Document

10-K 1 genon201610-k.htm 10-K Document

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K



x		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year ended December 31, 2016.

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition period from to .

GenOn Energy, Inc.

(Exact name of registrant as specified in its charter)

76-0655566 (I.R.S. Employer Identification No.)

Commission File Number: 001-16455

GenOn Americas Generation, LLC

(Exact name of registrant as specified in its charter)

51-0390520 (I.R.S. Employer Identification No.)

Commission File Number: 333-63240

GenOn Mid-Atlantic, LLC

(Exact name of registrant as specified in its charter)

58-2574140 (I.R.S. Employer Identification No.)

Commission File Number: 333-61668



Delaware (State or other jurisdiction of incorporation or organization)

804 Carnegie Center Princeton, New Jersey (Address of principal executive offices)		08540 (Zip Code)

(609) 524-4500

(Registrants' telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act.



GenOn Energy, Inc.	o	Yes	þ	No
GenOn Americas Generation, LLC	o	Yes	þ	No
GenOn Mid-Atlantic, LLC	o	Yes	þ	No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.



GenOn Energy, Inc.	þ	Yes	o	No
GenOn Americas Generation, LLC	þ	Yes	o	No
GenOn Mid-Atlantic, LLC	þ	Yes	o	No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. (As a voluntary filer not subject to filing requirements, the registrant nevertheless filed all reports which would have been required to be filed by Section 15(d) of the Exchange Act during the preceding 12 months had the registrant been required to file reports pursuant to Section 15(d) of the Securities Exchange Act of 1934 solely as a result of having registered debt securities under the Securities Act of 1933.)



GenOn Energy, Inc.	o	Yes	o	No
GenOn Americas Generation, LLC	o	Yes	o	No
GenOn Mid-Atlantic, LLC	o	Yes	o	No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).



GenOn Energy, Inc.	þ	Yes	o	No
GenOn Americas Generation, LLC	þ	Yes	o	No
GenOn Mid-Atlantic, LLC	þ	Yes	o	No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.



GenOn Energy, Inc.	þ
GenOn Americas Generation, LLC	þ
GenOn Mid-Atlantic, LLC	þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b‑2 of the Exchange Act.



	Large accelerated filer	Accelerated filer	Non-accelerated filer	Smaller reporting company
GenOn Energy, Inc.	o	o	þ	o
GenOn Americas Generation, LLC	o	o	þ	o
GenOn Mid-Atlantic, LLC	o	o	þ	o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Act).



GenOn Energy, Inc.	o	Yes	þ	No
GenOn Americas Generation, LLC	o	Yes	þ	No
GenOn Mid-Atlantic, LLC	o	Yes	þ	No

Each Registrant’s outstanding equity interests are held by its respective parent and there are no equity interests held by nonaffiliates.



Registrant		Parent
GenOn Energy, Inc.		NRG Energy, Inc.
GenOn Americas Generation, LLC		NRG Americas, Inc.
GenOn Mid-Atlantic, LLC		NRG North America, LLC

This combined Form 10-K is separately filed by GenOn Energy, Inc., GenOn Americas Generation, LLC and GenOn Mid-Atlantic, LLC. Information contained in this combined Form 10-K relating to GenOn Energy, Inc., GenOn Americas Generation, LLC and GenOn Mid-Atlantic, LLC is filed by such registrant on its own behalf and each registrant makes no representation as to information relating to registrants other than itself.

The registrants have not incorporated by reference any information into this Form 10-K from any annual report to securities holders, proxy statement or prospectus filed pursuant to 424(b) or (c) of the Securities Act.

NOTE: WHEREAS GENON ENERGY, INC., GENON AMERICAS GENERATION, LLC AND GENON MID-ATLANTIC, LLC MEET THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION I(1)(a) AND (b) OF FORM 10-K, THIS COMBINED FORM 10-K IS BEING FILED WITH THE REDUCED DISCLOSURE FORMAT PURSUANT TO GENERAL INSTRUCTION I(2).

TABLE OF CONTENTS



	Glossary of Terms	2
PART I		5
	Item 1 — Business	5
	Item 1A — Risk Factors Related to the Registrants	14
	Item 1B — Unresolved Staff Comments	27
	Item 2 — Properties	28
	Item 3 — Legal Proceedings	29
	Item 4 — Mine Safety Disclosures	29
PART II		30
	Item 5 — Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	30
	Item 6 — Selected Financial Data	30
	Item 7 — Management's Narrative Analysis of the Results of Operations and Financial Condition	31
	Item 7A — Quantitative and Qualitative Disclosures About Market Risk	49
	Item 8 — Financial Statements and Supplementary Data	50
	Item 9 — Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	51
	Item 9A — Controls and Procedures	51
	Item 9B — Other Information	51
PART III		52
	Item 10 — Directors, Executive Officers and Corporate Governance	52
	Item 11 — Executive Compensation	52
	Item 12 — Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	52
	Item 13 — Certain Relationships and Related Transactions, and Director Independence	52
	Item 14 — Principal Accounting Fees and Services	52
PART IV		53
	Item 15 — Exhibits, Financial Statement Schedules	53
EXHIBIT INDEX		143

Glossary of Terms

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



ARO		Asset Retirement Obligation
ASC		The FASB Accounting Standards Codification, which the FASB established as the source of authoritative GAAP
ASU		Accounting Standards Updates – updates to the ASC
Average realized prices		Volume-weighted average power prices, net of average fuel costs and reflecting the impact of settled hedges
Bankruptcy Court		United States Bankruptcy Court for the Northern District of Texas, Fort Worth Division
Baseload		Units expected to satisfy minimum baseload requirements of the system and produce electricity at an essentially constant rate and run continuously
CAIR		Clean Air Interstate Rule
CAISO		California Independent System Operator
CCGT		Combined Cycle Gas Turbine
CenterPoint		CenterPoint Energy, Inc. and its subsidiaries, on and after August 31, 2002, and Reliant Energy, Incorporated and its subsidiaries, prior to August 31, 2002
CES		Clean Energy Standard
CFTC		U.S. Commodity Futures Trading Commission
CO₂		Carbon Dioxide
CPUC		California Public Utilities Commission
CSAPR		Cross-State Air Pollution Rule
CWA		Clean Water Act
D.C. Circuit		U.S. Court of Appeals for the District of Columbia Circuit
Deactivation		Includes retirement, mothballing and long-term protective layup. In each instance, the deactivated unit cannot be currently called upon to generate electricity.
Dodd-Frank Act		Dodd-Frank Wall Street Reform and Consumer Protection Act
Economic gross margin		Sum of energy revenue, capacity revenue and other revenue, less cost of sales and other cost of sales
EGU		Electric Generating Unit
EMAAC		Eastern Mid-Atlantic Area Council
EPA		United States Environmental Protection Agency
EPC		Engineering, Procurement and Construction
EPSA		The Electric Power Supply Association
ERISA		The Employee Retirement Income Security Act of 1974
ESPS		Existing Source Performance Standards
Exchange Act		The Securities Exchange Act of 1934, as amended
FASB		Financial Accounting Standards Board
FCM		Forward Capacity Market
FERC		Federal Energy Regulatory Commission
FTRs		Financial Transmission Rights
FPA		Federal Power Act
GAAP		Accounting principles generally accepted in the U.S.
GenOn		GenOn Energy, Inc. and, except where the context indicates otherwise, its subsidiaries
GenOn Americas Generation		GenOn Americas Generation, LLC and, except where the context indicates otherwise, its subsidiaries
GenOn Americas Generation Senior Notes		GenOn Americas Generation's $695 million outstanding unsecured senior notes consisting of $366 million of 8.5% senior notes due 2021 and $329 million of 9.125% senior notes due 2031



GenOn Energy Holdings		GenOn Energy Holdings, Inc. and, except where the context indicates otherwise, its subsidiaries
GenOn Energy Management		GenOn Energy Management, LLC, a wholly owned subsidiary of GenOn Americas Generation, LLC
GenOn Mid-Atlantic		GenOn Mid-Atlantic, LLC and, except where the context indicates otherwise, its subsidiaries, which include the coal generation units at two generating facilities under operating leases
GenOn Plans		Collectively, the NRG GenOn LTIP, The GenOn Energy, Inc. 2002 Long-Term Incentive Plan, the GenOn Energy, Inc. 2002 Stock Plan and the Mirant Corporation 2005 Omnibus Incentive Compensation Plan
GenOn Senior Notes		GenOn's $1.8 billion outstanding unsecured senior notes consisting of $691 million of 7.875% senior notes due 2017, $649 million of 9.5% senior notes due 2018, and $490 million of 9.875% senior notes due 2020
GHG		Greenhouse Gas
HAPs		Hazardous Air Pollutants
IASB		International Accounting Standards Board
ICAP		New York Installed Capacity
ICE		Intercontinental Exchange
IFRS		International Financial Reporting Standards
IPA		Illinois Power Authority
IRC		Internal Revenue Code of 1986, as amended
IRC §		IRC Section
ISO		Independent System Operator, also referred to as RTO
ISO-NE		ISO New England Inc.
kWh		Kilowatt-hour
LIBOR		London Inter-Bank Offered Rate
LTSA		Long Term Service Agreement
MAAC		Mid-Atlantic Area Council
MATS		Mercury and Air Toxics Standards
MC Asset Recovery		MC Asset Recovery, LLC
MDE		Maryland Department of the Environment
Merit Order		A term used for the ranking of power stations in order of ascending marginal cost
Mirant		GenOn Energy Holdings, Inc. (formerly known as Mirant Corporation) and, except where the context indicates otherwise, its subsidiaries
Mirant/RRI Merger		The merger completed on December 3, 2010 pursuant to the Mirant/RRI Merger Agreement
Mirant Debtors		GenOn Energy Holdings, Inc. (formerly known as Mirant Corporation) and certain of its subsidiaries
MISO		Midcontinent Independent System Operator, Inc.
MMBtu		Million British Thermal Units
MOPR		Minimum Offer Price Rule
Mothballed		The unit has been removed from service and is unavailable for service, but has been laid up in a manner such that it can be brought back into service with an appropriate amount of notification, typically weeks or months
MW		Megawatt
MWh		Saleable megawatt hour net of internal/parasitic load megawatt-hour
NAAQS		National Ambient Air Quality Standards
Natixis		Natixis Funding Corp.
NEPGA		New England Power Generators Association
Net Exposure		Counterparty credit exposure to GenOn, GenOn Americas Generation or GenOn Mid-Atlantic, as applicable, net of collateral



Net Generation		The net amount of electricity produced, expressed in kWhs or MWhs, that is the total amount of electricity generated (gross) minus the amount of electricity used during generation.
NERC		North American Electric Reliability Corporation
NOL		Net Operating Loss
NOV		Notice of Violation
NO_x		Nitrogen Oxides
NPDES		National Pollution Discharge Elimination System
NPNS		Normal Purchase Normal Sale
NRG		NRG Energy, Inc. and, except where the context indicates otherwise, its subsidiaries
NRG Americas		NRG Americas, Inc. (formerly known as GenOn Americas, Inc.)
NRG GenOn LTIP		NRG 2010 Stock Plan for GenOn employees
NRG Merger		The merger completed on December 14, 2012 whereby GenOn became a wholly owned subsidiary of NRG
NSPS		New Source Performance Standards
NYISO		New York Independent System Operator
NYMEX		New York Mercantile Exchange
NYSPSC		New York State Public Service Commission
OCI		Other Comprehensive Income/ (Loss)
Peaking		Units expected to satisfy demand requirements during the periods of greatest or peak load on the system
PER		Peak Energy Rate
PJM		PJM Interconnection, LLC
Plan		The plan of reorganization that was approved in conjunction with Mirant Corporation's emergence from bankruptcy protection on January 3, 2006
PPM		Parts Per Million
PUCO		Public Utility Commission of Ohio
PUHCA		Public Utility Holding Company Act of 2005
PURPA		Public Utility Regulatory Policies Act of 1978
RCRA		Resource Conservation and Recovery Act of 1976
Registrants		GenOn, GenOn Americas Generation and GenOn Mid-Atlantic, collectively
REMA		NRG REMA LLC (formerly known as GenOn REMA, LLC)
Repowering		Technologies utilized to replace, rebuild, or redevelop major portions of an existing electrical generating facility, not only to achieve a substantial emission reduction, but also to increase facility capacity, and improve system efficiency
RGGI		Regional Greenhouse Gas Initiative
RMR		Reliability Must-Run
RRI Energy		RRI Energy, Inc.
RTO		Regional Transmission Organization
SCR		Selective Catalytic Reduction
SEC		U.S. Securities and Exchange Commission
Securities Act		The Securities Act of 1933, as amended
Seward		The Seward Generating Station, a 525 MW coal-fired facility in Pennsylvania
Shelby		The Shelby Generating Station, a 352 MW natural gas-fired facility in Illinois
SO₂		Sulfur Dioxide
U.S.		United States of America

PART I

Item 1 — Business (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

General

The Registrants are wholesale power generation subsidiaries of NRG, which is a competitive power company that produces, sells and delivers electricity and related services, primarily in major competitive power markets in the U.S. GenOn is an indirect wholly owned subsidiary of NRG. GenOn was incorporated as a Delaware corporation on August 9, 2000, under the name Reliant Energy Unregco, Inc. GenOn Americas Generation and GenOn Mid-Atlantic are indirect wholly owned subsidiaries of GenOn. GenOn Americas Generation was formed as a Delaware limited liability company on November 1, 2001, under the name Mirant Americas Generation, LLC. GenOn Mid-Atlantic was formed as a Delaware limited liability company on July 12, 2000, under the name Southern Energy Mid-Atlantic, LLC. GenOn Mid-Atlantic is a wholly-owned subsidiary of NRG North America and an indirect wholly owned subsidiary of GenOn Americas Generation. The Registrants are engaged in the ownership and operation of power generation facilities; the trading of energy, capacity and related products; and the transacting in and trading of fuel and transportation services.

The Registrants’ generation facilities are located in the U.S. and comprise generation facilities across the merit order. The sale of capacity and power from baseload and intermediate generation facilities accounts for a majority of the Registrants’ generation revenues. In addition, the Registrants’ generation portfolio provides each with opportunities to capture additional revenues by selling power during periods of peak demand, offering capacity or similar products, and providing ancillary services to support system reliability.

The following table summarizes the generation portfolio as of December 31, 2016, by Registrant:



	(In MW)^(a)
Generation Type	GenOn	GenOn Americas Generation	GenOn Mid-Atlantic
Natural gas^(b)(c)	10,377	4,040	1,864
Coal^(d)	4,199	2,433	2,433
Oil	1,847	1,434	308
Total generation capacity	16,423	7,907	4,605


(a)	MW figures provided represent nominal summer net MW capacity of power generated as adjusted for the Registrants' owned or leased interest excluding capacity from inactive/mothballed units.

(b)

GenOn's natural gas generation portfolio includes 325 MW related to the gas addition of New Castle Units 3-5 which was completed in the second quarter of 2016 and 597 MW related to the gas addition of Shawville which was completed in the fourth quarter of 2016. GenOn's natural gas generation does not include 78 MW related to the Chalk Point capital lease which expired at the end of 2015, 352 MW related to Shelby which was sold on March 1, 2016 and 878 MW related to Aurora which was sold on July 12, 2016.


(c)	GenOn's natural gas generation portfolio includes 275 MW related to Choctaw Unit 1 which is in forced outage which is expected to return to service in December 2017.

(d)

GenOn's coal generation portfolio does not include 325 MW related to New Castle Units 3-5, which completed a gas addition in the second quarter of 2016, 597 MW related to Shawville, which completed a gas addition in the fourth quarter of 2016, and 94 MW related to Avon Lake Unit 7, which was deactivated in the second quarter of 2016. In addition, GenOn's coal generation portfolio does not include 525 MW related to Seward which was sold on February 2, 2016.

Seasonality and Price Volatility

Annual and quarterly operating results of the Registrants' wholesale power generation segments can be significantly affected by weather and energy commodity price volatility. Significant other events, such as the demand for natural gas, interruptions in fuel supply infrastructure and relative levels of hydroelectric capacity, can increase seasonal fuel and power price volatility. The preceding factors related to seasonality and price volatility are fairly uniform across the Registrants' wholesale generation business.

2016 Significant Events and Developments

Going Concern

As disclosed in Item 15 — Note 1, Nature of Business and Note 9, Debt and Capital Leases, as of December 31, 2016, $691 million of GenOn's Senior Notes outstanding, excluding $8 million of associated premiums, are current within the GenOn consolidated balance sheet and are due on June 15, 2017. GenOn's future profitability continues to be adversely affected by (i) a sustained decline in natural gas prices and its resulting effect on wholesale power prices and capacity prices, and (ii) the inability of GenOn Mid-Atlantic and REMA to make distributions of cash and certain other restricted payments to GenOn. Based on current projections, GenOn is not expected to have sufficient liquidity exclusive of cash subject to the restrictions under the GenOn Mid-Atlantic and REMA operating leases to repay the GenOn Senior Notes due in June 2017. As a result of these factors, there is substantial doubt about GenOn's ability to continue as a going concern.

NRG, GenOn's parent company, has no obligation to provide any financial support other than the credit agreement between NRG and GenOn which provides for a $500 million revolving credit facility, all of which can be utilized for revolving loans and letters of credit as further in described in Item 15 — Note 13, Related Party Transactions. As controlled group members, ERISA requires that NRG and GenOn are jointly and severally liable for the NRG Pension Plan for Bargained Employees and the NRG Pension Plan, including the pension liabilities associated with GenOn employees.

GenOn is currently considering all options available to it, including negotiations with creditors and lessors, refinancing the GenOn Senior Notes, potential sales of certain generating assets as well as the possibility for a need to file for protection under Chapter 11 of the U.S. Bankruptcy Code. During 2016, GenOn appointed two independent directors, retained advisors and established a separate audit committee as part of this process.

As of December 31, 2016, GenOn Americas Generation, a consolidated subsidiary of GenOn, has a note receivable due from GenOn Energy Holdings, a consolidated subsidiary of GenOn, of $315 million and an accounts payable due to GenOn Energy Holdings of $43 million under the intercompany cash management program as further described in Item 15 — Note 13, Related Party Transactions. The terms of the intercompany note do not provide for priority to GenOn Americas Generation and as such, there is no assurance that options pursued by GenOn will not have an adverse impact on GenOn Americas Generation’s liquidity. As such, there is substantial doubt about GenOn Americas Generation’s ability to continue as a going concern.

With respect to GenOn Mid-Atlantic, a consolidated subsidiary of GenOn, management has determined that while it has sufficient cash on hand to fund current obligations including operating lease payments due under the GenOn Mid-Atlantic operating leases as of December 31, 2016, the potential significant adverse impact of financial stresses at GenOn Mid-Atlantic's parent companies and, to a lesser extent, any adverse impact resulting from the notification by GenOn Mid-Atlantic's lessors alleging the existence of lease events of default as further described in Note 9, Debt and Capital Leases, has caused there to be substantial doubt about GenOn Mid-Atlantic's ability to continue as a going concern.

Dispositions & Deactivations

During the year ended December 31, 2016, the Registrants completed dispositions of certain generating stations and real property further discussed in Item 15 — Note 3, Dispositions. The following table summarizes dispositions during 2016:



Name and Location of Facility	Net Generation Capacity (MW)	Power Market	Registrant	Date Sale Completed
Seward, New Florence, PA	525	PJM	GenOn	February 2, 2016
Shelby, Neoga, IL	352	PJM	GenOn	March 1, 2016
Aurora, IL	878	PJM	GenOn	July 12, 2016
Potrero, San Francisco, CA ^(a)	—	N/A	GenOn Americas Generation	September 26, 2016
	1,755

(a) The sale of Potrero consisted solely of real property, as the generating station was deactivated during the first quarter of 2011.

In addition, GenOn Americas Generation deactivated the Pittsburg Generating Station, a 1,029 MW natural gas-fired facility located in California, on January 1, 2017.

The Registrants' future operating revenues, gross margin and other operating costs may be adversely impacted as a result of facilities that have been sold or deactivated in 2016 or may be deactivated in the future.

Impairments

During 2016, GenOn recorded impairment losses on its Mandalay and Ormond Beach operating units along with its leased interests in Keystone and Conemaugh totaling $194 million. In addition, GenOn Americas Generation recorded an impairment on the Pittsburg generating station during the fourth quarter of 2016 resulting in an impairment loss of $20 million. See Item 15 — Note 8, Impairments, to the Consolidated Financial Statements for further discussion.

Competition

Wholesale power generation is a capital-intensive and commodity-driven business with numerous industry participants that compete on the basis of the location of their plants, fuel mix, plant efficiency and the reliability of the services offered. The Registrants compete on the basis of the location of their plants and ownership of portfolios of plants in various regions, which increases the stability and reliability of their energy revenues. Wholesale power generation is a regional business that is currently highly fragmented and diverse in terms of industry structure. As such, there is a wide variation in terms of the capabilities, resources, nature and identity of the companies the Registrants compete with depending on the market. Competitors include regulated utilities, municipalities, cooperatives and other independent power producers, and power marketers or trading companies, including those owned by financial institutions.

Competitive Strengths

The Registrants’ power generation assets are diversified by fuel-type, dispatch level and region, which helps mitigate the risks associated with fuel price volatility and market demand cycles. The Registrants' baseload and intermediate facilities provide each with a significant source of cash flow, while the peaking facilities provide the Registrants with opportunities to capture significant upside potential that can arise from time to time during periods of high demand.

Many of the Registrants’ generation assets are located within densely populated areas, which tend to have higher wholesale pricing as a result of relatively favorable local supply-demand balance. The Registrants have generation assets located in or near the New York City, Washington, D.C., Baltimore, Pittsburgh, Los Angeles and San Francisco metropolitan areas. These facilities, some of which are aging, are often ideally situated for repowering or the addition of new capacity because their location and existing infrastructure provide significant advantages over undeveloped sites.

Coal Operations

The following table summarizes GenOn's U.S. coal capacity and the corresponding revenues and average natural gas prices and positions resulting from coal hedge agreements extending beyond December 31, 2016 and through 2020:



	2017			2018			2019			2020			Annual Average for 2017-2020
	(Dollars in millions unless otherwise stated)
Net Coal Capacity (MW)^(a)	4,198			4,198			4,198			4,198			4,198
Forecasted Coal Capacity (MW) ^(b)	1,956			1,823			1,396			1,248			1,606
Total Coal Sales (GWh) ^(c)	16,636			1,905			—			—			4,635
Percentage Coal Capacity Sold Forward^(d)	97		%	12		%	—		%	—		%	27		%
Total Forward Hedged Revenues ^(e)	$	629		$	68		$	—		$	—		$	—
Weighted Average Hedged Price ($ per MWh) ^(e)	$	37.79		$	35.48		$	—		$	—		$	—
Average Equivalent Natural Gas Price ($ per MMBtu) ^(e)	$	3.65		$	3.43		$	—		$	—		$	—
Gross Margin Sensitivities
Gas Price Sensitivity Up $0.50/MMBtu on Coal Units	$	37		$	119		$	118		$	111		$	—
Gas Price Sensitivity Down $0.50/MMBtu on Coal Units	$	(10	)	$	(90	)	$	(82	)	$	(74	)	$	—
Heat Rate Sensitivity Up 1 MMBtu/MWh on Coal Units	$	35		$	61		$	56		$	52		$	—
Heat Rate Sensitivity Down 1 MMBtu/MWh on Coal Units	$	(11	)	$	(49	)	$	(48	)	$	(43	)	$	—


(a)	Net coal capacity represents nominal summer net MW capacity of power generated as adjusted for the Registrants' ownership position excluding capacity from inactive/mothballed units.


(b)	Forecasted generation dispatch output (MWh) based on forward price curves as of December 31, 2016, which is then divided by number of hours in a given year to arrive at MW capacity. The dispatch takes into account planned and unplanned outage assumptions.

(c)

Includes amounts under power sales contracts and natural gas hedges. The forward natural gas quantities are reflected in equivalent GWh based on forward market implied heat rate as of December 31, 2016, and then combined with power sales to arrive at equivalent GWh hedged. The coal sales include swaps and delta of options sold which is subject to change. For detailed information on the Registrants' hedging methodology through use of derivative instruments, see discussion in Item 15 - Note 5, Accounting for Derivative Instruments and Hedging Activities, to the Consolidated Financial Statements.


(d)	Percentage hedged is based on total coal sales as described in (c) above divided by the forecasted coal capacity.


(e)	Represents all U.S. coal sales, including energy revenue and demand charges, excluding revenues derived from capacity auctions.

Regulatory Matters

As owners of power plants and participants in wholesale energy markets, certain of the Registrants' subsidiaries are subject to regulation by various federal and state government agencies. These include the CFTC and FERC, as well as other public utility commissions in certain states where the Registrants' generating assets are located. In addition, the Registrants are subject to the market rules, procedures and protocols of the various ISO markets in which they participate. The Registrants must also comply with the mandatory reliability requirements imposed by NERC and the regional reliability entities in the regions where they operate.

Current Administration and Changeover at FERC — FERC is currently without a quorum and cannot issue orders in contested proceedings until a new Commissioner is appointed. FERC’s day-to-day work can continue through authority that has been delegated to FERC Staff. With a new administration and three vacant positions at FERC, the Registrants' business may be affected because its generation fleet is subject to changes in FERC regulatory policy.

PJM

2019/2020 PJM Auction Results — On May 24, 2016, PJM announced the results of its 2019/2020 base residual auction. GenOn (including GenOn Americas Generation and GenOn Mid-Atlantic) cleared approximately 6,766 MW of Capacity Performance product and 305 MW of Base Capacity product in the 2019/2020 base residual auction. GenOn's (including GenOn Americas Generation and GenOn Mid-Atlantic) expected capacity revenues from the 2019/2020 base residual auction for the 2019/2020 delivery year are approximately $260 million. GenOn Americas Generation (including GenOn Mid-Atlantic) cleared approximately 3,814 MW of Capacity Performance product in the 2019/2020 base residual auction. GenOn Americas Generation's (including GenOn Mid-Atlantic) expected capacity revenues from the 2019/2020 base residual auction for the 2019/2020 delivery year are approximately $140 million.

The tables below provide a detailed description of the Registrant's Base Residual Auction results:

GenOn:



	Base Capacity Product			Capacity Performance Product
Zone	Cleared Capacity (MW)⁽¹⁾	Price ($/MW-day)		Cleared Capacity (MW)⁽¹⁾	Price ($/MW-day)
EMAAC	103	$	99.77	414	$	119.77
MAAC	9	$	80.00	5,802	$	100.00
RTO	193	$	80.00	550	$	100.00
Total	305			6,766

(1) Includes imports. Excludes cleared capacity related to Aurora, the sale of which was completed on July 12, 2016.

GenOn Americas Generation & GenOn Mid-Atlantic:



	Base Capacity Product			Capacity Performance Product
Zone	Cleared Capacity (MW)⁽¹⁾	Price ($/MW-day)		Cleared Capacity (MW)⁽¹⁾	Price ($/MW-day)
MAAC ⁽²⁾	—	$	—	3,814	$	100.00
Total	—			3,814

(1) Includes imports.

(2) Plants that participate in the PJM auctions for GenOn Americas Generation are solely those operated by GenOn Mid-Atlantic.

PJM Capacity Performance Appeals — On or about July 8, 2016, four petitions were filed at the D.C. Circuit seeking review of the FERC orders approving PJM's Capacity Performance revisions to its forward capacity market after motions for rehearing at FERC were denied on May 10, 2016. NRG intervened in these matters on July 29, 2016. On December 9, 2016, NRG, along with other generators and industry trade groups, filed a joint brief in support of FERC's decision. Briefing is complete and oral argument occurred in February 2017. This case governs capacity revenues already received by the Registrants, as well as the revenues for forward periods.

PJM Seasonal Capacity Proceeding — On November 17, 2016, PJM proposed to enhance the ability of capacity storage resources, intermittent resources, demand response, energy efficiency, and environmentally limited resources, or collectively the seasonal capacity performance resources, to participate in the BRA and qualify as a resource providing the capacity performance product through aggregation. NRG filed comments specifically supporting PJM’s proposal to modify the aggregation rules to allow seasonal capacity resources to aggregate across LDAs and to allow aggregations through RPM auctions. On January 23, 2017, PJM amended its proposal to address questions from FERC. The outcome of this proceeding could have a material impact on future PJM capacity prices.

Complaints Related to Extension of Base Capacity — In 2015, FERC approved changes to PJM's capacity market, which included moving from the Base Capacity product to the higher performance Capacity Performance product over the course of a five year transition. Under this transition, as of the May 2017 BRA, the Base Capacity product will no longer be available. Several parties have filed complaints at FERC seeking to maintain the RPM Base Capacity product for at least one more delivery year or until such time as PJM develops a model for seasonal resources to participate. If the transition is delayed, capacity prices could be materially impacted. The matters are pending at FERC.

MOPR Revisions — On May 2, 2013, FERC accepted PJM's proposal to substantially revise its Minimum Offer Price Rule, or MOPR. Among other things, FERC approved the portions of the PJM proposal that exempt many new entrants from demonstrating that their proposed projects are economic, as well as providing a similar exemption for public power entities and certain self-supply entities. This exemption is subject to certain conditions designed to limit the financial incentive of such entities to suppress market prices. On June 3, 2013, NRG filed a request for rehearing of the FERC order and subsequently protested the manner in which PJM proposed to implement the FERC order. On October 15, 2015, FERC denied the requests for rehearing and accepted PJM’s compliance filing. NRG, along with other parties, filed a petition for review of FERC's decision with the D.C. Circuit. Briefing is complete. The case is pending at the D.C. Circuit.

Illinois Zero Emission Credit Legislation and Related PJM Complaint — Pursuant to legislation in Illinois, the Illinois Power Agency is to procure contracts for Zero Emission Credits, or ZECs, through a process that would take into account environmental benefits, including the preservation of zero emission facilities. The procurement would be subject to review by the Illinois Commerce Commission. These ZECs are out-of-market subsidies that threaten to artificially suppress prices in the PJM auctions. On February 14, 2017, NRG, along with other companies, filed a complaint in the District Court for the Northern District of Illinois; another plaintiff group filed a similar complaint on the same day.

As a result of the ZEC scheme adopted by the Illinois legislature and to address the effect of subsidies set to be paid to Illinois to certain nuclear units, on January 9, 2017, NRG and other generators and its trade association filed a joint amendment to the pending complaint seeking to apply the MOPR in the capacity market to existing resources that receive out-of-market subsidies. This amendment is to the March 21, 2016 complaint filed by NRG and other companies related to ratepayer-funded subsidies approved by the PUCO.

New England (GenOn and GenOn Americas Generation)

2020/2021 ISO-NE Auction Results — On February 6, 2017, ISO-NE announced the results of its 2020/2021 forward capacity auction. GenOn, including GenOn Americas Generation, cleared 1,112 MW at $5.297 per KW month providing expected annual capacity revenues of $71 million.

Peak Energy Rent Adjustment Complaint — On September 30, 2016, the New England Power Generators Association, or NEPGA, filed a complaint against ISO-NE asking FERC to find the Peak Energy Rent, or PER, unjust and unreasonable. On January 9, 2017, FERC granted NEPGA’s complaint requiring a change to how the PER strike price is calculated and determine any refunds during the time period provided for in the complaint. The first FERC-ordered settlement conference occurred on February 16, 2017.

Performance Incentive Proposal — On January 17, 2014, ISO-NE filed at FERC to revise its forward capacity market, or FCM, by making a resource’s forward capacity market compensation dependent on resource output during short intervals of operating reserve scarcity. The ISO-NE proposal would replace the existing shortage event penalty structure with a new performance incentive mechanism, resulting in capacity payments to resources that would be the combination of two components: (1) a base capacity payment and (2) a performance payment or charge. The performance payment or charge would be entirely dependent upon the resource’s delivery of energy or operating reserves during scarcity conditions, and could be larger than the base payment.

On May 30, 2014, FERC found that most of the provisions in the ISO-NE proposal, with modifications, together with an increase to the reserve constraint penalty factors, provided a just and reasonable structure. FERC instituted a proceeding for further hearings and required ISO-NE to make a compliance filing to modify its proposal and adopt the increases to the reserve constraint penalty factors. FERC denied rehearing. The NEPGA filed a petition for review of FERC's decision with the D.C. Circuit. Briefing is complete.

New York (GenOn and GenOn Americas Generation)

New York Clean Energy Standard and Zero Emission Credit Nuclear Bailout — On August 1, 2016, the NYSPSC issued its Clean Energy Standard, or CES, order. The CES order included three main components: (i) a commitment to move New York to 50% renewables by 2030; (ii) new renewable energy credit pricing for both new and existing renewable facilities; and (iii) a ZEC that would provide more than $7.6 billion over 12 years in out-of-market subsidy payments to certain selected nuclear generating units in the state. The stated purpose of the ZECs is to keep nuclear units running even though they would be uneconomic and likely retire if they received compensation only from the FERC-jurisdictional wholesale power market. The ZECs would have the effect of suppressing wholesale market prices and interfere with the wholesale market. On October 19, 2016, NRG, along with other entities, filed a complaint in the U.S. District Court for the Southern District of New York, challenging the validity of the NYSPSC action and the ZEC program. On December 9, 2016, Exelon, the NYSPSC and other parties filed a motion to dismiss the complaint. On January 6, 2017, NRG, along with other parties, filed an opposition to the motions to dismiss. The motions are pending before the U.S. District Court.

Independent Power Producers of New York (IPPNY) Complaint — On January 9, 2017, EPSA requested FERC to promptly direct the NYISO to file tariff provisions to address pending market concerns related to out of market payments to existing generation in the NYISO. This request was prompted by the ZEC program initiated by the NYSPSC. This request follows IPPNY’s complaint at FERC against the NYISO on May 10, 2013, as amended on March 25, 2014. The generators asked FERC to direct the NYISO to require that capacity from existing generation resources that would have exited the market but for out-of-market payments. Failure to implement buyer-side mitigation measures could result in uneconomic entry, which artificially decreases capacity prices below competitive market levels.

New York Public Service Commission Retail Energy Market Proceedings — On February 23, 2016, the NYSPSC issued what it refers to as its “Retail Reset” order, or Reset Order, in docket 12-M-0476 et al. Among other things, the Reset Order instituted a price cap on energy supply offers and required many retail providers to seek affirmative consent from certain retail customers over a very short period of time to retain those customers. Retail suppliers who cannot meet these conditions will be required to return their customers to energy supply service provided by the local utility. On July 25, 2016, the New York Supreme Court vacated part of the Reset Order on procedural grounds and remanded the matter to the NYSPSC for further consideration. Additionally, the Court affirmed the NYSPSC’s authority to regulate Energy Service Companies prices. The matter is now on appeal before the Supreme Court of New York, Appellate Division. On December 2, 2016 in the same docket, the NYSPSC issued notice of an evidentiary proceeding and collaborative process to determine the future structure of the retail energy market in New York. The outcome of this evidentiary and collaborative process, combined with the outcome of the appeal of the Reset Order, could affect the viability of the New York retail energy market.

MISO (GenOn)

Revisions to MISO Capacity Construct — On November 20, 2015, FERC issued a final order denying NRG’s request for rehearing of a 2012 FERC order approving the MISO capacity construct. NRG filed a petition for review of FERC’s decision with the D.C. Circuit on the grounds that FERC’s order denies merchant generators in MISO’s footprint any reasonable opportunity to recover their fixed costs. On November 2, 2016, NRG filed its initial brief and briefing continues. The eventual outcome of this proceeding could impact MISO’s attempts to redesign its capacity markets and thereby affect the value of NRG’s uncontracted assets within the MISO footprint.

MISO Forward Capacity Market Design for Retail Choice States — MISO staff has proposed revisions to its market design by implementing a three-year Forward Resource Auction for Illinois and the portion of Michigan with Retail Choice Load with a Sloped Demand Curve. On November 1, 2016, MISO filed its proposal with FERC. On December 14, 2016, NRG filed a protest to MISO’s proposal. On February 2, 2017, FERC rejected MISO’s proposal.

Environmental Matters

The Registrants are subject to a wide range of environmental laws in the development, construction, ownership and operation of projects. These laws generally require that governmental permits and approvals be obtained before construction and during operation of power plants. The electric generation industry is facing new requirements regarding GHGs, combustion byproducts, water discharge and use, and threatened and endangered species. Future laws may require the addition of emissions controls or other environmental controls or impose restrictions on the operations of the Registrants' facilities, which could have a material effect on the Registrants' operations. Complying with environmental laws involves significant capital and operating expenses. The Registrants decide to invest capital for environmental controls based on the relative certainty of the requirements, an evaluation of compliance options, and the expected economic returns on capital.

A number of regulations with the potential to affect the Registrants and their facilities are in development, under review or have been recently promulgated by the EPA, including ESPS/NSPS for GHGs, ash disposal requirements, NAAQS revisions and implementation and effluent guidelines. The Registrants are currently reviewing the outcome and any resulting impact of recently promulgated regulations and cannot fully predict such impact until legal challenges are resolved and the new presidential administration decides how to proceed with some of the more controversial regulations. Federal and state environmental laws generally have become more stringent over time, although this trend could change in the near term with respect to federal laws under the new U.S. presidential administration.

Ozone NAAQS — On October 26, 2015, the EPA promulgated a rule that reduces the ozone NAAQS to 0.070 ppm. If it survives legal challenges, this more stringent NAAQS will obligate the states to develop plans to reduce NO_x (an ozone precursor), which could affect some of the Registrants' units.

Cross-State Air Pollution Rule — The EPA finalized CSAPR in 2011, which was intended to replace CAIR in January 2012, to address certain states' obligations to reduce emissions so that downwind states can achieve federal air quality standards. In December 2011, the D.C. Circuit stayed the implementation of CSAPR and then vacated CSAPR in August 2012 but kept CAIR in place until the EPA could replace it. In April 2014, the U.S. Supreme Court reversed and remanded the D.C. Circuit's decision. In October 2014, the D.C. Circuit lifted the stay of CSAPR. In response, the EPA in November 2014 amended the CSAPR compliance dates. Accordingly, CSAPR replaced CAIR on January 1, 2015. On July 28, 2015, the D.C. Circuit held that the EPA had exceeded its authority by requiring certain reductions that were not necessary for downwind states to achieve federal standards. Although the D.C. Circuit kept the rule in place, the court ordered the EPA to revise the Phase 2 (or 2017) (i) SO₂ budgets for four states including Texas and (ii) ozone-season NO_x budgets for 11 states including Maryland, New Jersey, New York, Ohio, Pennsylvania and Texas. On October 26, 2016, the EPA finalized the CSAPR Update Rule, which reduces future NO_x allocations and discounts the current banked allowances to account for the more stringent 2008 Ozone NAAQS and to address the D.C. Circuit's July 2015 decision. This rule has been challenged in the D.C. Circuit. The Registrants believe that their investment in pollution controls and cleaner technologies leave the fleet well-positioned for compliance.

