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Goodwill and Other Intangibles | 12 Months Ended
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Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangibles | Goodwill and Other Intangibles Goodwill The table below presents the changes of goodwill for the year ended December 31, 2021 based on the Company's reportable segments. Goodwill did not change during the year ended December 31, 2020.
(in millions) | Texas |  | East |  | West/Services/Other |  |  |  | Total
Balance as of January 1, 2021 | $ | 324 |  |  | $ | 240 |  |  | $ | 15 |  |  |  |  | $ | 579 |
Goodwill resulted from the acquisition of Direct Energy | 427 |  |  | 648 |  |  | 175 |  |  |  |  | 1,250 |
Impairment losses | — |  |  | (35) |  |  | — |  |  |  |  | (35) |
Foreign currency translation | — |  |  | — |  |  | 1 |  |  |  |  | 1 |
Balance as of December 31, 2021 | $ | 751 |  |  | $ | 853 |  |  | $ | 191 |  |  |  |  | $ | 1,795 |
Intangible Assets The Company's intangible assets as of December 31, 2021, primarily reflect intangible assets established with the acquisitions of various companies, including Direct Energy, Stream Energy, other retail acquisitions, and Texas Genco. Intangible assets are comprised of the following: •Emission Allowances — These intangibles primarily consist of SO2 emission allowances, including those established with the 2006 acquisition of Texas Genco, RGGI emission credits and California carbon allowances. These emission allowances are held-for-use and are amortized to cost of operations based on units of production. •Customer and supply contracts — These intangibles include the fair value at the acquisition date of in-market and out-of-market customer and supply contracts from the acquisition of Direct Energy and are amortized to revenue and cost of operations, respectively, based upon the fair market value, as of the acquisition date, for each delivery month. It also included energy supply contracts acquired with Stream Energy that represent the fair value at the acquisition date of in-market contracts for the purchase of energy to serve retail electric customers and are amortized based on the expected delivery under the respective contracts. •Customer relationships — These intangibles represent the fair value at the acquisition date of acquired businesses' customer base from the acquisition of Direct Energy and other acquisitions. The customer relationships are amortized to depreciation and amortization expense based on the expected discounted future net cash flows by year. •Marketing partnerships — These intangibles represent the fair value at the acquisition date of existing agreements with marketing vendors and loyalty and affinity partners for customer acquisition. The marketing partnerships are amortized to depreciation and amortization expense based on the expected discounted future net cash flows by year. •Trade names — These intangibles are amortized to depreciation and amortization expense on a straight-line basis. •Other — These intangibles primarily include renewable energy credits. Renewable energy credits are retired, as required, for the applicable compliance period. They are expensed to cost of operations based on NRG’s customer usage. It also includes in-market nuclear fuel contracts established from the Texas Genco acquisition in 2006 which are amortized to cost of operations over expected volumes over the life of each contract, costs to extend the operating license for STP Units 1 and 2 and intellectual property related to Goal Zero which are amortized to depreciation and amortization expense. The following tables summarize the components of NRG's intangible assets:
(In millions) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Year Ended December 31, 2021 | Emission Allowances |  | Customer and Supply Contracts |  |  |  | Customer Relationships |  | Marketing Partnerships |  | Trade Names |  | Other(b) |  | Total
January 1, 2021 | $ | 672 |  |  | $ | 28 |  |  |  |  | $ | 527 |  |  | $ | 285 |  |  | $ | 373 |  |  | $ | 140 |  |  | $ | 2,025 |
Purchases | 10 |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  | 338 |  |  | 348 |
Acquisition of businesses (a) | — |  |  | 610 |  |  |  |  | 1,308 |  |  | — |  |  | 310 |  |  | 124 |  |  | 2,352 |
Usage/Sales/Retirements | (1) |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  | (364) |  |  | (365) |
Write-off of fully amortized balances | (51) |  |  | — |  |  |  |  | (158) |  |  | — |  |  | — |  |  | (7) |  |  | (216) |
