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NRG Energy Annual Report (Amendment), Year Ended Dec 31, 2002

Filing Date
Filed July 9, 2003
Period End
December 31, 2002
Security
NRG
In the record · 2016–202610-K1110-Q328-K163

NRG filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 163 current reports (8-K) between 2016 and 2026.

  1. Bankruptcy8-K · Dec ’17Dec ’17
  2. Leadership change8-K · Oct ’19Oct ’19
  3. Leadership change8-K · Nov ’21Nov ’21
  4. Material agreement8-K · Oct ’25Oct ’25

01—Abstract

Summary

Summary of the 10-K/A filed July 9, 2003. Cited figures are marked; the original filing is the authoritative source.

This Form 10-K/A amendment to NRG Energy, Inc.'s 2002 annual report states that its purpose is to file the financial statements of West Coast Power LLC, an entity in which NRG Energy owns an indirect 50%a interest.

The filing covers the company's fiscal year ended December 31, 2002, and is signed July 9, 2003. The registrant's shares were all held by Xcel Energy Wholesale Group Inc. at that date, with 3 Class A shares and 1 common share outstanding. The filing also lists the Corporate Units as registered on the New York Stock Exchange.

West Coast Power reported 2002 revenues of $683.5 millionb, net revenues of $585.3 million after $98.2 million of reserves, and net income of $34.1 million, down from $326.4 million in 2001. Total assets were $787.1 million at December 31, 2002, versus $1.06 billion a year earlier, and member equity was $640.8 million. The company recorded a $13.4 million impairment of long-lived assets related to four Cabrillo II combustion turbines, and cash provided by operating activities was $243.9 million.

Its four California merchant plants, El Segundo, Long Beach, Cabrillo I and Cabrillo II, sell power into the California wholesale market and under a power purchase agreement with the California Department of Water Resources through December 2004. The filing highlights substantial litigation and regulatory exposure. The company is a defendant in California market class actions, FERC refund proceedings and investigations, and a CFTC investigation.

Reserves of approximately $401.6 millionc relate to disputed ISO and PX revenues, potential FERC refunds, and receivable collectibility. Management states it believes it has meritorious defenses, but also says an adverse result in these proceedings could have a material adverse effect on financial condition and results of operations. Dynegy has agreed to indemnify NRG Energy against liability arising from the CFTC-related issues.

02—Key points

Key Highlights

  1. West Coast Power LLC 2002 revenues were $683.5 million, with net revenues of $585.3 million after $98.2 million of reserves.
  2. Net income fell to $34.1 million in 2002 from $326.4 million in 2001.
  3. A $13.4 million impairment charge was recorded on four Cabrillo II combustion turbines after land leases on U.S. Navy property were not renewed.
  4. Reserves of approximately $401.6 million cover disputed ISO and PX revenues, potential FERC refunds, and receivable collectibility.
  5. Total assets were $787.1 million and member equity was $640.8 million at December 31, 2002.
  6. The company faces multiple California market class actions, FERC refund and manipulation proceedings, and a CFTC investigation, with management stating an adverse outcome could be materially adverse.
  7. NRG Energy holds an indirect 50% interest in West Coast Power, and the registrant's shares were all owned by Xcel Energy Wholesale Group Inc. as of the filing date.

03—Questions

Frequently Asked Questions

  1. Why was this filing made, and what does it contain?

    The filing states that its purpose is to file the financial statements of West Coast Power LLC, in which NRG Energy owns an indirect 50% interest. It includes the audited 2002 and 2001 consolidated financial statements, notes, and consolidating information, along with certifications by George P. Schaefer and William T. Pieper.

  2. How did West Coast Power's profitability change in 2002?

    Net income was $34.1 million in 2002 compared with $326.4 million in 2001. Revenues were $683.5 million in 2002 versus $1.83 billion in 2001, and net revenues were $585.3 million versus $1.56 billion. Operating costs also declined, from $1.17 billion to $473.7 million.

  3. What are the main legal and regulatory risks disclosed?

    The filing discloses California Wholesale Electricity Antitrust Litigation and related class actions, a California Attorney General suit, FERC refund proceedings with a $401.6 million reserve balance across related receivables and refund exposure, FERC market manipulation investigations, and a CFTC investigation. Management says it intends to vigorously defend these matters but cannot estimate the range of possible loss from the lawsuits.

  4. Who is responsible for the audit and what changed in auditors?

    PricewaterhouseCoopers LLP audited the 2002 financial statements and issued an opinion dated April 23, 2003. Arthur Andersen LLP audited the 2001 and 2000 statements, and its report is reproduced in the filing with a note that it has not been reissued.

04—Continue

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