MATS — In February 2012, the EPA promulgated standards (the MATS rule) to control emissions of HAPs from coal and oil-fired electric generating units. The rule established limits for mercury, non-mercury metals, certain organics and acid gases, which had to be met beginning in April 2015 (with some units getting a 1-year extension). In June 2015, the U.S. Supreme Court issued a decision in the case of Michigan v. EPA, and held that the EPA unreasonably refused to consider costs when it determined that it was "appropriate and necessary" to regulate HAPs emitted by electric generating units. The U.S. Supreme Court did not vacate the MATS rule but rather remanded it to the D.C. Circuit for further proceedings. In December 2015, the D.C. Circuit remanded the MATS rule to the EPA without vacatur. On April 25, 2016, the EPA released a supplemental finding that the benefits of this regulation outweigh the costs to address the U.S. Supreme Court's ruling that the EPA had not properly considered costs. This finding has been challenged in the D.C. Circuit. While the Registrants cannot predict the final outcome of this rulemaking, the Registrants believes that because they have already invested in pollution controls and cleaner technologies, the fleet is well-positioned to comply with the MATS rule.

Clean Power Plan — The attention in recent years on GHG emissions has resulted in federal regulations and state legislative and regulatory action. In October 2015, the EPA finalized the Clean Power Plan, or CPP, addressing GHG emissions from existing EGUs. On February 9, 2016, the U.S. Supreme Court stayed the CPP. The D.C. Circuit, sitting en banc, heard oral argument on the legal challenges to the CPP in September 2016. Due to the ongoing litigation and the potential impact of the new U.S. presidential administration, the Registrants believe the CPP is not likely to survive.

Effluent Limitations Guidelines — In November 2015, the EPA revised the Effluent Limitations Guidelines for Steam Electric Generating Facilities, which will impose more stringent requirements (as individual permits are renewed) for wastewater streams from flue gas desulfurization, fly ash, bottom ash, and flue gas mercury control. The Registrants estimate that it would cost approximately $45 million over the next five years to comply with this rule at the Registrants' coal-fired plants. This regulation has been challenged and is subject to legal uncertainty. The change in U.S. presidential administration increases the likelihood that the legal challenges will succeed. The Registrants decide to invest capital for environmental controls based on: the certainty of regulations; evaluation of different technologies; options to convert to gas; and the expected economic returns on the capital. Over the next several years, the Registrants will decide whether to proceed with these investments at each of the plants as permits are renewed based on, among other things, the legal certainty of the regulation and market conditions at that time.

See Item 15 — Note 15, Regulatory Matters, Note 16, Environmental Matters, and Note 17, Guarantees, to the Consolidated Financial Statements.

Regional Environmental Issues

RGGI — The Registrants operate generating units in Maryland, Massachusetts and New York that are subject to RGGI, which is a regional cap and trade system. In 2013, each of these states finalized a rule that reduced and will continue to reduce the number of allowances through 2020. The nine RGGI states are re-evaluating the program and may alter the rules to further reduce the number of allowances. The revisions being currently contemplated could adversely impact the Registrants' results of operations, financial condition and cash flows.

Massachusetts Global Warming Solutions Act Proposed Regulation — In May 2016, the Massachusetts Supreme Judicial Court held that Massachusetts DEP had not complied with the 2008 Global Warming Solutions Act, which requires establishing limits for sources of GHGs. The Court held that participation in RGGI was not sufficient. In December 2016, the Massachusetts DEP proposed a regulation that would limit GHG emissions from large electric generating facilities located in Massachusetts. A final regulation is expected by August 2017. If promulgated in its current form, the regulation may limit the operations of affected facilities.

New Source Review — The EPA and various states have been investigating compliance of electric generating facilities with the pre-construction permitting requirements of the CAA known as “new source review,” or NSR. In January 2009, GenOn received an NOV from the EPA alleging that past work at Keystone, Portland and Shawville generating stations violated regulations regarding NSR. In June 2011, GenOn received an NOV from the EPA alleging that past work at Avon Lake and Niles generating stations violated NSR. In December 2007, the NJDEP filed suit alleging that NSR violations occurred at the Portland generating station, which suit was resolved pursuant to a July 2013 Consent Decree.

Environmental Capital Expenditures

GenOn estimates that environmental capital expenditures from 2017 through 2021 required to comply with environmental laws will be approximately $61 million for GenOn, which includes $31 million for GenOn Americas Generation. The estimate for GenOn Americas Generation includes $31 million for GenOn Mid-Atlantic.

Employees

As of December 31, 2016, GenOn had 1,581 employees of which 580 employees were part of GenOn Americas Generation and 430 employees were part of GenOn Mid-Atlantic, approximately 66.3%, 67.8% and 70.2%, respectively, of whom were covered by bargaining agreements. During 2016, the Registrants did not experience any labor stoppages or labor disputes at any of their facilities.

Available Information

The Registrants’ annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to section 13(a) or 15(d) of the Exchange Act are available free of charge through NRG's website, www.nrg.com, as soon as reasonably practicable after they are electronically filed with, or furnished to the SEC.

Item 1A — Risk Factors

The Registrants are subject to the following factors that could have a material adverse effect on their future performance, results of operations, financial condition and cash flows. In addition, such factors could affect their ability to service indebtedness and other obligations, to raise capital and could affect their future growth opportunities. Also, see Cautionary Statement Regarding Forward Looking Information and Item 7 — Management's Narrative Analysis of the Results of Operations and Financial Condition of this Form 10-K.

Risks Related to the Operation of the Registrants' Businesses

There is substantial doubt about GenOn's ability to continue as a going concern.

GenOn’s consolidated financial statements have been prepared assuming GenOn will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities in the normal course of business. As such, the accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets and their carrying amounts, or the amount and classification of liabilities that may result should GenOn be unable to continue as a going concern. Such adjustments could have a material adverse impact on GenOn's results of operations, cash flows and financial position.

As disclosed in Item 15 — Note 1, Nature of Business and Note 9, Debt and Capital Leases, $691 million of GenOn's Senior Notes outstanding, excluding $8 million of associated premiums, are current within the GenOn consolidated balance sheet and are due on June 15, 2017. GenOn's future profitability continues to be adversely affected by (i) a sustained decline in natural gas prices and its resulting effect on wholesale power prices and capacity prices, and (ii) the inability of GenOn Mid-Atlantic and REMA to make distributions of cash and certain other restricted payments to GenOn. Based on current projections, GenOn is not expected to have sufficient liquidity to repay the GenOn Senior Notes due in June 2017. As a result, there is substantial doubt about GenOn's ability to continue as a going concern.

As of December 31, 2016, GenOn has consolidated cash and cash equivalents of $1.0 billion, of which $471 million and $100 million is held by GenOn Mid-Atlantic and REMA, respectively. Under their respective operating leases, GenOn Mid-Atlantic and REMA are not permitted to make any distributions and other restricted payments unless: (a) they satisfy the fixed charge coverage ratio for the most recently ended period for four fiscal quarters; (b) they are projected to satisfy the fixed charge coverage ratio for each of the two following periods of four fiscal quarters, commencing with the fiscal quarter in which such payment is proposed to be made; and (c) no significant lease default or event of default has occurred and is continuing. Additionally, GenOn Mid-Atlantic and REMA must be in compliance with the requirement to provide credit support to the owner lessors securing their obligations to pay scheduled rent under their respective leases. As a result, GenOn Mid-Atlantic has not been able to make distributions of cash and certain other restricted payments since the quarter ended March 31, 2014 which was the last quarterly period for which GenOn Mid-Atlantic satisfied the conditions under its operating agreement. REMA has not satisfied the conditions under its operating agreement to make distributions of cash and certain other restricted payments since 2009.

NRG, GenOn's parent company, has no obligation to provide any financial support other than the credit agreement between NRG and GenOn which provides for a $500 million revolving credit facility, all of which can be utilized for revolving loans and letters of credit as further described in Item 15 — Note 13, Related Party Transactions. As controlled group members, ERISA requires that NRG and GenOn are jointly and severally liable for the NRG Pension Plan for Bargained Employees and the NRG Pension Plan, including the pension liabilities associated with GenOn employees.

GenOn is currently considering all options available to it, including negotiations with creditors, refinancing the GenOn Senior Notes, potential sales of certain generating assets as well as the possibility for a need to file for protection under Chapter 11 of the U.S. Bankruptcy Code. During 2016, GenOn appointed two independent directors, retained advisors and established a separate audit committee as part of this process.

GenOn is a wholly-owned subsidiary of NRG and is highly dependent on NRG for services under a shared services agreement.

GenOn relies on NRG for its administrative and management functions and services including human resources-related functions, accounting, tax administration, information systems, legal services, treasury and planning, operations and asset management, risk and commercial operations, and other support services under a management services agreement. GenOn anticipates continuing to rely upon NRG to provide many of these services. If NRG terminates the management services agreement or defaults in the performance of its obligations under the agreement, GenOn may be unable to contract with a substitute service provider on similar terms or at all, and the costs of substituting service providers may be substantial. In addition, in light of NRG's familiarity with GenOn's assets, a substitute service provider may not be able to provide the same level of service due to lack of preexisting synergies. If GenOn cannot locate a service provider that is able to provide it with substantially similar services as NRG does under the management services agreement on similar terms, it would likely have a material adverse effect on GenOn's business, financial condition, results of operation and cash flows.

The interests of NRG as GenOn's equity holder may conflict with the interests of holders of debt.

GenOn is owned and controlled by NRG. The interests of NRG may not in all cases be aligned with the interests of the holders of GenOn's debt or the debt and lease obligations of GenOn's subsidiaries. If GenOn encounters financial difficulties or becomes unable to pay its debts as they mature, NRG does not have any liability for any obligations under the GenOn notes or the notes and lease obligations of the GenOn subsidiaries. In addition, NRG may have an interest in pursuing acquisitions, divestitures, financings or other transactions that, in its judgment, could enhance its equity investments, even though such transactions might involve risks to GenOn's business or the holders of GenOn's and its subsidiaries' debt. Furthermore, NRG may own businesses that directly or indirectly compete with GenOn. NRG also may pursue acquisition opportunities that may be complementary to NRG's business, and as a result, those acquisition opportunities may not be available to GenOn.

The Registrants' financial results are unpredictable because most of their generating facilities operate without long-term power sales agreements, and their revenues and results of operations depend on market and competitive forces that are beyond their control.

The Registrants provide energy, capacity, ancillary and other energy services from their generating facilities in a variety of markets and to bi-lateral counterparties, including participating in wholesale energy markets, entering into tolling agreements, sales of resource adequacy and participation in capacity auctions. The Registrants' revenues from selling capacity are a significant part of their overall revenues. The Registrants are not guaranteed recovery of their costs or any return on their capital investments through mandated rates.

The market for wholesale electric energy and energy services reflects various market conditions beyond the Registrants' control, including the balance of supply and demand, transmission congestion, competitors' marginal and long-term costs of production, the price of fuel, and the effect of market regulation. The price at which the Registrants can sell their output may fluctuate on a day-to-day basis, and their ability to transact may be affected by the overall liquidity in the markets in which the Registrants operate. These markets remain subject to regulations that limit their ability to raise prices during periods of shortage to the degree that would occur in a fully deregulated market. In addition, unlike most other commodities, electric energy can be stored only on a very limited basis and generally must be produced at the time of use. As a result, the wholesale power markets are subject to substantial price fluctuations over relatively short periods of time and can be unpredictable.

The Registrants' revenues, results of operations and cash flows are influenced by factors that are beyond their control, including those set forth above, as well as:


•	the failure of market regulators to develop and maintain efficient mechanisms to compensate merchant generators for the value of providing capacity needed to meet demand;


•	actions by regulators, ISOs, RTOs and other bodies that may artificially modify supply and demand levels and prevent capacity and energy prices from rising to the level necessary for recovery of the Registrants' costs, investment and an adequate return on investment;


•	environmental regulations and legislation;

•

legal and political challenges to or changes in the rules used to calculate capacity payments in the markets in which the Registrants operate or the establishment of bifurcated markets, incentives, other market design changes or bidding requirements that give preferential treatment to new generating facilities over existing generating facilities or otherwise reduce capacity payments to existing generating facilities;


•	the ability of wholesale purchasers of power to make timely payment for energy or capacity, which may be adversely affected by factors such as retail rate caps, refusals by regulators to allow utilities to recover fully their wholesale power costs and investments through rates, catastrophic losses and losses from investments by utilities in unregulated businesses;


•	increases in prevailing market prices for fuel oil, coal, natural gas and emission allowances that may not be reflected in prices the Registrants receive for sales of energy;


•	increases in electricity supply as a result of actions of the Registrants' current competitors or new market entrants, including the development of new generating facilities or alternative energy sources that may be able to produce electricity less expensively than the Registrants' generating facilities and improvements in transmission that allow additional supply to reach their markets;


•	increases in credit standards, margin requirements, market volatility or other market conditions that could increase the Registrants' obligations to post collateral beyond amounts that are expected, including additional collateral costs associated with OTC hedging activities as a result of future OTC regulations adopted pursuant to the Dodd-Frank Act;


•	decreases in energy consumption resulting from demand-side management programs such as automated demand response, which may alter the amount and timing of consumer energy use;


•	the competitive advantages of certain competitors, including continued operation of older power facilities in strategic locations after recovery of historic capital costs from ratepayers;


•	existing or future regulation of the markets in which the Registrants operate by FERC, ISOs and RTOs, including any price limitations, non-performance penalties and other mechanisms to address some of the price volatility or illiquidity in these markets or the physical stability of the system;


•	the Registrants' obligation under any default sharing mechanisms in RTO and ISO markets, such mechanisms exist to spread the risk of defaults by transmission owning companies or other RTO members across all market participants;


•	regulatory policies of state agencies that affect the willingness of the Registrants' customers to enter into long-term contracts generally, and contracts for capacity in particular;


•	access to contractors and equipment;


•	changes in the rate of growth in electricity usage as a result of such factors as national and regional economic conditions and implementation of conservation programs;


•	seasonal variations in energy and natural gas prices, and capacity payments; and


•	seasonal fluctuations in weather, in particular abnormal weather conditions.

As discussed above, the market for wholesale electric energy and energy services reflects various market conditions beyond the Registrants' control, including the balance of supply and demand, the Registrants' competitors' marginal and long-term costs of production, and the effect of market regulation. The Registrants cannot ensure that higher earnings or price increases will result from industry retirements of coal-fired generating facilities or that higher earnings from their remaining facilities will offset or more than offset reduced earnings from facility deactivations.

Changes in the wholesale energy markets or in the Registrants' generating facility operations could result in impairments or other charges.

If the ongoing evaluation of the Registrants' business results in decisions to deactivate or dispose of additional facilities, the Registrants could have impairments or other charges. These evaluations involve significant judgments about the future. Actual future market prices, project costs and other factors could be materially different from current estimates.

The Registrants are exposed to the risk of fuel cost volatility because they must pre-purchase coal and oil.

Most of the Registrants' fuel contracts are at fixed prices with terms of two years or less. Although the Registrants purchase coal and oil based on expected requirements, they still face the risks of fuel price volatility if they require more or less fuel than expected.

The Registrants' cost of fuel may not reflect changes in energy and fuel prices in part because they must pre-purchase inventories of coal and oil for reliability and dispatch requirements, and thus the price of fuel may have been determined at an earlier date than the price of energy generated from the fuel. Similarly, the price the Registrants can obtain from the sale of energy may not rise at the same rate, or may not rise at all, to match a rise in fuel costs.

The Registrants are exposed to the risk of their fuel providers and fuel transportation providers failing to perform.

The Registrants purchase most of their coal from a limited number of suppliers. Because of a variety of operational issues, the Registrants' coal suppliers may not provide the contractual quantities on the dates specified within the agreements, or the deliveries may be carried over to future periods. Also, interruptions to planned or contracted deliveries to the Registrants' generating facilities can result from a lack of, or constraints in, coal transportation because of rail, river or road system disruptions, adverse weather conditions and other factors.

If the Registrants' coal suppliers do not perform in accordance with the agreements, the Registrants may have to procure higher priced coal in the market to meet their needs, or higher priced power in the market to meet their obligations. In addition, generally the Registrants' coal suppliers do not have investment grade credit ratings nor do they post collateral with the Registrants and, accordingly, the Registrants may have limited ability to collect damages in the event of default by such suppliers.

For the Registrants' oil-fired generating facilities, the Registrants typically purchase fuel from a limited number of suppliers. If the Registrants' oil suppliers do not perform in accordance with the agreements, the Registrants may have to procure higher priced oil in the market to meet their needs, or higher priced power in the market to meet their obligations. For the Registrants' gas-fired generating facilities, any curtailments or interruptions on transporting pipelines could result in curtailment of operations or increased fuel supply costs.

The operation of the Registrants' generating facilities involves risks that could result in disruption, curtailment or inefficiencies in their operations.

The operation of the Registrants' generating facilities involves various operating risks, including, but not limited to:

•the output and efficiency levels at which those generating facilities perform;

•interruptions in fuel supply and quality of available fuel;

•disruptions in the delivery of electricity;

•adverse zoning;

•breakdowns or equipment failures (whether a result of age or otherwise);

•violations of permit requirements or changes in the terms of, or revocation of, permits;

•releases of pollutants to air, soil, surface water or groundwater;

•ability to transport and dispose of coal ash at reasonable prices;

•curtailments or other interruptions in natural gas supply;

•shortages of equipment or spare parts;

•labor disputes, including strikes, work stoppages and slowdowns;

•the aging workforce at many of the Registrants' facilities;

•operator errors;

•curtailment of operations because of transmission constraints;

•failures in the electricity transmission system, which may cause large energy blackouts;

•implementation of unproven technologies in connection with environmental improvements; and

•catastrophic events such as fires, explosions, floods, earthquakes, hurricanes or other similar occurrences.

These factors could result in a material decrease, or the elimination of, the revenues generated by the Registrants' facilities or a material increase in the Registrants' costs of operations.

The Registrants operate in a limited number of markets and a significant portion of revenues are derived from the PJM market. The effect of adverse developments in the markets, especially the PJM market, may be greater on the Registrants than on more geographically diversified competitors.

As of December 31, 2016, GenOn's generating capacity is 58% in PJM, 23% in CAISO, 7% in NYISO, 7% ISO-NE and 5% in MISO, and GenOn Americas Generation's generating capacity is 58% in PJM, 13% in CAISO, 15% in NYISO and 14% ISO-NE. As of December 31, 2016, all of GenOn Mid-Atlantic's generating capacity is in PJM. Adverse developments in these regions, especially in the PJM market, may adversely affect the Registrants. Further, the effect of such adverse regional developments may be greater on the Registrants than on more geographically diversified competitors.

The integration of the Capacity Performance product into the PJM market and the Pay-for-Performance mechanism in ISO-NE could lead to substantial changes in capacity income and non-performance penalties, which could have a material adverse effect on the Registrants’ results of operations, financial condition and cash flows.

Both ISO-NE and PJM operate a pay-for-performance model where capacity payments are modified based on real-time generator performance. Capacity market prices are sensitive to design parameters, as well as additions of new capacity. The Registrants may experience substantial changes in capacity income and non-performance penalties, which could have a material adverse effect on the Registrants’ results of operations, financial condition and cash flows.

The Registrants are exposed to possible losses that may occur from the failure of a counterparty to perform according to the terms of a contractual arrangement, particularly in connection with non-collateralized power hedges with financial institutions.

Failure of a counterparty to perform according to the terms of a contractual arrangement may result in losses to the Registrants. Specifically, GenOn Mid-Atlantic's credit exposures on power and gas hedges with financial institutions in excess of applicable collateral thresholds are senior unsecured obligations of such counterparties. Deterioration in the financial condition of such counterparties could result in their failure to pay amounts owed to GenOn Mid-Atlantic or to perform obligations or services owed to GenOn Mid-Atlantic beyond collateral posted.

Changes in technology may significantly affect the Registrants' generating business by making their generating facilities less competitive.

The Registrants generate electricity using fossil fuels at large central facilities. This method results in economies of scale and lower costs than newer technologies such as fuel cells, battery storage, microturbines, windmills and photovoltaic solar cells. It is possible that advances in those technologies, or governmental incentives for renewable energies, will reduce their costs to levels that are equal to or below that of most central station electricity production.

The expected decommissioning and/or site remediation obligations of certain of the Registrants' generating facilities may negatively affect their cash flows.

Some of the Registrants' generating facilities and related properties are subject to decommissioning and/or site remediation obligations that may require material expenditures. Furthermore, laws and regulations may change to impose material additional decommissioning and remediation obligations on the Registrants in the future.

Terrorist attacks and/or cyber-attacks may result in the Registrants' inability to operate and fulfill their obligations, and could result in material repair costs.

As power generators, the Registrants face heightened risk of terrorism, including cyber terrorism, either by a direct act against one or more of their generating facilities or an act against the transmission and distribution infrastructure that is used to transport the power. Although the entire industry is exposed to these risks, the Registrants' generating facilities and the transmission and distribution infrastructure located in the PJM market are particularly at risk because of the proximity to major population centers, including governmental and commerce centers.

The Registrants rely on information technology networks and systems to operate their generating facilities, engage in asset management activities, and process, transmit and store electronic information. Security breaches of this information technology infrastructure, particularly through cyber-attacks and cyber terrorism, including by computer hackers, foreign governments and cyber terrorists, could lead to system disruptions, generating facility shutdowns or unauthorized disclosure of confidential information related to their employees, vendors and counterparties. Confidential information includes banking, vendor, counterparty and personal identity information.

Systemic damage to one or more of the Registrants' generating facilities and/or to the transmission and distribution infrastructure could result in the inability to operate in one or all of the markets the Registrants serve for an extended period of time. If the Registrants' generating facilities are shut down, they would be unable to respond to the ISOs and RTOs or fulfill their obligations under various energy and/or capacity arrangements, resulting in lost revenues and potential fines, penalties and other liabilities. Pervasive cyber-attacks across the industry could affect the ability of ISOs and RTOs to function in some regions. The cost to restore the Registrants' generating facilities after such an occurrence could be material.

The Registrants' operations are subject to hazards customary to the power generating industry. The Registrants may not have adequate insurance to cover all of these hazards.

Power generation involves hazardous activities, including acquiring, transporting and unloading fuel, operating large pieces of high-speed rotating equipment and delivering electricity to transmission and distribution systems. In addition to natural risks (such as earthquake, flood, storm surge, lightning, hurricane, tornado and wind), hazards (such as fire, explosion, collapse and machinery failure) are inherent risks in the Registrants' operations. The Registrants are also susceptible to terrorist attacks, including cyber-attacks, against their generating facilities or the transmission and distribution infrastructure that is used to transport their power. These hazards can cause significant injury to personnel or loss of life, severe damage to and destruction of property, plant and equipment, contamination of, or damage to, the environment and suspension of operations. The occurrence of any one of these events may result in one or more of the Registrants being named as a defendant in lawsuits asserting claims for substantial damages, environmental cleanup costs, personal injury and fines and/or penalties. The Registrants do not maintain specialized insurance for possible liability resulting from a cyber-attack on their systems that may shut down all or part of the transmission and distribution system. However, the Registrants maintain an amount of insurance protection that they consider adequate and customary for merchant power producers. The Registrants cannot assure that their insurance will be sufficient or effective under all circumstances and against all hazards or liabilities to which they may be subject.

Lawsuits, regulatory proceedings and tax proceedings could adversely affect the Registrants' future financial results.

From time to time, the Registrants are named as a party to, or their property is the subject of, lawsuits, regulatory proceedings or tax proceedings. The Registrants are currently involved in various proceedings which involve highly subjective matters with complex factual and legal questions. Their outcome is uncertain. Any claim that is successfully asserted against the Registrants could require significant expenditures by them. Even if the Registrants prevail, any proceedings could be costly and time-consuming, could divert the attention of management and key personnel from their business operations and could result in adverse changes in their insurance costs.

Risks Related to Economic and Financial Market Conditions

The Registrants are exposed to systemic risk of the financial markets and institutions and the risk of non-performance of the individual lenders under GenOn's undrawn credit facilities.

Maintaining sufficient liquidity in the Registrants' business for maintenance and operating expenditures, capital expenditures and collateral is crucial in order to mitigate the risk of future financial distress to the Registrants. Accordingly, GenOn maintains a revolving credit facility with NRG to manage its expected liquidity needs and contingencies.

A negative market perception of the Registrants' value could impair their ability to issue or refinance debt.

A sustained downturn in general economic conditions, including low power and commodity prices, could result in an actual or perceived weakness in the Registrants' overall financial health.

A negative market perception of the Registrants' value could result in their inability to obtain and maintain an appropriate credit rating. In this event, they may be unable to access debt markets or refinance future debt maturities, or they may be required to post additional collateral to operate their business.

Adverse economic conditions, including reduced demand, could adversely affect the Registrants' business, financial condition, results of operations and cash flows.

Adverse economic conditions and declines in wholesale energy prices, partially resulting from adverse economic conditions, may impact the Registrants' earnings. The breadth and depth of these negative economic conditions had a wide-ranging impact on the U.S. business environment, including the Registrants' businesses. In addition, adverse economic conditions also reduce the demand for energy commodities. This reduced demand continues to impact the key domestic wholesale energy markets the Registrants serve. The combination of lower demand for power and increased supply of natural gas has put downward price pressure on wholesale energy markets in general, further impacting the Registrants' results. In general, economic and commodity market conditions will continue to impact the Registrants' unhedged future energy margins, liquidity, earnings growth and overall financial condition.

As financial institutions consolidate and operate under more restrictive capital constraints and regulations, including the Dodd-Frank Act, there could be less liquidity in the energy and commodity markets for hedge transactions and fewer creditworthy counterparties.

The Registrants hedge economically a substantial portion of their PJM coal-fired generation and certain of their other generation. A significant portion of their hedges are financial swap transactions between GenOn Mid-Atlantic and financial counterparties that are senior unsecured obligations of such parties and do not require either party to post cash collateral, either for initial margin or for securing exposure as a result of changes in power or natural gas prices. Global financial institutions have been active participants in these energy and commodity markets. As global financial institutions consolidate and operate under more restrictive capital constraints and regulations, including the Dodd-Frank Act, there could be less liquidity in the energy and commodity markets, which could have a material adverse effect on the Registrants' ability to hedge economically and transact with creditworthy counterparties.

Many of the factors that cause changes in commodity prices are outside the Registrants' control and may materially increase their cost of producing power or lower the price at which they are able to sell their power.

The Registrants' generating business is subject to changes in power prices and fuel and emission costs, and these commodity prices are influenced by many factors outside the Registrants' control, including weather, seasonal variation in supply and demand, market liquidity, transmission and transportation inefficiencies, availability of competitively priced alternative energy sources, demand for energy commodities, production of natural gas, coal and crude oil, natural disasters, wars, embargoes and other catastrophic events, and federal, state and environmental regulation and legislation. In addition, significant fluctuations in the price of natural gas may cause significant fluctuations in the price of electricity. Significant fluctuations in commodity prices may affect the financial results and financial position by increasing the cost of producing power and decreasing the amounts the Registrants receive from the sale of power.

The Registrants' hedging activities will not fully protect them from fluctuations in commodity prices.

The Registrants engage in hedging activities related to sales of electricity and purchases of fuel and emission allowances. The income and losses from these activities are recorded as operating revenues and cost of operations. The Registrants may use forward contracts and other derivative financial instruments to manage market risk and exposure to volatility in prices of electricity, coal, natural gas, emissions and oil. The effectiveness of these hedges is dependent upon the correlation between the forward contracts and the other derivative financial instruments used as a hedge and the market risk of the asset or assets being hedged. The Registrants cannot provide assurance that these strategies will be successful in managing their price risks, or that they will not result in net losses to the Registrants as a result of future volatility in electricity, fuel and emission markets. Actual power prices and fuel costs may differ from expectations.

The Registrants hedging activities include natural gas derivative financial instruments that they use to hedge economically power prices for their baseload generation. The effectiveness of these hedges is dependent upon the correlation between power and natural gas prices in the markets where the Registrants operate. If those prices are not sufficiently correlated, the Registrants' financial results and financial position could be adversely affected.

Additionally, GenOn and GenOn Americas Generation expect to have an open position in the market, within their established guidelines, resulting from their fuel and emissions management activities. To the extent open positions exist, fluctuating commodity prices can affect their financial results and financial position, either favorably or unfavorably. As a result of these and other factors, the Registrants cannot predict the outcome that risk management decisions may have on their business, operating results or financial position. Although management devotes considerable attention to these issues, their outcome is uncertain.

The Registrants' policies and procedures cannot eliminate the risks associated with their hedging activities.

The risk management procedures the Registrants have in place may not always be followed or may not always work as planned. If any of the employees were able to violate the system of internal controls, including the risk management policy, and engage in unauthorized hedging and related activities, it could result in significant penalties and financial losses. In addition, risk management tools and metrics such as value at risk, gross margin at risk, and stress testing are partially based on historic price movements. If price movements significantly or persistently deviate from historical behavior, risk limits may not fully protect the Registrants from significant losses.

The Registrants' hedging and GenOn Americas Generation's fuel oil management activities may increase the volatility of the Registrants' GAAP financial results.

Derivatives from the Registrants' hedging and GenOn Americas Generation's fuel oil management activities are recorded on the balance sheets at fair value pursuant to the accounting guidance for derivative financial instruments. None of the Registrants' derivatives that are recorded at fair value are designated as hedges under this guidance, and changes in their fair values currently are recognized in earnings as unrealized gains or losses. As a result, the Registrants' GAAP financial results — including gross margin, operating income and balance sheet ratios — will, at times, be volatile and subject to fluctuations in value primarily because of changes in forward electricity and fuel prices.

The Registrants are exposed to possible losses that may occur from the failure to maintain counterparties or the failure of a counterparty to perform according to the terms of a contractual arrangement, particularly in connection with non-collateralized power hedges with financial institutions.

Failure of the Registrants to maintain counterparties or the failure of a counterparty to perform according to the terms of a contractual arrangement may result in losses to the Registrants. Specifically, GenOn Mid-Atlantic's credit exposures on power and gas hedges with financial institutions in excess of applicable collateral thresholds are senior unsecured obligations of such counterparties. Deterioration in the financial condition of such counterparties could result in their failure to pay amounts owed to GenOn Mid-Atlantic or to perform obligations or services owed to GenOn Mid-Atlantic beyond collateral posted. In addition, the Registrants may not be able to find market participants that are willing to act as hedging counterparties, which could have an adverse effect on the success of the Registrants’ hedging activities.

Risks Related to Governmental Regulation and Laws

Policies at the national, regional and state levels to regulate GHG emissions, as well as climate change, could adversely impact the Registrants' results of operations, financial condition and cash flows.

On October 23, 2015, the EPA promulgated the final GHG emissions rules for new and existing fossil-fuel-fired electric generating units. The impact of further legislation or regulation of GHGs on the Registrants' financial performance will depend on a number of factors, the applicability of offsets, and the extent to which the Registrants would be entitled to receive CO₂ emissions credits without having to purchase them in an auction or on the open market.

The Registrants operate generating units in Maryland, Massachusetts and New York that are subject to RGGI, which is a regional cap and trade system. In 2013, each of these states finalized a rule that reduced and will continue to reduce the number of allowances through 2020. The nine RGGI states are re-evaluating the program and may alter the rules to further reduce the number of allowances. The revisions being currently contemplated could adversely impact the Registrants' results of operations, financial condition and cash flows.

California has a CO₂ cap and trade program for electric generating units greater than 25 MW. The impact on the Registrants depends on the cost of the allowances and the ability to pass these costs through to customers.

On October 26, 2015, the EPA promulgated a rule that reduces the ozone NAAQS to 0.070 ppm. If it survives legal challenges, this more stringent NAAQS will obligate the states to develop plans to reduce NO_x (an ozone precursor), which could affect some of the Registrants' units.

Hazards customary to the power production industry include the potential for unusual weather conditions, which could affect fuel pricing and availability, the Registrants' route to market or access to customers, i.e., transmission and distribution lines, or critical plant assets. To the extent that climate change contributes to the frequency or intensity of weather related events, the Registrants' operations and planning process could be affected.

The Registrants' business is subject to substantial governmental regulation and may be adversely affected by legislative or regulatory changes, as well as liability under, or any future inability to comply with, existing or future regulations or requirements.

The Registrants' electric generation business is subject to extensive U.S. federal, state and local laws and regulation. Compliance with the requirements under these various regulatory regimes may cause the Registrants to incur significant additional costs, and failure to comply with such requirements could result in the shutdown of the non-complying facility, the imposition of liens, fines, and/or civil or criminal liability. Public utilities under the FPA are required to obtain FERC acceptance of their rate schedules for wholesale sales of electric energy, capacity and ancillary services. The Registrants' assets make wholesale sales of electric energy, capacity and ancillary services in interstate commerce and are public utilities for purposes of the FPA, unless otherwise exempt from such status. FERC's orders that grant market-based rate authority to wholesale power marketers reserve the right to revoke or revise that authority if FERC subsequently determines that the seller can exercise market power in transmission or generation, create barriers to entry, or engage in abusive affiliate transactions. In addition, public utilities are subject to FERC reporting requirements that impose administrative burdens and that, if violated, can expose such public utilities to criminal and civil penalties or other risks.

The Registrants' market-based sales will be subject to certain rules prohibiting manipulative or deceptive conduct, and if any of the Registrants' generating companies are deemed to have violated those rules, they will be subject to potential disgorgement of profits associated with the violation, penalties, suspension or revocation of market-based rate authority. If such generating companies were to lose their market-based rate authority, such companies would be required to obtain FERC's acceptance of a cost-of-service rate schedule and could become subject to the significant accounting, record-keeping, and reporting requirements that are imposed on utilities with cost-based rate schedules. This could have a material adverse effect on the rates the Registrants are able to charge for power from their facilities.

Most of the Registrants' assets are operating as Exempt Wholesale Generators as defined under the PUHCA, or Qualifying Facilities as defined under the PURPA, as amended, and therefore are exempt from certain regulation under the PUHCA and the PURPA. If a facility fails to maintain its status as an Exempt Wholesale Generator or a Qualifying Facility or there are legislative or regulatory changes revoking or limiting the exemptions to the PUHCA, then the Registrants may be subject to significant accounting, record-keeping, access to books and records and reporting requirements and failure to comply with such requirements could result in the imposition of penalties and additional compliance obligations.

Substantially all of the Registrants' generation assets are also subject to the reliability standards promulgated by the designated Electric Reliability Organization (currently NERC) and approved by FERC. If the Registrants fail to comply with the mandatory reliability standards, they could be subject to sanctions, including substantial monetary penalties and increased compliance obligations. The Registrants will also be affected by legislative and regulatory changes, as well as changes to market design, market rules, tariffs, cost allocations, and bidding rules that occur in the existing regional markets operated by RTOs or ISOs, such as PJM. The RTOs/ISOs that oversee most of the wholesale power markets impose, and in the future may continue to impose, mitigation, including price limitations, offer caps, and other mechanisms to address some of the volatility and the potential exercise of market power in these markets. These types of price limitations and other regulatory mechanisms may have a material adverse effect on the profitability of the Registrants' generation facilities acquired in the future that sell energy, capacity and ancillary products into the wholesale power markets. The regulatory environment for electric generation has undergone significant changes in the last several years due to state and federal policies affecting wholesale competition and the creation of incentives for the addition of large amounts of new renewable generation and, in some cases, transmission assets. These changes are ongoing, and the Registrants cannot predict the future design of the wholesale power markets or the ultimate effect that the changing regulatory environment will have on the Registrants' business. In addition, in some of these markets, interested parties have proposed to reinstate the vertical monopoly utility of the markets or require divestiture of electric generation assets by asset owners or operators to reduce their market share. If competitive restructuring of the electric power markets is reversed, discontinued, or delayed, the Registrants' business prospects and financial results could be negatively impacted.

The CFTC, among other things, has regulatory oversight authority over the trading of swaps, futures and many commodities under the Commodity Exchange Act, or CEA. Since 2010, there have been a number of reforms to the regulation of the derivatives markets, both in the U.S. and internationally. These regulations, and any further changes thereto, or adoption of additional regulations, including any regulations relating to position limits on futures and other derivatives or relating to margin for derivatives, could negatively impact the Registrants' ability to hedge their portfolio in an efficient, cost-effective manner by, among other things, potentially decreasing liquidity in the forward commodity and derivatives markets or limiting the Registrants' ability to utilize non-cash collateral for derivatives transactions.

The Registrants' business may be affected by state interference in the competitive wholesale marketplace.

The Registrants' generation business relies on a competitive wholesale marketplace. The competitive wholesale marketplace may be undermined by out-of-market subsidies provided by states or state entities, including bailouts of uneconomic nuclear plants, imports of power from Canada, renewable mandates or subsidies, as well as out-of-market payments to new generators. These out-of-market subsidies to existing or new generation undermine the competitive wholesale marketplace, which can lead to premature retirement of existing facilities, including those owned by the Registrants. If these measures continue, capacity and energy prices may be suppressed, and the Registrants may not be successful in their efforts to insulate the competitive market from this interference.

The Registrants' businesses are subject to physical, market and economic risks relating to potential effects of climate change.

Climate change may produce changes in weather or other environmental conditions, including temperature or precipitation levels, and thus may impact consumer demand for electricity. In addition, the potential physical effects of climate change, such as increased frequency and severity of storms, floods and other climatic events, could disrupt the Registrants' operations and cause them to incur significant costs in preparing for or responding to these effects. These or other meteorological changes could lead to increased operating costs, capital expenses or power purchase costs. Climate change could also affect the availability of a secure and economical supply of water in some locations, which is essential for the continued operation of the Registrants' generation plants.

GHG regulation could increase the cost of electricity, particularly power generated by fossil fuels, and such increases could have a depressive effect on regional economies. Reduced economic and consumer activity in the Registrants' service areas — both generally and specific to certain industries and consumers accustomed to previously lower cost power-could reduce demand for the power the Registrants generate.

The Registrants costs of compliance with environmental laws are significant and can affect their future operations and financial results.

The Registrants are subject to extensive and evolving environmental laws, particularly in regard to their coal-fired facilities. Environmental laws, particularly with respect to air emissions, disposal of ash, wastewater discharge and cooling water systems, are generally becoming more stringent, which may require the Registrants to install controls or restrict their operations. Failure to comply with environmental requirements could require the Registrants to shut down or reduce production at their facilities or create liabilities. The Registrants incur significant costs in complying with these regulations and, if they fail to comply, could incur significant penalties. The Registrants' cost estimates for environmental compliance are based on existing regulations or their view of reasonably likely regulations and their assessment of the costs of labor and materials and the state of evolving technologies. The Registrants' decision to make these investments is often subject to future market conditions. Changes to the preceding factors, new or revised environmental regulations, litigation and new legislation and/or regulations, as well as other factors, could cause their actual costs to vary outside the range of their estimates, further constrain their operations, increase their environmental compliance costs and/or make it uneconomical to operate some of their facilities.