Other | 4 |  |  | — |  |  |  |  | 2 |  |  | (1) |  |  | — |  |  | (2) |  |  | 3 |
December 31, 2021 | 634 |  |  | 638 |  |  |  |  | 1,679 |  |  | 284 |  |  | 683 |  |  | 229 |  |  | 4,147 |
Less accumulated amortization | (536) |  |  | (94) |  |  |  |  | (518) |  |  | (123) |  |  | (294) |  |  | (71) |  |  | (1,636) |
Net carrying amount | $ | 98 |  |  | $ | 544 |  |  |  |  | $ | 1,161 |  |  | $ | 161 |  |  | $ | 389 |  |  | $ | 158 |  |  | $ | 2,511 |
(a)The weighted average life of total acquired amortizable intangibles from the Direct Energy acquisition was 12 years, see Note 4 — Acquisitions, Discontinued Operations and Dispositions for weighted average life of acquired amortizable intangibles for each intangible asset type (b)RECs are not subject to amortization and had a carrying value of $123 million
(In millions) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Year Ended December 31, 2020 | Emission Allowances |  | Customer and Supply Contracts |  |  |  | Customer Relationships |  | Marketing Partnerships |  | Trade Names |  | Other(b) |  | Total
January 1, 2020 | $ | 662 |  |  | $ | 28 |  |  |  |  | $ | 573 |  |  | $ | 285 |  |  | $ | 373 |  |  | $ | 130 |  |  | $ | 2,051 |
Purchases | 25 |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  | 45 |  |  | 70 |
Acquisition of businesses (a) | — |  |  | — |  |  |  |  | 22 |  |  | — |  |  | — |  |  | — |  |  | 22 |
Usage/Retirements | — |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  | (35) |  |  | (35) |
Write-off of fully amortized balances | (4) |  |  | — |  |  |  |  | (70) |  |  | — |  |  | — |  |  | — |  |  | (74) |
Impairment | (14) |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (14) |
Other | 3 |  |  | — |  |  |  |  | 2 |  |  | — |  |  | — |  |  | — |  |  | 5 |
December 31, 2020 | 672 |  |  | 28 |  |  |  |  | 527 |  |  | 285 |  |  | 373 |  |  | 140 |  |  | 2,025 |
Less accumulated amortization | (563) |  |  | (28) |  |  |  |  | (349) |  |  | (99) |  |  | (247) |  |  | (71) |  |  | (1,357) |
Net carrying amount | $ | 109 |  |  | $ | — |  |  |  |  | $ | 178 |  |  | $ | 186 |  |  | $ | 126 |  |  | $ | 69 |  |  | $ | 668 |
(a)The weighted average life of acquired intangibles was 5 years for customer relationships (b)RECs are not subject to amortization and had a carrying value of $28 million The following table presents NRG's amortization of intangible assets for each of the past three years:
| Years Ended December 31,
(In millions) | 2021 |  | 2020 |  | 2019
Emission allowances | $ | 24 |  |  | $ | 28 |  |  | $ | 32 |
Customer and supply contracts | 66 |  |  | 12 |  |  | 14 |
Customer relationships | 327 |  |  | 74 |  |  | 44 |
Marketing partnerships | 24 |  |  | 24 |  |  | 15 |
Trade names | 47 |  |  | 27 |  |  | 25 |
Other(a) | 7 |  |  | 3 |  |  | 4 |
Total amortization | $ | 495 |  |  | $ | 168 |  |  | $ | 134 |
(a)For the years ended December 31, 2021, 2020 and 2019, other intangibles were amortized to depreciation and amortization expense for $3 million, $3 million and $4 million, respectively The following table presents estimated amortization of NRG's intangible assets as of December 31, 2021 for each of the next five years:
(In millions) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Year Ended December 31, | Emission Allowances |  |  |  | Customer and Supply Contracts |  | Customer Relationships |  | Marketing Partnerships |  | Trade Names |  | Other |  | Total
2022 | $ | 14 |  |  |  |  | $ | 143 |  |  | $ | 265 |  |  | $ | 23 |  |  | $ | 47 |  |  | $ | 3 |  |  | $ | 495 |
2023 | 12 |  |  |  |  | 120 |  |  | 216 |  |  | 23 |  |  | 46 |  |  | 4 |  |  | 421 |
2024 | 12 |  |  |  |  | 73 |  |  | 148 |  |  | 23 |  |  | 38 |  |  | 3 |  |  | 297 |
2025 | 11 |  |  |  |  | 50 |  |  | 110 |  |  | 22 |  |  | 32 |  |  | 4 |  |  | 229 |
2026 | 9 |  |  |  |  | 52 |  |  | 95 |  |  | 22 |  |  | 24 |  |  | 4 |  |  | 206 |
Intangible assets held-for-sale — From time to time, management may authorize the transfer from the Company's emission bank of emission allowances held-for-use to intangible assets held-for-sale. Emission allowances held-for-sale are included in other non-current assets on the Company's consolidated balance sheet and are not amortized, but rather expensed as sold. As of December 31, 2021 and 2020, the value of emission allowances held-for-sale was $15 million and $14 million, respectively, within the Corporate segment. Once transferred to held-for-sale, these emission allowances are prohibited from moving back to held-for-use.

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
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