts category sites. actively over

believe we support can we of capacity. another gigawatts Beyond X.X this,

We This best for have offers but additional are resolve. are strong These medium have specific typically X to take sites constraints small that group to time will centers. suited options. greenfield and data exploring opportunities

evidenced we're least space. development cements in the by today, see and we else as this at announcements taking a total, incredible XX one first potential of us accelerate And no match. speed scale the at can as gigawatts In next to an that capacity, step projects. the opportunity advancing We're leader a already

expertise, platform energy world-class and of solutions. Kiewit operate landmark the development a energy development, manufacturing, subsidiary, through deep XX. will leadership the and track own engineering turbine construction and joint GE Turning prime bringing fully plants, to proven large its record expertise for with We're energy development TIC, most a brings announcing create development locations together end-to-end to Slide markets and load which advanced NRG, collaboration Vernova and execution. integrated

capabilities. integrated industry-leading efficiently and certainty GE more support, a deliver with access, approach, anyone ready-to-build to provides Speed engineering best-in-class turbine in than power the With development turbine Kiewit else sites and market faster, planned and While fully Vernova construction EP market. and wins. coordinated we technology can delivers greater

is platform delivering The results. already

X.X online gas new in of XXXX. shovel-ready This announced We have gigawatts secured reservation our gigawatts in agreements capacity turbines XHA X GEV with of to X.X already supporting for addition capacity. is their slot

working data center the We several of this course, and, of are value operators initial additional premium for related actively with our sites. capacity

We targeting capacity of are XXXX. gigawatts initially by X.X

supply recognize XX. power strategy and their Turning locations our LOIs go-to-market our data capabilities. of our advancing and sites to We're value also sites. multiple center our to developers the to to bring They with strategic their facilities through Slide

generation not their build needs, power We on-site long-term and can and operate develop, but move are strategically also positioned to certainty. meet where speed needed. We only with

$XX on capabilities our revenue per portfolio. supply megawatt Our power To the to This to the capture is location, project driven strength, structure long-term seeing sites attributes. strong on strategic flexibility this, our both depending quantify value agreements. us of and ranging by site hour, and our of premiums and position premium from breadth rates $XX we're

We year, are announced company it. the very about proud a is past we The moved from executing have as Not we have of today. incredibly talking what on clear. takeaway center only to data key strategy we performed this

with the market stage beginning. and team, strategy the this Today's value. and energy announcement to will the NRG look we is we continue long-term this to lead partnerships forward as more the execute. create We to the just execution positioning, speed, have and revolution And sharing unmatched set

we key advantage market embedded presents and the conditions fleet highlight Texas want another platform, evolve. I in value to As it our turn our as XX, opportunity again generation the Slide to of

our premium contracts. reserves existing rapidly. optimization conditions demand upside Rising what power tracking. Our site portfolio. we've Market benefit been The confirms capacity prices and latest tightening are and report extends ERCOT past

As this will earnings. unfolds, additional our create generation

$XX market Our benefits forward conservative through to and platform our a assumed previously megawatt trading multiyear pricing low XXXX. pricing per provided for more in signaling outlook, early Texas the potential. Yet around-the-clock is hour XXs already to you,

partners solution center benefits capture our hour the with cycle. generation capabilities clock, our We opportunities the and customers' platform our megawatt power to portfolio, on the NRG GE As million the in produce of with front $XXX positioned to of portfolio bringing challenges Vernova the Kiewit demand would an commercial solve generation and example, structural additional strategy per value $XX of and open benefit go-to-market super is data supply basis. portfolio the us. our and in an at margin around of the the from

for I'll you time. the to now the over for Bruce thank that, review. financial call turn With your

Bruce Chung

Rob. you, Thank

in year XX. exceptionally Turning share am to Slide XXXX, outstanding financially NRG operationally to both pleased across company. that I the and another high at executing had levels,

Strong the share per This $X.XX Our of nearly of XXXX. share accounted per $X.XX share our $X.XX. per earnings XXXX growth, share businesses above per delivered represents $X.XX XX% our beating came $X.XX execution share midpoint the share by guidance the of for the in $X.XX adjusted from remaining the per the or came of year-over-year from increase repurchase an while growth raised in range, in XXXX. performance program by year-over-year