Federal, state and regional initiatives to regulate GHG emissions could have a material impact on the Registrants' financial performance and condition. The actual impact will depend on a number of factors, including the overall level of GHG reductions required under any such regulations, the final form of the regulations or legislation, and the price and availability of emission allowances if allowances are a part of any final regulatory framework.

The Registrants are required to surrender emission allowances equal to emissions of specific substances to operate their facilities. Surrender requirements may require purchase of allowances, which may be unavailable or only available at costs that would make it uneconomical to operate their facilities.

Certain environmental laws, including the Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980 and comparable state laws, impose strict and, in many circumstances, joint and several liability for costs of remediating contamination. Some of the Registrants' facilities have areas with known soil and/or groundwater contamination. The Registrants could be required to spend significant sums to remediate contamination, regardless of whether they caused such contamination, (a) if there are releases or discoveries of hazardous substances at their generating facilities, at disposal sites they currently use or have used, or at other locations for which they may be liable, or (b) if parties contractually responsible to them for contamination fail to or are unable to respond when claims or obligations regarding such contamination arise.

The Registrants' coal-fired generating units produce certain byproducts that involve extensive handling and disposal costs and are subject to government regulation. Changes in these regulations, or their administration, by legislatures, state and federal regulatory agencies, or other bodies may affect the costs of handling and disposing of these byproducts.

As a result of the coal combustion process, the Registrants produce significant quantities of ash at their coal-fired generating units that must be beneficially used or disposed of at sites permitted to handle ash. One of the Registrants' landfills in Maryland has reached design capacity and it is expected that another site in Maryland may reach full capacity in the next few years. As a result, the Registrants are further developing existing and new ash management facilities. However, the costs associated with developing new ash management facilities could be material, and the amount of time to complete such developments could extend beyond the time when new facilities are needed. Likewise, the facility for preparing ash for beneficial uses may not operate as expected; or the ash may not be marketed and sold as expected. Additionally, costs associated with third-party ash handling and disposal are material and could have a material adverse effect on the Registrants' financial performance and condition.

The Registrants also produce gypsum as a byproduct of the SO₂ scrubbing process at their coal-fired generating facilities, much of which is sold to third parties for use in drywall production. Should their ability to sell such gypsum to third parties be restricted as a result of the lack of demand or otherwise, their gypsum disposal costs could rise materially.

In April 2015, the EPA finalized the rule regulating byproducts of coal combustion (e.g., ash and gypsum) as solid wastes under the RCRA. The Registrants are evaluating the impact of the new rule on their results of operations, financial condition and cash flows and have accrued their environmental and asset retirement obligations under the rule based on current estimates as of December 31, 2016.

The Registrants' business is subject to complex government regulations. Changes in these regulations, or their administration, by legislatures, state and federal regulatory agencies, or other bodies may affect the prices at which the Registrants are able to sell the electricity they produce, the costs of operating their generating facilities or their ability to operate their facilities.

The majority of the Registrants' generation is sold at market prices under market-based rate authority granted by FERC. If certain conditions are not met, FERC has the authority to withhold or rescind market-based rate authority and require sales to be made based on cost-of-service rates. A loss of the Registrants' market-based rate authority could have a materially negative impact on their generating business.

Even when market-based rate authority has been granted, FERC may impose various forms of market mitigation measures, including price caps and operating restrictions, when it determines that potential market power might exist and that the public interest requires such potential market power to be mitigated. In addition to direct regulation by FERC, most of the Registrants' facilities are subject to rules and terms of participation imposed and administered by various ISOs and RTOs. Although these entities are themselves ultimately regulated by FERC, they can impose rules, restrictions and terms of service that are quasi-regulatory in nature and can have a material adverse impact on the Registrants' business. For example, ISOs and RTOs may impose bidding and scheduling rules, both to curb the potential exercise of market power and to ensure market functions. Such actions may materially affect the Registrants' ability to sell and the price they receive for their energy, capacity and ancillary services.

To conduct the Registrants' business, they must obtain and periodically renew licenses, permits and approvals for their facilities. These licenses, permits and approvals can be in addition to any required environmental permits. No assurance can be provided that they will be able to obtain and comply with all necessary licenses, permits and approvals for these facilities.

Conflicts may occur between reliability needs and environmental rules, particularly with increasingly stringent environmental restrictions. Without a consent decree or adjustments to permit requirements, which require long lead times to obtain, the Registrants remain subject to environmental penalties or liabilities that may occur as a result of operating in compliance with reliability requirements. Further, the Registrants could be subject to citizen suits in these types of circumstances, even if they have received a consent decree or permit adjustment exempting them from environmental requirements.

The Registrants cannot predict whether the federal or state legislatures will adopt legislation relating to the restructuring of the energy industry. There are proposals in many jurisdictions that would either roll back or advance the movement toward competitive markets for the supply of electricity, at both the wholesale and retail levels. In addition, any future legislation favoring large, vertically integrated utilities and a concentration of ownership of such utilities could affect the Registrants' ability to compete successfully, and their business and results of operations could be adversely affected. Similarly, any regulations or laws that favor new generation over existing generation could adversely affect their business.

Risks Related to Level of Indebtedness

The Registrants' substantial indebtedness and operating lease obligations could limit their ability to react to changes in the economy or the industry and prevent them from meeting or refinancing their obligations.

At December 31, 2016, GenOn's consolidated indebtedness was $2.8 billion and GenOn Americas Generation's consolidated indebtedness was $745 million. In addition, the present values of lease payments under the respective GenOn Mid-Atlantic and REMA operating leases were approximately $583 million and $346 million, respectively (assuming a 10% and 9.4% discount rate, respectively) and the termination values of the respective GenOn Mid-Atlantic and REMA operating leases were $800 million and $618 million, respectively.

The Registrants' substantial indebtedness and operating lease obligations could have important consequences for their liquidity, results of operations, financial position and prospects, including their ability to grow in accordance with their strategies. These consequences include the following:


•	they may limit their ability to obtain additional debt for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes;


•	a substantial portion of their cash flows from operations must be dedicated to the payment of rent and principal and interest on their indebtedness and will not be available for other purposes, including for working capital, capital expenditures, acquisitions and other general corporate purposes;


•	the debt service requirements of their indebtedness and their lease obligations could make it difficult for them to satisfy or refinance their financial obligations;


•	certain of the Registrants' borrowings, including borrowings under the NRG credit agreement, are at variable rates of interest, exposing the Registrants to the risk of increased interest rates;


•	they may limit their flexibility in planning for and reacting to changes in the industry;


•	they may place the Registrants at a competitive disadvantage compared to other, less leveraged competitors;


•	GenOn's and GenOn Americas Generation's credit agreement with NRG contains restrictive covenants that limit their ability to engage in activities that may be in their long-term best interest; and


•	the Registrants may be more vulnerable in a downturn in general economic conditions or in their business and they may be unable to carry out capital expenditures that are important to their long-term growth or necessary to comply with environmental regulations.

GenOn and its subsidiaries that are holding companies, including GenOn Americas Generation, may not have access to sufficient cash to meet their obligations if their subsidiaries, in particular GenOn Mid-Atlantic, are unable to make distributions.

GenOn and certain of its subsidiaries, including GenOn Americas Generation and NRG Americas, are holding companies and, as a result, are dependent upon dividends, distributions and other payments from their operating subsidiaries to generate the funds necessary to meet their obligations. In particular, a substantial portion of the cash from their operations is generated by GenOn Mid-Atlantic. The ability of certain of their subsidiaries to pay dividends and make distributions is restricted under the terms of their debt or other agreements, including the operating leases of GenOn Mid-Atlantic and REMA. Under their respective operating leases, GenOn Mid-Atlantic and REMA are not permitted to make any distributions and other restricted payments unless: (a) they satisfy the fixed charge coverage ratio for the most recently ended period of four fiscal quarters; (b) they are projected to satisfy the fixed charge coverage ratio for each of the two following periods of four fiscal quarters, commencing with the fiscal quarter in which such payment is proposed to be made; and (c) no significant lease default or event of default has occurred and is continuing. In the event of a default under the respective operating leases or if the respective restricted payment tests are not satisfied, GenOn Mid-Atlantic and REMA would not be able to distribute cash. At December 31, 2016, GenOn Mid-Atlantic and REMA did not satisfy the restricted payments test.

Each of GenOn and GenOn Americas Generation may be unable to generate sufficient cash to service their debt and leases and to post required amounts of cash collateral necessary to hedge economically market risk.

The ability of each of GenOn or GenOn Americas Generation to pay principal and interest on their debt and the rent on their leases depends on their future operating performance. If their cash flows and capital resources are insufficient to allow them to make scheduled payments on their debt, GenOn or GenOn Americas Generation may have to reduce or delay capital expenditures, sell assets, restructure or refinance. There can be no assurance that the terms of their debt or leases will allow these alternative measures, that the financial markets will be available to them on acceptable terms or that such measures would satisfy their scheduled debt service and lease rent obligations. If either GenOn or GenOn Americas Generation do not comply with the payment and other material covenants under their debt and lease agreements, they could default under their debt or leases.

The Registrants' asset management activities may require them to post collateral either in the form of cash or letters of credit. Although the Registrants seek to structure transactions in a way that reduces their potential liquidity needs for collateral, they may be unable to execute their hedging strategy successfully if they are unable to post the amount of collateral required to enter into and support hedging contracts.

GenOn and GenOn Americas Generation are active participants in energy exchange and clearing markets, which require a per-contract initial margin to be posted. The initial margins are determined by the exchanges through the use of proprietary models that rely on a variety of inputs and factors, including market conditions. They have limited notice of any changes to the margin rates. Consequently, they are exposed to changes in the per unit margin rates required by the exchanges and could be required to post additional collateral on short notice.

The terms of the Registrants' credit facilities and leases restrict their current and future operations, particularly their ability to respond to changes or take certain actions.

The Registrants' credit facilities and leases contain a number of restrictive covenants that impose significant operating and financial restrictions on them and may limit their ability to engage in acts that may be in their long-term best interest, including restrictions on their ability to:

•incur additional indebtedness;

•pay dividends or make other distributions;

•prepay, redeem or repurchase certain debt;

•make loans and investments;

•sell assets;

•incur liens;

•enter into transactions with affiliates;

•enter into sale-leaseback transactions; and

•consolidate, merge or sell all or substantially all of their assets.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This Annual Report on Form 10-K includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. The words "believe," "project," "anticipate," "plan," "expect," "intend," "estimate" and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Registrants’ actual results, performance and achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These factors, risks and uncertainties include the following:


•	GenOn's and certain of its subsidiaries' ability to continue as a going concern;


•	General economic conditions, changes in the wholesale power markets and fluctuations in the cost of fuel;


•	Volatile power supply costs and demand for power;

•

Hazards customary to the power production industry and power generation operations such as fuel and electricity price volatility, unusual weather conditions, catastrophic weather-related or other damage to facilities, unscheduled generation outages, maintenance or repairs, unanticipated changes to fuel supply costs or availability due to higher demand, shortages, transportation problems or other developments, environmental incidents, or electric transmission or gas pipeline system constraints and the possibility that the Registrants may not have adequate insurance to cover losses as a result of such hazards;


•	The effectiveness of the Registrants’ risk management policies and procedures, and the ability of the Registrants’ counterparties to satisfy their financial commitments;


•	Counterparties' collateral demands and other factors affecting the Registrants' liquidity position and financial condition;


•	The Registrants' ability to find market participants that are willing to act as hedging counterparties;


•	The Registrants’ ability to operate their businesses efficiently, manage capital expenditures and costs tightly, and generate earnings and cash flows from their asset-based businesses in relation to their debt and other obligations;


•	The Registrants’ ability to enter into contracts to sell power and procure fuel on acceptable terms and prices;


•	The liquidity and competitiveness of wholesale markets for energy commodities;


•	Government regulation, including compliance with regulatory requirements and changes in market rules, rates, tariffs and environmental laws and increased regulation of carbon dioxide and other GHG emissions;


•	Changes in law, including judicial decisions;


•	Price mitigation strategies and other market structures employed by ISOs or RTOs that result in a failure to adequately compensate the Registrants’ generation units for all of their costs;


•	The Registrants' ability to mitigate forced outage risk as they become subject to capacity performance in PJM and new performance incentives in ISO-NE;


•	The Registrants’ ability to borrow additional funds and access capital markets, as well as GenOn’s substantial indebtedness and the possibility that the Registrants may incur additional indebtedness going forward;


•	Operating and financial restrictions placed on the Registrants and their subsidiaries that are contained in the indentures governing GenOn’s outstanding notes, and in debt and other agreements of certain of the Registrants’ subsidiaries and project affiliates generally;


•	The Registrants’ ability to implement their strategy of developing and building new power generation facilities;


•	The Registrants’ ability to implement their strategy of finding ways to meet the challenges of climate change, clean air and protecting natural resources while taking advantage of business opportunities;


•	The Registrants’ ability to implement their strategy of increasing the return on invested capital through operational performance improvements and a range of initiatives at plants and corporate offices to reduce costs or generate revenues;


•	The Registrants’ ability to successfully evaluate investments in new business and growth initiatives;


•	The Registrants’ ability to successfully integrate and manage any acquired businesses; and


•	The Registrants’ ability to develop and maintain successful partnering relationships.

Forward-looking statements speak only as of the date they were made, and the Registrants undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The foregoing review of factors that could cause the Registrants’ actual results to differ materially from those contemplated in any forward-looking statements included in this Annual Report on Form 10-K should not be construed as exhaustive.

Item 1B — Unresolved Staff Comments

None.

Item 2 — Properties (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Listed below are descriptions of Registrants’ interests in facilities, operations and/or projects owned or leased as of December 31, 2016. The MW figures provided represent nominal summer net megawatt capacity of power generated as adjusted for the Registrants’ ownership position excluding capacity from inactive/mothballed units as of December 31, 2016. The following table summarizes the Registrants' power production and cogeneration facilities by region:



Name and Location of Facility	Power Market	% Owned		Net Generation Capacity (MW) ^(a)	Primary Fuel-type

Chalk Point, Aquasco, MD	PJM	100.00		667	Coal
Chalk Point, Aquasco, MD	PJM	100.00		1,570	Natural Gas
Chalk Point, Aquasco, MD	PJM	100.00		42	Oil
Dickerson, MD	PJM	100.00	^(b)	537	Coal
Dickerson, MD	PJM	100.00	^(b)	294	Natural Gas
Dickerson, MD	PJM	100.00	^(b)	18	Oil
Morgantown, Newburg, MD	PJM	100.00	^(b)	1,229	Coal
Morgantown, Newburg, MD	PJM	100.00	^(b)	248	Oil
	Total GenOn Mid-Atlantic:			4,605

Bowline, West Haverstraw, NY	NYISO	100.00		1,147	Natural Gas
Canal, Sandwich, MA	ISO-NE	100.00		1,112	Oil
Martha’s Vineyard, MA	ISO-NE	100.00		14	Oil
Pittsburg, CA ^(c)	CAISO	100.00		1,029	Natural Gas
Total GenOn Americas Generation:				7,907

Avon Lake, OH ^(d)	PJM	100.00		638	Coal
Avon Lake, OH	PJM	100.00		21	Oil
Blossburg, PA	PJM	100.00		19	Natural Gas
Brunot Island, Pittsburgh, PA	PJM	100.00		244	Natural Gas
Brunot Island, Pittsburgh, PA	PJM	100.00		15	Oil
Cheswick, Springdale, PA	PJM	100.00		565	Coal
Choctaw, French Camp, MS	TVA^(e)	100.00		800	Natural Gas
Conemaugh, New Florence, PA ^(f)	PJM	16.45		280	Coal
Conemaugh, New Florence, PA ^(f)	PJM	16.45		2	Oil
Ellwood, Goleta, CA	CAISO	100.00		54	Natural Gas
Etiwanda, Rancho Cucamonga, CA	CAISO	100.00		640	Natural Gas
Gilbert, Milford, NJ	PJM	100.00		438	Natural Gas
Hamilton, East Berlin, PA	PJM	100.00		20	Oil
Hunterstown CCGT, Gettysburg, PA	PJM	100.00		810	Natural Gas
Hunterstown CTS, Gettysburg, PA	PJM	100.00		60	Natural Gas
Keystone, Shelocta, PA ^(f)	PJM	16.67		283	Coal
Keystone, Shelocta, PA ^(f)	PJM	16.67		2	Oil
Mandalay, Oxnard, CA	CAISO	100.00		560	Natural Gas
Mountain, Mount Holly Springs, PA	PJM	100.00		40	Oil
New Castle, West Pittsburg, PA ^(g)	PJM	100.00		325	Natural Gas
New Castle, West Pittsburg, PA	PJM	100.00		3	Oil
Niles, OH	PJM	100.00		25	Oil
Ormond Beach, Oxnard, CA	CAISO	100.00		1,516	Natural Gas
Orrtana, PA	PJM	100.00		20	Oil



Name and Location of Facility	Power Market	% Owned	Net Generation Capacity (MW) ^(a)	Primary Fuel-type

Portland, Mount Bethel, PA	PJM	100.00	169	Oil
Sayreville, NJ	PJM	100.00	217	Natural Gas
Shawnee, East Stroudsburg, PA	PJM	100.00	20	Oil
Shawville, PA ^(f)(h)	PJM	100.00	597	Natural Gas
Shawville, PA ^(f)	PJM	100.00	6	Oil
Titus, Birdsboro, PA	PJM	100.00	31	Oil
Tolna, Stewartstown, PA	PJM	100.00	39	Oil
Warren, PA	PJM	100.00	57	Natural Gas
	Total GenOn:		16,423


(a)	Actual capacity can vary depending on factors including weather conditions, operational conditions, and other factors.


(b)	GenOn Mid-Atlantic leases 100% interests in the Dickerson and Morgantown coal generation units through facility lease agreements expiring in 2029 and 2034, respectively. GenOn Mid-Atlantic owns 312 MW and 248 MW of peaking capacity at the Dickerson and Morgantown generating facilities, respectively. GenOn Mid-Atlantic operates the Dickerson and Morgantown facilities.


(c)	GenOn Americas Generation deactivated Pittsburg on January 1, 2017.


(d)	GenOn deactivated net generation capacity at the Avon Lake Unit 7 which has net generation capacity of 94 MW in the second quarter of 2016.


(e)	Dual interconnect between TVA and MISO.


(f)	GenOn leases 100%, 16.67% and 16.45% interests in three Pennsylvania facilities (Shawville, Keystone and Conemaugh, respectively) through facility lease agreements expiring in 2026, 2034 and 2034, respectively. GenOn operates the Shawville, Keystone and Conemaugh facilities. The table includes GenOn’s net share of the capacity of these facilities.


(g)	GenOn added natural gas capabilities at the New Castle facility, which was completed in the second quarter of 2016.


(h)	GenOn added natural gas capabilities at the Shawville facility, which was completed in the fourth quarter of 2016.

Other Properties

The Registrants own or lease oil and gas pipelines that serve its generating facilities. GenOn leases other offices. The Registrants believe that their properties are adequate for their present needs. Except for the Conemaugh and Keystone facilities, the Registrants’ interest as of December 31, 2016 is 100% for each property. The Registrants have satisfactory title, rights and possession to their owned facilities, subject to exceptions, which, in their opinion, would not have a material adverse effect on the use or value of the facilities.

Item 3 — Legal Proceedings (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

See Item 15 — Note 14, Commitments and Contingencies, to the Consolidated Financial Statements for discussion of the material legal proceedings to which the Registrants are a party.

Item 4 — Mine Safety Disclosures (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Not applicable.

PART II

Item 5 — Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Market Information and Holders

GenOn is a wholly owned subsidiary of NRG. All of GenOn’s common stock is held by its parent, NRG, and GenOn’s common stock is not publicly traded. GenOn Americas Generation and GenOn Mid‑Atlantic are indirect wholly owned subsidiaries of GenOn. All of GenOn Americas Generation’s membership interests are held by its parent, NRG Americas. All of GenOn Mid‑Atlantic’s membership interests are held by its parent, NRG North America. GenOn Americas Generation’s and GenOn Mid‑Atlantic’s membership interests are not publicly traded.

Item 6 — Selected Financial Data (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Item 6 has been omitted from this report pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.

Item 7 — Management's Narrative Analysis of the Results of Operations and Financial Condition (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Reference is made to the Registrants’ Consolidated Statements of Operations to this Annual Report on Form 10-K, which presents the results of the Registrants’ operations for the years ended December 31, 2016 and 2015. Also refer to Item 1 to this Form 10-K for additional discussion about the Registrants’ business.

The consolidated results of operations is separately presented for GenOn Energy, Inc., GenOn Americas Generation, LLC, and GenOn Mid-Atlantic, LLC, for the years ended December 31, 2016 and 2015. The following section includes a discussion of electricity prices, gross margin, and economic gross margin along with other significant drivers impacting each of the Registrants' results of operations.

Environmental Matters, Regulatory Matters and Legal Proceedings

Details of environmental matters are presented in Item 15 — Note 16, Environmental Matters, to the Consolidated Financial Statements. Details of regulatory matters are presented in Item 15 — Note 15, Regulatory Matters, to the Consolidated Financial Statements. Details of legal proceedings are presented in Item 15 — Note 14, Commitments and Contingencies, to the Consolidated Financial Statements. Some of this information relates to costs that may be material to the Registrants’ financial results.

Electricity Prices

The following table summarizes average on-peak power prices for each of the major markets in which the Registrants operate for the years ended December 31, 2016 and 2015. Average on-peak power prices decreased primarily due to the decrease in natural gas prices for the year ended December 31, 2016, as compared to the same period in 2015.



	Average on Peak Power Price ($/MWh) ^(a)
	For the year ended December 31,
	2016		2015		Change %
MISO - Louisiana Hub^(b)	$	34.30	$	34.55	(1	)%
NEPOOL	35.05		48.25		(27	)%
PEPCO (PJM)	37.92		46.48		(18	)%
PJM West Hub	33.79		41.97		(19	)%
CAISO - NP15	31.73		35.50		(11	)%
CAISO - SP15	31.17		32.45		(4	)%

(a) Average on peak power prices based on real time settlement prices as published by the respective ISOs.

(b) Region also transacts in PJM - West Hub.

The following table summarizes average realized power prices for each Registrant for the years ended December 31, 2016 and 2015, which reflects the impact of settled hedges:



	Average Realized Power Price ($/MWh)^(a)
	For the year ended December 31,
Region	2016		2015		Change %
GenOn	$	46.76	$	55.27	(15	)%
GenOn Americas Generation^(b)	72.10		90.97		(21	)%
GenOn Mid-Atlantic	74.29		86.56		(14	)%

(a) Excludes closure and financial settlement of certain open positions with counterparties that would have otherwise been realized in subsequent periods.

(b) Excludes pass-through amounts for GenOn Energy Management.

Average on peak power prices have decreased on average by 15% for the year ended December 31, 2016 with average realized prices for each of the Registrants' remaining consistent with the decrease year-over-year due to the Registrants' multi-year hedging program and the success of the Registrants' commercial operations team that optimizes the value of the assets on a daily basis.

Consolidated Results of Operations

Gross Margin

The Registrants' calculate gross margin in order to evaluate operating performance as operating revenues less cost of sales, which includes cost of fuel, other costs of sales, contract and emission credit amortization and mark-to-market for economic hedging activities.

Economic Gross Margin

In addition to gross margin, the Registrants evaluate their operating performance using the measure of economic gross margin, which is not a GAAP measure and may not be comparable to other companies’ presentations or deemed more useful than the GAAP information provided elsewhere in this report. Economic gross margin should be viewed as a supplement to and not a substitute for the Registrants' presentation of gross margin, which is the most directly comparable GAAP measure. Economic gross margin is not intended to represent gross margin. The Registrants believe that economic gross margin is useful to investors as it is a key operational measure reviewed by the Registrants' chief operating decision maker. Economic gross margin is defined as the sum of energy revenue, capacity revenue and other revenue, less cost of fuel and other cost of sales.

The economic gross margin does not include mark-to-market gains or losses on economic hedging activities that are not yet settled, contract and emission credit amortization, or other operating costs.

GenOn

2016 Compared to 2015

The following table provides selected financial information for GenOn:



	For the Year Ended December 31,
(In millions except otherwise noted)	2016			2015			Change
Operating Revenues
Energy revenue ^(a)	$	1,339		$	1,637		$	(298	)
Capacity revenue ^(a)	671			802			(131		)
Mark-to-market for economic hedging activities	(221		)	(112		)	(109		)
Other revenues	73			44			29
Total operating revenues	1,862			2,371			(509		)
Operating Costs and Expenses
Generation cost of sales ^(a)	747			995			(248		)
Mark-to-market for economic hedging activities	(70		)	68			(138		)
Contract and emissions credit amortization	(37		)	(31		)	(6		)
Operations and maintenance	576			656			(80		)
Other cost of operations	63			91			(28		)
Total cost of operations	1,279			1,779			(500		)
Depreciation and amortization	195			215			(20		)
Impairment losses	214			170			44
General and administrative	23			10			13
General and administrative — affiliate	185			184			1
Total operating costs and expenses	1,896			2,358			(462		)
Gain on sale of assets	294			—			294
Operating Income	260			13			247
Other Income/(Expense)
Other income, net	8			6			2
Interest expense	(176		)	(202		)	26
Gain on debt extinguishment	—			65			(65		)
Total other expense	(168		)	(131		)	(37		)
Income/(Loss) before income tax expense/(benefit)	92			(118		)	210
Income tax expense/(benefit)	11			(3		)	14
Net Income/(Loss)	$	81		$	(115	)	$	196
Business Metrics
Average natural gas price — Henry Hub ($/MMBtu)	$	2.46		$	2.66		(8		)%
MWh sold (in thousands)^(b)	25,729			29,620			(13		)%
MWh generated (in thousands)	25,952			29,723			(13		)%


(a)	Includes realized gains and losses from financially settled transactions.


(b)	MWh sold excludes generation at facilities that generate revenue under tolling agreements.

The following table presents the composition and reconciliation of GenOn's gross margin and economic gross margin for the years ended December 31, 2016 and 2015:



	Year Ended December 31,
(In millions)	2016			2015			Change $
Energy revenue	$	1,339		$	1,637		$	(298	)
Capacity revenue	671			802			(131		)
Mark-to-market for economic hedging activities	(221		)	(112		)	(109		)
Other revenues	73			44			29
Operating revenue	1,862			2,371			(509		)
Cost of fuel	(660		)	(904		)	244
Other cost of sales	(87		)	(91		)	4
Mark-to-market for economic hedging activities	70			(68		)	138
Contract and emission credit amortization	37			31			6
Gross margin	$	1,222		$	1,339		$	(117	)
Less: Mark-to-market for economic hedging activities, net	(151		)	(180		)	29
Less: Contract and emission credit amortization, net	37			31			6
Economic gross margin	$	1,336		$	1,488		$	(152	)

Gross margin decreased by $117 million and economic gross margin decreased by $152 million for the year ended December 31, 2016, compared to the same period in 2015 due to:



	(In millions)
Lower gross margin due to a 17% decrease in average realized energy prices partially offset by a decrease in the price of natural gas and transportation costs due to more favorable short-term natural gas contracts	$	(194	)
Lower gross margin due to a 16% decrease in PJM cleared auction capacity volumes slightly offset by lower purchased capacity to cover capacity supply obligations due to plant deactivations, asset sales and fuel conversions	(87		)
Lower gross margin due to 5% decrease in PJM cleared auction capacity prices and lower pricing in NY Hudson Valley Zone	(35		)
Lower gross margin due to a 9% decrease in generation driven by fuel conversions as well as less dispatch at certain plants due to pricing	(14		)
Lower gross margin due to the sale of Seward and Shelby generating stations during the first quarter of 2016 and the sale of Aurora generating station during the third quarter of 2016	(10		)
Higher gross margin due to the closure and financial settlement of certain open positions with counterparties that would have otherwise been realized in subsequent periods	136
Higher gross margin due to the sale of emission credits	36
Higher gross margin due to prior year excess and market adjustments for fuel oil inventory for Bowline, Chalk Point, and Osceola	19
Other	(3		)
Decrease in economic gross margin	$	(152	)
Increase in mark-to-market for economic hedging primarily due to reversals of previously recognized unrealized gains/losses on settled positions and unrealized gains/losses on open positions related to economic hedges as further described below	29
Increase in contract and emission credit amortization	6
Decrease in gross margin	$	(117	)

Mark-to-market for Economic Hedging Activities

Mark-to-market for economic hedging activities includes asset-backed hedges that have not been designated as cash flow hedges. The breakdown of gains and losses included in operating revenues and operating costs and expenses are as follows:



	Year Ended December 31,
(In millions)	2016			2015
Mark-to-market results in operating revenues
Reversal of previously recognized unrealized gains on settled positions related to economic hedges	$	(247	)	$	(208	)
Net unrealized gains on open positions related to economic hedges	26			96
Total mark-to-market losses in operating revenues	$	(221	)	$	(112	)
Mark-to-market results in operating costs and expenses
Reversal of previously recognized unrealized losses on settled positions related to economic hedges	$	82		$	10
Net unrealized losses on open positions related to economic hedges	(12		)	(78		)
Total mark-to-market gains/(losses) in operating costs and expenses	$	70		$	(68	)

Mark-to-market results consist of unrealized gains and losses on contracts that are not yet settled. The settlement of these transactions is reflected in the same revenue or cost caption as the items being hedged.

For the year ended December 31, 2016, the $221 million loss in operating revenues from economic hedge positions was driven by the reversal of previously recognized unrealized gains from electricity and natural gas contracts that settled during the period partially offset by an increase in the value of forward sales of electricity contracts as a result of decreases in power prices. The $70 million gain in operating costs and expenses from economic hedge positions was driven by the reversal of previously recognized unrealized loss from fuel contracts that settled during the period partially offset by decreases in the value of new coal contracts executed during the year. As discussed in Item 15 — Note 5, Accounting for Derivative Instruments and Hedging Activities, the reversal of previously recognized gains and losses on settled positions related to economic hedges included in operating revenues and operating costs and expenses during the year ended December 31, 2016 include any gains or losses associated with positions that were closed out and financially settled with certain counterparties that would have otherwise been realized in future periods.

For the year ended December 31, 2015, the $112 million loss in operating revenues from economic hedge positions was driven by the reversal of previously recognized unrealized gains from electricity and natural gas contracts that settled during the period partially offset by an increase in the value of forward sales of electricity contracts as a result of decreases in power prices. The $68 million loss in operating costs and expenses from economic hedge positions was driven by a decrease in the value of forward purchases of fuel contracts as a result of decreases in forward fuel prices, partially offset by the reversal of previously recognized unrealized loss from fuel contracts that settled during the period.

Operations and Maintenance

Operations and maintenance was $576 million for the year ended December 31, 2016 and $656 million for the year ended December 31, 2015. The decrease of $80 million was due to the following:



	(In millions)
Lower variable operating and maintenance costs primarily due to the sale of Seward during the first quarter of 2016	$	(63	)
Lower maintenance costs due to the timing of prior year outages primarily at Bowline and Canal	(49		)
Higher environmental expenses at GenOn Mid-Atlantic for Maryland ash sites	16
Higher maintenance costs due to environmental control work at Avon Lake	14
Other	2
	$	(80	)

Other Cost of Operations

Other cost of operations was $63 million for the year ended December 31, 2016, and $91 million for the year ended December 31, 2015. The decrease of $28 million was primarily due to reduction in property tax assessments for the Chalk Point, Dickerson, and Morgantown generating stations and favorable property tax settlements reached for all three generating stations for previous tax years during the year ended December 31, 2016, partially offset by an increase in accretion expense related to asset retirement obligations.

Depreciation and Amortization

Depreciation and amortization expense was $195 million for the year ended December 31, 2016, and $215 million for the year ended December 31, 2015. The decrease of $20 million was primarily due to the sales of Seward and Shelby during the first quarter of 2016, sale of Aurora during the third quarter of 2016, and the expiration of Chalk Point's capital lease at the end of 2015.

Impairment Losses

Impairment losses of $214 million for the year ended December 31, 2016, were primarily due to impairments at GenOn for Mandalay and Ormond Beach operating units along with the impairment of GenOn's leased interest in Keystone and Conemaugh and at GenOn Americas Generation for Pittsburg. These losses are further described in Item 15 — Note 8, Impairments.

Impairment losses of $170 million for the year ended December 31, 2015, primarily reflect an impairment of property, plant, and equipment of $134 million related to the Seward facility, $20 million related to the suspension of the oil conversion project at Portland, $8 million related to oil tanks located at the Pittsburg facility, and $8 million related to certain equipment. These losses are further described in Item 15 — Note 8, Impairments.

General and Administrative

General and administrative expenses increased by $13 million during the year ended December 31, 2016 compared to the same period in 2015 due to costs incurred in connection with advisors and other creditors engaged to assist GenOn and its creditors with regards to its ability to continue as a going concern as further discussed in Item 15 — Note 1, Nature of Business.

Gain on Sale of Assets

The $294 million gain on sale of assets for the year ended December 31, 2016 reflects the $74 million gain on sale of Potrero real property and a $188 million gain on sale of the Aurora Generating Station during the third quarter of 2016, and a $29 million gain on sale of Shelby and a $3 million gain on the sale of an easement of land at Potrero during the first quarter of 2016.

Interest Expense

Interest expense was $176 million for the year ended December 31, 2016, and $202 million for the year ended December 31, 2015. The decrease of $26 million was primarily due to the repurchase of GenOn and GenOn Americas Generation senior notes during the fourth quarter of 2015.

Gain on Debt Extinguishment

The $65 million gain on debt extinguishment for the year ended December 31, 2015, is driven by the repurchase of GenOn senior notes due 2017, 2018 and 2020 and GenOn Americas Generation senior notes due 2021 and 2031 at a price below par value, combined with the write-off of unamortized premium balances. The debt reductions of senior unsecured notes executed in 2015 resulted in annual future interest savings of approximately $25 million for GenOn, which includes $14 million of annual interest savings for GenOn Americas Generation.

Income Tax Expense/(Benefit)

During the year ended December 31, 2016, GenOn incurred tax expense of $11 million due to state income taxes as a result of the gain on the sale of certain generating stations during the year. During the year ended December 31, 2015, GenOn had a tax benefit of $3 million related to the recognition of previously uncertain tax benefits.

GenOn Americas Generation

2016 Compared to 2015

The following table provides selected financial information for GenOn Americas Generation:



	For the Year Ended December 31,
(In millions except otherwise noted)	2016			2015			Change
Operating Revenues
Energy revenue ^(a)	$	1,229		$	1,483		$	(254	)
Capacity revenue ^(a)	687			823			(136		)
Mark-to-market for economic hedging activities	(248		)	(66		)	(182		)
Other revenues	18			25			(7		)
Total operating revenues	1,686			2,265			(579		)
Operating Costs and Expenses
Generation cost of sales ^(a)	1,134			1,541			(407		)
Mark-to-market for economic hedging activities	(62		)	57			(119		)
Contract and emissions credit amortization	1			—			1
Operations and maintenance	296			310			(14		)
Other cost of operations	29			52			(23		)
Total cost of operations	1,398			1,960			(562		)
Depreciation and amortization	78			74			4
Impairment losses	20			8			12
General and administrative — affiliate	90			81			9
Total operating costs and expenses	1,586			2,123			(537		)
Gain on sale of assets	77			—			77
Operating Income	177			142			35
Other Income/(Expense)
Other income, net	2			2			—
Interest expense	(58		)	(70		)	12
Gain on debt extinguishment	—			42			(42		)
Total other expense	(56		)	(26		)	(30		)
Income before income tax	121			116			5
Income tax	—			—			—
Net Income	$	121		$	116		$	5
Business Metrics
Average natural gas price — Henry Hub ($/MMBtu)	$	2.46		$	2.66		(8		)%
MWh sold (in thousands)^(b)	10,000			8,992			11		%
MWh generated (in thousands)	9,962			9,094			10		%

(a) Includes realized gains and losses from financially settled transactions.

(b) MWh sold excludes generation at facilities that generate revenue under tolling agreements.

The following table presents the composition and reconciliation of GenOn Americas Generation's gross margin and economic gross margin for the years ended December 31, 2016, and 2015:



	For the Year Ended December 31,
(In millions)	2016			2015			Change $
Energy revenue	$	1,229		$	1,483		$	(254	)
Capacity revenue	687			823			(136		)
Mark-to-market for economic hedging activities	(248		)	(66		)	(182		)
Other revenues	18			25			(7		)
Operating revenue	1,686			2,265			(579		)
Cost of fuel	(403		)	(474		)	71
Other cost of sales	(731		)	(1,067		)	336
Mark-to-market for economic hedging activities	62			(57		)	119
Contract and emission credit amortization	(1		)	—			(1		)
Gross margin	$	613		$	667		$	(54	)
Less: Mark-to-market for economic hedging activities, net	(186		)	(123		)	(63		)
Less: Contract and emission credit amortization, net	(1		)	—			(1		)
Economic gross margin	$	800		$	790		$	10

Gross margin and economic gross margin reflects the following pass-through amounts for GenOn Energy Management for services including the bidding and dispatch of the generating units, fuel procurement and the execution of contracts, including economic hedges, to reduce price risk:



	For the Year Ended December 31,
(In millions)	2016			2015
Energy revenue	$	423		$	665
Capacity revenue	311			415
Other revenues	3			11
Generation revenue	737			1,091
Cost of fuel	(65		)	(67		)
Other cost of sales	(672		)	(1,024		)
Gross margin and economic gross margin	$	—		$	—

Gross margin decreased by $54 million and economic gross margin increased by $10 million for the year ended December 31, 2016, compared to the same period in 2015 due to:



	(In millions)
Higher gross margin due to the closure and financial settlement of certain open positions with counterparties that would have otherwise been realized in subsequent periods	$	85
Higher gross margin due to lower oil usage at Bowline and Canal as a result of the timing of planned and unplanned outages	23
Higher gross margin due to a 17% increase in generation due to more economic generation at GenOn Mid-Atlantic resulting from warmer weather conditions compared to the prior year	22
Higher gross margin due to prior year market adjustments for fuel oil inventory for Bowline and Chalk Point	17
Higher gross margin due to increased capacity contracts for New York partially offset by a decrease in contracted capacity prices	17
Lower gross margin due to a 44% decrease in average realized energy prices in New York and New England partially offset by a decrease in natural gas prices primarily at Bowline	(58		)
Lower gross margin at GenOn Mid-Atlantic due to a 14% decrease in average realized energy prices as a result of decline in merchant power prices partially offset by decrease in natural gas prices due to short-term natural gas contracts	(41		)
Lower gross margin due to a 9% decrease in PJM cleared auction capacity prices as a result of more imports, fewer constraints, and less demand growth than the prior year and lower pricing in NY Hudson Valley Zone in 2016	(35		)
Lower gross margin due to a 3% decrease in PJM cleared auction capacity volumes due to plant deactivations and lower New York volumes as there was increased bilateral activity	(18		)
Other	(2		)
Increase in economic gross margin	$	10
Decrease in mark-to-market for economic hedging primarily due to reversals of previously recognized unrealized gains/losses on settled positions and unrealized gains/losses on open positions related to economic hedges as further described below	(63		)
Decrease in contract and emission credit amortization	(1		)
Decrease in gross margin	$	(54	)

Mark-to-market for Economic Hedging Activities



	For the Year Ended December 31,
(In millions)	2016			2015
Mark-to-market results in operating revenues
Reversal of previously recognized unrealized gains on settled positions related to economic hedges	$	(259	)	$	(205	)
Net unrealized gains on open positions related to economic hedges	11			139
Total mark-to-market losses in operating revenues	(248		)	(66		)
Mark-to-market results in operating costs and expenses
Reversal of previously recognized unrealized losses on settled positions related to economic hedges	$	75		$	12
Net unrealized losses on open positions related to economic hedges	(13		)	(69		)
Total mark-to-market gains/(losses) in operating costs and expenses	$	62		$	(57	)

For the year ended December 31, 2016, the $248 million loss in operating revenues from economic hedge positions was driven by the reversal of previously recognized unrealized gains from electricity and natural gas contracts that settled during the period partially offset by an increase in the value of forward sales of electricity contracts as a result of decreases in power prices. The $62 million gain in operating costs and expenses from economic hedge positions was driven by the reversal of previously recognized unrealized losses from fuel contracts that settled during the period partially offset by decreases in the value of new coal contracts executed during the year. As discussed in Item 15 — Note 5, Accounting for Derivative Instruments and Hedging Activities, the reversal of previously recognized gains and losses on settled positions related to economic hedges included in operating revenues and operating costs and expenses during the year ended December 31, 2016 include any gains or losses associated with positions that were closed out and financially settled with certain counterparties that would have otherwise been realized in future periods.

