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Revenue Recognition | 12 Months Ended
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Dec. 31, 2021
Revenue from Contract with Customer [Abstract] |
Revenue Recognition | Revenue Recognition The Company's policies with respect to its various revenue streams are detailed below. The Company generally applies the invoicing practical expedient to recognize revenue for the revenue streams detailed below, except in circumstances where the invoiced amount does not represent the value transferred to the customer. Retail Revenue Gross revenues for energy sales and services to retail customers are recognized as the Company transfers the promised goods and services to the customer. For the majority of its electricity and natural gas contracts, the Company’s performance obligation with the customer is satisfied over time and performance obligations for its electricity and natural gas products are recognized as the customer takes possession of the product. The Company also allocates the contract consideration to distinct performance obligations in a contract for which the timing of the revenue recognized is different. Additionally, customer discounts and incentives reduce the contract consideration and are recognized over the term of the contract. Energy sales and services that have been delivered but not billed by period end are estimated. Accrued unbilled revenues are based on estimates of customer usage since the date of the last meter reading provided by the independent system operators, utilities, or electric distribution companies. Volume estimates are based on daily forecasted volumes and estimated customer usage by class. Unbilled revenues are calculated by multiplying these volume estimates by the applicable rate by customer class. Estimated amounts are adjusted when actual usage is known and billed. As contracts for retail electricity and natural gas can be for multi-year periods, the Company has performance obligations under these contracts that have not yet been satisfied. These performance obligations have transaction prices that are both fixed and variable, and that vary based on the contract duration, customer type, inception date and other contract-specific factors. For the fixed price contracts, the amount of any unsatisfied performance obligations will vary based on customer usage, which will depend on factors such as weather and customer activity and therefore it is not practicable to estimate such amounts. Energy Revenue Both physical and financial transactions consist of revenues billed to a third party at either market or negotiated contract terms to optimize the financial performance of the Company's generating facilities. Electric energy revenue is recognized upon transmission to the customer over time, using the output method for measuring progress of satisfaction of performance obligations. Physical transactions, or the sale of generated electricity to meet supply and demand, are recorded on a gross basis in the Company's consolidated statements of operations. The Company applies the invoicing practical expedient in recognizing energy revenue. Under the practical expedient, revenue is recognized based on the invoiced amount which is equal to the value to the customer of NRG’s performance obligation completed to date. Financial transactions used to hedge the sale of electricity are recorded net within operating revenues in the consolidated statements of operations in accordance with ASC 815. Ancillary revenues, included in Other revenue, are recognized over time as the obligation is fulfilled, using the output method for measuring progress of satisfaction of performance obligations. Capacity Revenue The Company's largest sources of capacity revenues are capacity auctions in PJM, ISO-NE and NYISO. Capacity revenues also include revenues billed to a third party at either market or negotiated contract terms for making installed generation and demand response capacity available in order to satisfy system integrity and reliability requirements. Capacity revenues are recognized over time, using the output method for measuring progress of satisfaction of performance obligations. The Company applies the invoicing practical expedient in recognizing capacity revenue. Under the practical expedient, revenue is recognized based on the invoiced amount which is equal to the value to the customer of NRG’s performance obligation completed to date. Performance Obligations As of December 31, 2021, estimated future fixed fee performance obligations are $258 million, $48 million and $1 million for fiscal years 2022, 2023 and 2024, respectively. These performance obligations are for cleared auction MWs in the PJM, ISO-NE, NYISO and MISO capacity auctions and are subject to penalties for non-performance. Disaggregated Revenue The following tables represent the Company’s disaggregation of revenue from contracts with customers for the years ended December 31, 2021, 2020 and 2019:
| For the Year Ended December 31, 2021
(In millions) | Texas |  | East |  | West/Services/Other |  |  |  | Corporate/Eliminations |  | Total
Retail revenue |  |  |  |  |  |  |  |  |  |  |
Home(a) | $ | 5,665 |  |  | $ | 1,959 |  |  | $ | 2,053 |  |  |  |  | $ | (1) |  |  | $ | 9,676 |
Business | 2,745 |  |  | 9,903 |  |  | 1,237 |  |  |  |  | — |  |  | 13,885 |
Total retail revenue | 8,410 |  |  | 11,862 |  |  | 3,290 |  |  |  |  | (1) |  |  | 23,561 |
Energy revenue(c) | 329 |  |  | 508 |  |  | 371 |  |  |  |  | 7 |  |  | 1,215 |
Capacity revenue(c) | — |  |  | 718 |  |  | 57 |  |  |  |  | — |  |  | 775 |
Mark-to-market for economic hedging activities(d) | (3) |  |  | (88) |  |  | (86) |  |  |  |  | 13 |  |  | (164) |
Contract amortization | — |  |  | (26) |  |  | (4) |  |  |  |  | — |  |  | (30) |
Other revenue(b)(c) | 1,557 |  |  | 59 |  |  | 25 |  |  |  |  | (9) |  |  | 1,632 |
Total operating revenue | 10,293 |  |  | 13,033 |  |  | 3,653 |  |  |  |  | 10 |  |  | 26,989 |
Less: Lease revenue | — |  |  | 1 |  |  | 7 |  |  |  |  | — |  |  | 8 |
Less: Realized and unrealized ASC 815 revenue | 130 |  |  | 184 |  |  | (96) |  |  |  |  | 16 |  |  | 234 |
Less: Contract amortization | — |  |  | (26) |  |  | (4) |  |  |  |  | — |  |  | (30) |
Total revenue from contracts with customers | $ | 10,163 |  |  | $ | 12,874 |  |  | $ | 3,746 |  |  |  |  | $ | (6) |  |  | $ | 26,777 |
(a) Home includes Services
(b) Other Revenue in Texas includes ancillary revenues of $1.3 billion driven by high pricing during Winter Storm Uri
(c) The following amounts of energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:
(In millions) | Texas |  | East |  | West/Services/Other |  |  |  | Corporate/Eliminations |  | Total
Energy revenue | $ | — |  |  | $ | 131 |  |  | $ | 2 |  |  |  |  | $ | 3 |  |  | $ | 136 |
Capacity revenue | — |  |  | 149 |  |  | — |  |  |  |  | — |  |  | 149 |
Other revenue | 133 |  |  | (8) |  |  | (12) |  |  |  |  | — |  |  | 113 |
(d) Revenue relates entirely to unrealized gains and losses on derivative instruments accounted for under ASC 815
| For the Year Ended December 31, 2020
(In millions) | Texas |  | East |  | West/Services/Other |  |  |  | Corporate/Eliminations |  | Total
Retail revenue |  |  |  |  |  |  |  |  |  |  |
Home(a) | $ | 5,027 |  |  | $ | 1,210 |  |  | $ | 96 |  |  |  |  | $ | (2) |  |  | $ | 6,331 |
Business | 1,034 |  |  | 95 |  |  | — |  |  |  |  | — |  |  | 1,129 |
Total retail revenue | 6,061 |  |  | 1,305 |  |  | 96 |  |  |  |  | (2) |  |  | 7,460 |
Energy revenue(b) | 24 |  |  | 183 |  |  | 333 |  |  |  |  | (1) |  |  | 539 |
Capacity revenue(b) | — |  |  | 620 |  |  | 61 |  |  |  |  | (1) |  |  | 680 |
Mark-to-market for economic hedging activities(c) | 2 |  |  | 88 |  |  | (3) |  |  |  |  | 8 |  |  | 95 |
Other revenue(b) | 222 |  |  | 62 |  |  | 43 |  |  |  |  | (8) |  |  | 319 |
Total operating revenue | 6,309 |  |  | 2,258 |  |  | 530 |  |  |  |  | (4) |  |  | 9,093 |
Less: Lease revenue | — |  |  | 1 |  |  | 17 |  |  |  |  | — |  |  | 18 |
Less: Realized and unrealized ASC 815 revenue | 30 |  |  | 314 |  |  | 38 |  |  |  |  | 3 |  |  | 385 |
Total revenue from contracts with customers | $ | 6,279 |  |  | $ | 1,943 |  |  | $ | 475 |  |  |  |  | $ | (7) |  |  | $ | 8,690 |
(a) Home includes Services
(b) The following amounts of energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:
(In millions) | Texas |  | East |  | West/Services/Other |  |  |  | Corporate/Eliminations |  | Total
Energy revenue | $ | — |  |  | $ | 67 |  |  | $ | 43 |  |  |  |  | $ | (5) |  |  | $ | 105 |
Capacity revenue | — |  |  | 156 |  |  | — |  |  |  |  | — |  |  | 156 |
Other revenue | 28 |  |  | 3 |  |  | (2) |  |  |  |  | — |  |  | 29 |
(c) Revenue relates entirely to unrealized gains and losses on derivative instruments accounted for under ASC 815
| For the Year Ended December 31, 2019