$XX.XX, repurchased at We to price average at of XXXX. the beginning representing close of outstanding XX X% of our million shares shares

profitability As we reporting a you are strength reminder, provide framework. strong the the and profile of our EPS insight earnings and the allocation into and introduced adjusted NRG's results of we today our with to additional highlight growth capital power

adjusted $X.X XXXX $XXX of increase was results. NRG's an EBITDA full million billion, XXXX over year

outperformance. marking free such second $X.X financial We also of metrics income net delivered cash our the guidance the before of ranges, $X.X these billion exceeded and year midpoint in consecutive flow Each billion of growth. in adjusted raised

to power Our East in XXXX benefited were East segment lower counts. adjusting taken costs and sales asset at million approximately driven margins impact compared year-over-year natural for After customer maintenance the by and benefited by and $XXX expanded these from XXXX. and also In was results gas lower from of our items, opportunistic due EBITDA West supply higher plants. to Texas, Texas' increased segments closed additional our preventative

Our the results platform. operations weather the expertise ability in to in to XXXX Texas deliver strength integrated testament commercial team of a is our the our higher and real of despite year-over-year milder

our and financial past significantly made As these plants you on real invested few our a know, impact have over we results. have investments in years, the

it availability Our which close full now been the factor, XXXX. to across highest NRG's portfolio XX% stands has is since in-the-money

NRG financial continues results deliver advantages generation of our Our to a that strategy can market core and of through supply and diversified one be conditions. us consistent variety operating gives confidence

recurring and The In which marks subscriber a XXXX, service achieved its excellent high full business XX% our first perform and net an the margin results all-time value our counts ownership monthly increase year across retention, XX% in Turning add under the Smart with business. for improved results Home financial business to Smart portfolio. segment. to and generated Home nearly NRG's consumer continues of X% and customer

the perspective, free midpoint revised XXXX flow flow our $XX.XX From in flow growth a free free cash of share. exceeded of guidance, cash cash before growth before resulting per

over XX% before original flow growth represents the XXXX per growth midpoint over over actuals guidance. Our and share free our cash XXXX XX% XXXX growth of

items Lastly, we all across financial are reaffirming metrics. our financial XXXX

the Our adjusted in flow target net detailed adjusted guidance, ranges for can including adjusted growth the found EPS, before income, cash tables G in EBITDA and appendix. be Regulation free

billion. Turning update largely ended that $X.X XXXX divestiture to excess the for year We with capital $XXX unallocated to for by year, our in capital bringing an on available the driven cash, point late allocation. XXXX next million Airtron the closed in our allocation starting in slide for XXXX fiscal

results, shareholders return strong of including our billion capital through targeted $X.X In maintains yielding impressive metrics capital commitment executing actionable the allocation and programs, XXXX, of our repurchase early program. our we and capital to in sheet, the approximately of and management maintained credit robust focus our liability plan XXXX balance our capital on allocation guests, growth common strategic return our and share to a investments. dividend achievement The

including management, the hedged will ongoing fully right on last left to from capped page, million which liability we the allocated for be note, convertible of retirement year. the $XXX Moving expected and

on our already of approximately and been million allocation share executed framework, commitments consistent related synergy $XXX in we prior After cost million which are XX-XX capital repurchases in over year-to-date. have and XXXX, billion remaining of costs have We $XXX to planning $X.X programs. integration these with acquisitions

performance we over expected $X.X growth after over XX% as per common $X.XX return integration the excess Notwithstanding stock our to of X% our liability the capital. strong represents our last still cash total of about our incredibly see year, dividend our excess shares management be use and over dividend an XXXX is share, which capital per compelling currently XXXX in our share, with billion of Together of costs. or of

We we Investor revenue allocate to our Turning investments. completion at Day. announced toward growth XXXX $XXX the of plan synergy million plan to

$XXX investments, projects. In development to ERCOT growth million our addition, which new build we are includes other of allocating continued

unallocated which showing Finally, look I $XXX will the we XXXX. continue to we over as of are you into course million providing capital, our we of allocate execute to forward with XXXX. plan updates

back it With you, that, to I'll turn Larry.