For the year ended December 31, 2015, the $66 million loss in operating revenues from economic hedge positions was driven by the reversal of previously recognized unrealized gains from electricity and natural gas contracts that settled during the period partially offset by an increase in the value of forward sales of electricity contracts as a result of decreases in power prices. The $57 million loss in operating costs and expenses from economic hedge positions was driven by a decrease in the value of forward purchases of fuel contracts as a result of decreases in forward fuel prices partially offset by the reversal of previously recognized unrealized losses from fuel contracts that settled during the period.

Operations and Maintenance

Operations and maintenance was $296 million for the year ended December 31, 2016 and $310 million for the year ended December 31, 2015. The decrease of $14 million was primarily due to lower maintenance expense as a result of prior year outages at Bowline and Canal partially offset by an increase in environmental expenses at GenOn Mid-Atlantic in the current year.

Other Cost of Operations

Other cost of operations was $29 million for the year ended December 31, 2016, and $52 million for the year ended December 31, 2015. The decrease of $23 million was primarily due to a reduction in property tax assessments for the Chalk Point, Dickerson, and Morgantown generating stations and favorable property tax settlements reached for all three generating stations for previous tax years during the year ended December 31, 2016.

Impairment Losses

Impairment losses of $20 million for the year ended December 31, 2016, relate to the impairment of the Pittsburg generating station which was deactivated on January 1, 2017. Impairment losses of $8 million for the year ended December 31, 2015, reflect the impairment of oil tanks at the Pittsburg facility. These losses are further described in Item 15 — Note 8, Impairments

General and Administrative — Affiliate

General and administrative — affiliate expenses increased $9 million during the year ended December 31, 2016 compared to the same period in 2015. As described in Item 15 — Note 13, Related Party Transactions, costs incurred under the Services Agreement between GenOn and NRG are allocated to GenOn's subsidiaries based on each operating subsidiary's planned operating expenses. The increase in expenses during 2016 is driven by an increase in planned operating expenses at GenOn Americas Generation relative to the rest of GenOn.

Gain on Sale of Assets

The $77 million gain on sale of assets for the year ended December 31, 2016, reflects the $74 million gain on the sale of Potrero real property and a $3 million gain on the sale of an easement of land at Potrero.

Interest Expense

Interest expense was $58 million for the year ended December 31, 2016, and $70 million for the year ended December 31, 2015. The decrease of $12 million was primarily due to the repurchase of GenOn Americas Generation senior notes during the fourth quarter of 2015.

Gain on Debt Extinguishment

The $42 million gain on debt extinguishment for the year ended December 31, 2015, is driven by the repurchase of GenOn Americas Generation senior notes due 2021 and 2031 at a price below par value, combined with the write-off of unamortized premium balances. The debt reductions of senior unsecured notes executed in 2015 resulted in annual future interest savings of approximately $14 million for GenOn Americas Generation.

GenOn Mid-Atlantic

2016 Compared to 2015

The following table provides selected financial information for GenOn Mid-Atlantic:



	Year Ended December 31,
(In millions except otherwise noted)	2016			2015			Change
Operating Revenues
Energy revenue ^(a)	$	710		$	623		$	87
Capacity revenue ^(a)	218			249			(31		)
Mark-to-market for economic hedging activities	(223		)	(27		)	(196		)
Other revenues	7			11			(4		)
Total operating revenues	712			856			(144		)
Operating Costs and Expenses
Generation cost of sales ^(a)	337			325			12
Mark-to-market for economic hedging activities	(62		)	50			(112		)
Operations and maintenance	241			212			29
Other cost of operations	10			38			(28		)
Total cost of operations	526			625			(99		)
Depreciation and amortization	60			65			(5		)
General and administrative — affiliate	71			58			13
Total operating costs and expenses	657			748			(91		)
Operating Income	55			108			(53		)
Other Income/(Expense)
Other income, net	2			—			2
Interest expense	(5		)	(4		)	(1		)
Total other expense	(3		)	(4		)	1
Income before income tax	52			104			(52		)
Income tax	—			—			—
Net Income	$	52		$	104		$	(52	)
Business Metrics
Average natural gas price — Henry Hub ($/MMBtu)	$	2.46		$	2.66		(8		)%
MWh sold (in thousands)	8,413			7,197			17		%
MWh generated (in thousands)	8,413			7,197			17		%


(a)	Includes realized gains and losses from financially settled transactions.

The following table presents the composition and reconciliation of GenOn Mid-Atlantic's gross margin and economic gross margin for years ended December 31, 2016, and 2015:



	For the Year Ended December 31,
(In millions)	2016			2015			Change $
Energy revenue	$	710		$	623		$	87
Capacity revenue	218			249			(31		)
Mark-to-market for economic hedging activities	(223		)	(27		)	(196		)
Other revenues	7			11			(4		)
Operating revenue	712			856			(144		)
Cost of fuel	(292		)	(288		)	(4		)
Other cost of sales	(45		)	(37		)	(8		)
Mark-to-market for economic hedging activities	62			(50		)	112
Gross margin	$	437		$	481		$	(44	)
Less: Mark-to-market for economic hedging activities, net	(161		)	(77		)	(84		)
Economic gross margin	$	598		$	558		$	40

Gross margin decreased by $44 million and economic gross margin increased by $40 million for the year ended December 31, 2016, compared to the same period in 2015 due to:



	(In millions)
Higher gross margin due to the closure and financial settlement of certain open positions with counterparties that would have otherwise been realized in subsequent periods	$	85
Higher gross margin due to a 17% increase in generation due to more economic generation resulting from warmer weather conditions compared to the prior year	22
Lower gross margin due to a 14% decrease in average realized energy prices as a result of decline in merchant power prices partially offset by decrease in natural gas prices due to short-term natural gas contracts	(41		)
Lower gross margin due to a 9% decrease in PJM cleared auction capacity prices as a result of more imports, fewer constraints, and less demand growth than the prior year	(21		)
Lower gross margin due to a 3% decrease in PJM cleared auction capacity volumes as capacity supply obligations expired at Potomac River	(8		)
Other	3
Increase in economic gross margin	$	40
Decrease in mark-to-market for economic hedging primarily due to reversals of previously recognized unrealized gains/losses on settled positions and unrealized gains/losses on open positions related to economic hedges as further described below	(84		)
Decrease in gross margin	$	(44	)

Mark-to-market for Economic Hedging Activities



	For the Year Ended December 31,
(In millions)	2016			2015
Mark-to-market results in operating revenues
Reversal of previously recognized unrealized gains on settled positions related to economic hedges	$	(233	)	$	(129	)
Net unrealized gains on open positions related to economic hedges	10			102
Total mark-to-market losses in operating revenues	(223		)	(27		)
Mark-to-market results in operating costs and expenses
Reversal of previously recognized unrealized losses on settled positions related to economic hedges	$	69		$	13
Net unrealized losses on open positions related to economic hedges	(7		)	(63		)
Total mark-to-market gains/(losses) in operating costs and expenses	$	62		$	(50	)

For the year ended December 31, 2016, the $223 million loss in operating revenues from economic hedge positions was driven by the reversal of previously recognized unrealized gains from electricity and natural gas contracts that settled during the period partially offset by an increase in the value of forward sales of electricity contracts as a result of decreases in power prices. The $62 million gain in operating costs and expenses from economic hedge positions was driven by the reversal of previously recognized unrealized losses from fuel contracts that settled during the period partially offset by decreases in the value of new coal contracts executed during the year. As discussed in Item 15 — Note 5, Accounting for Derivative Instruments and Hedging Activities, the reversal of previously recognized gains and losses on settled positions related to economic hedges included in operating revenues and operating costs and expenses during the year ended December 31, 2016 include any gains or losses associated with positions that were closed out and financially settled with certain counterparties that would have otherwise been realized in future periods.

For the year ended December 31, 2015, the $27 million loss in operating revenues from economic hedge positions was driven by the reversal of previously recognized unrealized gains from electricity and natural gas contracts that settled during the period partially offset by an increase in the value of forward sales of electricity contracts as a result of decreases in power prices. The $50 million loss in operating costs and expenses from economic hedge positions was driven by a decrease in the value of forward purchases of fuel contracts as a result of decreases in forward fuel prices partially offset by the reversal of previously recognized unrealized losses from fuel contracts that settled during the period.

Operations and Maintenance

Operations and maintenance was $241 million for the year ended December 31, 2016, and $212 million for the year ended December 31, 2015. The increase of $29 million was primarily due to an increase in environmental expenses and higher maintenance costs driven by increased generation in the current year.

Other Cost of Operations

Other cost of operations was $10 million for the year ended December 31, 2016, and $38 million for the year ended December 31, 2015. The decrease of $28 million was primarily due to a reduction in property tax assessments for the Chalk Point, Dickerson, and Morgantown generating stations and favorable property tax settlements reached for all three generating stations for previous tax years during the year ended December 31, 2016.

Depreciation and Amortization

Depreciation and amortization expense was $60 million for the year ended December 31, 2016, and $65 million for the year ended December 31, 2015. The decrease of $5 million was primarily due to the expiration of Chalk Point's capital lease at the end of 2015.

General and Administrative — Affiliate

General and administrative — affiliate expenses increased $13 million during the year ended December 31, 2016 compared to the same period in 2015. As described in Item 15 — Note 13, Related Party Transactions, costs incurred under the Services Agreement between GenOn and NRG are allocated to GenOn's subsidiaries based on each operating subsidiary's planned operating expenses. The increase in expenses during 2016 is driven by an increase in planned operating expenses at GenOn Mid-Atlantic relative to the rest of GenOn.

Other income, net

During the year ended December 31, 2016, GenOn Mid-Atlantic had other income of $2 million primarily due to increased interest income resulting from the increase in GenOn Mid-Atlantic's cash balance during the year.

Liquidity and Capital Resources

Liquidity Position

As of December 31, 2016, and 2015, the Registrants' liquidity was comprised of the following:



	As of December 31,
	2016		2015
	(In millions)
Cash and cash equivalents:
GenOn excluding GenOn Mid-Atlantic and REMA	$	463	$	174
GenOn Mid-Atlantic ^(a)	471		299
REMA ^(a)	100		192
Total	1,034		665
Credit facility availability	228		222
Total liquidity	$	1,262	$	887

(a) At December 31, 2016, GenOn Mid-Atlantic and REMA did not satisfy the restricted payment tests and therefore, could not use such funds to distribute cash and make other restricted payments.

For the year ended December 31, 2016, total liquidity increased $375 million primarily driven by the sales of assets and real property during 2016 as discussed in Item 15 — Note 3, Dispositions, along with the settlement of certain open positions with one of GenOn's counterparties as discussed in Item 15 — Note 5, Accounting for Derivative Instruments and Hedging Activities.

As described in Item 15 — Note 1, Basis of Presentation, management believes that the GenOn's liquidity position and cash flows from operations will not be adequate to finance current operating, maintenance and capital expenditures, debt service obligations and other liquidity commitments.

As further described in Item 15 — Note 9, Debt and Capital Leases, to the Consolidated Financial Statements, $691 million of GenOn's senior unsecured notes, excluding $8 million of associated premiums, are current and due on June 15, 2017. GenOn's future profitability continues to be adversely affected by (i) a sustained decline in natural gas prices and its resulting effect on wholesale power prices and capacity prices, and (ii) the inability of GenOn Mid-Atlantic and REMA to make distributions of cash and certain other restricted payments to GenOn. Based on current projections, GenOn is not expected to have sufficient liquidity to repay the senior unsecured notes due in June 2017. As a result of these factors, there is substantial doubt about GenOn's ability to continue as a going concern. If GenOn cannot continue as a going concern, this may have a material adverse impact on GenOn's liquidity, results of operations, cash flows and financial position.

NRG, GenOn’s parent company, has no obligation to provide any financial support other than the credit agreement between NRG and GenOn which provides for a $500 million revolving credit facility, all of which can be utilized for revolving loans and letters of credit as further described in Item 15 — Note 13, Related Party Transactions. As controlled group members, ERISA requires that NRG and GenOn are jointly and severally liable for the NRG Pension Plan for Bargained Employees and the NRG Pension Plan, including the pension liabilities associated with GenOn employees.

GenOn is currently considering all options available to it, including negotiations with creditors, refinancing the senior unsecured notes, potential sales of certain generating assets as well as the possibility for a need to file for protection under Chapter 11 of the U.S. Bankruptcy Code. During 2016, GenOn appointed two independent directors, retained advisors and established a separate audit committee as part of this process.

Restricted Payments Tests

Of the $1.0 billion of cash and cash equivalents of the Registrants' as of December 31, 2016, $471 million and $100 million were held by GenOn Mid-Atlantic and REMA, respectively. The ability of certain of GenOn’s and GenOn Americas Generation’s subsidiaries to pay dividends and make distributions is restricted under the terms of certain agreements, including the GenOn Mid-Atlantic and REMA operating leases. Under their respective operating leases, GenOn Mid-Atlantic and REMA are not permitted to make any distributions and other restricted payments unless: (a) they satisfy the fixed charge coverage ratio for the most recently ended period of four fiscal quarters; (b) they are projected to satisfy the fixed charge coverage ratio for each of the two following periods of four fiscal quarters, commencing with the fiscal quarter in which such payment is proposed to be made; and (c) no significant lease default or event of default has occurred and is continuing. In addition, prior to making a dividend or other restricted payment, GenOn Mid-Atlantic and REMA must be in compliance with the requirement to provide credit support to the owner lessors securing their obligations to pay scheduled rent under their respective leases. Based on GenOn Mid-Atlantic’s and REMA’s most recent calculations of these tests, GenOn Mid-Atlantic and REMA did not satisfy the restricted payments tests. As a result, as of December 31, 2016, GenOn Mid-Atlantic and REMA could not make distributions of cash and certain other restricted payments. GenOn Mid-Atlantic and REMA may recalculate their fixed charge coverage ratios from time to time and, subject to compliance with the restricted payments test described above, make dividends or other restricted payments.

To the extent GenOn Mid-Atlantic or REMA are able to pay dividends to GenOn, the GenOn Senior Notes due 2018 and 2020 and the related indentures restrict the ability of GenOn to incur additional liens and make certain restricted payments, including dividends. In the event of a default or if restricted payment tests are not satisfied, GenOn would not be able to distribute cash to its parent, NRG. At December 31, 2016, GenOn did not meet the consolidated debt ratio component of the restricted payments test.

Credit Ratings

Credit rating agencies rate a firm's public debt securities. These ratings are utilized by the debt markets in evaluating a firm's credit risk. Ratings influence the price paid to issue new debt securities by indicating to the market the Registrants' ability to pay principal and interest. Rating agencies evaluate a firm's industry, cash flow, leverage, liquidity, and hedge profile, among other factors, in their credit analysis of a firm's credit risk.

On October 7, 2016, Moody's lowered its corporate credit ratings on GenOn to Caa3 from Caa2 and its probability of default rating to Caa3-PD from Caa2-PD. In addition, Moody's also lowered the ratings of REMA and GenOn Mid-Atlantic's pass through certificates to Caa1 from B2. These changes are an update from March 21, 2016, at which time GenOn's corporate credit rating was lowered from B3 to Caa2. At that time, Moody's also lowered the issue level ratings on GenOn Senior Notes from B3 to Caa2 and the GenOn Americas Generation Senior Notes from Caa1 to Caa2.

On January 10, 2017, GenOn's corporate rating was further lowered by S&P to CCC- from CCC. The ratings outlook for GenOn, GenOn Americas Generation, GenOn Mid-Atlantic and REMA is negative. In addition, S&P also lowered the issue-level ratings on the GenOn Senior Notes to CCC from CCC+, the GenOn Americas Generation Senior Notes to CCC- from CCC, and the pass-through certificates at REMA and GenOn Mid-Atlantic to CCC+ from B-.

The following table summarizes the Registrants' current credit ratings:



	S&P	Moody's
GenOn 7.875% Senior Notes, due 2017	CCC	Caa3
GenOn 9.500% Senior Notes, due 2018	CCC	Caa3
GenOn 9.875% Senior Notes, due 2020	CCC	Caa3
GenOn Americas Generation 8.500% Senior Notes, due 2021	CCC-	Caa3
GenOn Americas Generation 9.125% Senior Notes, due 2031	CCC-	Caa3

Sources of Liquidity

The principal sources of liquidity for the Registrants' future operating and capital expenditures are expected to be derived from existing cash on hand, cash flows from operations, cash proceeds from future sales of assets and the intercompany revolving credit agreement with NRG, as described more fully in Item 15—Note 13, Related Party Transactions. The Registrants' operating cash flows may be affected by, among other things, demand for electricity, the difference between the cost of fuel used to generate electricity and the market value of the electricity generated, commodity prices (including prices for electricity, emissions allowances, natural gas, coal and oil), operations and maintenance expenses in the ordinary course, planned and unplanned outages, terms with trade creditors, cash requirements for capital expenditures relating to certain facilities (including those necessary to comply with environmental regulations) and the potential impact of future environmental regulations.

Asset Dispositions

During the year ended December 31, 2016, GenOn received proceeds of $118 million related to the sale of Seward and Shelby during the first quarter, proceeds of $369 million related to the sale of the Aurora Generating Station during the third quarter and proceeds of $76 million related to the sale of an easement of land and real property located at Potrero during the first and third quarter of 2016.

GenOn Mid-Atlantic Prepaid Letter of Credit

On January 27, 2017, GenOn Mid-Atlantic entered into an agreement with Natixis under which Natixis will procure payment and credit support for the payment of certain lease payments owed pursuant to the GenOn Mid-Atlantic operating leases for Morgantown and Dickerson. GenOn Mid-Atlantic made a payment of $130 million plus fees of $1 million as consideration for Natixis applying for the issuance of, and obtaining, letters of credit from Natixis, New York Branch, the LC Provider, to support the lease payments. Natixis is solely responsible for (i) obtaining letters of credit from the LC Provider, (ii) causing the letters of credit to be issued to the lessors to support the lease payments on behalf of GenOn Mid-Atlantic, (iii) making lease payments and (iv) satisfying any reimbursement obligations payable to the LC Provider.

On February 24, 2017, GenOn Mid-Atlantic received a series of notices from the owner lessors under its operating leases of the Morgantown coal generation unit, or Notices, as further described in Note 14, Commitments and Contingencies, alleging default. The Notices allege the existence of lease events of default as a result of, among other items, the purported failure by GenOn Mid-Atlantic to comply with a covenant requiring the maintenance of qualifying credit support. The Notices instructed the relevant trustees to draw on letters of credit under the secured intercompany revolving credit agreement between NRG and GenOn as further described in Note 13, Related Party Transactions, supporting the GenOn Mid-Atlantic operating leases that were set to expire on February 28, 2017. On February 28, 2017, the trustees drew on the letters of credit under NRG's revolving credit facility, which resulted in additional borrowings of $125 million. Upon notification, GenOn will become obligated under the secured intercompany revolving credit agreement between NRG and GenOn. In addition, a corresponding payable is expected to be recorded by GenOn Mid-Atlantic to GenOn, with the offset recorded as a deposit under the related operating leases, pending resolution of the matter. The Registrant is unaware of whether any further action will be taken by the owner lessors or any other person in connection with the Notices. GenOn Mid-Atlantic disagrees with the owner lessors as to the existence of any lease events of default and/or any breaches by GenOn Mid-Atlantic of any terms and conditions of the operating leases and believes that the declaration of a lease event of default, the instruction to draw on the letters of credit under the secured intercompany revolving credit agreement between NRG and GenOn and any actual draw thereon constitutes a violation by the owner lessors and the relevant trustees of the terms and conditions of the GenOn Mid-Atlantic operating leases. GenOn Mid-Atlantic intends to vigorously pursue its rights and remedies in connection with these actions.

Uses of Liquidity

The Registrants' requirements for liquidity and capital resources, other than for operating its facilities, can generally be categorized by the following: (i) debt service obligations, as described more fully in Item 15 — Note 9, Debt and Capital Leases, to the Consolidated Financial Statements; (ii) capital expenditures, including maintenance and environmental; and (iii) payments under the GenOn Mid-Atlantic and REMA operating leases.

Capital Expenditures

The following tables and descriptions summarize the Registrants' capital expenditures, excluding accruals, for maintenance, environmental, and fuel conversions/additions for the year ended December 31, 2016, and the estimated capital expenditure forecast for 2017.



	Maintenance		Environmental		Growth		Total
	(In millions)
Total cash capital expenditures for the year ended December 31, 2016
GenOn	$	118	$	45	$	105	$	268
GenOn Americas Generation	45		10		—		55
GenOn Mid-Atlantic	42		7		—		49
Total cash capital expenditures forecasted for the year ended December 31, 2017
GenOn	72		13		6		91
GenOn Americas Generation	20		7		—		27
GenOn Mid-Atlantic	17		7		—		24

The following table summarizes the Registrants' estimated environmental capital expenditures for the referenced periods by region:



	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
	(In millions)
2017	$	13	$	7	$	7
2018	2		—		—
2019	8		—		—
2020	11		5		5
2021	27		19		19
Total	$	61	$	31	$	31

Operating Leases

GenOn Mid-Atlantic leases 100% interest in both the Dickerson and Morgantown coal units and associated property through 2029 and 2034, respectively, and has an option to extend the leases. Any extensions of the respective leases would be for less than 75% of the economic useful life of the facility, as measured from the beginning of the original lease term through the end of the proposed remaining lease term. The leases are accounted for as operating leases. Although there is variability in the scheduled payment amounts over the lease term, rent expense is recognized for these leases on a straight-line basis. The scheduled payment amounts for the leases are $144 million and $105 million for 2017 and 2018, respectively. At December 31, 2016, the total notional minimum lease payments for the remaining term of the leases aggregated $935 million and the aggregate termination value for the leases was approximately $800 million and generally decreases over time. In addition, the present value of lease payments at December 31, 2016, was approximately $583 million (assuming a 10% discount rate). NRG provides letters of credit under the credit agreement between NRG and GenOn as further described in Item 15 — Note 13, Related Party Transactions in support of GenOn Mid-Atlantic's lease obligations in an aggregate amount equal to the greatest of the next six months scheduled rent payments, 50% of the next 12 months scheduled rent payments or $128 million.

REMA leases 16.45% and 16.67% interests in the Conemaugh and Keystone coal facilities, respectively through 2034 and expects to make payments through 2029. REMA also leases a 100% interest in the Shawville facility through 2026 and expects to make payments through that date. At the expiration of these leases, there are several renewal options related to fair value. The leases are accounted for as operating leases. The scheduled payment amounts for the REMA leases are $63 million and $55 million for 2017 and 2018, respectively. At December 31, 2016, the total notional minimum lease payments for the remaining term of the leases aggregated $517 million and the aggregate termination value for the leases was approximately $618 million and generally decreases over time. In addition, the present value of lease payments at December 31, 2016, was approximately $346 million (assuming a 9.4% discount rate). NRG provides letters of credit under the credit agreement between NRG and GenOn as further described in Item 15 — Note 13, Related Party Transactions in support of REMA's lease obligations to post rent reserves in an aggregate amount equal to the greater of the next six months scheduled rent payments or 50% of the next 12 months scheduled rent payments.

Item 7A — Quantitative and Qualitative Disclosures About Market Risk (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

The Registrants are exposed to several market risks in their normal business activities. Market risk is the potential loss that may result from market changes associated with the Registrants’ merchant power generation or with an existing or forecasted financial or commodity transaction. The types of risks the Registrants are exposed to are commodity price risk, interest rate risk and credit and performance risk. In order to manage commodity price, the Registrants use various fixed-price forward purchase and sales contracts, futures and option contracts traded on NYMEX, and swaps and options traded in the over-the-counter financial markets to:


•	Manage and hedge fixed-price purchase and sales commitments;


•	Reduce exposure to the volatility of cash market prices; and


•	Hedge fuel requirements for the Registrants’ generating facilities.

Commodity Price Risk

Commodity price risks result from exposures to changes in spot prices, forward prices, volatilities, and correlations between various commodities, such as natural gas, electricity, coal, oil, and emission credits. The Registrants manage the commodity price risk of their merchant generation operations by entering into various derivative or non-derivative instruments to hedge the variability in future cash flows from forecasted sales and purchases of electricity and fuel. These instruments include forwards, futures, swaps, and option contracts traded on various exchanges, such as NYMEX and ICE, as well as over-the-counter markets. The portion of forecasted transactions hedged may vary based upon management's assessment of market, weather, operation and other factors.

While some of the contracts the Registrants use to manage risk represent commodities or instruments for which prices are available from external sources, other commodities and certain contracts are not actively traded and are valued using other pricing sources and modeling techniques to determine expected future market prices, contract quantities, or both. The Registrants use their best estimates to determine the fair value of those derivative contracts. However, it is likely that future market prices could vary from those used in recording mark-to-market derivative instrument valuation, and such variations could be material.

Interest Rate Risk

As of December 31, 2016, GenOn's debt fair value was $1.9 billion and the carrying value was $2.8 billion. GenOn estimates that a 1% decrease in market interest rates would have increased the fair value of its long-term debt by $130 million. As of December 31, 2016, GenOn Americas Generation's debt fair value was $570 million and the carrying value was $745 million. GenOn Americas Generation estimates that a 1% decrease in market interest rates would have increased the fair value of its long-term debt by $92 million.

Counterparty Credit Risk

Credit risk relates to the risk of loss resulting from non-performance or non-payment by counterparties pursuant to the terms of their contractual obligations. The Registrants monitor and manage credit risk through credit policies that include: (i) an established credit approval process; (ii) a daily monitoring of counterparties' credit limits; (iii) the use of credit mitigation measures such as margin, collateral, prepayment arrangements, or volumetric limits; (iv) the use of payment netting agreements; and (v) the use of master netting agreements that allow for the netting of positive and negative exposures of various contracts associated with a single counterparty. Risks surrounding counterparty performance and credit could ultimately impact the amount and timing of expected cash flows. The Registrants seek to mitigate counterparty risk by having a diversified portfolio of counterparties. The Registrants also have credit protection within various agreements to call on additional collateral support if and when necessary. Cash margin is collected and held at the Registrants to cover the credit risk of the counterparty until positions settle.

As of December 31, 2016, counterparty credit exposure to a significant portion of GenOn’s counterparties was $58 million and GenOn held no collateral against these positions, resulting in a net exposure of $58 million. Approximately 97% of GenOn's exposure before collateral is expected to roll off by the end of 2018. GenOn Americas Generation’s counterparty credit exposure to a significant portion of counterparties was $57 million and GenOn Americas Generation held no collateral against those positions, resulting in a net exposure of $57 million. Approximately 97% of GenOn Americas Generation’s exposure before collateral is expected to roll off by the end of 2018. As of December 31, 2016, GenOn Mid-Atlantic had no counterparty credit exposure.

The following tables highlight the credit quality and the net counterparty credit exposure by industry sector. Net counterparty credit exposure is defined as the aggregate net asset position for the Registrants with counterparties where netting is permitted under the enabling agreement and includes all cash flow, mark-to-market and NPNS, and non-derivative transactions. As of December 31, 2016, the exposure is shown net of collateral held and includes amounts net of receivables or payables.



	Net Exposure ^{(a) (b)} (% of Total)
Category	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
Utilities, energy merchants, marketers and other	100	%	100	%	—	%
Total as of December 31, 2016	100	%	100	%	—	%



	Net Exposure ^{(a) (b)} (% of Total)
Category	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
Investment grade	87	%	89	%	—	%
Non-Investment grade/Non-Rated	13	%	11	%	—	%
Total as of December 31, 2016	100	%	100	%	—	%


(a)	Counterparty credit exposure excludes transportation contracts because of the unavailability of market prices.


(b)	The figures in the tables above exclude potential counterparty credit exposure related to RTOs, ISOs, registered commodity exchanges and certain long term contracts.

The Registrants have counterparty credit risk exposure to certain counterparties, each of which represent more than 10% of their respective total net exposure discussed above. The aggregate of such counterparties' exposure was $45 million, $45 million and $0 for GenOn, GenOn Americas Generation and GenOn Mid-Atlantic, respectively. Changes in hedge positions and market prices will affect credit exposure and counterparty concentration. Given the credit quality, diversification and term of the exposure in the portfolio, the Registrants do not anticipate a material impact on their financial position or results of operations from nonperformance by any of their counterparties.

RTOs and ISOs

The Registrants participate in the organized markets of CAISO, ISO-NE, MISO, NYISO and PJM, known as RTO or ISOs. Trading in these markets is approved by FERC and includes credit policies that, under certain circumstances, require that losses arising from the default of one member on spot market transactions be shared by the remaining participants. As a result, the counterparty credit risk to these markets is limited to the Registrants' applicable share of the overall market and are excluded from the above exposure.

Exchange Traded Transactions

The Registrants enter into commodity transactions on registered exchanges, notably ICE and NYMEX. These clearinghouses act as the counterparty, and transactions are subject to extensive collateral and margining requirements. As a result, these commodity transactions have limited counterparty credit risk.

Credit Risk Related Contingent Features

Certain of the Registrants’ hedging agreements contain provisions that require the Registrants to post additional collateral if the counterparty determines that there has been deterioration in credit quality, generally termed "adequate assurance" under the agreements, or require the Registrants to post additional collateral if there were a one notch downgrade in the Registrants’ credit rating. The collateral required for contracts that have adequate assurance clauses that are in net liability positions, as of December 31, 2016, was $5 million for GenOn and GenOn Americas Generation. As of December 31, 2016, no collateral was required for contracts with credit rating contingent features that are in a net liability position for GenOn and GenOn Americas Generation. GenOn and GenOn Americas Generation are also party to certain marginable agreements under which $2 million of collateral was due as of December 31, 2016. As of December 31, 2016, GenOn Mid-Atlantic did not have any financial instruments with credit risk related contingent features.

Item 8 — Financial Statements and Supplementary Data (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

The financial statements and schedules of the Registrants are listed in Part IV, Item 15 of this Form 10-K.

Item 9 — Changes in and Disagreements with Accountants on Accounting and Financial Disclosure (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

None.

Item 9A — Controls and Procedures (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures and Internal Control Over Financial Reporting

Under the supervision and with the participation of the Registrants’ management, including principal executive officer, principal financial officer and principal accounting officer, the Registrants conducted an evaluation of the effectiveness of the design and operation of disclosure controls and procedures, as such term is defined in Rules 13a-15(e) or 15d-15(e) of the Exchange Act. Based on this evaluation, the Registrants’ principal executive officer, principal financial officer and principal accounting officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this annual report on Form 10-K. Management's reports on the Registrants’ internal control over financial reporting are incorporated under the caption "Management's Report on Internal Control over Financial Reporting" of the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

Changes in Internal Control over Financial Reporting

There were no changes in the Registrants’ internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) that occurred in the fourth quarter of 2016 that materially affected, or are reasonably likely to materially affect, the Registrants’ internal control over financial reporting.

Inherent Limitations over Internal Controls

The Registrants’ internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with GAAP. The Registrants’ internal control over financial reporting includes those policies and procedures that:


1.	Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Registrants’ assets;

2. Provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with GAAP, and that the Registrants’ receipts and expenditures are being made only in accordance with authorizations of management and directors; and

3. Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Registrants’ assets that could have a material effect on the consolidated financial statements.

Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations, including the possibility of human error and circumvention by collusion or overriding of controls. Accordingly, even an effective internal control system may not prevent or detect material misstatements on a timely basis. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Management's Report on Internal Control Over Financial Reporting

The Registrants’ management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of the Registrants’ management, including their principal executive officer, principal financial officer and principal accounting officer, the Registrants conducted an evaluation of the effectiveness of their internal control over financial reporting based on the framework in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the Registrants’ evaluation under the framework in Internal Control — Integrated Framework (2013), the Registrants’ management concluded that their internal control over financial reporting was effective as of December 31, 2016.

Item 9B — Other Information (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

None.

PART III

Item 10 — Directors, Executive Officers and Corporate Governance

Item 10 has been omitted from this report for the Registrants pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.

Item 11 — Executive Compensation

Item 11 has been omitted from this report for the Registrants pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.

Item 12 — Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12 has been omitted from this report for the Registrants pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.

Item 13 — Certain Relationships and Related Transactions, and Director Independence

Item 13 has been omitted from this report for the Registrants pursuant to the reduced disclosure format permitted by General Instruction I to Form 10-K.

Item 14 — Principal Accounting Fees and Services (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

KPMG LLP conducts an integrated audit of NRG and its subsidiaries. Professional audit services and other services rendered by KPMG LLP subsequent to December 14, 2012, were allocated to the Registrants through the Services Agreement with NRG as described in Item 15 —Note 14, Commitments and Contingencies, to the Registrants’ Consolidated Financial Statements. As provided in the NRG Audit Committee Charter, the NRG Audit Committee pre-approved all audit services and permissible non-audit services provided by the independent auditor for the fiscal years 2016 and 2015.

The following table shows the aggregate fees related to the audit provided by KPMG LLP for fiscal years 2016 and 2015.



	2016		2015
	(in thousands)
Audit Fees^(a)	$	928	$	928

(a)

Includes fees and expenses related to the audits of the Registrants’ consolidated financial statements for 2016 and 2015. This category also includes the review of financial statements included in the Registrants’ Quarterly Reports on Form 10-Q for the applicable fiscal year, the audits of various subsidiary financial statements required by statute or regulation, and services that are normally provided by the independent auditors in connection with regulatory filings or engagements, consultations provided on audit and accounting matters that arose during, or as a result of, the audits or the reviews of interim financial statements, and the preparation of any written communications on internal control matters.

PART IV

Item 15 — Exhibits, Financial Statement Schedules (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

(a)(1) Financial Statements

The following consolidated financial statements of GenOn Energy, Inc., GenOn Americas Generation, LLC and GenOn Mid-Atlantic, LLC and related notes thereto, together with the reports thereon of KPMG LLP, are included herein:

GenOn Energy, Inc.

Consolidated Statements of Operations — Years ended December 31, 2016, 2015, and 2014

Consolidated Statements of Comprehensive Income/(Loss) — Years ended December 31, 2016, 2015, and 2014

Consolidated Balance Sheets — As of December 31, 2016, and 2015

Consolidated Statements of Cash Flows — Years ended December 31, 2016, 2015, and 2014

Consolidated Statement of Stockholder's Equity — Years ended December 31, 2016, 2015, and 2014

GenOn Americas Generation, LLC

Consolidated Statements of Operations — Years ended December 31, 2016, 2015, and 2014

Consolidated Balance Sheets — As of December 31, 2016 and 2015

Consolidated Statements of Cash Flows — Years ended December 31, 2016, 2015, and 2014

Consolidated Statement of Member’s Equity — Years ended December 31, 2016, 2015, and 2014

GenOn Mid-Atlantic, LLC

Consolidated Statements of Operations — Years ended December 31, 2016, 2015, and 2014

Consolidated Balance Sheets — As of December 31, 2016 and 2015

Consolidated Statements of Cash Flows — Years ended December 31, 2016, 2015, and 2014

Consolidated Statement of Member’s Equity — Years ended December 31, 2016, 2015, and 2014

Combined Notes to Consolidated Financial Statements

(a)(2) Financial Statement Schedules

The following Consolidated Financial Statement Schedules of GenOn Energy, Inc., GenOn Americas Generation, LLC and GenOn Mid-Atlantic, LLC are filed as part of Item 15 of this report and should be read in conjunction with the Consolidated Financial Statements.

Schedule I — GenOn Energy, Inc. Financial Statements

Schedule I — GenOn Americas Generation, LLC Financial Statements

Schedule II — Valuation and Qualifying Accounts

All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore, have been omitted.

(a)(3) Exhibits: See Exhibit Index submitted as a separate section of this report.