(In millions) | Texas |  | East |  | West/Services/Other |  |  |  | Corporate/Eliminations |  | Total
Retail revenue |  |  |  |  |  |  |  |  |  |  |
Home(a) | $ | 5,027 |  |  | $ | 1,173 |  |  | $ | 57 |  |  |  |  | $ | (3) |  |  | $ | 6,254 |
Business | 1,205 |  |  | 74 |  |  | — |  |  |  |  | — |  |  | 1,279 |
Total retail revenue | 6,232 |  |  | 1,247 |  |  | 57 |  |  |  |  | (3) |  |  | 7,533 |
Energy revenue(b) | 529 |  |  | 322 |  |  | 318 |  |  |  |  | — |  |  | 1,169 |
Capacity revenue(b) | — |  |  | 664 |  |  | 36 |  |  |  |  | — |  |  | 700 |
Mark-to-market for economic hedging activities(c) | 47 |  |  | (29) |  |  | 16 |  |  |  |  | (1) |  |  | 33 |
Other revenue(b) | 261 |  |  | 58 |  |  | 70 |  |  |  |  | (3) |  |  | 386 |
Total operating revenue | 7,069 |  |  | 2,262 |  |  | 497 |  |  |  |  | (7) |  |  | 9,821 |
Less: Lease revenue | — |  |  | 1 |  |  | 19 |  |  |  |  | — |  |  | 20 |
Less: Realized and unrealized ASC 815 revenue | 1,562 |  |  | 183 |  |  | 67 |  |  |  |  | (2) |  |  | 1,810 |
Total revenue from contracts with customers | $ | 5,507 |  |  | $ | 2,078 |  |  | $ | 411 |  |  |  |  | $ | (5) |  |  | $ | 7,991 |
(a) Home includes Services
(b) The following amounts of energy, capacity and other revenue relate to derivative instruments and are accounted for under ASC 815:
(In millions) | Texas |  | East |  | West/Services/Other |  |  |  | Corporate/Eliminations |  | Total
Energy revenue | $ | 1,459 |  |  | $ | 98 |  |  | $ | 39 |  |  |  |  | $ | (1) |  |  | $ | 1,595 |
Capacity revenue | — |  |  | 109 |  |  | — |  |  |  |  | — |  |  | 109 |
Other revenue | 56 |  |  | 5 |  |  | 12 |  |  |  |  | — |  |  | 73 |
(c) Revenue relates entirely to unrealized gains and losses on derivative instruments accounted for under ASC 815
Contract Balances The following table reflects the contract assets and liabilities included in the Company's balance sheet as of December 31, 2021 and 2020:
(In millions) |  | December 31, 2021 |  | December 31, 2020
Deferred customer acquisition costs |  | $ | 133 |  |  | $ | 113 |
Accounts receivable, net - Contracts with customers |  | 3,057 |  |  | 866 |
Accounts receivable, net - Derivative instruments |  | 182 |  |  | 33 |
Accounts receivable, net - Affiliate |  | 6 |  |  | 5 |
Total accounts receivable, net |  | $ | 3,245 |  |  | $ | 904 |
Unbilled revenues (included within Accounts receivable, net - Contracts with customers) |  | $ | 1,574 |  |  | $ | 393 |
Deferred revenues (a) |  | $ | 227 |  |  | $ | 60 |
(a) Deferred revenues from contracts with customers for the years ended December 31, 2021 and 2020 were approximately $224 million and $31 million, respectively The revenue recognized from contracts with customers during the years ended December 31, 2021 and 2020 relating to the deferred revenue balance at the beginning of each period was $23 million and $13 million, respectively. The change in deferred revenue balances during the years ended December 31, 2021 and 2020 was primarily due to the timing difference of when consideration was received and when the performance obligation was transferred. The Company's customer acquisition costs consist of broker fees, commission payments and other costs that represent incremental costs of obtaining the contract with customers for which the Company expects to recover. The Company amortizes these amounts over the estimated life of the customer contract. As a practical expedient, the Company expenses the incremental costs of obtaining a contract if the amortization period of the asset would have been one year or less. When the Company receives consideration from the customer that is in excess of the amount due, such consideration is reclassified to deferred revenue, which represents a contract liability. Generally, the Company will recognize revenue from contract liabilities in the next period as the Company satisfies its performance obligations.

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -URI http://asc.fasb.org/topic&trid=49130388 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130551-203045 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 13 -Subparagraph (b)(2) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130556-203045 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130550-203045 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130558-203045 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 + Details
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