Lawrence Coben

delivered ahead Slide in been X better reiterate, The Bruce. to XXXX, execution. or marking record XX, NRG consecutive earnings never opportunities of stronger. On years have you, exceptional Thank

Our growth plan underway. well is

long-term expand, to the before creating even from upside those continues as platform contribution meaningful and significant for any opportunities discussed shareholders we're such value considering Our our today.

of making opportunities. on We progress strong are these several

Today's growing announcements large both existing showcase needs load customers new and of at the serve our ability scale. to

with center Our position and to to laser-focused us on the you. will strategic large we demand meet shareholder with strategy value. updates with am data our thrilled data agreements these share and on execution. we EPC, load leading as And I speed maximizing manufacturer, remain forward, unmatched turbine center move developers,

or excited some may as you of these news through meaningful I a these may must words, and not that or progress site-specific I we updates, our tell lend space so for is attributes you each when milestones, details. priorities. unique, is itself other by there expect the through trajectory. to opportunities, about either share am customer to This that shaped In overall quarterly have regular announcements formal to growth is competitive transactions wait of as

Thank Operator, you the questions. please for continued interest. time lines for open and your

Operator

Jefferies. of [Operator Instructions] of Our the first line from question Dumoulin-Smith Julien comes

Julien Dumoulin-Smith

you've question does opportunities announcement here. on data the position signal future on specifically, LOIs Look, yet on a How series here. the key latest centers? again of And and announced results done Nicely here.

that is mean, about, the patients you you're to would this chain about on bit? those here, timing need the the execute, Can just I talk long literally, transpose you've LOIs speak that we given then how practical that. expecting you got wait to a really to corner, imagine the I could to got I be arrangements? up. intra-quarter? follow-up supply when talking I mean a little And here Given around firmer lined XXXX are into that

Lawrence Coben

of a is XX%, give doesn't is one one to, this don't want to make and do try Happy this by is step step this Julien. what one quarter people XX%. sense. sit and every Look, XX%, there is tell I have to any people, really development It

the in plant been when You've development what to is development development is is business enough side the power done. long on done like know and

that, plants in 'XX, we've about service Having talked said in and having 'XX. 'XX

going you working moved these you weeks from X to time But or before so and it's people X what X this Y to get updates. And years don't X, those frames, do an expect to call, forward, that from Z. back now, they're can May the on be that is get expect update not going I want we've

quite between say out we'll to historically, but also, we this, when as quarters haven't I put do Julien, need for stuff think think something things don't the always done calls have quarterly I we to frankly, of historically anymore. kind we to that well. We've waited do

Julien Dumoulin-Smith

seek a little kind sight on LOIs specific big supply then you well? there? the of expand And morning. could And To to What your sight, Excellent. ripe you certainly, Can the and you you think chain on was of opportunity the there? remarks expand have on further and would it. from one obviously, do X seem Got TEF here. then prepared extent line sites further TEF. gigs a of established. number plus here as your you I it's bit this of It already mean, have participation what which to GV also, extent elaborate with can line like I comments a

Lawrence Coben

X Let projects the in go I the We then GE, X shovel-ready of TEF today. me take if are I'll do TEF the first, part may. to have and back

to third is TEF certainly to that. The us comes do if one TEF-ready

enter come You our then one certainly for consider might very per that. the customer, that third were And it we'll second initially, project able if very, in one, that they to recall seriously. we was and

I forward. of the view, to So point go shovel-ready a think gigs from extremely TEF X.X positioned we're with well

GE, got look, X On slots. we've already the

coming you working that online development continue continue best think But we year to we've series over you significant when we online have that's projects. And probably a as as past more our amount of those well a this today. of the line as the I are to on update, capacity XXXX. new give where be of to we'll is that get well. tells But sight see slots, before -- information about you from projects can goal, is will been

Operator

from next Shar question Partners. comes Guggenheim Our Pourreza of

Shahriar Pourreza

can X.X? contracted by they starting those the you quite there just an for high trying to Is intention the come to gig be merchant? confirm just X.X develop Just Larry, ] update. as Maybe your be a at foot venture XXXX? GEV the level, [ with fully all will some X.X to gig of Or online?