(b) Exhibits

See Exhibit Index submitted as a separate section of this report.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors

GenOn Energy, Inc.:

We have audited the accompanying consolidated balance sheets of GenOn Energy, Inc. and subsidiaries (the Company) as of December 31, 2016 and 2015, and the related consolidated statements of operations, comprehensive income/(loss), cash flows, and stockholder’s equity for each of the years in the three-year period ended December 31, 2016. In connection with our audits of the consolidated financial statements, we have also audited financial statement schedules “Schedule I. Condensed Financial Information of Registrant” and “Schedule II. Valuation and Qualifying Accounts.” These consolidated financial statements and financial statement schedules are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedules based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of GenOn Energy, Inc. and subsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2016 in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1, Nature of Business, to the consolidated financial statements, $691 million of GenOn Energy, Inc.'s (GenOn) senior notes outstanding are current within the consolidated balance sheet are due on June 15, 2017. GenOn’s future profitability continues to be adversely affected by (i) a sustained decline in natural gas prices and its resulting effect on wholesale power prices and capacity prices, and (ii) the inability of GenOn Mid-Atlantic, LLC (GenOn Mid-Atlantic) and NRG REMA LLC (REMA), two wholly owned subsidiaries of GenOn, to make distributions of cash and certain other restricted payments to GenOn. Based on current projections, GenOn is not expected to have sufficient liquidity exclusive of cash subject to the restrictions under the GenOn Mid-Atlantic and REMA operating leases to repay the senior notes due in June 2017. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

(signed) KPMG LLP

Philadelphia, Pennsylvania

February 28, 2017

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors

GenOn Americas Generation, LLC:

We have audited the accompanying consolidated balance sheets of GenOn Americas Generation, LLC and subsidiaries (the Company) as of December 31, 2016 and 2015, and the related consolidated statements of operations, cash flows, and member’s equity for each of the years in the three-year period ended December 31, 2016. In connection with our audits of the consolidated financial statements, we have also audited financial statement schedules “Schedule I. Condensed Financial Information of Registrant” and “Schedule II. Valuation and Qualifying Accounts.” These consolidated financial statements and financial statement schedules are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedules based on our audits.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of GenOn Americas Generation, LLC and subsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2016 in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1, Nature of Business, to the consolidated financial statements, GenOn Energy, Inc. (the Company's parent) does not have sufficient liquidity to satisfy its obligations as of December 31, 2016. This factor raises substantial doubt about its ability to continue as a going concern. The potential outcomes as described in Note 1 related to GenOn Energy, Inc. further raises substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

(signed) KPMG LLP

Philadelphia, Pennsylvania

February 28, 2017

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors

GenOn Mid-Atlantic, LLC:

We have audited the accompanying consolidated balance sheets of GenOn Mid-Atlantic, LLC and subsidiaries (the Company) as of December 31, 2016 and 2015, and the related consolidated statements of operations, cash flows, and member’s equity for each of the years in the three-year period ended December 31, 2016. In connection with our audits of the consolidated financial statements, we have also audited financial statement schedule “Schedule II. Valuation and Qualifying Accounts.” These consolidated financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedule based on our audits.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of GenOn Mid-Atlantic, LLC and subsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2016 in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1, Nature of Business, to the consolidated financial statements, GenOn Energy, Inc., (the Company's indirect parent) does not have sufficient liquidity to satisfy its obligations as of December 31, 2016. This factor raises substantial doubt about its ability to continue as a going concern. The potential outcomes as described in Note 1 related to GenOn Energy, Inc. further raises substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

(signed) KPMG LLP

Philadelphia, Pennsylvania

February 28, 2017

GENON ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Operating Revenues
Operating revenue	$	1,851		$	2,365		$	3,087
Operating revenues - affiliate	11			6			3
Total operating revenues	1,862			2,371			3,090
Operating Costs and Expenses
Cost of operations	1,066			1,537			1,759
Cost of operations - affiliate	213			242			418
Depreciation and amortization	195			215			245
Impairment losses	214			170			82
General and administrative	23			10			72
General and administrative - affiliate	185			184			128
Acquisition-related transaction and integration costs	—			—			4
Total operating costs and expenses	1,896			2,358			2,708
Gain/(loss) on sale of assets	294			—			(6		)
Operating Income	260			13			376
Other Income/(Expense)
Other income, net	8			6			2
Gain on sale of equity-method investment	—			—			18
Interest expense	(165		)	(191		)	(186		)
Interest expense - affiliate	(11		)	(11		)	(12		)
Gain on debt extinguishment	—			65			—
Total other expense	(168		)	(131		)	(178		)
Income/(Loss) Before Income Taxes	92			(118		)	198
Income tax expense/(benefit)	11			(3		)	6
Net Income/(Loss)	$	81		$	(115	)	$	192

See notes to Consolidated Financial Statements.

GENON ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Net Income/(Loss)	$	81		$	(115	)	$	192
Other Comprehensive Loss, net of reclassifications, net of tax of $0:
Defined benefit plans	(13		)	(14		)	(104		)
Other Comprehensive Loss	(13		)	(14		)	(104		)
Comprehensive Income/(Loss)	$	68		$	(129	)	$	88

See notes to Consolidated Financial Statements.

GENON ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



	As of December 31,
	2016		2015
	(In millions)
ASSETS
Current Assets
Cash and cash equivalents	$	1,034	$	665
Funds deposited by counterparties	—		51
Accounts receivable	109		99
Inventory	389		448
Derivative instruments	54		544
Derivative instruments — affiliate	54		30
Cash collateral posted in support of energy risk management activities	53		12
Cash collateral posted in support of energy risk management activities — affiliate	79		36
Prepaid rent and other current assets	128		137
Current assets held-for-sale	—		6
Total current assets	1,900		2,028
Property, plant and equipment, net	2,543		2,831
Other Assets
Intangible assets, net	62		74
Derivative instruments	16		154
Derivative instruments — affiliate	—		1
Other non-current assets	339		253
Non-current assets held-for-sale	—		105
Total other assets	417		587
Total Assets	$	4,860	$	5,446

See notes to Consolidated Financial Statements.

GENON ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (Continued)



	As of December 31,
	2016			2015
	(In millions)
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities
Current portion of long-term debt and capital leases	$	704		$	4
Accounts payable	113			112
Accounts payable — affiliate	78			71
Derivative instruments	46			465
Derivative instruments — affiliate	59			10
Cash collateral received in support of energy risk management activities	—			51
Accrued payroll	49			48
Accrued taxes	44			58
Accrued interest expense	39			39
Accrued expenses and other current liabilities	59			56
Current liabilities held-for-sale	—			2
Total current liabilities	1,191			916
Other Liabilities
Long-term debt and capital leases	2,050			2,762
Postretirement and other benefit obligations	188			199
Derivative instruments	10			102
Derivative instruments — affiliate	7			14
Out-of-market contracts	811			892
Other non-current liabilities	263			285
Non-current liabilities held-for-sale	—			4
Total non-current liabilities	3,329			4,258
Total Liabilities	4,520			5,174
Commitments and Contingencies
Stockholder's Equity
Common stock: $0.001 par value, 1 share authorized and issued at December 31, 2016 and 2015	—			—
Additional paid-in capital	325			325
Retained earnings / (accumulated deficit)	44			(37		)
Accumulated other comprehensive loss	(29		)	(16		)
Total Stockholder's Equity	340			272
Total Liabilities and Stockholder's Equity	$	4,860		$	5,446

See notes to Consolidated Financial Statements.

GENON ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Cash Flows from Operating Activities
Net income/(loss)	$	81		$	(115	)	$	192
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
Depreciation and amortization	195			215			245
Amortization of debt premiums	(52		)	(58		)	(58		)
Gain on debt extinguishment	—			(65		)	—
Amortization of out-of-market contracts and emission allowances	(76		)	(70		)	(38		)
Amortization of unearned equity compensation	—			2			6
(Gain)/loss on and sale of assets	(294		)	—			6
Gain on sale of equity method investment	—			—			(18		)
Impairment losses	214			170			82
Changes in derivative instruments	136			180			152
Changes in collateral deposits supporting energy risk management activities	(84		)	(10		)	24
Proceeds from sale of emission allowances	36			—			—
Lower of cost or market inventory adjustments	—			19			12
Cash provided/(used) by changes in other working capital:
Accounts receivable	(5		)	23			52
Inventory	63			33			(76		)
Prepayments and other current assets	5			29			27
Accounts payable and accounts payable — affiliate	12			(38		)	(127		)
Accrued expenses and other current liabilities	(4		)	20			(33		)
Other assets and liabilities	(150		)	(94		)	(211		)
Net Cash Provided by Operating Activities	77			241			237
Cash Flows from Investing Activities
Capital expenditures	(268		)	(254		)	(171		)
Proceeds from sale of assets, net	563			—			50
Proceeds from sale of equity method investments	—			—			35
Other	2			(5		)	10
Net Cash Provided/(Used) by Investing Activities	297			(259		)	(76		)
Cash Flows from Financing Activities
Payments for short and long-term debt	(5		)	(237		)	(1		)
Net Cash Used by Financing Activities	(5		)	(237		)	(1		)
Net Increase/(Decrease) in Cash and Cash Equivalents	369			(255		)	160
Cash and Cash Equivalents at Beginning of Period	665			920			760
Cash and Cash Equivalents at End of Period	$	1,034		$	665		$	920
Supplemental Disclosures
Interest paid, net of amount capitalized	$	216		$	248		$	240
Income taxes paid, net	13			4			3
Non-Cash Investing and Financing Activities
Additions to fixed assets for accrued capital expenditures	$	40		$	20		$	78

See notes to Consolidated Financial Statements.

GENON ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY



	Common Stock		Additional Paid-In Capital		(Accumulated Deficit) / Retained Earnings			Accumulated Other Comprehensive Income/(Loss)			Total Stockholder's Equity
	(In millions)
Balances as of December 31, 2013	$	—	$	325	$	(114	)	$	102		$	313
Net income	—		—		192			—			192
Other comprehensive loss	—		—		—			(104		)	(104		)
Balances as of December 31, 2014	—		325		78			(2		)	401
Net loss	—		—		(115		)	—			(115		)
Other comprehensive loss	—		—		—			(14		)	(14		)
Balances as of December 31, 2015	—		325		(37		)	(16		)	272
Net income	—		—		81			—			81
Other comprehensive loss	—		—		—			(13		)	(13		)
Balances as of December 31, 2016	$	—	$	325	$	44		$	(29	)	$	340

See notes to Consolidated Financial Statements.

GENON AMERICAS GENERATION, LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Operating Revenues
Operating revenues	$	1,684		$	2,176		$	2,869
Operating revenues - affiliate	2			89			60
Total operating revenues	1,686			2,265			2,929
Operating Costs and Expenses
Cost of operations	628			840			944
Cost of operations - affiliate	770			1,120			1,441
Depreciation and amortization	78			74			72
Impairment losses	20			8			—
General and administrative	—			—			9
General and administrative - affiliate	90			81			79
Total operating costs and expenses	1,586			2,123			2,545
Gain/(loss) on sale of assets	77			—			(6		)
Operating Income	177			142			378
Other Income/(Expense)
Other income, net	2			2			1
Interest expense	(51		)	(64		)	(66		)
Interest expense — affiliate	(7		)	(6		)	(8		)
Gain on debt extinguishment	—			42			—
Total other expense	(56		)	(26		)	(73		)
Income Before Income Taxes	121			116			305
Income tax	—			—			—
Net Income	$	121		$	116		$	305

See notes to Consolidated Financial Statements.

GENON AMERICAS GENERATION, LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



	As of December 31,
	2016		2015
	(In millions)
ASSETS
Current Assets
Cash and cash equivalents	$	471	$	246
Funds deposited by counterparties	—		51
Accounts receivable	85		86
Note receivable — affiliate	315		331
Inventory	245		289
Derivative instruments	54		545
Derivative instruments — affiliate	126		316
Cash collateral posted in support of energy risk management activities	51		3
Cash collateral posted in support of energy risk management activities — affiliate	79		36
Prepaid rent and other current assets	77		84
Total current assets	1,503		1,987
Property, plant and equipment, net	1,088		1,116
Other Assets
Intangible assets, net	62		73
Derivative instruments	16		154
Derivative instruments — affiliate	18		81
Other non-current assets	215		131
Total other assets	311		439
Total Assets	$	2,902	$	3,542

See notes to Consolidated Financial Statements.

GENON AMERICAS GENERATION, LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (Continued)



	As of December 31,
	2016		2015
	(In millions)
LIABILITIES AND MEMBER'S EQUITY
Current Liabilities
Accounts payable	$	61	$	48
Accounts payable — affiliate	116		109
Derivative instruments	46		465
Derivative instruments — affiliate	139		272
Cash collateral received in support of energy risk management activities	—		51
Accrued expenses and other current liabilities	94		104
Total current liabilities	456		1,049
Other Liabilities
Long-term debt	745		752
Derivative instruments	10		102
Derivative instruments — affiliate	22		80
Out-of-market contracts	492		520
Other non-current liabilities	124		107
Total non-current liabilities	1,393		1,561
Total Liabilities	1,849		2,610
Commitments and Contingencies
Member’s Equity
Member’s interest	1,053		932
Total Member’s Equity	1,053		932
Total Liabilities and Member’s Equity	$	2,902	$	3,542

See notes to Consolidated Financial Statements.

GENON AMERICAS GENERATION, LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Cash Flows from Operating Activities
Net income	$	121		$	116		$	305
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	78			74			72
Amortization of debt premiums	(7		)	(9		)	(9		)
Gain on debt extinguishment	—			(42		)	—
Amortization of out-of-market contracts and emission allowances	(27		)	(27		)	(16		)
(Gain)/loss on and sale of assets	(77		)	—			6
Changes in collateral deposits supporting energy risk management activities	(91		)	(10		)	(35		)
Changes in derivative instruments	180			122			128
Impairment losses	20			8			—
Lower of cost or market inventory adjustments	—			17			9
Cash provided/(used) by changes in other working capital:
Accounts receivable	1			20			39
Inventory	41			12			(57		)
Prepayments and other current assets	7			6			15
Accounts payable	8			—			(45		)
Accounts payable - affiliate	7			86			2
Accrued expenses and other current liabilities	(4		)	11			1
Other assets and liabilities	(69		)	(36		)	(115		)
Net Cash Provided by Operating Activities	188			348			300
Cash Flows from Investing Activities
Capital expenditures	(55		)	(74		)	(32		)
Proceeds from sale of assets, net	76			—			50
Decrease/(increase) notes receivable - affiliate	16			—			(32		)
Net Cash Provided/(Used) by Investing Activities	37			(74		)	(14		)
Cash Flows from Financing Activities
Payments for short and long-term debt	—			(131		)	—
Capital contributions	—			—			74
Distributions to member	—			—			(320		)
Net Cash Used by Financing Activities	—			(131		)	(246		)
Net Increase in Cash and Cash Equivalents	225			143			40
Cash and Cash Equivalents at Beginning of Period	246			103			63
Cash and Cash Equivalents at End of Period	$	471		$	246		$	103
Supplemental Disclosures
Interest paid, net of amount capitalized	$	58		$	76		$	75
Non-Cash Investing and Financing Activities
Additions to fixed assets for accrued capital expenditures	$	6		$	7		$	5

See notes to Consolidated Financial Statements.

GENON AMERICAS GENERATION, LLC SUBSIDIARIES

CONSOLIDATED STATEMENT OF MEMBER’S EQUITY



	Total Member’s Equity
	(In millions)
Balances as of December 31, 2013	$	691
Net income	305
Distributions to member	(320		)
Non-cash capital contributions	66
Capital contributions	74
Balances as of December 31, 2014	816
Net income	116
Balances as of December 31, 2015	932
Net income	121
Balances as of December 31, 2016	$	1,053

See notes to Consolidated Financial Statements.

GENON MID-ATLANTIC, LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Operating Revenues
Operating revenues	$	1		$	11		$	(62	)
Operating revenues — affiliate	711			845			1,145
Total operating revenues	712			856			1,083
Operating Costs and Expenses
Cost of operations	522			506			678
Cost of operations — affiliate	4			119			50
Depreciation and amortization	60			65			50
General and administrative — affiliate	71			58			64
Total operating costs and expenses	657			748			842
Operating Income	55			108			241
Other Expense
Other income, net	2			—			—
Interest expense	(1		)	(1		)	(2		)
Interest expense — affiliate	(4		)	(3		)	(3		)
Total other expense	(3		)	(4		)	(5		)
Income Before Income Taxes	52			104			236
Income tax	—			—			—
Net Income	$	52		$	104		$	236

See notes to Consolidated Financial Statements.

GENON MID-ATLANTIC, LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



	As of December 31,
	2016		2015
	(In millions)
ASSETS
Current Assets
Cash and cash equivalents	$	471	$	299
Accounts receivable	8		2
Inventory	135		172
Derivative instruments — affiliate	44		269
Prepaid rent and other current assets	73		79
Total current assets	731		821
Property, plant and equipment, net	926		925
Other Assets
Intangible assets, net	10		13
Derivative instruments — affiliate	4		83
Other non-current assets	204		125
Total other assets	218		221
Total Assets	$	1,875	$	1,967

See notes to Consolidated Financial Statements.

GENON MID-ATLANTIC, LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (Continued)



	As of December 31,
	2016		2015
	(In millions)
LIABILITIES AND MEMBER'S EQUITY
Current Liabilities
Accounts payable	$	30	$	21
Accounts payable — affiliate	29		8
Derivative instruments — affiliate	44		163
Accrued taxes	32		44
Accrued environmental liabilities	32		27
Accrued expenses and other current liabilities	5		4
Total current liabilities	172		267
Other Liabilities
Derivative instruments — affiliate	2		32
Out-of-market contracts	492		520
Other non-current liabilities	59		50
Total non-current liabilities	553		602
Total Liabilities	725		869
Commitments and Contingencies
Member’s Equity
Member’s interest	1,150		1,098
Total Member’s Equity	1,150		1,098
Total Liabilities and Member’s Equity	$	1,875	$	1,967

See notes to Consolidated Financial Statements.

GENON MID-ATLANTIC, LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Cash Flows from Operating Activities
Net income	$	52		$	104		$	236
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	60			65			50
Amortization of out-of-market contracts and emission allowances	(28		)	(27		)	1
Changes in derivative instruments	155			75			202
Lower of cost or market inventory adjustments	—			6			—
Cash provided/(used) by changes in other working capital:
Accounts receivable	(6		)	8			(6		)
Inventory	37			(12		)	(8		)
Prepayments and other current assets	6			2			34
Accounts payable	3			—			8
Accounts payable - affiliate	21			(6		)	14
Accrued expenses and other current liabilities	(6		)	22			4
Other assets and liabilities	(73		)	(51		)	(106		)
Net Cash Provided by Operating Activities	221			186			429
Cash Flows from Investing Activities
Capital expenditures	(49		)	(39		)	(16		)
Net Cash Used by Investing Activities	(49		)	(39		)	(16		)
Cash Flows from Financing Activities
Payments for short and long-term debt	—			(5		)	—
Distributions to member	—			—			(320		)
Net Cash Used by Financing Activities	—			(5		)	(320		)
Net Increase in Cash and Cash Equivalents	172			142			93
Cash and Cash Equivalents at Beginning of Period	299			157			64
Cash and Cash Equivalents at End of Period	$	471		$	299		$	157
Non-Cash Investing and Financing Activities
Additions/(decreases) to fixed assets for accrued capital expenditures	$	5		$	(6	)	$	5

See notes to Consolidated Financial Statements.

GENON MID-ATLANTIC, LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF MEMBER’S EQUITY



	Total Member’s Equity
	(In millions)
Balances as of December 31, 2013	$	1,078
Net income	236
Distributions to member	(320		)
Balances as of December 31, 2014	994
Net income	104
Balances as of December 31, 2015	1,098
Net income	52
Balances as of December 31, 2016	$	1,150

See notes to Consolidated Financial Statements.

COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 — Nature of Business (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

General

GenOn Energy, Inc., a wholly owned subsidiary of NRG, is a wholesale generator engaged in the ownership and operation of power generation facilities, with approximately 16,423 MW of net electric generating capacity located in the U.S.

GenOn Americas Generation is a wholesale power generator with approximately 7,907 MW of net electric generating capacity located, in many cases, near major metropolitan areas. GenOn Americas Generation's electric generating capacity is part of the 16,423 MW of net electric generating capacity of GenOn.

GenOn Mid-Atlantic operates and owns or leases 4,605 MW of net electric generating capacity in Maryland, near Washington, D.C. GenOn Mid-Atlantic’s electric generating capacity is part of the 7,907 MW of net electric generating capacity of GenOn Americas Generation. GenOn Mid-Atlantic’s generating facilities serve the Eastern PJM markets.

GenOn Americas Generation and GenOn Mid-Atlantic are Delaware limited liability companies and indirect wholly owned subsidiaries of GenOn. GenOn Mid-Atlantic is a wholly owned subsidiary of NRG North America and an indirect wholly owned subsidiary of GenOn Americas Generation. The following illustrates the ownership structure of the Registrants, excluding any intermediary subsidiaries, as of December 31, 2016:

GenOn's generation facilities consist of baseload, intermediate and peaking power generation facilities. The following table summarizes the generation portfolio by Registrant:



	(In MW)
Generation Type	GenOn	GenOn Americas Generation	GenOn Mid-Atlantic
Natural gas	10,377	4,040	1,864
Coal	4,199	2,433	2,433
Oil	1,847	1,434	308
Total generation capacity	16,423	7,907	4,605

The Registrants sell power from their generation portfolio and offer capacity or similar products to retail electric providers and others, and provide ancillary services to support system reliability.

Liquidity and Ability to Continue as a Going Concern

The accompanying consolidated financial statements have been prepared assuming the Registrants will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities in the normal course of business. As such, the accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets and their carrying amounts, or the amount and classification of liabilities that may result should the Registrants be unable to continue as a going concern. Such adjustments could have a material adverse impact on the Registrants' results of operations, cash flows and financial position.

As disclosed in Note 9, Debt and Capital Leases, as of December 31, 2016, $691 million of GenOn's Senior Notes outstanding, excluding $8 million of associated premiums, are current within the GenOn consolidated balance sheet and are due on June 15, 2017. GenOn's future profitability continues to be adversely affected by (i) a sustained decline in natural gas prices and its resulting effect on wholesale power prices and capacity prices, and (ii) the inability of GenOn Mid-Atlantic and REMA to make distributions of cash and certain other restricted payments to GenOn. Based on current projections, GenOn is not expected to have sufficient liquidity exclusive of cash subject to the restrictions under the GenOn Mid-Atlantic and REMA operating leases to repay the senior notes due in June 2017. As a result of these factors, there is substantial doubt about GenOn's ability to continue as a going concern.

As of December 31, 2016, GenOn has cash and cash equivalents of $1.0 billion, of which $471 million and $100 million is held by GenOn Mid-Atlantic and REMA, respectively. Under their respective operating leases, GenOn Mid-Atlantic and REMA are not permitted to make any distributions and other restricted payments unless: (a) they satisfy the fixed charge coverage ratio for the most recently ended period for four fiscal quarters; (b) they are projected to satisfy the fixed charge coverage ratio for each of the two following periods of four fiscal quarters, commencing with the fiscal quarter in which such payment is proposed to be made; and (c) no significant lease default or event of default has occurred and is continuing. Additionally, GenOn Mid-Atlantic and REMA must be in compliance with the requirement to provide credit support to the owner lessors securing their obligations to pay scheduled rent under their respective leases. As a result, GenOn Mid-Atlantic has not been able to make distributions of cash and certain other restricted payments since the quarter ended March 31, 2014 which was the last quarterly period for which GenOn Mid-Atlantic satisfied the conditions under its operating agreement. REMA has not satisfied the conditions under its operating agreement to make distributions of cash and certain other restricted payments since 2009.

NRG, GenOn's parent company, has no obligation to provide any financial support other than the credit agreement between NRG and GenOn which provides for a $500 million revolving credit facility, all of which can be utilized for revolving loans and letters of credit as further described in Note 13, Related Party Transactions. As controlled group members, ERISA requires that NRG and GenOn are jointly and severally liable for the NRG Pension Plan for Bargained Employees and the NRG Pension Plan, including the pension liabilities associated with GenOn employees.

GenOn is currently considering all options available to it, including negotiations with creditors and lessors, refinancing the senior notes, potential sales of certain generating assets as well as the possibility for a need to file for protection under Chapter 11 of the U.S. Bankruptcy Code. During 2016, GenOn appointed two independent directors, retained advisors and established a separate audit committee as part of this process.

As of December 31, 2016, GenOn Americas Generation, a consolidated subsidiary of GenOn, has a note receivable due from GenOn Energy Holdings, a consolidated subsidiary of GenOn, of $315 million and an accounts payable due to GenOn Energy Holdings of $43 million under the intercompany cash management program as further described in Note 13, Related Party Transactions. The terms of the intercompany note do not provide for priority to GenOn Americas Generation and as such, there is no assurance that options pursued by GenOn will not have an adverse impact on GenOn Americas Generation’s liquidity. As such, there is substantial doubt about GenOn Americas Generation’s ability to continue as a going concern.

NRG Merger

On December 14, 2012, NRG completed the acquisition of GenOn with GenOn continuing as a wholly owned subsidiary of NRG. The NRG Merger was accounted for under the acquisition method of accounting. Fair value adjustments related to the NRG Merger have been pushed down to GenOn, GenOn Americas Generation and GenOn Mid-Atlantic, resulting in certain assets and liabilities of the Registrants being recorded at fair value at December 15, 2012.

The Registrants’ consolidated statements of operations subsequent to the NRG Merger include amortization expense relating to fair value adjustments and depreciation expense based on the fair value of the Registrants’ property, plant and equipment. In addition, effective with the NRG Merger, the Registrants adopted accounting policies of NRG.

Note 2 — Summary of Significant Accounting Policies (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Basis of Presentation and Principles of Consolidation

This is a combined annual report of the Registrants. The notes to the consolidated financial statements apply to the Registrants as indicated parenthetically next to each corresponding disclosure.

The Registrants' consolidated financial statements have been prepared in accordance with GAAP. The ASC, established by the FASB, is the source of authoritative GAAP to be applied by nongovernmental entities. In addition, the rules and interpretative releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants.

The consolidated financial statements include the Registrants' accounts and operations and those of their subsidiaries in which the Registrants have a controlling interest. All significant intercompany transactions and balances have been eliminated in consolidation. The usual condition for a controlling financial interest is ownership of a majority of the voting interests of an entity. However, a controlling financial interest may also exist through arrangements that do not involve controlling voting interests. As such, the Registrants apply the guidance of ASC 810, Consolidations, or ASC 810, to determine when an entity that is insufficiently capitalized or not controlled through its voting interests, referred to as a VIE, should be consolidated.

Cash and Cash Equivalents

Cash and cash equivalents include highly liquid investments with an original maturity of three months or less at the time of purchase.

Funds Deposited by Counterparties (GenOn and GenOn Americas Generation)

Funds deposited by counterparties consist of cash held by GenOn and GenOn Americas Generation as a result of collateral posting obligations from GenOn's and GenOn Americas Generation's counterparties. Some amounts are segregated into separate accounts that are not contractually restricted but, based on GenOn's and GenOn Americas Generation's intentions, are not available for the payment of general corporate obligations. Depending on market fluctuations and the settlement of the underlying contracts, GenOn and GenOn Americas Generation will refund this collateral to the hedge counterparties pursuant to the terms and conditions of the underlying trades. Since collateral requirements fluctuate daily and GenOn and GenOn Americas Generation cannot predict if any collateral will be held for more than twelve months, the funds deposited by counterparties are classified as a current asset on GenOn's and GenOn Americas Generation's balance sheets, with an offsetting liability for this cash collateral received within current liabilities. Changes in funds deposited by counterparties are closely associated with GenOn's and GenOn Americas Generation's operating activities and are classified as an operating activity in GenOn's and GenOn Americas Generation's consolidated statements of cash flows.

Inventory

Inventory is valued at the lower of weighted average cost or market, and consists principally of fuel oil, coal and raw materials used to generate electricity. The Registrants remove these inventories as they are used in the production of electricity. Spare parts inventory is valued at a weighted average cost, since the Registrants expect to recover these costs in the ordinary course of business. The Registrants remove these inventories when they are used for repairs, maintenance or capital projects. Sales of inventory are classified as an operating activity in the consolidated statements of cash flows.

Property, Plant and Equipment

Property, plant and equipment are stated at cost; however impairment adjustments are recorded whenever events or changes in circumstances indicate that their carrying values may not be recoverable. Significant additions or improvements extending asset lives are capitalized as incurred, while repairs and maintenance that do not improve or extend the life of the respective asset are charged to expense as incurred. Depreciation is computed using the straight-line method over the estimated useful lives. Certain assets and their related accumulated depreciation amounts are adjusted for asset retirements and disposals with the resulting gain or loss included in cost of operations in the consolidated statements of operations.

Asset Impairments

Long-lived assets that are held and used are reviewed for impairment whenever events or changes in circumstances indicate carrying values may not be recoverable. Such reviews are performed in accordance with ASC 360, Property, Plant and Equipment. An impairment loss is indicated if the total future estimated undiscounted cash flows expected from an asset are less than its carrying value. An impairment charge is measured by the difference between an asset's carrying amount and fair value with the difference recorded in operating costs and expenses in the consolidated statements of operations. Fair values are determined by a variety of valuation methods, including appraisals, sales prices of similar assets and present value techniques.

For further discussion of these matters, refer to Note 8, Impairments.

Capitalized Interest

Interest incurred on funds borrowed to finance capital projects is capitalized until the project under construction is ready for its intended use. The amounts of interest capitalized were as follows:



	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
	(In millions)
GenOn	$	13	$	5	$	11
GenOn Americas Generation	3		2		1
GenOn Mid-Atlantic	3		1		1

When a project is available for operations, capitalized interest is reclassified to property, plant and equipment and depreciated on a straight-line basis over the estimated useful life of the project's related assets. Capitalized costs are charged to expense if a project is abandoned or management otherwise determines the costs to be unrecoverable.

Intangible Assets

Intangible assets represent contractual rights held by the Registrants. The Registrants recognize specifically identifiable intangible assets when specific rights and contracts are acquired. As of December 31, 2016, and 2015, the Registrants' intangible assets are primarily comprised of SO₂ emission allowances and CO₂ emission credits held for compliance with RGGI that are held-for-use and are amortized to cost of operations based on straight line or units of production basis. The following table presents the Registrants’ amortization of intangible assets for each of the past three years:



	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
	(In millions)
GenOn	$	48	$	39	$	38
GenOn Americas Generation	45		32		33
GenOn Mid-Atlantic	39		27		29

The following table presents estimated amortization of the Registrants’ intangible assets for each of the next five years:



	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
	(In millions)
2017	$	39	$	35	$	1
2018	4		—		—
2019	4		—		—
2020	5		—		—
2021	—		—		—

The following table presents the accumulated amortization included in intangible assets, net, for each of the Registrants as of December 31, 2016 and December 31, 2015:



		Intangible assets Accumulated amortization
		December 31, 2016		December 31, 2015
	(In millions)
GenOn		$	87	$	40
GenOn Americas Generation		87		40
GenOn Mid-Atlantic		29		—

Out of Market Contracts

In connection with the NRG Merger, acquired out-of-market contracts were pushed down to the Registrants, as applicable, and primarily relate to GenOn Mid-Atlantic and REMA leases and long-term natural gas transportation and storage contracts. These out-of-market contracts are amortized to operating revenues and cost of operations, as applicable, based on the nature of the contracts and over their contractual lives. The following table presents the Registrants' amortization of out-of-market contracts for each of the past three years:



	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
	(In millions)
GenOn	$	83	$	79	$	78
GenOn Americas Generation	28		28		28
GenOn Mid-Atlantic	28		28		28

The following table summarizes the estimated amortization related to the Registrants’ out-of-market contracts:



	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
	(In millions)
2017	$	76	$	28	$	28
2018	71		28		28
2019	68		28		28
2020	68		28		28
2021	65		28		28

Income Taxes

GenOn

GenOn is a wholly owned subsidiary of NRG that exists as a corporate regarded entity for income tax purposes. As a result, GenOn, NRG Americas and NRG have direct liability for the majority of the federal and state income taxes resulting from GenOn's operations. GenOn has allocated income taxes as if it were a single consolidated taxpayer using the liability method in accordance with ASC 740, which requires that GenOn use the asset and liability method of accounting for deferred income taxes and provide deferred income taxes for all significant temporary differences.

GenOn has two categories of income tax expense or benefit - current and deferred, as follows:

•Current income tax expense or benefit consists solely of current taxes payable less applicable tax credits, and

•Deferred income tax expense or benefit is the change in the net deferred income tax asset or liability, excluding amounts charged or credited to accumulated other comprehensive income.

GenOn reports some of its revenues and expenses differently for financial statement purposes than for income tax return purposes, resulting in temporary and permanent differences between its financial statements and income tax returns. The tax effects of such temporary differences are recorded as either deferred income tax assets or deferred income tax liabilities in GenOn's consolidated balance sheets. GenOn measures its deferred income tax assets and deferred income tax liabilities using income tax rates that are currently in effect. A valuation allowance is recorded to reduce GenOn's net deferred tax assets to an amount that is more-likely-than-not to be realized.

The determination of a valuation allowance requires significant judgment as to the generation of taxable income during future periods in which those temporary differences are deductible. In making this determination, management considers all available positive and negative evidence affecting specific deferred tax assets, including GenOn's past and projected pre-tax book earnings, the reversal of deferred tax liabilities and the implementation of tax planning strategies.

GenOn accounts for uncertain tax positions in accordance with ASC 740, which applies to all tax positions related to income taxes. Under ASC 740, tax benefits are recognized when it is more-likely-than-not that a tax position will be sustained upon examination by the authorities. The benefit recognized from a position that has surpassed the more-likely-than-not threshold is the largest amount of benefit that is more than 50% likely to be realized upon settlement. GenOn recognizes interest and penalties accrued related to uncertain tax benefits as a component of income tax expense.

GenOn Americas Generation

GenOn Americas Generation and most of its subsidiaries are limited liability companies that are treated as branches of GenOn Americas for income tax purposes. As a result, NRG Americas, GenOn and NRG have direct liability for the majority of the federal and state income taxes relating to GenOn Americas Generation's operations. Several of GenOn Americas Generation's subsidiaries exist as regarded corporate entities for income tax purposes. For the subsidiaries that continue to exist as corporate regarded entities, GenOn Americas Generation allocates current and deferred income taxes to each corporate regarded entity as if such entity were a single taxpayer utilizing the asset and liability method to account for income taxes.

GenOn Americas Generation reports some of its revenues and expenses differently for financial statement purposes than for income tax return purposes, resulting in temporary and permanent differences between its financial statements and income tax returns. The tax effects of such temporary differences are recorded as either deferred income tax assets or deferred income tax liabilities in GenOn Americas Generation's consolidated balance sheets. GenOn Americas Generation measures its deferred income tax assets and deferred income tax liabilities using income tax rates that are currently in effect. A valuation allowance is recorded to reduce GenOn Americas Generation's net deferred tax assets to an amount that is more-likely-than-not to be realized.

The determination of a valuation allowance requires significant judgment as to the generation of taxable income during future periods in which those temporary differences are deductible. In making this determination, management considers all available positive and negative evidence affecting specific deferred tax assets, including GenOn Americas Generation's past and projected pre-tax book earnings, the reversal of deferred tax liabilities and the implementation of tax planning strategies.

GenOn Americas Generation accounts for uncertain tax positions in accordance with ASC 740, which applies to all tax positions related to income taxes. Under ASC 740, tax benefits are recognized when it is more-likely-than-not that a tax position will be sustained upon examination by the authorities. The benefit recognized from a position that has surpassed the more-likely-than-not threshold is the largest amount of benefit that is more than 50% likely to be realized upon settlement. GenOn Americas Generation recognizes interest and penalties accrued related to uncertain tax benefits as a component of income tax expense.

GenOn Mid-Atlantic

GenOn Mid-Atlantic and GenOn Mid-Atlantic's subsidiaries are limited liability companies that are treated as branches of NRG Americas for income tax purposes. As such, GenOn, NRG Americas and NRG have direct liability for the majority of the federal and state income taxes relating to GenOn Mid-Atlantic's operations.

Revenue Recognition

Energy — Both physical and financial transactions are entered into to optimize the financial performance of the Registrants' generating facilities. Electric energy revenue is recognized upon transmission to the customer. Physical transactions, or the sale of generated electricity to meet supply and demand, are recorded on a gross basis in the Registrants’ consolidated statements of operations. Financial transactions, or the buying and selling of energy for trading purposes, are recorded net within operating revenues in the consolidated statements of operations in accordance with ASC 815.

Capacity — Capacity revenues are recognized when contractually earned, and consist of revenues billed to a third party at either the market or a negotiated contract price for making installed generation capacity available in order to satisfy system integrity and reliability requirements.

Natural Gas Sales (GenOn and GenOn Americas Generation) — GenOn and GenOn Americas Generation record revenues from the sales of natural gas under the accrual method. These sales are sold at market-based prices. Sales that have been delivered but not billed by period end are estimated.

During the years ended December 31, 2016 and 2015, the Registrants had one customer from which each Registrant derived more than 10% of their respective consolidated revenues.

Derivative Financial Instruments

The Registrants account for derivative financial instruments under ASC 815, which requires the Registrants to record all derivatives on the balance sheet at fair value unless they qualify for a NPNS exception. Changes in the fair value of derivatives are immediately recognized in earnings.

The Registrants’ primary derivative instruments are financial power and natural gas contracts, fuels purchase contracts, and other energy related commodities used to mitigate variability in earnings due to fluctuations in market prices.

Revenues and expenses on contracts that qualify for the NPNS exception are recognized when the underlying physical transaction is delivered. While these contracts are considered derivative financial instruments under ASC 815, they are not recorded at fair value, but on an accrual basis of accounting. If it is determined that a transaction designated as NPNS no longer meets the scope exception, the fair value of the related contract is recorded on the balance sheet and immediately recognized through earnings.

The Registrants’ trading activities are subject to limits in accordance with the Risk Management Policy. These contracts are recognized on the balance sheet at fair value and changes in the fair value of these derivative financial instruments are recognized in earnings.

Concentrations of Credit Risk

Financial instruments which potentially subject the Registrants to concentrations of credit risk consist primarily of accounts receivable and derivatives. Certain accounts receivable and derivative instruments are concentrated within entities engaged in the energy industry. These industry concentrations may impact the Registrants’ overall exposure to credit risk, either positively or negatively, in that the customers may be similarly affected by changes in economic, industry or other conditions. Receivables and other contractual arrangements are subject to collateral requirements under the terms of enabling agreements. However, the Registrants believe that the credit risk posed by industry concentration is offset by the diversification and creditworthiness of the Registrants’ customer base. See Note 4, Fair Value of Financial Instruments, for a further discussion of derivative concentrations.

Fair Value of Financial Instruments

The carrying amount of cash and cash equivalents, funds deposited by counterparties, receivables, accounts payable, and accrued liabilities approximate fair value because of the short-term maturity of these instruments. See Note 4, Fair Value of Financial Instruments, for a further discussion of fair value of financial instruments.

Asset Retirement Obligations

The Registrants account for their AROs in accordance with ASC 410-20, Asset Retirement Obligations, or ASC 410-20. Retirement obligations associated with long-lived assets included within the scope of ASC 410-20 are those for which a legal obligation exists under enacted laws, statutes, and written or oral contracts, including obligations arising under the doctrine of promissory estoppel, and for which the timing and/or method of settlement may be conditional on a future event. ASC 410-20 requires an entity to recognize the fair value of a liability for an ARO in the period in which it is incurred and a reasonable estimate of fair value can be made.