Lawrence Coben

Yes. Absolutely.

think today Shar, contracted. you going happen vast won't X the the be over to I that I will for be next for the to would but years, tell be, intention sure what's majority,

the data our retail merchant always significant our now our of book, As C&I and you we're taking know risk. center got not book that of We've business in amounts clientele.

to to contracted. So of expect or all vast be contracted I would majority it the be that

Shahriar Pourreza

the was of That of period how we, growth CapEx? in funding the key you a guess, the about substantial thinking question. should of And just, time. I short about a guess, kind check It's are How then Perfect. think ramp-up project. I the

Lawrence Coben

able of to can to worse we And if has his that would if and take to As accretive in that generated that. we partner the contracts on think capital, agreed a of it now. we'll be of Shar, we of for kinds look leverage with pay bonus. we're all lot out it, flow, our of who to forego plus Bruce people people there's consider Obviously, at talking cash we about be business comes internally some want between worst, this

Bruce Chung

back point before may at to start it... that buy You stock

Operator

next Chopra of Evercore comes from question Our ISI. Durgesh

Durgesh Chopra

Bruce team. nice to And take one to update. for Great see continuing the

So listen, questions. two

of just X the clear be to First, be megawatts, clarify I there. all market. letter coming just the existing intent new is to to right, can in with going These assets. you are want the developers? This

Robert Gaudette

is This Yes. Rob.

for to about kinds So power think is these One are demand. so build a have the of our it X agreements get data they developers securing those structures. new is way on it out sites them. plants And a on center, site, don't

So to we're not build plant there. going

is piece which the second support it. we'll to we'll way is you build alluded, The power build data the plant it a -- will center, they build

So generation behind everything we should fleet. you additional, that run question? currently think your nothing is existing our that answer Does for

Durgesh Chopra

It Exactly. does.

to are the megawatts additional the these So existing. market, not coming

focused context, maybe How then there, What Okay. should to session which in Texas, there impacting speak legislative do you see your are investors the of you couple please? on be And that about the thoughts talk bills you've Perfect. a your seen on what loads. in large that can discussions?

Lawrence Coben

system the to their that starting allocating bills it so entirely who clarification think a data the what SBX a are person work It actual costs share center it of light are the additional and build shines doesn't actually real we market. on Look, pay because fair people data in being customers. in provides on retail towards cost centers the like fall positive the properly,

fair as this a that actually for without will supplier in this to So are provide we consumers proponents shock rate think of And the allocation bill Texas. of for obviously of the biggest be Texas. needs retail cost it. across huge We done

the a the the entire to are think actions are makes we working generally and try sense quite system. we bill legislators for that So taking forward to with look to that them get positive,

Operator

comes of next Our from question Seaport. Angie Storozynski

Agnieszka Storozynski

details. of Lots

$XX mentioned you first, Rob, gas there. to of plants. new for rate, those questions Lots $XX So revenue long-term

like in you contracts more manage contracts saw So going the structure for be to going plants? probably collaterals XX-year would agreements you build? these these we how spark when to new California? volatility over How Are these tolling commodity the you to that like price mimicking spreads-driven and do Are XX- gas contracts? be we

Robert Gaudette

Sure.

customer. to So every depending with, will the be slightly start structure different on

for will Some want XX up lock to years.

Some But serving to of XX a want not heat gas, power lock these the reset. way power, capacity your will the right? think locked but in. their one keep lock to a ultimately, up, have if then for rate loads, meaning probably is about we plant it you exposure price, is and It's

the on. doing But -- We leaves we're backing know our have heat would adders what the There's would asking. ultimate to So $XX we be. is exposure, would up. because it from And in revenue the just capacity. And facility so with energy plus it clear. other if somewhere did you we rate perspective question it side to know you're what you rates is $XX PJM, be that that gas go which the be

team of physical who platform this, We've got country. incredible the And you people know out in and it both gas work I'll just the gas biggest and out an say term. loud, financial we the built

we we new for is already. do. something confident be customer feel we'll whatever up to so Angie, may And kinds want that very And large customers the not do lock of for C&I exposures to This this that us. able remember,

Agnieszka Storozynski

own haven't one on was both collateral mean associated it's because of contracts. credit plant I given come the reasons contract have these are side postings gas every the side that, that LC. power of its been gas there to like heard will the for plants issues and not some with duration existing So had why I've we a

current within that's you with So deal the can that again, something business.