Upon initial recognition of a liability for an ARO, the Registrants capitalize the asset retirement cost by increasing the carrying amount of the related long-lived asset by the same amount. Over time, the liability is accreted to its future value, while the capitalized cost is depreciated over the useful life of the related asset. See Note 10, Asset Retirement Obligations, for a further discussion of AROs.

Pensions and Other Postretirement Benefits (GenOn)

GenOn offers pension benefits through defined benefit pension plans. In addition, GenOn provides postretirement health and welfare benefits for certain groups of employees. GenOn accounts for pension and other postretirement benefits in accordance with ASC 715, Compensation — Retirement Benefits. GenOn recognizes the funded status of its defined benefit plans in the statement of financial position and records an offset for gains and losses as well as all prior service costs that have not been included as part of GenOn's net periodic benefit cost to other comprehensive income. The determination of GenOn's obligation and expenses for pension benefits is dependent on the selection of certain assumptions. These assumptions determined by management include the discount rate, the expected rate of return on plan assets and the rate of future compensation increases. GenOn's actuarial consultants determine assumptions for such items as retirement age. The assumptions used may differ materially from actual results, which may result in a significant impact to the amount of pension obligation or expense recorded by GenOn.

GenOn measures the fair value of its pension assets in accordance with ASC 820, Fair Value Measurements and Disclosures, or ASC 820.

On December 31, 2014, NRG merged 8 qualified pension plans into 2 separate qualified pension plans, the NRG Pension Plan for Bargained Employees and the NRG Pension Plan. The GenOn Mirant Bargaining Unit Pension Plan, GenOn First Energy Pension Plan, GenOn Duquesne Pension Plan, and GenOn REMA Pension Plan were merged into the NRG Pension Plan for Bargained Employees. The GenOn Mirant Pension Plan was merged into the NRG Pension Plan for Non-Bargained Employees and renamed the NRG Pension Plans. These actions were conducted to simplify internal administration of the plans, reduce regulatory filings, and lower fees paid to outside vendors as part of the management services agreement. The benefits provided to current participants in the Plans were not impacted and GenOn remains obligated for its respective pension liabilities.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

In recording transactions and balances resulting from business operations, the Registrants use estimates based on the best information available. Estimates are used for such items as plant depreciable lives, tax provisions, actuarially determined benefit costs, the valuation of energy commodity contracts, environmental liabilities, legal costs incurred in connection with recorded loss contingencies, and assets acquired and liabilities assumed in business combinations, among others. In addition, estimates are used to test long-lived assets for impairment and to determine the fair value of impaired assets. As better information becomes available or actual amounts are determinable, the recorded estimates are revised. Consequently, operating results can be affected by revisions to prior accounting estimates.

Reclassifications

Certain prior-year amounts have been reclassified for comparative purposes. The reclassifications did not affect results from operations, net assets or cash flows.

Recent Accounting Developments

ASU 2016-16 — In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory, or ASU No. 2016-16. The amendments of ASU No. 2016-16 were issued to improve the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party which has resulted in diversity in practice and increased complexity within financial reporting. The amendments of ASU No. 2016-16 would require an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs and do not require new disclosure requirements. The amendments of ASU No. 2016-16 are effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual periods. Early adoption is permitted and the adoption of ASU No. 2016-16 should be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Registrants are currently evaluating the impact of the standard on the Registrants’ results of operations, cash flows and financial position.

ASU 2016-15 — In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments, or ASU No. 2016-15. The amendments of ASU No. 2016-15 were issued to address eight specific cash flow issues for which stakeholders have indicated to the FASB that a diversity in practice existed in how entities were presenting and classifying these items in the statement of cash flows. The issues addressed by ASU No. 2016-15 include but are not limited to the classification of debt prepayment and debt extinguishment costs, payments made for contingent consideration for a business combination, proceeds from the settlement of insurance proceeds, distributions received from equity method investees and separately identifiable cash flows and the application of the predominance principle. The amendments of ASU No. 2016-15 are effective for public entities for fiscal years beginning after December 15, 2017 and interim periods in those fiscal years. Early adoption is permitted, including adoption in an interim fiscal period with all amendments adopted in the same period. The adoption of ASU No. 2016-15 is required to be applied retrospectively. The Registrants are currently evaluating the impact of the standard on the Registrants’ statement of cash flows.

ASU 2016-02 — In 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), or Topic 842 with the objective to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and to improve financial reporting by expanding the related disclosures. The guidance in Topic 842 provides that a lessee that may have previously accounted for a lease as an operating lease under current GAAP should recognize the assets and liabilities that arise from a lease on the balance sheet. In addition, Topic 842 expands the required quantitative and qualitative disclosures with regards to lease arrangements. The Registrants expect to adopt the standard effective January 1, 2019 utilizing the required modified retrospective approach for the earliest period presented. The Registrants expect to elect certain of the practical expedients permitted, including the expedient that permits the Registrants to retain its existing lease assessment and classification. The Registrants are currently working through an adoption plan which includes the evaluation of lease contracts compared to the new standard. While the Registrants are currently evaluating the impact the new guidance will have on their financial position and results of operations, the Registrants expect to recognize lease liabilities and right of use assets. The extent of the increase to assets and liabilities associated with these amounts remains to be determined pending the Registrants' review of its existing lease contracts and service contracts which may contain embedded leases. As this review is still in process, it is currently not practicable to quantify the impact of adopting the ASU at this time.

ASU 2016-01 — In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, or ASU No. 2016-01. The amendments of ASU No. 2016-01 eliminate available-for-sale classification of equity investments and require that equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be generally measured at fair value with changes in fair value recognized in net income. Further, the amendments require that financial assets and financial liabilities to be presented separately in the notes to the financial statements, grouped by measurement category and form of financial asset. The guidance in ASU No. 2016-01 is effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those annual periods. The Registrants are currently evaluating the impact of the standard on the Registrants' results of operations, cash flows and financial position.

ASU 2014-15 — In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements — Going Concern (Subtopic 205-40): Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern, which requires management to evaluate whether there are conditions and events that raise substantial doubt about an entity's ability to continue as a going concern within one year after the financial statements are available to be issued. The Registrants adopted this ASU effective January 1, 2016.

ASU 2014-09 — In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), or ASU No. 2014-09, which was further amended through various updates issued by the FASB thereafter. The amendments of ASU No. 2014-09 completed the joint effort between the FASB and the IASB, to develop a common revenue standard for GAAP and IFRS, and to improve financial reporting. The guidance under Topic 606 provides that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for the goods or services provided and establishes a five step model to be applied by an entity in evaluating its contracts with customers. The Registrants expect to adopt the standard effective January 1, 2018 and apply the guidance retrospectively to contracts at the date of adoption. The Registrants will recognize the cumulative effect of applying Topic 606 at the date of initial application, as prescribed under the modified retrospective transition method. The Registrants also expect to elect the practical expedient available under Topic 606 for measuring progress toward complete satisfaction of a performance obligation and for disclosure requirements of remaining performance obligations. The practical expedient allows an entity to recognize revenue in the amount to which the entity has the right to invoice such that the entity has a right to the consideration in an amount that corresponds directly with the value to the customer for performance completed to date by the entity. In 2016, the Registrants continued to assess the new standard with a focus on identifying the performance obligations included within its revenue arrangements with customers and evaluating the Registrants' methods of estimating the amount and timing of variable consideration. Based on the assessment to date, the Registrants are currently evaluating the impact of the new standard on the Registrants' results of operations, financial position or cash flows.

Note 3 — Dispositions (GenOn and GenOn Americas Generation)

Potrero Disposition (GenOn and GenOn Americas Generation)

On September 26, 2016, NRG Potrero LLC, or Potrero, an indirect wholly owned subsidiary of GenOn Americas Generation, completed the sale of real property at the Potrero generating station located in San Francisco, CA to California Barrel Company, LLC for total consideration of $86 million comprised of $74 million of cash received, which is net of $8 million of closing costs and $4 million to be held in escrow in order to cover post closing obligations. The sale resulted in a gain of approximately $74 million recognized within GenOn Americas Generation's consolidated results of operations during the third quarter of 2016.

In October 2016, in connection with the completion of the Potrero real property disposition, Potrero received $16 million from GenOn Energy Holdings for the settlement of a note receivable which reduced the outstanding note receivable — affiliate balance to $315 million as of December 31, 2016. Refer to Note 13, Related Party Transactions — Intercompany Cash Management Program for further discussion of the note receivable — affiliate.

Aurora Disposition (GenOn)

On May 12, 2016, GenOn entered into an agreement with RA Generation, LLC to sell the Aurora Generating Station, or Aurora, for cash consideration of $365 million, subject to adjustments for working capital and the results of the PJM 2019/2020 Base Residual Auction. Aurora is an 878 MW natural gas facility located in Aurora, Illinois. On July 12, 2016, GenOn completed the sale of Aurora for cash proceeds of $369 million, including $4 million in adjustments primarily for the PJM base residual auction results and estimated working capital, which is subject to further adjustment. The sale resulted in a gain of approximately $188 million recognized within GenOn's consolidated results of operations during the third quarter of 2016. In connection with the sale, GenOn issued a guaranty to RA Generation, LLC for the payment of certain indemnified costs under the purchase agreement limited to $365 million, which is reduced to $183 million on January 1, 2018 and then to $91 million beginning January 1, 2019 and will terminate upon the third anniversary of the sale.

Seward Disposition (GenOn)

On November 24, 2015, GenOn entered into an agreement with Seward Generation, LLC and an affiliate of Robindale Energy Services, Inc. to sell 100% of its interest in the Seward Generation Station, for cash consideration of $75 million. Seward owns a 525 MW coal-fired facility in Pennsylvania. The transaction triggered an impairment indicator as the sale price was less than the carrying amount of the assets and, as a result, the assets were considered to be impaired. GenOn measured the impairment loss as the difference between the carrying amount of the assets and the agreed-upon sale price. GenOn recorded an impairment loss of $134 million in its consolidated results of operations for the year ended December 31, 2015, to reduce the carrying amount of the assets held for sale to the fair market value. For further discussion on this impairment, refer to Note 8 — Impairments. At December 31, 2015, GenOn had classified on its balance sheet the assets and liabilities of Seward as held for sale. On February 2, 2016, GenOn completed the sale of Seward and received gross cash proceeds of $75 million excluding $3 million of cash on hand transferred to the buyer. GenOn will also receive $5 million in deferred cash consideration in five $1 million annual installments and up to $2.5 million in payments contingent upon certain environmental requirements being impose by August 2017. In addition, Robindale committed to future inventory purchases from GenOn of $13 million through 2019.

Shelby Disposition (GenOn)

On November 9, 2015, GenOn entered into an agreement with an affiliate of Rockland Power Partners II, LP and Shelby County Energy Center, LLC to sell 100% of its interest in the Shelby Generating Station, for cash consideration of $46 million. Shelby owns a 352 MW natural gas-fired facility located in Illinois. At December 31, 2015, GenOn had classified on its balance sheet the assets and liabilities of Shelby as held for sale. On March 1, 2016, GenOn completed the sale of Shelby for cash proceeds of $46 million which resulted in a gain of $29 million recognized within GenOn's consolidated results of operations during the year ended of December 31, 2016. In addition, GenOn retained $10 million related to future revenue rights as part of the agreement of which $8 million had been received as of December 31, 2016.

Sabine Disposition (GenOn)

On December 2, 2014, GenOn, through its subsidiaries GenOn Sabine (Delaware), Inc. and GenOn Sabine (Texas), Inc., completed the sale of its 50% interest in Sabine Cogen, L.P., or Sabine, to Bayou Power, LLC, an affiliate of Rockland Capital, LLC. Sabine owns a 105 MW natural gas-fired cogeneration facility located in Texas. GenOn received cash consideration of $35 million at closing. A gain of $18 million was recognized as a result of the transaction and recorded within GenOn's consolidated statements of operations during the year ended December 31, 2014.

Kendall Disposition (GenOn and GenOn Americas Generation)

On January, 31, 2014, NRG North America LLC, a wholly owned subsidiary of GenOn Americas Generations, completed the sale of NRG Kendall LLC to Veolia Energy North America Holdings, Inc. for cash consideration of $50 million. There was a $6 million loss recorded in the consolidated results of operations of GenOn and GenOn Americas Generation during the first quarter of 2014.

Note 4 — Fair Value of Financial Instruments (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

For cash and cash equivalents, funds deposited by counterparties, receivables, accounts payable, accrued liabilities, and cash collateral posted and received in support of energy risk management activities, the carrying amount approximates fair value because of the short-term maturity of those instruments and are classified as Level 1 within the fair value hierarchy.

The estimated carrying values and fair values of GenOn and GenOn Americas Generation’s debt are as follows:

GenOn



	As of December 31, 2016				As of December 31, 2015
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(In millions)
Long-term debt, including current portion	$	2,752	$	1,946	$	2,764	$	2,043

The fair value of long and short-term debt that is estimated using reported market prices for instruments that are publicly traded is classified as Level 2 within the fair value hierarchy. The fair value of non-publicly traded debt is based on the income approach valuation technique using current interest rates for similar instruments with equivalent credit quality and is classified as Level 3 within the fair value hierarchy. The following table presents the level within the fair value hierarchy for long-term debt, including current portion as of December 31, 2016 and 2015:



	As of December 31, 2016				As of December 31, 2015
	Level 2		Level 3		Level 2		Level 3
	(In millions)
Long-term debt, including current portion	$	1,850	$	96	$	1,987	$	56

GenOn Americas Generation



	As of December 31, 2016				As of December 31, 2015
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(In millions)
Long-term debt, including current portion	$	745	$	570	$	752	$	500

The fair value of long and short-term debt is estimated using reported market prices for instruments that are publicly traded and is classified as Level 2 within the fair value hierarchy.

Fair Value Accounting under ASC 820

ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows:


•	Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities that the Registrants have the ability to access as of the measurement date. The Registrants’ financial assets and liabilities utilizing Level 1 inputs include active exchange-traded securities, energy derivatives and interest-bearing funds.


•	Level 2 — inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. The Registrants’ financial assets and liabilities utilizing Level 2 inputs include exchange-based derivatives, and over the counter derivatives such as swaps, options and forward contracts.


•	Level 3 — unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date. The Registrants’ financial assets and liabilities utilizing Level 3 inputs include infrequently-traded and non-exchange-based derivatives which are measured using present value pricing models.

In accordance with ASC 820, the Registrants determine the level in the fair value hierarchy within which each fair value measurement in its entirety falls, based on the lowest level input that is significant to the fair value measurement in its entirety.

Recurring Fair Value Measurements

Derivative assets and liabilities are carried at fair market value.

GenOn

The following tables present assets and liabilities (including amounts with affiliates) measured and recorded at fair value on GenOn’s consolidated balance sheet on a recurring basis and their level within the fair value hierarchy:



	As of December 31, 2016
	Fair Value
	Level 1^(a)		Level 2 ^(a)		Level 3		Total
	(In millions)
Derivative assets:
Commodity contracts	$	—	$	122	$	2	$	124
Derivative liabilities:
Commodity contracts	$	—	$	119	$	3	$	122
Other assets ^(b)	$	10	$	—	$	—	$	10

(a) There were no transfers during the year ended December 31, 2016 between Levels 1 and 2.


(b)	Relates to mutual funds held in a rabbi trust for non-qualified deferred compensation plans for some key and highly compensated employees.



	As of December 31, 2015
	Fair Value
	Level 1 ^(a)		Level 2 ^(a)		Level 3		Total
	(In millions)
Derivative assets:
Commodity contracts	$	192	$	535	$	2	$	729
Derivative liabilities:
Commodity contracts	$	157	$	420	$	14	$	591
Other assets ^(b)	$	14	$	—	$	—	$	14

(a) There were no transfers during the year ended December 31, 2015 between Levels 1 and 2.


(b)	Relates to mutual funds held in a rabbi trust for non-qualified deferred compensation plans for some key and highly compensated employees.

The following table reconciles the beginning and ending balances for derivatives that are recognized at fair value in GenOn’s consolidated financial statements at least annually using significant unobservable inputs for the years ended December 31, 2016 and 2015:



	For the Year Ended December 31,
	2016			2015
	Fair Value Measurement Using Significant Unobservable Inputs (Level 3)
	Derivatives ^(a)
	(In millions)
Balance as of beginning of period	$	(12	)	$	33
Total gains and losses (realized/unrealized) included in earnings	11			(40		)
Purchases	(1		)	(5		)
Transfers out of Level 3^(b)	1			—
Balance as of end of period	$	(1	)	$	(12	)
The amount of the total losses for the period included in earnings attributable to the change in unrealized derivatives relating to assets still held at end of period	$	(1	)	$	(8	)


(a)	Consists of derivatives assets and liabilities, net.

(b) Transfers out of Level 3 are related to the availability of broker quotes and are valued as of the end of the reporting period.

GenOn Americas Generation

The following tables present assets and liabilities (including amounts with affiliates) measured and recorded at fair value on GenOn Americas Generation's consolidated balance sheet on a recurring basis and their level within the fair value hierarchy:



	As of December 31, 2016
	Fair Value
	Level 1^(a)		Level 2 ^(a)		Level 3		Total
	(In millions)
Derivative assets:
Commodity contracts	$	—	$	209	$	5	$	214
Derivative liabilities:
Commodity contracts	$	—	$	212	$	5	$	217

(a) There were no transfers during the year ended December 31, 2016, between Levels 1 and 2.



	As of December 31, 2015
	Fair Value
	Level 1^(a)		Level 2 ^(a)		Level 3		Total
	(In millions)
Derivative assets:
Commodity contracts	$	285	$	796	$	15	$	1,096
Derivative liabilities:
Commodity contracts	$	170	$	735	$	14	$	919

(a) There were no transfers during the year ended December 31, 2015, between Levels 1 and 2.

The following table reconciles the beginning and ending balances for GenOn Americas Generation's derivatives that are recognized at fair value in the consolidated financial statements at least annually using significant unobservable inputs for the years ended December 31, 2016 and 2015:



	For the Year Ended December 31,
	2016			2015
	Fair Value Measurement Using Significant Unobservable Inputs (Level 3)
	Derivatives ^(a)
	(In millions)
Balance as of beginning of period	$	1		$	20
Total losses (realized/unrealized) included in earnings	(1		)	(20		)
Purchases	—			1
Balance as of end of period	$	—		$	1


(a)	Consists of derivatives assets and liabilities, net.

There were no gains or losses for the years ended December 31, 2016 and 2015 included in earnings attributable to the change in unrealized derivatives relating to assets still held at the end of the period.

GenOn Mid-Atlantic

The following tables present assets and liabilities (including amounts with affiliates) measured and recorded at fair value on GenOn Mid-Atlantic's consolidated balance sheet on a recurring basis and their level within the fair value hierarchy:



	As of December 31, 2016
	Fair Value
	Level 1^(a)		Level 2 ^(a)		Level 3		Total
	(In millions)
Derivative assets:
Commodity contracts	$	—	$	47	$	1	$	48
Derivative liabilities:
Commodity contracts	$	—	$	45	$	1	$	46

(a) There were no transfers during the year ended December 31, 2016 between Levels 1 and 2.



	As of December 31, 2015
	Fair Value
	Level 1^(a)		Level 2 ^(a)		Level 3		Total
	(In millions)
Derivative assets:
Commodity contracts	$	175	$	175	$	2	$	352
Derivative liabilities:
Commodity contracts	$	58	$	137	$	—	$	195

(a) There were no transfers during the year ended December 31, 2015 between Levels 1 and 2.

The following table reconciles the beginning and ending balances for GenOn Mid-Atlantic's derivatives that are recognized at fair value in the consolidated financial statements at least annually using significant unobservable inputs for the years ended December 31, 2016 and 2015:



	For the Year Ended December 31,
	2016			2015
	Fair Value Measurement Using Significant Unobservable Inputs (Level 3)
	Derivatives ^(a)
	(In millions)
Balance as of beginning of period	$	2		$	20
Total losses (realized/unrealized) included in earnings	(2		)	(20		)
Purchases	—			2
Balance as of end of period	$	—		$	2

(a) Consists of derivatives assets and liabilities, net.

Realized and unrealized gains and losses included in earnings that are related to energy derivatives are recorded in operating revenues and cost of operations.

Derivative Fair Value Measurements

A portion of the Registrants’ contracts are exchange-traded contracts with readily available quoted market prices. A majority of the Registrants’ contracts are non-exchange-traded contracts valued using prices provided by external sources, primarily price quotations available through brokers or over-the-counter and on-line exchanges. For the majority of the Registrants’ markets, quotes are from multiple sources. To the extent that the Registrants receive multiple quotes, prices reflect the average of the bid-ask mid-point prices obtained from all sources that the Registrants believe provide the most liquid market for the commodity. If the Registrants receive one quote, then the mid-point of the bid-ask spread for that quote is used. The terms for which such price information is available vary by commodity, region and product. A significant portion of the fair value of the Registrants’ derivative portfolio is based on price quotes from brokers in active markets who regularly facilitate those transactions and the Registrants believe such price quotes are executable. The Registrants do not use third party sources that derive price based on proprietary models or market surveys. The remainder of the assets and liabilities represents contracts for which external sources or observable market quotes are not available. These contracts are valued based on various valuation techniques including but not limited to internal models based on a fundamental analysis of the market and extrapolation of observable market data with similar characteristics. Contracts valued with prices provided by models and other valuation techniques make up 2% of GenOn's derivative assets and 2% of GenOn's derivative liabilities, 2% of GenOn Americas Generation’s derivative assets and 2% of GenOn Americas Generation's derivative liabilities and 2% of GenOn Mid-Atlantic’s derivative assets and 2% of GenOn Mid-Atlantic's derivative liabilities.

The Registrants' positions classified as Level 3 are physical and financial power and physical coal executed in illiquid markets as well as financial transmission rights, or FTRs. The significant unobservable inputs used in developing fair value include illiquid power and coal location pricing, which is derived as a basis to liquid locations. The basis spread is based on observable market data when available or derived from historic prices and forward market prices from similar observable markets when not available. For FTRs, the Registrants use the most recent auction prices to derive the fair value.

The following tables quantify the significant unobservable inputs used in developing the fair value of the Registrants' Level 3 positions as of December 31, 2016 and 2015:

GenOn



	Significant Unobservable Inputs
	December 31, 2016
	Fair Value						Input/Range
	Assets		Liabilities		Valuation Technique	Significant Unobservable Input	Low			High		Weighted Average
	(In millions)
Power Contracts	$	1	$	—	Discounted Cash Flow	Forward Market Price (per MWh)	$	29		$	59	$	43
Coal Contracts	—		1		Discounted Cash Flow	Forward Market Price (per ton)	42			51		45
FTRs	1		2		Discounted Cash Flow	Auction Prices (per MWh)	(2		)	3		—
	$	2	$	3



	Significant Unobservable Inputs
	December 31, 2015
	Fair Value						Input/Range
	Assets		Liabilities		Valuation Technique	Significant Unobservable Input	Low		High		Weighted Average
	(In millions)
Power Contracts	$	1	$	—	Discounted Cash Flow	Forward Market Price (per MWh)	$	22	$	67	$	42
Coal Contracts	—		12		Discounted Cash Flow	Forward Market Price (per ton)	28		45		35
FTRs	1		2		Discounted Cash Flow	Auction Prices (per MWh)	—		3		1
	$	2	$	14

GenOn Americas Generation



	Significant Unobservable Inputs
	December 31, 2016
	Fair Value						Input/Range
	Assets		Liabilities		Valuation Technique	Significant Unobservable Input	Low			High		Weighted Average
	(In millions)
Power Contracts	$	1	$	—	Discounted Cash Flow	Forward Market Price (per MWh)	$	29		$	59	$	43
Coal Contracts	1		1		Discounted Cash Flow	Forward Market Price (per ton)	42			51		45
FTRs	3		4		Discounted Cash Flow	Auction Prices (per MWh)	(2		)	3		—
	$	5	$	5



	Significant Unobservable Inputs
	December 31, 2015
	Fair Value						Input/Range
	Assets		Liabilities		Valuation Technique	Significant Unobservable Input	Low		High		Weighted Average
	(In millions)
Power Contracts	$	1	$	—	Discounted Cash Flow	Forward Market Price (per MWh)	$	22	$	67	$	42
Coal Contracts	12		12		Discounted Cash Flow	Forward Market Price (per ton)	28		45		35
FTRs	2		2		Discounted Cash Flow	Auction Prices (per MWh)	—		3		1
	$	15	$	14

GenOn Mid-Atlantic



	Significant Unobservable Inputs
	December 31, 2016
	Fair Value						Input/Range
	Assets		Liabilities		Valuation Technique	Significant Unobservable Input	Low		High		Weighted Average
	(In millions)
Power Contracts	$	1	$	—	Discounted Cash Flow	Forward Market Price (per MWh)	$	29	$	59	$	43
FTRs	—		1		Discounted Cash Flow	Auction Prices (per MWh)	—		1		—
	$	1	$	1



	Significant Unobservable Inputs
	December 31, 2015
	Fair Value						Input/Range
	Assets		Liabilities		Valuation Technique	Significant Unobservable Input	Low		High		Weighted Average
	(In millions)
Power Contracts	$	2	$	—	Discounted Cash Flow	Forward Market Price (per MWh)	$	22	$	67	$	42
	$	2	$	—

The following table provides sensitivity of fair value measurements to increases/(decreases) in significant unobservable inputs as of December 31, 2016 and 2015:



Significant Unobservable Input	Position	Change In Input	Impact on Fair Value Measurement
Forward Market Price Power/Coal	Buy	Increase/(Decrease)	Higher/(Lower)
Forward Market Price Power/Coal	Sell	Increase/(Decrease)	Lower/(Higher)
FTR Prices	Buy	Increase/(Decrease)	Higher/(Lower)
FTR Prices	Sell	Increase/(Decrease)	Lower/(Higher)

The fair value of each contract is discounted using a risk free interest rate. In addition, the Registrants apply a credit/non-performance reserve to reflect credit risk which is calculated based on published default probabilities. To the extent that the Registrants’ net exposure under a specific master agreement is an asset, the Registrants use the counterparty's default swap rate. The credit reserve is added to the discounted fair value to reflect the exit price that a market participant would be willing to receive to assume the Registrants’ liabilities or that a market participant would be willing to pay for the Registrants’ assets. The Registrants' credit/(non-performance) reserves were as follows:



	As of December 31,
	2016		2015
	(In millions)
GenOn	$	1	$	(1	)
GenOn Americas Generation	1		—
GenOn Mid-Atlantic	—		4

The fair values in each category reflect the level of forward prices and volatility factors as of December 31, 2016, and may change as a result of changes in these factors. Management uses its best estimates to determine the fair value of commodity and derivative contracts the Registrants hold and sell. These estimates consider various factors including closing exchange and over-the-counter price quotations, time value, volatility factors and credit exposure. It is possible however, that future market prices could vary from those used in recording assets and liabilities from energy marketing and trading activities and such variations could be material.

Under the guidance of ASC 815, entities may choose to offset cash collateral posted or received against the fair value of derivative positions executed with the same counterparties under the same master netting agreements. The Registrants have chosen not to offset positions as defined in ASC 815. As of December 31, 2016, GenOn recorded $132 million of cash collateral posted, which includes $79 million of collateral posted to NRG, and $53 million posted to other counterparties. As of December 31, 2016, GenOn Americas Generation recorded $130 million of cash collateral posted, which includes $79 million of collateral posted to NRG, and $51 million of collateral posted to other counterparties. As of December 31, 2016, GenOn Mid-Atlantic had no outstanding cash collateral posted or received on its balance sheet.

Concentration of Credit Risk

In addition to the credit risk discussion as disclosed in Note 2, Summary of Significant Accounting Policies, the following item is a discussion of the concentration of credit risk for the Registrants’ financial instruments. Credit risk relates to the risk of loss resulting from non-performance or non-payment by counterparties pursuant to the terms of their contractual obligations. The Registrants monitor and manage credit risk through credit policies that include: (i) an established credit approval process; (ii) a daily monitoring of counterparties' credit limits; (iii) the use of credit mitigation measures such as margin, collateral, prepayment arrangements, or volumetric limits; (iv) the use of payment netting agreements; and (v) the use of master netting agreements that allow for the netting of positive and negative exposures of various contracts associated with a single counterparty. Risks surrounding counterparty performance and credit could ultimately impact the amount and timing of expected cash flows. The Registrants seek to mitigate counterparty risk by having a diversified portfolio of counterparties. The Registrants also have credit protection within various agreements to call on additional collateral support if and when necessary. Cash margin is collected and held at the Registrants to cover the credit risk of the counterparty until positions settle.

As of December 31, 2016, counterparty credit exposure to a significant portion of GenOn’s counterparties was $58 million and GenOn held no collateral against those positions, resulting in a net exposure of $58 million. Approximately 97% of GenOn's exposure before collateral is expected to roll off by the end of 2018. GenOn Americas Generation’s counterparty credit exposure to a significant portion of counterparties was $57 million and GenOn Americas Generation held no collateral against those positions, resulting in a net exposure of $57 million. Approximately 97% of GenOn Americas Generation’s exposure before collateral is expected to roll off by the end of 2018. As of December 31, 2016, GenOn Mid-Atlantic had no counterparty credit exposure.

The following tables highlight the counterparty credit quality and the net counterparty credit exposure by industry sector. Net counterparty credit exposure is defined as the aggregate net asset position for the Registrants with counterparties where netting is permitted under the enabling agreement and includes all cash flow, mark-to-market and NPNS, and non-derivative transactions. As of December 31, 2016, the exposure is shown net of collateral held and includes amounts net of receivables or payables.



	Net Exposure ^{(a) (b)} (% of Total)
Category	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
Utilities, energy merchants, marketers and other	100	%	100	%	—	%
Total	100	%	100	%	—	%



Category	Net Exposure ^{(a) (b)} (% of Total)
	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
Investment grade	87	%	89	%	—	%
Non-Investment grade/Non-Rated	13	%	11	%	—	%
Total	100	%	100	%	—	%


(a)	Counterparty credit exposure excludes transportation contracts because of the unavailability of market prices.


(b)	The figures in the tables above exclude potential counterparty credit exposure related to RTOs, ISOs, registered commodity exchanges and certain long term contracts.

The Registrants have counterparty credit risk exposure to certain counterparties representing more than 10% of their respective total net exposure discussed above. The aggregate of such counterparties was $45 million, $45 million, and $0 for GenOn, GenOn Americas Generation and GenOn Mid-Atlantic, respectively. Changes in hedge positions and market prices will affect credit exposure and counterparty concentration. Given the credit quality, diversification and term of the exposure in the portfolio, the Registrants do not anticipate a material impact on their financial position or results of operations from nonperformance by any of their counterparties.

RTOs and ISOs

Exchange Traded Transactions

Note 5 — Accounting for Derivative Instruments and Hedging Activities (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

ASC 815 requires the Registrants to recognize all derivative instruments on the balance sheet as either assets or liabilities and to measure them at fair value each reporting period unless they qualify for a NPNS exception.

Certain derivative instruments may qualify for the NPNS exception and are therefore exempt from fair value accounting treatment. ASC 815 applies to the Registrants’ energy related commodity contracts.

Energy-Related Commodities (GenOn, GenOn Americas Generation, and GenOn Mid-Atlantic)

To manage the commodity price risk associated with the Registrants’ competitive supply activities and the price risk associated with wholesale power sales from the Registrants’ electric generation facilities, the Registrants enter into a variety of derivative and non-derivative hedging instruments, utilizing the following:


•	Forward contracts, which commit the Registrants to purchase or sell energy commodities or purchase fuels in the future.


•	Futures contracts, which are exchange-traded standardized commitments to purchase or sell a commodity or financial instrument.


•	Swap agreements, which require payments to or from counterparties based upon the differential between two prices for a predetermined contractual, or notional, quantity.


•	Financial and non-financial option contracts, which convey to the option holder the right but not the obligation to purchase or sell a commodity.

The objectives for entering into derivative contracts used for economic hedging include:


•	Fixing the price for a portion of anticipated future electricity sales that provides an acceptable return on the Registrants’ electric generation operations.


•	Fixing the price of a portion of anticipated fuel purchases for the operation of the Registrants’ power plants.

GenOn, GenOn Americas Generation and GenOn Mid-Atlantic’s trading and hedging activities are subject to limits within the risk management policy. These contracts are recognized on the balance sheet at fair value and changes in the fair value of these derivative financial instruments are recognized in earnings.

GenOn

As of December 31, 2016, GenOn’s derivative assets and liabilities consisted primarily of the following:


•	Forward and financial contracts for the purchase/sale of electricity and related products economically hedging GenOn’s generation assets' forecasted output through 2019.


•	Forward and financial contracts for the purchase of fuel commodities relating to the forecasted usage of GenOn’s generation assets through 2018.

Also, as of December 31, 2016, GenOn had other energy-related contracts that did not meet the definition of a derivative instrument as follows:


•	Power transmission contracts through 2019;


•	Natural gas transportation contracts and storage agreements through 2027; and


•	Coal transportation contracts through 2018.

GenOn Americas Generation

As of December 31, 2016, GenOn Americas Generation’s derivative assets and liabilities consisted primarily of the following:


•	Forward and financial contracts for the purchase/sale of electricity and related products economically hedging GenOn Americas Generation’s generation assets' forecasted output through 2019.


•	Forward and financial contracts for the purchase of fuel commodities relating to the forecasted usage of GenOn Americas Generation’s generation assets through 2018.

Also, as of December 31, 2016, GenOn Americas Generation had other energy-related contracts that did not meet the definition of a derivative instrument as follows:


•	Power transmission contracts through 2019;


•	Natural gas transportation contracts and storage agreements through 2026; and


•	Coal transportation contracts through 2018.

GenOn Mid-Atlantic

As of December 31, 2016, GenOn Mid-Atlantic’s derivative assets and liabilities consisted primarily of the following:


•	Forward and financial contracts for the purchase/sale of electricity and related products economically hedging GenOn Mid-Atlantic’s generation assets' forecasted output through 2019.


•	Forward and financial contracts for the purchase of fuel commodities relating to the forecasted usage of GenOn Mid-Atlantic’s generation assets through 2018.

Also, as of December 31, 2016, GenOn Mid-Atlantic had other energy-related contracts that did not meet the definition of a derivative instrument as follows:


•	Natural gas transportation contracts and storage agreements through 2023; and


•	Coal transportation contracts through 2018.

Volumetric Underlying Derivative Transactions (GenOn, GenOn Americas Generation, and GenOn Mid-Atlantic)

The following table summarizes the net notional volume buy/(sell) of the Registrants’ open derivative transactions broken out by commodity, excluding those derivatives that qualified for the NPNS exception as of December 31, 2016 and 2015. Option contracts are reflected using delta volume. Delta volume equals the notional volume of an option adjusted for the probability that the option will be in-the-money at its expiration date.



		GenOn				GenOn Americas Generation				GenOn Mid-Atlantic
		Total Volume				Total Volume				Total Volume
		December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
Commodity	Units	(In millions)				(In millions)				(In millions)
Coal	Short Ton	5		7		4		3		4		3
Natural Gas	MMBtu	138		191		30		2		23		(10	)
Power	MWh	(35	)	(49	)	(12	)	(20	)	(11	)	(18	)

The change in the natural gas position was the result of buying natural gas to convert fixed price natural gas hedges into fixed price power hedges, as well as the settlement of positions during the period.

Fair Value of Derivative Instruments

The following tables summarize the fair value within the derivative instrument valuation on the balance sheet:

GenOn



	Fair Value
	Derivative Assets				Derivative Liabilities
	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
	(In millions)				(In millions)
Derivatives Not Designated as Cash Flow Hedges:
Commodity contracts current	$	108	$	574	$	105	$	475
Commodity contracts long-term	16		155		17		116
Total Derivatives Not Designated as Cash Flow Hedges	$	124	$	729	$	122	$	591

GenOn Americas Generation



	Fair Value
	Derivative Assets				Derivative Liabilities
	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
	(In millions)				(In millions)
Derivatives Not Designated as Cash Flow Hedges:
Commodity contracts current	$	180	$	861	$	185	$	737
Commodity contracts long-term	34		235		32		182
Total Derivatives Not Designated as Cash Flow Hedges	$	214	$	1,096	$	217	$	919

GenOn Mid-Atlantic



	Fair Value
	Derivative Assets				Derivative Liabilities
	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
	(In millions)				(In millions)
Derivatives Not Designated as Cash Flow Hedges:
Commodity contracts current	$	44	$	269	$	44	$	163
Commodity contracts long-term	4		83		2		32
Total Derivatives Not Designated as Cash Flow Hedges	$	48	$	352	$	46	$	195

The Registrants have elected to present derivative assets and liabilities on the balance sheet on a trade-by-trade basis and do not offset amounts at the counterparty master agreement level. In addition, collateral received or paid on the Registrants' derivative assets or liabilities are recorded on a separate line item on the balance sheet. The following tables summarize the offsetting of derivatives by counterparty master agreement level and collateral received or paid:

GenOn



	Gross Amounts Not Offset in the Statement of Financial Position
Description	Gross Amounts of Recognized Assets/Liabilities			Derivative Instruments			Cash Collateral (Held)/Posted		Net Amount
December 31, 2016	(In millions)
Commodity Contracts:
Derivative assets	$	70		$	(39	)	$	—	$	31
Derivative assets- affiliate	54			(54		)	—		—
Derivative liabilities	(56		)	39			1		(16		)
Derivative liabilities- affiliate	(66		)	54			12		—
Total derivative instruments	$	2		$	—		$	13	$	15



	Gross Amounts Not Offset in the Statement of Financial Position
Description	Gross Amounts of Recognized Assets/Liabilities			Derivative Instruments			Cash Collateral (Held)/Posted			Net Amount
December 31, 2015	(In millions)
Commodity Contracts:
Derivative assets	$	698		$	(485	)	$	(51	)	$	162
Derivative assets- affiliate	31			(24		)	—			7
Derivative liabilities	(567		)	485			—			(82		)
Derivative liabilities- affiliate	(24		)	24			—			—
Total derivative instruments	$	138		$	—		$	(51	)	$	87

GenOn Americas Generation



	Gross Amounts Not Offset in the Statement of Financial Position
Description	Gross Amounts of Recognized Assets/Liabilities			Derivative Instruments			Cash Collateral (Held)/Posted		Net Amount
December 31, 2016	(In millions)
Commodity Contracts:
Derivative assets	$	70		$	(39	)	$	—	$	31
Derivative assets- affiliate	144			(144		)	—		—
Derivative liabilities	(56		)	39			1		(16		)
Derivative liabilities- affiliate	(161		)	144			12		(5		)
Total derivative instruments	$	(3	)	$	—		$	13	$	10



	Gross Amounts Not Offset in the Statement of Financial Position
Description	Gross Amounts of Recognized Assets/Liabilities			Derivative Instruments			Cash Collateral (Held)/Posted			Net Amount
December 31, 2015	(In millions)
Commodity Contracts:
Derivative assets	$	699		$	(485	)	$	(51	)	$	163
Derivative assets- affiliate	397			(352		)	—			45
Derivative liabilities	(567		)	485			—			(82		)
Derivative liabilities- affiliate	(352		)	352			—			—
Total derivative instruments	$	177		$	—		$	(51	)	$	126

GenOn Mid-Atlantic



	Gross Amounts Not Offset in the Statement of Financial Position
Description	Gross Amounts of Recognized Assets/Liabilities			Derivative Instruments			Cash Collateral (Held)/Posted		Net Amount
December 31, 2016	(In millions)
Commodity Contracts:
Derivative assets- affiliate	$	48		$	(46	)	$	—	$	2
Derivative liabilities- affiliate	(46		)	46			—		—
Total derivative instruments	$	2		$	—		$	—	$	2



	Gross Amounts Not Offset in the Statement of Financial Position
Description	Gross Amounts of Recognized Assets/Liabilities			Derivative Instruments			Cash Collateral (Held)/Posted		Net Amount
December 31, 2015	(In millions)
Commodity Contracts:
Derivative assets- affiliate	$	352		$	(195	)	$	—	$	157
Derivative liabilities- affiliate	(195		)	195			—		—
Total derivative instruments	$	157		$	—		$	—	$	157

Impact of Derivative Instruments on the Statement of Operations (GenOn, GenOn Americas Generation, and GenOn Mid-Atlantic)

Unrealized gains and losses associated with changes in the fair value of derivative instruments are reflected in current period earnings.

During 2016, the Registrants have been undergoing the process of closing out and financially settling certain open positions with counterparties. The closure and financial settlements with these counterparties were necessary to manage the increases in collateral posting requirements following rating agency downgrades, as further described in Note 9, Debt and Capital Leases, and reduce expected collateral costs associated with exchange cleared hedge transactions.

The following tables summarize the pre-tax effects of economic hedges and trading activity on the Registrants’ statements of operations. These amounts are included within operating revenues and cost of operations.

GenOn



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Unrealized mark-to-market results
Reversal of previously recognized unrealized gains on settled positions related to economic hedges	$	(165	)	$	(198	)	$	(314	)
Net unrealized gains on open positions related to economic hedges	14			18			167
Total unrealized mark-to-market losses for economic hedging activities	(151		)	(180		)	(147		)
Reversal of previously recognized unrealized gains on settled positions related to trading activity	—			—			(1		)
Total unrealized mark-to-market losses for trading activity	—			—			(1		)
Total unrealized losses	$	(151	)	$	(180	)	$	(148	)



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Revenue from operations — energy commodities	$	(221	)	$	(112	)	$	(151	)
Cost of operations	70			(68		)	3
Total impact to statement of operations	$	(151	)	$	(180	)	$	(148	)

As discussed above, GenOn realized approximately $38 million due to the closure and financial settlement of all open positions with one of GenOn's counterparties during the second quarter of 2016, for which $18 million, $19 million and $1 million would have otherwise been realized during the remainder of 2016 and in 2017 and 2018, respectively. In addition, GenOn realized $98 million due to the closure and financial settlement of certain open positions with an additional counterparty during the third quarter of 2016, for which $82 million, $13 million and $3 million would have otherwise been realized in 2017, 2018, and 2019, respectively. GenOn has entered into additional transactions with NRG Power Marketing LLC and an external counterparty in order to economically re-hedge the positions settled with certain counterparties.

GenOn Americas Generation



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Unrealized mark-to-market results
Reversal of previously recognized unrealized gains on settled positions related to economic hedges	$	(184	)	$	(193	)	$	(288	)
Net unrealized (losses)/gains on open positions related to economic hedges	(2		)	70			164
Total unrealized mark-to-market losses for economic hedging activities	(186		)	(123		)	(124		)
Reversal of previously recognized unrealized gains on settled positions related to trading activity	—			—			(1		)
Total unrealized mark-to-market losses for trading activity	—			—			(1		)
Total unrealized losses	$	(186	)	$	(123	)	$	(125	)



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Revenue from operations — energy commodities	$	(248	)	$	(66	)	$	(119	)
Cost of operations	62			(57		)	(6		)
Total impact to statement of operations	$	(186	)	$	(123	)	$	(125	)

As discussed above, GenOn Americas Generation realized approximately $35 million due to the closure and financial settlement of all open positions with one of GenOn Americas Generation's counterparties during the second quarter of 2016, for which $16 million and $19 million would have otherwise been realized during the remainder of 2016 and in 2017, respectively. In addition, GenOn Americas Generation realized $50 million due to the closure and financial settlement of certain open positions with an additional counterparty during the third quarter of 2016, for which $46 million and $4 million would have otherwise been realized in 2017 and 2018, respectively. GenOn has entered into additional transactions with NRG Power Marketing LLC and an external counterparty in order to economically re-hedge the positions settled with certain counterparties.

GenOn Mid-Atlantic



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Unrealized mark-to-market results
Reversal of previously recognized unrealized gains on settled positions related to economic hedges	$	(164	)	$	(116	)	$	(288	)
Net unrealized gains on open positions related to economic hedges	3			39			90
Total unrealized losses	$	(161	)	$	(77	)	$	(198	)



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Revenue from operations — energy commodities	$	(223	)	$	(27	)	$	(192	)
Cost of operations	62			(50		)	(6		)
Total impact to statement of operations	$	(161	)	$	(77	)	$	(198	)

As discussed above, GenOn Mid-Atlantic realized approximately $35 million due to the closure and financial settlement of all open positions with one of GenOn Mid-Atlantic's counterparties during the second quarter of 2016, for which $16 million and $19 million would have otherwise been realized during the remainder of 2016 and in 2017, respectively. In addition, GenOn Mid-Atlantic realized $50 million due to the closure and financial settlement of certain open positions with an additional counterparty during the third quarter of 2016, for which $46 million and $4 million would have otherwise been realized in 2017 and 2018, respectively. GenOn has entered into additional transactions with NRG Power Marketing LLC and an external counterparty in order to economically re-hedge the positions settled with certain counterparties.

Credit Risk Related Contingent Features (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Certain of GenOn and GenOn Americas Generation’s hedging agreements contain provisions that require the Registrants to post additional collateral if the counterparty determines that there has been deterioration in credit quality, generally termed "adequate assurance" under the agreements, or require the Registrants to post additional collateral if there were a one notch downgrade in the Registrants’ credit rating. The collateral required for contracts that have adequate assurance clauses that are in net liability positions as of December 31, 2016, was $5 million for GenOn and GenOn Americas Generation. As of December 31, 2016, no collateral was required for contracts with credit rating contingent features that are in a net liability position for GenOn and GenOn Americas Generation. GenOn and GenOn Americas Generation are also party to certain marginable agreements under which it has a net liability position, but the counterparty has not called for the collateral due which was approximately $2 million as of December 31, 2016. At December 31, 2016, GenOn Mid-Atlantic did not have any financial instruments with credit risk related contingent features.

See Note 4, Fair Value of Financial Instruments, for discussion regarding concentration of credit risk.

Note 6 — Inventory (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Inventory held by the Registrants consisted of the following:

GenOn



	As of December 31,
	2016		2015
	(In millions)
Fuel oil	$	147	$	161
Coal	114		154
Spare parts	122		127
Other	6		6
Total Inventory	$	389	$	448

During the year ended December 31, 2015, GenOn recorded a lower of weighted average cost or market adjustment related to fuel oil of $19 million and wrote down certain equipment to its fair value resulting in an impairment of $8 million.

GenOn Americas Generation



	As of December 31,
	2016		2015
	(In millions)
Fuel oil	$	123	$	134
Coal	68		97
Spare parts	53		57
Other	1		1
Total Inventory	$	245	$	289

During the year ended December 31, 2015, GenOn Americas Generation recorded a lower of weighted average cost or market adjustment related to fuel oil of $17 million.

GenOn Mid-Atlantic



	As of December 31,
	2016		2015
	(In millions)
Fuel oil	$	26	$	33
Coal	68		97
Spare parts	40		41
Other	1		1
Total Inventory	$	135	$	172

During the year ended December 31, 2015, GenOn Mid-Atlantic recorded a lower of weighted average cost or market adjustment related to fuel oil of $6 million.

Note 7 — Property, Plant and Equipment (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Major classes of property, plant, and equipment were as follows:

GenOn



	As of December 31,
	2016			2015			Depreciable Lives
	(In millions)
Facilities and equipment	$	2,793		$	2,989		2 - 34 Years
Land and improvements	276			292
Construction in progress	78			164
Total property, plant and equipment	3,147			3,445
Accumulated depreciation	(604		)	(614		)
Net property, plant and equipment	$	2,543		$	2,831

GenOn Americas Generation



	As of December 31,
	2016			2015			Depreciable Lives
	(In millions)
Facilities and equipment	$	1,191		$	1,192		2 - 34 Years
Land and improvements	136			139
Construction in progress	36			29
Total property, plant and equipment	1,363			1,360
Accumulated depreciation	(275		)	(244		)
Net property, plant and equipment	$	1,088		$	1,116

GenOn Mid-Atlantic



	As of December 31,
	2016			2015			Depreciable Lives
	(In millions)
Facilities and equipment	$	1,064		$	1,037		2 - 34 Years
Land and improvements	63			62
Construction in progress	36			26
Total property, plant and equipment	1,163			1,125
Accumulated depreciation	(237		)	(200		)
Net property, plant and equipment	$	926		$	925

The Registrants recorded long-lived asset impairments during 2016 and 2015, as further described in Note 8, Impairments.

Note 8 — Impairments (GenOn and GenOn Americas Generation)

In accordance with ASC 360, Property, Plant, and Equipment, or ASC 360, the Registrants evaluate property, plant and equipment for impairment whenever indicators of impairment exist. Examples of such indicators or events are:


•	Significant decrease in the market price of a long-lived asset;


•	Significant adverse change in the manner an asset is being used or its physical condition;


•	Adverse business climate;


•	Accumulation of costs significantly in excess of the amount originally expected for the construction or acquisition of an asset;


•	Current period loss combined with a history of losses or the projection of future losses; and


•	Change in the Registrants' intent about an asset from an intent to hold to a greater than 50% likelihood that an asset will be sold or disposed of before the end of its previously estimated useful life.

Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future net cash flows expected to be generated by the asset, through considering project specific assumptions for long-term power pool prices, escalated future project operating costs and expected plant operations. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets by factoring in the probability weighting of different courses of action available to the Registrants. Generally, fair value will be determined using valuation techniques such as the present value of expected future cash flows. The Registrants use its best estimates in making these evaluations and considers various factors, including forward price curves for energy, fuel costs and operating costs. However, actual future market prices and project costs could vary from the assumptions used in the Registrants estimates, and the impact of such variations could be material.

For assets to be held and used, if the Registrants determine that the undiscounted cash flows from the asset are less than the carrying amount of the asset, the Registrant must estimate fair value to determine the amount of any impairment loss. Assets held-for-sale are reported at the lower of the carrying amount or fair value less the cost to sell. The estimation of fair value under ASC 360, whether in conjunction with an asset to be held and used or with an asset held-for-sale, and the evaluation of asset impairment are, by their nature, subjective. The Registrants consider quoted market prices in active markets to the extent they are available. The Registrants will also discount the estimated future cash flows associated with the asset using a single interest rate representative of the risk involved with such an investment or employ an expected present value method that probability-weights a range of possible outcomes. Annually, during the fourth quarter, the Registrants revise their views of power and fuel prices including the Registrants' fundamental view for long term prices , estimated generation, and forecasted operating expenses and capital expenditures in connection with the preparation of its annual budget. Changes to the Registrants' view of long term power and fuel prices impacted the Registrants' projections of profitability, based on management's estimate of supply and demand within the sub-markets for each plant and the physical and economic characteristics of each plant.

The following are the long-lived impairments recognized by the Registrants for each of the years ended December 31, 2016, 2015, and 2014:

2016 Impairments

Mandalay (GenOn) — On May 26, 2016, the CPUC rejected a multi-year resource adequacy contract between Mandalay and Southern California Edison. Additionally, during the second quarter of 2016, CAISO issued its Local Capacity Requirements report for 2017 indicating unfavorable changes within the local reliability areas in which Mandalay is located. The culmination of these events was considered to be an indicator of impairment and as a result, GenOn performed an impairment test for the Mandalay assets. Based on the results of the impairment test, GenOn determined that the carrying amount of these assets was higher than the estimated future net cash flows expected to be generated by the assets and that the Mandalay assets were impaired. The fair value of the Mandalay operating unit was determined using the income approach which utilizes estimates of discounted future cash flows, which were Level 3 fair value measurements and include key inputs such as forecasted contract prices, forecasted operating expenses and discount rates. GenOn measured the impairment loss as the difference between the carrying amount of the Mandalay operating unit and the present value of the estimated future net cash flows for the operating unit. GenOn recorded an impairment loss of $16 million for Mandalay for the year ended December 31, 2016.

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Ormond Beach (GenOn) — During the second quarter of 2016, the Statewide Advisory Committee on Cooling Water Intake Structures, or SACCWIS, issued a draft April 2016 Report noting that CAISO plans to continue to assume in its transmission studies that Ormond Beach will not operate after December 31, 2020, the deadline for Ormond Beach compliance with California regulations to mitigate once-through cooling impacts. The Registrant does not anticipate that contracts of sufficient value can be secured to support the significant investment required to design, permit, construct and operate measures required for once-through cooling compliance. As a result, on May 6, 2016, the Registrant notified SACCWIS that it does not expect to continue to operate Ormond Beach beyond 2020. In addition, during the fourth quarter of 2016 the declining prices for resource adequacy contracts available in the reliability sub-area which Ormond Beach operates further reduced anticipated cash flows to be generated from Ormond Beach through its anticipated retirement in 2020. These events were considered to be indicators of impairment and as a result, GenOn performed an impairment test for the Ormond Beach assets. Based on the results of the impairment test, GenOn determined that the carrying amount of these assets was higher than the estimated future net cash flows expected to be generated by the assets and that the Ormond Beach assets were impaired. The fair value of the Ormond Beach operating unit was determined using the income approach which utilizes estimates of discounted future cash flows, which were Level 3 fair value measurements and include key inputs such as forecasted contract prices, forecasted operating expenses and discount rates. GenOn measured the impairment loss as the difference between the carrying amount of the Ormond Beach operating unit and the present value of the estimated future net cash flows for the operating unit. GenOn recorded an impairment loss of $71 million for Ormond Beach for the year ended December 31, 2016.

Keystone and Conemaugh Leased Interest (GenOn) — During the fourth quarter of 2016, as described above the Registrants revised their view of forecasted cash flows in connection with the preparation of its annual budget. GenOn noted the cash flows for the leased interests in Keystone and Conemaugh were below the carrying value of the related assets, primarily driven by a reduction in long-term energy and capacity prices in PJM, and the assets were impaired. The fair value of the interests in Keystone and Conemaugh were determined using the income approach which utilizes estimates of discounted future cash flows, which were Level 3 fair value measurements and include key inputs such as forecasted power, capacity and fuel prices, forecasted operating expenses, contractual lease payments and discount rates. GenOn recorded impairment losses of $10 million and $97 million for Keystone and Conemaugh, respectively, for the year ended December 31, 2016.

Pittsburg (GenOn and GenOn Americas Generation) — In October 2016, GenOn Americas Generation was give notice that its bid for a resource adequacy contract for 2017 with Pacific Gas & Electric was not accepted for the Pittsburg generation station, or Pittsburg. As a result, GenOn Americas Generation decided that it would retire Pittsburg on January 1, 2017. These events were considered to be indicators of impairment and as a result, GenOn Americas Generation performed an impairment test for the Pittsburg assets. Based on the results of the impairment test, GenOn Americas Generation determined that the carrying amount of the assets was higher than the estimated future net cash flows expected to be generated by the assets and that the Pittsburg assets were impaired. The fair value of the Pittsburg operating unit was determined using the income approach which utilizes estimates of discounted future cash flows, which were Level 3 fair value measurements and include key inputs such as forecasted contract prices, forecasted operating expense and discount rates. GenOn Americas Generation measured the impairment loss as the difference between the carrying amount of the Pittsburg operating unit and the present value of the estimated future net cash flows for the operating unit. GenOn Americas Generation recorded an impairment loss of $20 million for Pittsburg for the year ended December 31, 2016.

2015 Impairments

Seward (GenOn) — As described in Note 3, Dispositions, on November 24, 2015, GenOn entered into an agreement with Robindale Energy Services, Inc. to sell 100% of its interest in Seward for cash consideration of $75 million. The transaction triggered an impairment indicator as the sale price was less than the carrying amount of the assets, and, as a result, the assets were considered to be impaired. GenOn measured the impairment loss as the difference between the carrying amount of the assets and the agreed-upon sale price. GenOn recorded an impairment loss of $134 million in the consolidated results of operations of GenOn for the year ended December 31, 2015 to reduce the carrying amount of the assets held for sale to the fair market value.

Portland (GenOn) — During the fourth quarter of 2015, the oil conversion project at the Portland facility was suspended indefinitely. In connection with the project suspension, GenOn wrote off the balance of fixed assets associated with the project and recorded expected losses on related contracts totaling $20 million.

Spare Parts (GenOn) — During the fourth quarter of 2015, GenOn wrote down certain equipment to its fair value resulting in an impairment of $8 million during the year ended December 31, 2015.

Pittsburg (GenOn and GenOn Americas Generation) — GenOn owns oil tanks and associated land located near its Pittsburg facility that were subject to a purchase option. The option was terminated during the fourth quarter of 2015 and, accordingly, the oil tanks were considered to be impaired. GenOn recorded an impairment of $8 million to reduce the carrying amount of the oil tanks to reflect the fair market value.

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2014 Impairments

Coolwater (GenOn) — During the fourth quarter of 2014, GenOn determined that it would pursue retiring the 636 MW natural-gas fired Coolwater facility in Dagget, California. The facility faced critical repairs on the cooling towers for Units 3 and 4 and, during the fourth quarter of 2014, did not receive any awards in a near-term capacity auction and no interest in a bilateral capacity deal. GenOn considered this to be an indicator of impairment and performed an impairment test for these assets. The carrying amount of the assets was higher than the future net cash flows expected to be generated by the assets, and as a result the assets were considered to be impaired. GenOn measured the impairment loss as the difference between the carrying amount and the fair value of the assets. GenOn retired the Coolwater facility effective January 1, 2015. All remaining fixed assets of the station were written off resulting in an impairment loss of $22 million recognized during the year ended December 31, 2014.

Osceola (GenOn) — During the third quarter of 2014, GenOn determined that it would mothball the 463 MW natural gas-fired Osceola facility in Saint Cloud, Florida. GenOn considered this to be an indicator of impairment and performed an impairment test for these assets. The carrying amount of the assets was higher than the future net cash flows expected to be generated by the assets, and as a result the assets were considered to be impaired. GenOn measured the impairment loss as the difference between the carrying amount and the fair value of the assets. Due to the location of the facility, it was determined that the best indicator of fair value is the market value of the combustion turbines. GenOn recorded an impairment loss of approximately $60 million during the year ended December 31, 2014, which represents the excess of the carrying value over the fair market value.

Note 9 —Debt and Capital Leases (GenOn and GenOn Americas Generation)

Long-term debt and capital leases consisted of the following:



	As of December 31,
	2016		2015		Interest Rate %
	(In millions, except rates)
GenOn Americas Generation:
GenOn Americas Generation Senior Notes, due 2021	$	392	$	398	8.500
GenOn Americas Generation Senior Notes, due 2031	353		354		9.125
Subtotal GenOn Americas Generation	745		752
GenOn Energy:
GenOn Senior Notes, due 2017	699		714		7.875
GenOn Senior Notes, due 2018	687		708		9.500
GenOn Senior Notes, due 2020	525		534		9.875
Other ^(a)	96		56
GenOn capital lease	2		2
Subtotal GenOn Energy	2,009		2,014
Subtotal	2,754		2,766
Less current maturities	704		4
Total long-term debt and capital leases	$	2,050	$	2,762

(a) The Long Term Service Agreements for the Hunterstown and Choctaw facilities are accounted for as a debt financing liability in accordance with GAAP.

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Long-term debt including current maturities includes the following premiums:



	As of December 31,
	2016		2015
	(In millions)
GenOn Americas Generation:
GenOn Americas Generation Senior Notes, due 2021	$	26	$	32
GenOn Americas Generation Senior Notes, due 2031	24		25
GenOn Energy:
GenOn Senior Notes, due 2017	8		23
GenOn Senior Notes, due 2018	38		59
GenOn Senior Notes, due 2020	35		44
Total premium	$	131	$	183

Credit Downgrades

On October 7, 2016, GenOn's corporate credit rating was lowered by Moody's from Caa2 to Caa3 and its probability of default rating was lowered from Caa2-PD to Caa3-PD. In addition, Moody's also lowered the ratings of REMA and GenOn Mid-Atlantic's pass through certificates to Caa1 from B2. These changes are an update from March 21, 2016, at which time GenOn's corporate credit rating was lowered from B3 to Caa2. At that time, Moody's also lowered the issue-level ratings on the GenOn Senior Notes from B3 to Caa2 and the GenOn Americas Generation Senior Notes from Caa1 to Caa2.

GenOn Senior Notes (GenOn)

Under the GenOn Senior Notes and the related indentures, the GenOn Senior Notes are the sole obligation of GenOn and are not guaranteed by any subsidiary or affiliate of GenOn. The GenOn Senior Notes are senior unsecured obligations of GenOn having no recourse to any subsidiary or affiliate of GenOn. The GenOn Senior Notes restrict the ability of GenOn and its subsidiaries to encumber their assets.

GenOn Senior Notes, Due 2018 and 2020. The GenOn Senior Notes due 2018 and 2020 and the related indentures restrict the ability of GenOn to incur additional liens and make certain restricted payments, including dividends and purchases of capital stock. At December 31, 2016, GenOn did not meet the consolidated debt ratio component of the restricted payments test and, therefore, the ability of GenOn to make restricted payments is limited to specified exclusions from the covenant, including up to $250 million of such restricted payments. The GenOn Senior Notes are subject to acceleration of GenOn’s obligations thereunder upon the occurrence of certain events of default, including: (a) default in interest payment for 30 days, (b) default in the payment of principal or premium, if any, (c) failure after 90 days of specified notice to comply with any other agreements in the indenture, (d) certain cross-acceleration events, (e) failure by GenOn or its significant subsidiaries to pay certain final and non-appealable judgments after 90 days and (f) certain events of bankruptcy and insolvency.

Prior to October 15, 2018, GenOn may redeem the GenOn Senior Notes due 2018, in whole or in part, at a redemption price equal to 100% of the principal amount plus a premium and accrued and unpaid interest. The premium is the greater of: (i) 1% of the principal amount of the notes; or (ii) the excess of the following: the present value of 100% of the note, plus interest payments due on the note through maturity, discounted at a Treasury rate plus 0.50% over the principal amount of the note.

GenOn may redeem some or all of the GenOn Senior Notes due 2020 at redemption prices expressed as percentages of principal amount as set forth in the following table, plus accrued and unpaid interest on the notes redeemed to the first applicable redemption rate:



Redemption Period	Redemption Percentage
October 15, 2016 to October 14, 2017	103.292	%
October 15, 2017 to October 14, 2018	101.646	%
October 15, 2018 and thereafter	100.000	%

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GenOn Senior Notes, Due 2017. Prior to maturity on June 15, 2017, GenOn may redeem all or a part of the GenOn Senior Notes due 2017 at a redemption price equal to 100% of the notes plus a premium and accrued and unpaid interest. The premium is the greater of: (i) 1% of the principal amount of the notes; or (ii) the excess of the following: the present value of 100% of the note, plus interest payments due on the note through maturity, discounted at a Treasury rate plus 0.50% over the principal amount of the note. As of December 31, 2016, the GenOn Senior Notes due 2017 were classified as current within the GenOn consolidated balance sheet. Further discussion of GenOn's liquidity and ability to meet the obligation to repay the senior notes is discussed in Note 1, Nature of Business.

Credit Agreement with NRG (GenOn). As described in Note 13, Related Party Transactions, GenOn is party to a secured intercompany revolving credit agreement with NRG. This credit agreement provides for a $500 million revolving credit facility, available for revolving loans and letters of credit. At December 31, 2016, $272 million of letters of credit and no borrowings were outstanding under the NRG credit agreement.

Repurchase of 2017 GenOn Senior Notes. In the fourth quarter of 2015, GenOn repurchased $33 million of the 2017 GenOn Senior Notes at an average price of $95.17, plus any accrued and unpaid interest as of the repurchase date. In connection with the repurchase, a $3 million gain on debt extinguishment of the 2017 GenOn Senior Notes was recorded during the year ended December 31, 2015, which primarily consisted of the discount on repurchase of $2 million and write-off of unamortized premium of $1 million.

Repurchase of 2018 GenOn Senior Notes. In the fourth quarter of 2015, GenOn repurchased $25 million of the 2018 GenOn Senior Notes at an average price of $90.95, plus any accrued and unpaid interest as of the repurchase date. In connection with the repurchase, a $5 million gain on debt extinguishment of the 2018 GenOn Senior Notes was recorded during the year ended December 31, 2015, which primarily consisted of the discount on repurchase of $2 million and write-off of unamortized premium of $3 million.

Repurchase of 2020 GenOn Senior Notes. In the fourth quarter of 2015, GenOn repurchased $61 million of the 2020 GenOn Senior Notes at an average price of $83.85, plus any accrued and unpaid interest as of the repurchase date. In connection with the repurchase, a $15 million gain on debt extinguishment of the 2020 GenOn Senior Notes was recorded during the year ended December 31, 2015, which primarily consisted of the discount on repurchase of $10 million and write-off of unamortized premium of $5 million.

GenOn Americas Generation Senior Notes (GenOn and GenOn Americas Generation)

GenOn Americas Generation Senior Notes. The GenOn Americas Generation Senior Notes due 2021 and 2031 are senior unsecured obligations of GenOn Americas Generation having no recourse to any subsidiary or affiliate of GenOn Americas Generation. Prior to maturity, GenOn Americas Generation may redeem all or a part of the GenOn Americas Generation Senior Notes due 2021 and 2031 at a redemption price equal to 100% of the notes plus a premium and accrued and unpaid interest. The premium is the greater of: (i) the discounted present value of the then-remaining scheduled payments of principal and interest on the outstanding notes, discounted at a Treasury rate plus 0.375%, less the unpaid principal amount; and (ii) zero.

Repurchase of 2021 GenOn Americas Generation Senior Notes. In the fourth quarter of 2015, GenOn Americas Generation repurchased $84 million of the 2021 GenOn Americas Generation Senior Notes at an average price of $84.91, plus any accrued and unpaid interest as of the repurchase date. In connection with the repurchase, a $20 million gain on debt extinguishment of the 2021 GenOn Americas Generation Senior Notes was recorded during the year ended December 31, 2015, which primarily consisted of the discount on repurchase of $13 million and write-off of unamortized premium of $7 million.

Repurchase of 2031 GenOn Americas Generation Senior Notes. In November 2015, GenOn Americas Generation repurchased $71 million of the 2031 GenOn Americas Generation Senior Notes at an average price of $77.02, plus any accrued and unpaid interest as of the repurchase date. In connection with the repurchase, a $22 million gain on debt extinguishment of the 2031 GenOn Americas Generation Senior Notes was recorded during the year ended December 31, 2015, which primarily consisted of the discount on repurchase of $16 million and write-off of unamortized premium of $6 million.

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GenOn Mid-Atlantic Prepaid Letter of Credit (GenOn Mid-Atlantic)

GenOn Mid-Atlantic Prepaid Letter of Credit . On January 27, 2017, GenOn Mid-Atlantic entered into an agreement with Natixis under which Natixis will procure payment and credit support for the payment of certain lease payments owed pursuant to the GenOn Mid-Atlantic operating leases for Morgantown and Dickerson. GenOn Mid-Atlantic made a payment of $130 million plus fees of $1 million as consideration for Natixis applying for the issuance of, and obtaining, letters of credit from Natixis, New York Branch, the LC Provider, to support the lease payments. Natixis is solely responsible for (i) obtaining letters of credit from the LC Provider, (ii) causing the letters of credit to be issued to the lessors to support the lease payments on behalf of GenOn Mid-Atlantic, (iii) making lease payments and (iv) satisfying any reimbursement obligations payable to the LC Provider.

On February 24, 2017, GenOn Mid-Atlantic received a series of Notices from the owner lessors under its operating leases of the Morgantown coal generation unit, as further described in Note 14, Commitments and Contingencies, alleging default. The Notices allege the existence of lease events of default as a result of, among other items, the purported failure by GenOn Mid-Atlantic to comply with a covenant requiring the maintenance of qualifying credit support. The Notices instructed the relevant trustees to draw on letters of credit under the secured intercompany revolving credit agreement between NRG and GenOn as further described in Note 13, Related Party Transactions, supporting the GenOn Mid-Atlantic operating leases that were set to expire on February 28, 2017. On February 28, 2017, the trustees drew on the letters of credit under NRG's revolving credit facility, which resulted in additional borrowings of $125 million. Upon notification, GenOn will become obligated under the secured intercompany revolving credit agreement between NRG and GenOn. In addition, a corresponding payable is expected to be recorded by GenOn Mid-Atlantic to GenOn, with the offset recorded as a deposit under the related operating leases, pending resolution of the matter. The Registrant is unaware of whether any further action will be taken by the owner lessors or any other person in connection with the Notices. GenOn Mid-Atlantic disagrees with the owner lessors as to the existence of any lease events of default and/or any breaches by GenOn Mid-Atlantic of any terms and conditions of the operating leases and believes that the declaration of a lease event of default, the instruction to draw on the letters of credit under the secured intercompany revolving credit agreement between NRG and GenOn and any actual draw thereon constitutes a violation by the owner lessors and the relevant trustees of the terms and conditions of the GenOn Mid-Atlantic operating leases. GenOn Mid-Atlantic intends to vigorously pursue its rights and remedies in connection with these actions.

Restricted Net Assets (GenOn and GenOn Americas Generation)

GenOn and GenOn Americas Generation and certain of their subsidiaries are holding companies and, as a result, GenOn and GenOn Americas Generation and such subsidiaries are dependent upon dividends, distributions and other payments from their respective subsidiaries to generate the funds necessary to meet their obligations. In particular, a substantial portion of the cash from GenOn’s and GenOn Americas Generation’s operations is generated by GenOn Mid-Atlantic. The ability of certain of GenOn’s and GenOn Americas Generation’s subsidiaries to pay dividends and make distributions is restricted under the terms of their debt or other agreements, including the operating leases of GenOn Mid-Atlantic for GenOn and GenOn Americas Generation and REMA for GenOn. Under their respective operating leases, GenOn Mid-Atlantic and REMA are not permitted to make any distributions and other restricted payments unless: (a) they satisfy the fixed charge coverage ratio for the most recently ended period of four fiscal quarters; (b) they are projected to satisfy the fixed charge coverage ratio for each of the two following periods of four fiscal quarters, commencing with the fiscal quarter in which such payment is proposed to be made; and (c) no significant lease default or event of default has occurred and is continuing. In the event of a default under the respective operating leases or if the respective restricted payment tests are not satisfied, GenOn Mid-Atlantic and REMA would not be able to distribute cash. At December 31, 2016, GenOn Mid-Atlantic and REMA did not satisfy the restricted payments test.

Pursuant to the terms of their respective lease agreements, GenOn Mid-Atlantic and REMA are restricted from, among other actions, (a) encumbering assets, (b) entering into business combinations or divesting assets, (c) incurring additional debt, (d) entering into transactions with affiliates on other than an arm’s length basis or (e) materially changing their business. Therefore, at December 31, 2016, all of GenOn Mid-Atlantic’s and REMA’s net assets (excluding cash) were deemed restricted for purposes of Rule 4-08(e)(3)(ii) of Regulation S-X. As of December 31, 2016, GenOn Mid-Atlantic and REMA had restricted net assets of $1.2 billion and $(1.3) billion, respectively.

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Consolidated Annual Maturities (GenOn and GenOn Americas Generation)

Annual payments based on the maturities of GenOn's debt and capital leases for the years ending after December 31, 2016, are as follows:



	(In millions)
2017	$	696
2018	655
2019	5
2020	495
2021	372
Thereafter	400
Total	$	2,623

Annual payments based on the maturities of GenOn Americas Generation's debt for the years ending after December 31, 2016, are as follows:



	(In millions)
2017	$	—
2018	—
2019	—
2020	—
2021	366
Thereafter	329
Total	$	695

Note 10 — Asset Retirement Obligations (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

The Registrants' AROs are primarily related to the future dismantlement of equipment on leased property and environmental obligations related to ash disposal, site closures and fuel storage facilities. In addition, the Registrants have also identified conditional AROs for asbestos removal and disposal, which are specific to certain power generation facilities.

The following table represents the balance of ARO obligations as of December 31, 2015, along with the additions, reductions and accretion related to the Registrants’ ARO obligations for the year ended December 31, 2016:



	GenOn			GenOn Americas Generation			GenOn Mid-Atlantic
	(In millions)
Balance as of December 31, 2015	$	187		$	82		$	27
Additions	16			16			—
Revisions in estimates for current obligations	(13		)	(10		)	10
Spending for current obligations and other settlements	(6		)	(1		)	—
Accretion — expense	21			13			2
Balance as of December 31, 2016	$	205		$	100		$	39

Note 11 — Benefit Plans and Other Postretirement Benefits (GenOn)

Defined Benefit Plans

GenOn provides pension benefits to eligible non-union and union employees through various defined benefit pension plans. These benefits are based on pay, service history and age at retirement. Most pension benefits are provided through tax-qualified plans that are funded in accordance with the Employee Retirement Income Security Act of 1974 and Internal Revenue Service requirements. Certain executive pension benefits that cannot be provided by the tax-qualified plans are provided through unfunded non-tax-qualified plans. The measurement date for the defined benefit plans was December 31 for all periods presented unless otherwise noted. GenOn also provides certain medical care and life insurance benefits for eligible retired employees. The measurement date for these postretirement benefit plans was December 31 for all periods presented unless otherwise noted. On December 31, 2014, NRG merged 8 qualified pension plans into 2 separate qualified pension plans, the NRG Pension Plan for

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Bargained Employees and the NRG Pension Plan. The GenOn Mirant Bargaining Unit Pension Plan, GenOn First Energy Pension Plan, GenOn Duquesne Pension Plan, and GenOn REMA Pension Plan were merged into the NRG Pension Plan for Bargained Employees. The GenOn Mirant Pension Plan was merged into the NRG Pension Plan for Non-Bargained Employees and renamed the NRG Pension Plans. These actions were conducted to simplify internal administration of the plans, reduce regulatory filings, and lower fees paid to outside vendors as part of the management services agreement. The benefits provided to current participants in the Plans were not impacted. As controlled group members, ERISA requires that NRG and GenOn are jointly and severally liable for the NRG Pension Plan for Bargained Employees and the NRG Pension Plan.

As part of the change in control associated with the NRG Merger, NRG decided to terminate/settle the nonqualified legacy GenOn Benefit Restoration Plan and Supplemental Executive Retirement Plan. Final settlement payments totaling $12 million were paid to remaining participants during 2014.

The net periodic pension cost/(credit) related to GenOn’s pension and other postretirement benefit plans include the following components:



	Pension Benefits
	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Service cost benefits earned	$	10		$	10		$	10
Interest cost on benefit obligation	23			27			27
Expected return on plan assets	(34		)	(35		)	(34		)
Amortization of unrecognized net loss/(gain)	—			1			(6		)
Amortization of unrecognized prior service cost	1			—			—
Net periodic benefit cost/(credit)	$	—		$	3		$	(3	)



	Other Postretirement Benefits
	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Service cost benefits earned	$	—		$	1		$	1
Interest cost on benefit obligation	1			3			3
Amortization of unrecognized prior service credit	(1		)	(4		)	(17		)
Net periodic benefit credit	$	—		$	—		$	(13	)

A comparison of the pension benefit obligation, other postretirement benefit obligations and related plan assets for GenOn plans on a combined basis is as follows:

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	Pension Benefits
	Year Ended December 31,
	2016			2015
	(In millions)
Benefit obligation at beginning of period	$	625		$	660
Service cost	10			10
Interest cost	23			27
Actuarial loss/(gain)	4			(33		)
Benefit payments	(33		)	(39		)
Benefit obligation at end of period	629			625
Fair value of plan assets at beginning of period	506			548
Actual return on plan assets	20			(17		)
Employer contributions	16			14
Benefit payments	(33		)	(39		)
Fair value of plan assets at end of period	509			506
Funded status at end of period — excess of obligation over assets	$	(120	)	$	(119	)



	Other Postretirement Benefits
	Year Ended December 31,
	2016			2015
	(In millions)
Benefit obligation at beginning of period	$	54		$	65
Service cost	—			1
Interest cost	1			3
Participant contributions	2			1
Actuarial gain	(4		)	(8		)
Benefit payments	(7		)	(7		)
Plan amendments	—			(1		)
Benefit obligation at end of period	46			54
Fair value of plan assets at beginning of period	—			—
Employer contributions	5			6
Participant contributions	2			1
Benefit payments	(7		)	(7		)
Fair value of plan assets at end of period	—			—
Funded status at end of period — excess of obligation over assets	$	(46	)	$	(54	)

The accumulated benefit obligation exceeded the fair value of plan assets at December 31, 2016 and 2015 for the tax-qualified defined benefit pension plans. The total accumulated benefit obligation for the tax-qualified plans at December 31, 2016 and 2015 was $611 million and $608 million, respectively.

Amounts recognized in GenOn’s balance sheets were as follows:



	Pension Benefits				Other Postretirement Benefits
	As of December 31,				As of December 31,
	2016		2015		2016		2015
	(In millions)				(In millions)
Current liabilities	$	—	$	—	$	5	$	5
Non-current liabilities	120		119		41		49

Amounts recognized in GenOn’s accumulated other comprehensive income/loss that have not yet been recognized as components of net periodic benefit cost were as follows:

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	Year Ended December 31,
	Pension Benefits						Other Postretirement Benefits
	2016			2015			2016		2015
	(In millions)
Net (loss)/gain	$	(37	)	$	(20	)	$	7	$	3
Prior service (cost)/credit	—			(1		)	1		2

Amounts recognized in GenOn’s OCI for the pension and other postretirement benefit plans were as follows:



	Year Ended December 31,
	Pension Benefits						Other Postretirement Benefits
	2016			2015			2016			2015
	(In millions)
Net actuarial (loss)/gain	$	(17	)	$	(20	)	$	4		$	9
Amortization of net actuarial gain	—			1			—			—
Amortization of prior service cost	1			—			(1		)	(4		)
Total recognized in other comprehensive (loss)/income	$	(16	)	$	(19	)	$	3		$	5

The total net loss recognized in net periodic benefit cost and OCI for the pension plans for the years ended December 31, 2016, 2015, and 2014 were $16 million, $22 million, and $90 million, respectively. The total net gain recognized in net periodic benefit credit and OCI for the other postretirement benefit plans for the years ended December 31, 2016, 2015, and 2014 were $3 million, $6 million, and $2 million, respectively.