Robert Gaudette

correct. That's

Agnieszka Storozynski

for these utilities there so besides and build noise a progressing like take have is if is it see other back, you of varies the build there you seems that growing And probably IPPs I does this? step it this new red new actually are utilities? higher much you that contracting around assets? I is, faster matter question contract-based markets. a power little and are centers both and mean, are capital that have is what concern than do how the by on Again, plants, if you in Okay. total tape regulated these surrounding growth, gas-fired a demand data with competing build market. to competitive existing assets cost again, But regulated are power And

Lawrence Coben

start Angie, with not let's I think the in case. -- Texas, certainly, it's -- and that's

We in That's want centers the why on regulator. They SBX. state. one data have they're working

But So market. to I competitive ones, is slow they a have, commercial I me we are, stock the do are. mean, buy, anything I imagine will times. are to of in be letters a the though regulated that if think shows I Look, that's at should people. we competitive go they'll competitive see them to I speak to share being the bit given us being it's buying. that to a today, But venture regulated we of do don't have in in any be markets, probably people they I need don't as think can't businesses, we'll we we're regulated in intent market. people market fair see for wait announced update hard fast a today, you to utility regulated the as -- are complex when don't see this to business. being and going And others. announcements markets. slow that to need everywhere. of I to that this false When centers different get they'll advantages data don't competitive existing versus regulated -- these our I all

Agnieszka Storozynski

Okay.

one the just last Now CDR. on the

haven't of we in from there a within seen So I Rob, XX% sense calculation months. -- forward reaction But changes we all to prepared I so a know much power of And years think the I why your you've went a that we have I curves, through are seen in a mean have of surplus remarks, really shortage X is. CDRs, here. XX% XX mentioned we for the in mean many it you

large so you those sort in a and example, And lock for Permian are do loads, looking reaction, projected existing some are from at currently it a of or in to forwards? anywhere seeing prices else in the step in dynamics they expect that observable because supply-demand willing at power be ERCOT are these change

Robert Gaudette

there. lot a There's right. All

reduction grid. a of the value in it try a things. view, and side CDR is. right, the think they What what will it to view big to times. what out. were in created through One, threw all so load you're of CDR we've your So let the on So determine this, to me knock looked we've at X right? loads update, the supply a and more realistic happened multiple The they adjusted in then CDR the And supply you that bunch been

they right, You're like probably were whatever 'XX. the are bit. better they out months which a look a reserve clock, 'XX curves around reflected in month little than I would or They're mid-XXs you up the and haven't fully now ago. where X is considerably tell margins the

they 'XX. power up and coming The in asked Texas, out dramatic to couple been seen terms lock into of sidelines a for or plus who've increase to looking I'm to large the glad customers in have you the years us, every sitting in a for power of looking your 'XX, on to loads X the -- up years, and question, We right? book, are last it. zone C&I with so power, In lock

and So see help that. happy ahead it, to trying to they it, and get them of we're do they're

Operator

Sullivan of Research. from Wolfe comes Michael question next Our

Michael Sullivan

here you're and definitely give on Thanks square how return directionally, update compares $XX going GEV But sense just wait in some builds we then to brownfields can investments? cost that these doing the can new how maybe there, Texas $XX kind with ultimately the do agreement, this to PPA of to you're the targeting and you're of a us maybe of appreciate for you you the the maybe to details. the on want

Lawrence Coben

Yes. more brownfield. again, that achievable, roughly. are that's X,XXX of terms not Kiewit going it's was, all a that's the brand I than the the be fields we in what, mean, advance obviously, the number, of work I because run, obviously did in partnership, GE, with mean to

we'll So you will heck seems advantage us and And to I think have which lot. to venture, we that this us I most of range X,XXX to can be this of be be do look that the I transaction partners, in expedite we'll in at right learn X,XXX delays, and market, construction which repeating better don't at those the avoid think a a replicable things, will -- expect help than now. more as with other

be those to or that range, So the at us do lower else able things of we're end will them of at get is than kind going all hopeful, anyone lower least of to for.

I you be So to the give outline respect that broadest costs. I could kind with of that those think would

Michael Sullivan

Okay. targeting? And the just on returns you're

Lawrence Coben

investment rates but and rate going posted think rate exceed because forth significantly public we've hurdle hurdle will of think the putting -- I and the changed, this hasn't hurdle to time we and this with our market. think our beat target in Our I set we're new But that transaction we're actually we the hurdle not these changing significantly. the doing We're all in here rate today. all pricing premium

Michael Sullivan

when helpful. that Okay. full doing... XX-XX even that, just also beyond framework holds That's this tied period you're the through 'XX like And to

Lawrence Coben

I to and don't holds this don't next to think X But still 'XX, ramping change. But capital this, be I year. revisiting. not I it I'm will have not you capital you this that. time the today, at -- have the for we'll a they're not accretive you our 'XX, think ton think years, the continue look like. from as to X of that. ramps, going mean always be will stock perhaps to 'XX, it's late tell world that's If an allocation when the attractive going because at the it at to time, will no for look our in it and not buybacks. It's really look now the if do But year. next spend option, anymore know what to it is policy I years of incredibly same about that we're

Michael Sullivan

legislative just sit watching And the Texas, last in session as in Okay. SBX should else one, Great. we now? right anything beyond we be

Lawrence Coben

No.

the eyes That's think SBX I is where one. are. certainly our big

Operator

Arcaro of Morgan final question David from comes Our Stanley.

David Arcaro

I you like things deal had Do studies, place? that? upgrades, with offer Or a access loads? transmission question Can to in need the for on large medium-priority have speed the market to still they sites. grid would high-priority the transmission and those

Robert Gaudette

all -- you the transmission interconnects than deliveries. the have and David, do Texas, So turbine every a typically, site and a studies speed filing those regardless of interconnect. lot faster is, component happen it especially The around what in to

not -- So piece. interconnection worried that really about that I'm

is our other sites that equipment that some of is there. of value The already

Z X, back you Y, and study Y site. get already Z, when the it So is you need and or says X, on

process with that least also. ISOs. So up nobody speeds But is the without file of having each going to at build anything the

David Arcaro

it. Got

got, have And That that for Kiewit you specifically question an to project Yes. turbine that and Do or connected slots a offtaker I Great. do Vernova then initial had a GE here. X.X X.X-gigawatt gigawatts? on just venture Okay. the order you've that? have for you clarifying

Lawrence Coben

have there, think do where and a I people to When happening the exploring We we we letters do, of we we're -- David, good of mean still you hyperscalers. X will obviously we line -- lot a the to of have still sight, intent know. is be options. pretty are among have first but interested. who There's what

we that, -- we signed announce if obviously, we'd So have like to anything it. have

I it be material. probably would think, anyway,

to have in prior making that we we're on -- confident significant that, place but very will PPAs I before, said commitments those. So as

David Arcaro

around sense. data given there's then state? But the comfortable just talking of or demand the the the and maybe backdrop? tight centers hesitation in Just data legislative around Makes Texas third the cetera. for And in grid been updates, in session market to you concerns and Seek, you're was among the et jitters some the or center concerns be or the to? it. with Got industry hesitation Yes. too supply-demand parties detecting Is urgency reconsiderations Deep any pace any that some broadly, curious, are getting I

Lawrence Coben

seeing actually we're think I opposite. the

one us, the we down to wanted work our We so this I together venture great have mean more of new of I have -- we all the down one beating have But people doors. And think people capital of that. order We reasons each is if beating prioritize that. their the doors in either to to seeing hyperscalers other's expanding win all you or are look, projects. be wouldn't commitments. we're reaffirming all

They're So to to to they're it, they need going our clearly, build going build it. spend need they're going power. it. And if to

So we're that. not seeing

positive there's as in know, And David, investors just they rumor but a now. think get for Look, I with or longer. the that of comes space I out, lot all a negative, enthusiastic next to think, the you either or depressed. year And every have to maybe super so, or live time we're going super new

Operator

for closing would I turn Coben like Larry to Thank now remarks. the Sir? you. to conference back

Lawrence Coben

and want to I for all you thank great listening questions. for your

look in our excited super more NRG as are the super forward we company in where ahead. we opportunities discussed. core and and a hear, you cycle to both in days sharing about businesses the We with can you we As sit,

Operator

conference This concludes today's call. for participating. Thank you

disconnect. now may You

NRG Energy (NRG) 26 Feb 252024 Q4 Earnings call transcript