The estimated unrecognized loss for the pension and other postretirement benefit plans that will be amortized from accumulated other comprehensive income/loss to net period benefit cost during 2017 is less than $1 million. The estimated unrecognized prior service credit for the pension and other postretirement benefit plans that will be amortized from accumulated other comprehensive income/loss to net period benefit cost during 2017 is approximately $1 million.

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Fair Value Hierarchy of Plan Assets

GenOn's market-related value of its plan assets is the fair value of the assets. The fair values of GenOn's pension plan assets by asset category and their level within the fair value hierarchy are as follows:



	Fair Value Measurements as of December 31, 2016
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Total
	(In millions)
Common/collective trust investment — U.S. equity	$	—	$	152	$	152
Common/collective trust investment — non-U.S. equity	—		80		80
Common/collective trust investment — global equity	—		56		56
Common/collective trust investment — fixed income	—		204		204
Partnerships/Joint Ventures	—		16		16
Short-term investment fund	1		—		1
Total	$	1	$	508	$	509



	Fair Value Measurements as of December 31, 2015
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Total
	(In millions)
Common/collective trust investment — U.S. equity	$	—	$	142	$	142
Common/collective trust investment — non-U.S. equity	—		82		82
Common/collective trust investment — global equity	—		49		49
Common/collective trust investment — fixed income	—		220		220
Partnerships/Joint Ventures	—		10		10
Short-term investment fund	3		—		3
Total	$	3	$	503	$	506

In accordance with ASC 820, GenOn determines the level in the fair value hierarchy within which each fair value measurement in its entirety falls, based on the lowest level input that is significant to the fair value measurement in its entirety. The fair value of the common/collective trusts is valued at fair value which is equal to the sum of the market value of all of the fund's underlying investments, and is categorized as Level 2. Partnerships/joint ventures Level 2 investments consist primarily of a partnership which invests in emerging market equity securities. There are no investments categorized as Level 3.

Assumptions

GenOn sets the discount rate assumptions on an annual basis for each of its defined benefit retirement plans as of December 31. The discount rate assumptions represent the current rate at which the associated liabilities could be effectively settled at December 31. GenOn utilizes the Aon Hewitt AA Above Median, or AA-AM, yield curve to select the appropriate discount rate assumption for each retirement plan. The AA-M yield curve is a hypothetical AA yield curve represented by a series of annualized individual spot discount rates from 6 months to 99 years. Each bond issue used to build this yield curve must be non-callable, and have an average rating of AA when averaging all available Moody's Investor Services, Standard & Poor's and Fitch ratings.

The following table presents the significant assumptions used to calculate GenOn's benefit obligations:



	Pension Benefits				Other Postretirement Benefits
	As of December 31,				As of December 31,
	2016		2015		2016		2015
Weighted–Average Assumptions
Discount rate	4.29	%	4.54	%	4.03	%	4.16	%
Rate of compensation increase	3.00	%	3.00	%	N/A		N/A

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GenOn’s assumed healthcare cost trend rates used for other postretirement benefit obligations are:



	Other Postretirement Benefit Plans
	As of December 31,
	2016		2015
Weighted–Average Assumptions
Assumed medical inflation for next year:
Before age 65	7.00	%	7.25	%
Age 65 and after	8.75	%	9.00	%
Assumed ultimate medical inflation rate	5.00	%	5.00	%
Year in which ultimate rate is reached	2025		2025

An annual increase of 1% in the assumed healthcare cost trend rates would correspondingly increase the postretirement benefit obligation at December 31, 2016 by $3 million. An annual decrease of 1% in the assumed healthcare cost trend rates would correspondingly decrease the postretirement benefit obligation at December 31, 2016 by $3 million.

The following tables present the significant assumptions used to calculate GenOn's benefit expense/credit:



	Pension Benefits
	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
Weighted–Average Assumptions
Discount rate	4.54	%	4.18	%	5.02	%
Rate of compensation increase	3.00	%	2.97	%	2.91	%
Expected return on plan assets	6.63	%	6.41	%	7.00	%



	Other Postretirement Benefit Plans
	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
Weighted–Average Assumptions
Discount rate	4.16	%	3.86	%	4.53	%

GenOn’s assumed healthcare cost trend rates used for other postretirement benefit net periodic benefit expense/credit are:



	Other Postretirement Benefit Plans
	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
Weighted–Average Assumptions
Assumed medical inflation for next year:
Before age 65	7.25	%	8.60	%	8.50	%
Age 65 and after	9.00	%	8.10	%	8.69	%
Assumed ultimate medical inflation rate	5.00	%	5.00	%	5.50	%
Year in which ultimate rate is reached	2025		2023		2019

An annual increase or decrease of 1% in the assumed healthcare cost trend rates would correspondingly increase or decrease the total annual service and interest cost components of net period benefit credit during 2016 by less than $1 million.

In 2016, GenOn changed the approach utilized to estimate the service cost and interest cost components of net periodic benefit cost for pension and postretirement benefit plans. Historically, GenOn estimated these components by using a single weighted average discount rate derived from the yield curve used to measure the benefit obligation. GenOn elected to use a spot rate approach in the estimation of the components of benefit cost by applying specific spot rates along the yield curve to the relevant projected cash flows, as this provides a better estimate of service and interest costs. This election is considered a change in estimate and, accordingly, GenOn accounted for prospectively starting in 2016. This change does not affect the measurement of GenOn's total benefit obligation.

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Pension Plan Assets

Pension plans’ assets are managed solely in the interest of the plans’ participants and their beneficiaries and are invested with the objective of earning the necessary returns to meet the time horizons of the accumulated and projected retirement benefit obligations. GenOn uses a mix of equities and fixed income investments intended to manage risk to a reasonable and prudent level. GenOn’s risk tolerance is established through consideration of the plans’ liabilities and funded status as well as corporate financial condition. Equity investments are diversified across U.S. and non-U.S. stocks. For U.S. stocks, GenOn employs both a passive and active approach by investing in index funds and actively managed funds. For non-U.S. stocks, GenOn is invested in both developed and emerging market equity funds. Fixed income investments are comprised of long-term U.S. government and corporate securities. Derivative securities can be used for diversification, risk-control and return enhancement purposes but may not be used for the purpose of leverage. The assets for the NRG Pension Plan for Bargained Employees and the NRG Pension Plan are in a single qualified trust. At the time of the plan mergers, the fair value of the assets from the prior plans were allocated on a pro-rata basis based on the benefit obligations on January 1, 2015 and will continue to be allocated on this basis at each reporting date.

GenOn's pension asset allocation methodology is based on the results of a study completed by a third-party investment consulting firm. The methodology divides the pension plan assets into two primary portfolios: (i) return seeking assets, those assets intended to generate returns in excess of pension liability growth (U.S. equity, non-U.S. equity, global equity, and emerging market equity) and (ii) liability-hedging assets, those assets intended to have characteristics similar to pension liabilities (fixed income securities). As GenOn’s pension plans’ funded status improves, the methodology actively moves the plan assets from return seeking assets toward liability-hedging assets. GenOn employs a building block approach to determining the long-term rate of return for plan assets, with proper consideration given to diversification and rebalancing. Historical markets are studied and long-term historical relationships between equities and fixed income are preserved, consistent with the widely accepted capital market principle that assets with higher volatility generate a greater return over the long run. Current factors such as inflation and interest rates are evaluated before long-term capital assumptions are determined. Peer data and historical returns are reviewed to check for reasonableness and appropriateness.

The target allocations for GenOn’s pension plan assets were as follows for the year ended December 31, 2016:



U.S. equities	27	%
Non-U.S. equities	15	%
Global equities	10	%
Emerging market equities	3	%
Fixed income securities	45	%

Investment risk and performance are monitored on an ongoing basis through quarterly portfolio reviews of each asset fund class to a related performance benchmark, if applicable, and annual pension liability measurements. Performance benchmarks are composed of the following indices:



Asset Class		Index
U.S. equities		Dow Jones U.S. Total Stock Market Index
Non-U.S. equities		MSCI All Country World Ex-U.S. IMI Index
Global equities		MSCI World Index
Emerging market equities		MSCI Emerging Markets Index
Fixed income securities		Barclays Capital Long Term Government/Credit Index & Barclays Strips 20+ Index

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Expected Contributions and Benefit Payments

GenOn expects to contribute approximately $16 million to the tax-qualified pension plans during 2017.

GenOn's expected future benefit payments for each of the next five years, and in the aggregate for the five years thereafter, are as follows:



	Pension Benefit Payments		Other Postretirement Benefit Payments
	(In millions)
2017	$	29	$	4
2018	31		5
2019	32		4
2020	34		5
2021	35		4
2022 through 2026	194		14

Employee Savings and Profit Sharing Plan

GenOn has employee savings plans under Sections 401(a) and 401(k) of the IRC whereby employees may contribute a portion of their eligible compensation to the employee savings plan, subject to limits under the IRC. GenOn also historically provided for a profit sharing arrangement for non-bargaining employees and some bargaining employees not accruing a benefit under the defined benefit pension plans, whereby GenOn contributed a fixed contribution of 2% of eligible pay per pay period and could make an annual discretionary contribution up to 3% of eligible pay based on GenOn’s performance. Upon completion of the NRG Merger, NRG assumed GenOn’s defined contribution 401(k) plans and amended the plan for the non-bargaining employees with NRG 401(k) plan features, effective January 1, 2013. On July 5, 2013, the GenOn defined contribution 401(k) plans were merged into the NRG 401(k) plan.

GenOn also sponsors non-qualified deferred compensation plans for key and highly compensated employees. GenOn’s obligations and the related rabbi trust investments under these plans were $11 million and $15 million at December 31, 2016 and 2015, respectively. Upon completion of the NRG Merger, NRG assumed GenOn’s non-qualified plans and their respective obligations.

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Note 12 — Income Taxes (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Income Taxes

GenOn

GenOn’s income tax expense/(benefit) consisted of the following:



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions, except percentages)
Current
U.S. Federal	$	—		$	—		$	—
State	11			(3		)	6
Total — current	11			(3		)	6
Deferred
U.S. Federal	—			—			—
State	—			—			—
Total — deferred	—			—			—
Total income tax expense/(benefit)	$	11		$	(3	)	$	6
Effective tax rate	12.0		%	2.5		%	3.0		%

A reconciliation of GenOn's federal statutory income tax provision to the effective income tax expense/(benefit) adjusted for permanent and other items during 2016, 2015, and 2014, is as follows:



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Income/(loss) before income taxes	$	92		$	(118	)	$	198
Provision for income taxes based on U.S. federal statutory income tax rate	32			(42		)	70
State and local income tax provision, net of federal income taxes	11			(3		)	14
Change in deferred tax asset valuation allowance	(92		)	16			(100		)
State rate change	60			26			21
Other, net	—			—			1
Income tax expense/(benefit)	$	11		$	(3	)	$	6

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The tax effects of temporary differences between the carrying amounts of assets and liabilities in GenOn's financial statements and their respective tax bases which give rise to deferred tax assets and liabilities are as follows:



	As of December 31,
	2016			2015
	(In millions)
Deferred Tax Assets:
Employee benefits	$	61		$	76
Pension and other postretirement benefits	61			—
Federal loss carryforwards	442			394
State loss carryforwards	116			214
Property and intangible assets	1,080			931
Inventory	32			—
Investment in projects	1			—
Derivative contracts	—			470
Out-of-market contracts fair value adjustment	242			378
Debt premium, net	49			92
Other	9			20
Subtotal	2,093			2,575
Valuation allowance	(2,087		)	(2,194		)
Net deferred tax assets	6			381
Deferred Tax Liabilities:
Pension and other postretirement benefits	—			381
Derivative contracts	6			—
Net deferred tax liabilities	6			381
Net deferred taxes	$	—		$	—

The December 31, 2015 presentation of the GenOn deferred tax asset reflects a decrease of $270 million with a corresponding offset to valuation allowance of $270 million for a net impact of zero. These adjustments for GenOn had no impact to results from operations, net assets or cash flows.

Deferred tax assets and valuation allowance

Net deferred tax balance — As of December 31, 2016 and 2015, GenOn recorded a net deferred tax asset of $2.1 billion and $2.2 billion, respectively. Based on its assessment of positive and negative evidence, including available tax planning strategies, GenOn believes that it is more likely than not that a benefit will not be realized on $2.1 billion and $2.2 billion of tax assets as of December 31, 2016 and 2015, respectively, thus a valuation allowance has been recorded.

In connection with the accounting for the NRG Merger, GenOn recorded the realizable deferred tax assets and liabilities acquired, primarily consisting of net operating losses and other temporary differences. In addition, the excess of GenOn's historical tax basis of assets and liabilities over the amount assigned to the fair value of the assets acquired and liabilities assumed generated deferred tax assets and liabilities that were recorded on the acquisition date.

NOL carryforwards — At December 31, 2016, GenOn had tax effected cumulative domestic NOLs consisting of carryforwards for federal income tax purposes of $442 million and state of $116 million. GenOn's pre-merger federal NOLs are limited to tax effected $22 million annually. GenOn estimates it will need to generate future taxable income to fully realize the net federal deferred tax asset before expiration commencing in 2032.

Valuation allowance — As of December 31, 2016, GenOn's tax effected valuation allowance was $2.1 billion, relating primarily to federal and state loss carryforwards, out-of-market contracts and differences between book and tax basis of property, plant and equipment.

Uncertain tax benefits

GenOn does not have any uncertain tax benefits.

GenOn recognizes interest and penalties related to uncertain tax benefits in income tax expense. During the year ended December 31, 2016 and 2015, GenOn did not accrue interest. As of December 31, 2016 GenOn had no cumulative interest and penalties.

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Tax jurisdictions — GenOn is no longer subject to U.S. federal income tax examinations for years prior to 2015. With few exceptions, state and local income tax examinations are no longer open for years before 2010.

The following table reconciles the total amounts of uncertain tax benefits:



	As of December 31,
	2016		2015
	(In millions)
Balance as of January 1	$	—	$	2
Decrease due to prior year positions	—		(2		)
Uncertain tax benefits as of December 31	$	—	$	—

GenOn Americas Generation

GenOn America's Generation is a wholly owned limited liability company, a disregarded entity, for federal and state income tax purposes. Therefore federal and state taxes are assessed at the parent level. Accordingly, no provision has been made for federal or state income taxes in the accompanying financial statements.

A reconciliation of GenOn Americas Generation's expected federal statutory income tax provision to the effective income tax provision adjusted for permanent and other items during 2016, 2015, and 2014, is as follows:



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Income before income taxes	$	121		$	116		$	305
Provision for income taxes based on U.S. federal statutory income tax rate	42			41			107
State and local income tax provision, net of federal income taxes	(5		)	10			18
LLC income not subject to taxation	(77		)	(51		)	(115		)
State rate change	40			—			(2		)
Other	—			—			(8		)
Income tax provision	$	—		$	—		$	—

Uncertain tax benefits

GenOn Americas Generation does not have any uncertain tax benefits.

Pro Forma Income Tax Disclosures

GenOn Americas Generation

GenOn Americas Generation is not subject to income taxes except for those subsidiaries of GenOn Americas Generation that are separate taxpayers. NRG Americas, GenOn and NRG are otherwise directly responsible for income taxes related to GenOn Americas Generation's operations.

GenOn Americas Generation was not allocated income taxes attributable to its operations on a pro forma income tax provision basis for the years ended December 31, 2016, 2015, and 2014.

116

The following table presents the pro forma reconciliation of GenOn Americas Generation's federal statutory income tax provision for continuing operations adjusted for reorganization items to the pro forma effective tax provision:



	Year Ended December 31, 2016			Year Ended December 31, 2015			Year Ended December 31, 2014
	(In millions)
Income before income taxes	$	121		$	116		$	305
Provision for income taxes based on U.S. federal statutory income tax rate	42			41			107
State and local income tax provision, net of federal income taxes	(5		)	10			18
Change in deferred tax asset valuation allowance	(77		)	(51		)	(115		)
State rate change	40			—			(2		)
Other	—			—			(8		)
Income tax provision	$	—		$	—		$	—

The tax effects of temporary differences between the carrying amounts of assets and liabilities in the consolidated balance sheets and their respective tax bases which give rise to the pro forma deferred tax assets and liabilities would be as follows:



	As of December 31,
	2016			2015
	(In millions)
Deferred Tax Assets:
Pension and other postretirement benefits	$	1		$	1
Reserves	27			19
Property and intangible assets	566			637
Out-of-market contracts fair value adjustment	188			213
Derivative contract assets and liabilities	4			—
Debt premium	20			24
Other, net	16			8
Subtotal	822			902
Valuation allowance	(822		)	(835		)
Net deferred tax assets	—			67
Deferred Tax Liabilities:
Derivative contract assets and liabilities	—			67
Net deferred tax liabilities	—			67
Net deferred taxes	$	—		$	—

The December 31, 2015 pro forma presentation of the GenOn Americas Generation deferred tax asset reflects a decrease of $1.1 billion with a corresponding offset to valuation allowance of $1.1 billion for a net impact of zero. These adjustments for GenOn Americas Generation had no impact to results from operations, net assets or cash flows as the adjustments were made to provide pro forma information.

Deferred tax assets and valuation allowance

Net deferred tax balance — As of December 31, 2016 and 2015, GenOn Americas Generation recorded a net deferred tax asset of $822 million and $902 million, respectively. Based on its assessment of positive and negative evidence, including available tax planning strategies, GenOn Americas believes that it is more likely than not that a benefit will not be realized on $822 million and $902 million of tax assets as of December 31, 2016 and 2015, respectively, thus a valuation allowance has been recorded.

In connection with the accounting for the GenOn acquisition, GenOn Americas Generation recorded the realizable deferred tax assets and liabilities acquired, primarily consisting of historical tax basis of assets and liabilities over the amount assigned to the fair value of the assets acquired and liabilities assumed.

NOL carryforwards — At December 31, 2016, GenOn Americas Generation had no cumulative carryforwards available.

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Valuation allowance — As of December 31, 2016, GenOn Americas Generation's tax effected valuation allowance was $822 million, relating primarily to differences between book and tax basis of property, plant and equipment and out-of-market contracts.

Uncertain tax benefits

As of December 31, 2016, GenOn Americas Generation did not have any uncertain tax benefits.

GenOn Mid-Atlantic

The following reflects a pro forma disclosure of the income tax provision that would be reported if GenOn Mid-Atlantic was to be allocated income taxes attributable to its operations. Pro forma income tax provision attributable to income before tax would consist of the following:



	Year Ended December 31, 2016			Year Ended December 31, 2015		Year Ended December 31, 2014
	(In millions)
Current provision:
Federal	$	51		$	36	$	82
State	9			6		11
Deferred provision/(benefit):
Federal	(42		)	—		(5		)
State	42			—		(1		)
Valuation allowance	648			—		—
Total provision for income taxes	$	708		$	42	$	87

The following table presents the pro forma reconciliation of GenOn Mid-Atlantic's federal statutory income tax provision for continuing operations adjusted for reorganization items to the pro forma effective tax provision:



	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
	(In millions)
Income before income taxes	$	52	$	104	$	236
Provision for income taxes based on U.S. federal statutory income tax rate	18		36		82
State and local income taxes	2		6		11
State rate change	31		—		(1		)
Valuation allowance	648		—		—
Other, net	9		—		(5		)
Income tax provision	$	708	$	42	$	87

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	As of December 31,
	2016			2015
	(In millions)
Deferred Tax Assets:
Pension and other postretirement benefits	$	1		$	1
Reserves	24			17
Property and intangible assets	424			467
Derivative contracts	2			—
Out-of-market contracts fair value adjustment	189			213
Inventory reserves	8			13
Total deferred tax assets	648			711
Valuation allowance	(648		)	—
Net deferred tax assets	—			711
Deferred Tax Liabilities:
Derivative contracts	—			63
Net deferred tax liabilities	—			63
Net deferred taxes	$	—		$	648

GenOn Mid-Atlantic's December 31, 2015 pro forma presentation of deferred tax assets reflects an increase of $325 million and a decrease in the deferred tax liability of $267 million resulting in an increase in the net deferred taxes of $592 million. These adjustments for GenOn Mid-Atlantic had no impact to results from operations, net assets or cash flows as the adjustments were made to provide pro forma information.

Deferred tax assets and valuation allowance

Net deferred tax balance — As of December 31, 2016, GenOn Mid-Atlantic recorded a net deferred tax asset of $648 million. Based upon the assessment of cumulative and forecasted pretax book earnings and the future reversal of existing taxable temporary differences, it was determined that a valuation allowance was required to be recorded.

Valuation allowance — As of December 31, 2016, GenOn Mid-Atlantic's tax effected valuation allowance was $648 million, primarily relating to differences between book and tax basis of property, plant and equipment.

Uncertain tax benefits

As of December 31, 2016, GenOn Mid-Atlantic does not have any uncertain tax benefits.

Note 13 - Related Party Transactions (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Services Agreement with NRG (GenOn)

NRG provides GenOn with various management, personnel and other services, which include human resources, regulatory and public affairs, accounting, tax, legal, information systems, treasury, risk management, commercial operations, and asset management, as set forth in the Services Agreement. The initial term of the Services Agreement was through December 31, 2013, with an automatic renewal absent a request for termination. The fee charged is determined based on a fixed amount as described in the Services Agreement and was calculated based on historical GenOn expenses prior to the NRG Merger. The annual fees under the Services Agreement are approximately $193 million. NRG charges these fees on a monthly basis, less amounts incurred directly by GenOn. Management has concluded that this method of charging overhead costs is reasonable. For the years ended December 31, 2016 and 2015, GenOn recorded costs related to these services of $185 million and $184 million, respectively, as general and administrative - affiliate.

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Administrative Services Provided by NRG (GenOn Americas Generation and GenOn Mid-Atlantic)

NRG provides GenOn Americas Generation and GenOn Mid-Atlantic with various management, personnel and other services consistent with those set forth in the Services Agreement discussed above between NRG and GenOn. GenOn's costs incurred under the Services Agreement with NRG are allocated to its subsidiaries based on each operating subsidiary's planned operating expenses relative to all operating subsidiaries of GenOn. These allocations and charges are not necessarily indicative of what would have been incurred had GenOn Americas Generation and GenOn Mid-Atlantic been unaffiliated entities. Management has concluded that this method of charging overhead costs is reasonable.

The following costs were incurred under these arrangements:

GenOn Americas Generation



	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
	(In millions)
Allocated costs:
Cost of operations — affiliate	$	3	$	3	$	7
Selling, general and administrative — affiliate	90		81		79
Total	$	93	$	84	$	86

GenOn Mid-Atlantic



	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
	(In millions)
Allocated costs:
Cost of operations — affiliate	$	4	$	1	$	4
Selling, general and administrative — affiliate	71		58		64
Total	$	75	$	59	$	68

Credit Agreement with NRG (GenOn)

GenOn and NRG Americas are party to a secured intercompany revolving credit agreement with NRG. This credit agreement provides for a $500 million revolving credit facility, all of which is available for revolving loans and letters of credit. At December 31, 2016, $272 million of letters of credit were outstanding under the NRG credit agreement for GenOn. Of this amount, $199 million were issued on behalf of GenOn Americas Generation, which includes $128 million issued on behalf of GenOn Mid-Atlantic. At December 31, 2016, no loans were outstanding under this credit agreement. Certain of GenOn's subsidiaries, as guarantors, are subject to a guarantee agreement pursuant to which these guarantors guaranteed amounts borrowed and obligations incurred under the credit agreement. The guarantors are restricted from incurring additional liens on certain of their assets. The credit agreement is payable at maturity, subject to certain exceptions primarily related to asset sales not in the ordinary course of business and borrowings of debt and matures in December of 2018. At GenOn's election, the interest rate per year applicable to the loans under the credit agreement will be determined by reference to either (i) the base rate plus 2.50% per year or (ii) the LIBOR rate plus 3.50% per year. In addition, the credit agreement contains customary its covenants and events of default. As of December 31, 2016 GenOn was in compliance with covenants under the credit agreement with NRG.

As further described in Note 9, Debt and Capital Leases, GenOn Mid-Atlantic entered into a prepaid letter of credit agreement with Natixis under which Natixis will procure payment and credit support for the payment of certain lease payments owed under the GenOn Mid-Atlantic operating lease.

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Intercompany Cash Management Program (GenOn Americas Generation)

GenOn Americas Generation and certain of its subsidiaries participate in separate intercompany cash management programs whereby cash balances at GenOn Americas Generation and the respective participating subsidiaries are transferred to central concentration accounts to fund working capital and other needs of the respective participants. The balances under this program are reflected as notes receivable — affiliate and accounts receivable — affiliate or notes payable — affiliate and accounts payable — affiliate, as appropriate. The notes are due on demand and notes receivable — affiliate and notes payable — affiliate accrue interest on the net position, which is payable quarterly, at a rate determined by GenOn Energy Holdings. At December 31, 2016 and 2015, GenOn Americas Generation had a net current notes receivable — affiliate from GenOn Energy Holdings of $315 million and $331 million, respectively, related to its intercompany cash management program. For the years ended December 31, 2016, 2015, and 2014, GenOn Americas Generation earned an insignificant amount of net interest income related to these notes. Additionally, at December 31, 2016 and 2015, GenOn Americas Generation had an accounts payable — affiliate of $43 million and $41 million, respectively, with GenOn Energy Holdings.

See Note 3, Dispositions for further discussion on the settlement of notes receivable — affiliate related to Potrero during the year ended December 31, 2016.

GenOn Mid-Atlantic Distributions (GenOn Americas Generation and GenOn Mid-Atlantic)

For the year ended December 31, 2014, GenOn Mid-Atlantic made a distribution of $320 million to its parent, NRG North America LLC, who in turn made a distribution of $320 million to its parent, GenOn Americas Generation. GenOn Americas Generation subsequently made a distribution in the same amount, through its parent company, NRG Americas, Inc. to GenOn Energy Holdings, Inc., a consolidated subsidiary of GenOn.

Purchased Emission Allowances (GenOn Mid-Atlantic)

GenOn Energy Management maintains an inventory of certain purchased emission allowances related to the Regional Greenhouse Gas Initiative on behalf of GenOn Mid-Atlantic. The emission allowances are sold by GenOn Energy Management to GenOn Mid-Atlantic as they are needed for operations. GenOn Mid-Atlantic purchases emission allowances from GenOn Energy Management at GenOn Energy Management's original cost to purchase the allowances. For allowances that have been purchased by GenOn Energy Management from a GenOn Energy affiliate, the price paid by GenOn Energy Management is determined by market indices.

Emission allowances purchased from GenOn Energy Management that were utilized during the years ended December 31, 2016, 2015, and 2014 were $39 million, $27 million, and $19 million, respectively, and are recorded in cost of operations — affiliate in GenOn Mid-Atlantic's consolidated statements of operations.

Operator of Leased Facilities (GenOn)

See Note 14, Commitments and Contingencies, for a discussion of the GenOn leased facilities (Conemaugh and Keystone) that GenOn also operates.

Intercompany Hedging Agreements with NRG

Under intercompany agreements, NRG Power Marketing LLC enters into physical and financial intercompany commodity and hedging transactions with GenOn and certain of its subsidiaries. Subject to applicable collateral thresholds, these arrangements may provide for the bilateral exchange of credit support based upon market exposure and potential market movements. The terms and conditions of the agreements are generally consistent with industry practices and other third party arrangements. As of December 31, 2016, GenOn has no net exposure under these arrangements.

121

Note 14— Commitments and Contingencies (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

Commitments

GenOn Mid-Atlantic Operating Leases

GenOn Mid-Atlantic leases a 100% interest in the Dickerson and Morgantown coal generation units and associated property through 2029 and 2034, respectively. GenOn Mid-Atlantic has an option to extend the leases. Any extensions of the respective leases would be for less than 75% of the economic useful life of the facility, as measured from the beginning of the original lease term through the end of the proposed remaining lease term. GenOn Mid-Atlantic accounts for these leases as operating leases and recognizes rent expense on a straight-line basis over the lease term. Rent expense totaled $43 million for each of the years ended December 31, 2016, 2015, and 2014 respectively, net of annual amortization of the out-of-market liability of $28 million. Rent expense is included in cost of operations. As of December 31, 2016 and 2015, GenOn Mid-Atlantic has paid $275 million and $196 million, respectively, of lease payments in excess of rent expense recognized, which is included in prepaid rent and other current assets and other non-current assets on the consolidated balance sheets. Of these amounts, $71 million is included, for both 2016 and 2015, in prepaid rent and other current assets.

For restrictions under these leases, see Note 9, Debt and Capital Leases.

As a result of pushdown accounting, GenOn Mid-Atlantic recorded the acquisition date fair value of the leasehold interests, net of the present value of the lease obligation, equal to an out-of-market liability of $604 million, classified in out-of-market contracts. This liability is amortized to rent expense on a straight-line basis over the term of the lease.

Future minimum lease commitments under the GenOn Mid-Atlantic operating leases for the years ending after December 31, 2016 are as follows:



	(In millions)
2017	$	144
2018	105
2019	139
2020	105
2021	42
Thereafter	400
Total	$	935

REMA Operating Leases (GenOn)

GenOn, through its subsidiary, REMA, leases a 100% interest in the Shawville generation facility through 2026, and expects to make payments under the Shawville lease through that date, and leases 16.45% and 16.67% interests in the Conemaugh and Keystone coal generation facilities, respectively, through 2034, and expects to make payments under the Conemaugh and Keystone leases through 2029 in accordance with the terms of the leases. At the expiration of these leases, there are several renewal options related to fair value. GenOn accounts for these leases as operating leases and records lease expense on a straight-line basis over the lease term. Rent expense totaled $29 million for each of the years ended December 31, 2016, 2015, and 2014, respectively, net of annual amortization of out-of-market liability of $11 million. Rent expense is included in cost of operations. GenOn has paid $82 million and $61 million of lease payments in excess of rent expense recognized, which is included in prepaid rent and other current assets and other non-current assets on the consolidated balance sheets as of December 31, 2016 and 2015, respectively. Of these amounts, $41 million is included, for both 2016 and 2015, in prepaid rent and other current assets.

GenOn operates the Conemaugh and Keystone generating facilities under 5‑year agreements that initially expired in December 2015 and were renewed through December 2020. Under certain provisions and notifications, the agreements could be terminated annually with 1 year’s notice. GenOn is reimbursed by the other owners for the cost of direct services provided to the Conemaugh and Keystone facilities. Additionally, GenOn received fees of $11 million for each of the years ended December 31, 2016, 2015, and 2014.

For restrictions under these leases, see Note 9, Debt and Capital Leases.

As a result of pushdown accounting, GenOn recorded the acquisition date fair value of the leasehold interests, net of the present value of the lease obligation, equal to an out-of-market liability of $186 million, classified in out-of-market contracts. This liability is amortized to rent expense on a straight-line basis over the term of the lease.

122

Future minimum lease commitments under the REMA operating leases for the years ending after December 31, 2016 are as follows:



	(In millions)
2017	$	63
2018	55
2019	65
2020	56
2021	47
Thereafter	231
Total	$	517

Other Operating Leases

The Registrants have commitments under other operating leases with various terms and expiration dates. Included in other operating leases is GenOn’s long-term lease for offices in Houston, Texas which expires in 2018. GenOn Mid-Atlantic has other operating leases which primarily relate to the Chalk Point generating facility. Rent expense for other operating leases is recorded to cost of operations or general and administrative, as applicable, based on the nature of the lease.

The Registrants’ rent expense associated with other operating leases was as follows:



	Year Ended December 31, 2016		Year Ended December 31, 2015		Year Ended December 31, 2014
	(In millions)
GenOn	$	14	$	15	$	12
GenOn Americas Generation	1		1		—
GenOn Mid-Atlantic	—		1		—

Future minimum lease commitments under the Registrants’ other operating leases for the years ending after December 31, 2016 are as follows:



	GenOn^(a)		GenOn Americas Generation		GenOn Mid-Atlantic
			(In millions)
2017	$	17	$	5	$	3
2018	13		4		3
2019	5		4		3
2020	3		2		1
2021	2		1		1
Thereafter	3		1		1
Total	$	43	$	17	$	12


(a)	Amounts in the table exclude future sublease income of $8 million associated with GenOn’s long-term leases for office locations which end in 2018.

Fuel and Commodity Transportation Commitments

The Registrants have commitments under coal agreements and commodity transportation contracts, primarily related to natural gas and coal, of various quantities and durations. At December 31, 2016, the maximum remaining term under any individual fuel supply contract is three years and any transportation contract is eight years.

123

As of December 31, 2016, the Registrants’ commitments under such outstanding agreements are estimated as follows:



	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
			(In millions)
2017	$	162	$	70	$	69
2018	70		15		14
2019	15		15		14
2020	1		1		—
2021	1		1		—
Thereafter	2		2		—
Total	$	251	$	104	$	97

LTSA Commitments (GenOn)

LTSA commitments primarily relate to long-term service agreements that cover some periodic maintenance, including parts, on power generation turbines. The long-term maintenance agreements terminate from 2037 to 2039 based on turbine usage.

As of December 31, 2016, GenOn's commitments under such outstanding agreements are estimated as follows:



	GenOn
	(In millions)
2017	$	21
2018	25
2019	29
2020	23
2021	23
Thereafter	281
Total	$	402

Other Commitments

The Registrants have other commitments under contractual arrangements with various terms and expiration dates. The Registrants' other commitments primarily include the operation and maintenance agreement and the fly ash sales agreement entered into by GenOn Mid-Atlantic in connection with its ash beneficiation facility. The ash beneficiation facility agreements will expire in 2031. GenOn Mid-Atlantic has other similar agreements for gypsum.

As of December 31, 2016, the Registrants’ other commitments are estimated as follows:



	GenOn		GenOn Americas Generation		GenOn Mid-Atlantic
			(In millions)
2017	$	4	$	4	$	4
2018	4		4		4
2019	4		4		4
2020	4		4		4
2021	5		5		5
Thereafter	5		5		5
Total	$	26	$	26	$	26

124

Contingencies

The Registrants’ material legal proceedings are described below. The Registrants believe that they have valid defenses to these legal proceedings and intend to defend them vigorously. The Registrants record reserves for estimated losses from contingencies when information available indicates that a loss is probable and the amount of the loss, or range of loss, can be reasonably estimated. As applicable, the Registrants believe they have established an adequate reserve for the matters discussed below. In addition, legal costs are expensed as incurred. Management has assessed each of the following matters based on current information and made a judgment concerning its potential outcome, considering the nature of the claim, the amount and nature of damages sought, and the probability of success. Unless specified below, the Registrants are unable to predict the outcome of these legal proceedings or reasonably estimate the scope or amount of any associated costs and potential liabilities. As additional information becomes available, management adjusts its assessment and estimates of such contingencies accordingly. Because litigation is subject to inherent uncertainties and unfavorable rulings or developments, it is possible that the ultimate resolution of the Registrants’ liabilities and contingencies could be at amounts that are different from their currently recorded reserves and that such difference could be material.

In addition to the legal proceedings noted below, the Registrants are parties to other litigation or legal proceedings arising in the ordinary course of business. In management's opinion, the disposition of these ordinary course matters will not materially adversely affect the Registrants’ respective consolidated financial position, results of operations, or cash flows.

Actions Pursued by MC Asset Recovery (GenOn) — With Mirant Corporation's emergence from bankruptcy protection in 2006, certain actions filed by GenOn Energy Holdings and some of its subsidiaries against third parties were transferred to MC Asset Recovery, a wholly owned subsidiary of GenOn Energy Holdings. MC Asset Recovery is governed by a manager who is independent of NRG and GenOn. MC Asset Recovery is a disregarded entity for income tax purposes. Under the remaining action transferred to MC Asset Recovery, MC Asset Recovery seeks to recover damages from Commerzbank AG and various other banks, or the Commerzbank Defendants, for alleged fraudulent transfers that occurred prior to Mirant's bankruptcy proceedings. In December 2010, the U.S. District Court for the Northern District of Texas dismissed MC Asset Recovery's complaint against the Commerzbank Defendants. In January 2011, MC Asset Recovery appealed the District Court's dismissal of its complaint against the Commerzbank Defendants to the U.S. Court of Appeals for the Fifth Circuit, or the Fifth Circuit. In March 2012, the Fifth Circuit reversed the District Court's dismissal and reinstated MC Asset Recovery's amended complaint against the Commerzbank Defendants. On December 10, 2015, the District Court granted summary judgment in favor of the Commerzbank Defendants. On December 29, 2015, MC Asset Recovery filed a notice to appeal this judgment with the Fifth Circuit. The appeal has been fully briefed by the parties and was argued before the Fifth Circuit on February 8, 2017.

Natural Gas Litigation (GenOn) — GenOn is party to several lawsuits, certain of which are class action lawsuits, in state and federal courts in Kansas, Missouri, Nevada and Wisconsin. These lawsuits were filed in the aftermath of the California energy crisis in 2000 and 2001 and the resulting FERC investigations and relate to alleged conduct to increase natural gas prices in violation of state antitrust law and similar laws. The lawsuits seek treble or punitive damages, restitution and/or expenses. The lawsuits also name as parties a number of energy companies unaffiliated with NRG. In July 2011, the U.S. District Court for the District of Nevada, which was handling four of the five cases, granted the defendants' motion for summary judgment and dismissed all claims against GenOn in those cases. The plaintiffs appealed to the U.S. Court of Appeals for the Ninth Circuit which reversed the decision of the District Court. GenOn along with the other defendants in the lawsuit filed a petition for a writ of certiorari to the U.S. Supreme Court challenging the Court of Appeals' decision and the Supreme Court granted the petition. On April 21, 2015, the Supreme Court affirmed the Ninth Circuit’s holding that plaintiffs’ state antitrust law claims are not field-preempted by the federal Natural Gas Act and the Supremacy Clause of the U.S. Constitution. The Supreme Court left open whether the claims were preempted on the basis of conflict preemption. The Supreme Court directed that the case be remanded to the U.S. District Court for the District of Nevada for further proceedings. On March 7, 2016, class plaintiffs filed their motions for class certification. Defendants filed their briefs in opposition to class plaintiffs' motions for class certification on June 24, 2016. On January 26, 2017, the court heard oral argument on several motions, including plaintiffs' motions on class certification. In May 2016, the U.S. District Court for the District of Nevada granted defendants' motion for summary judgment in one of the Kansas cases, subsequently in December 2016, plaintiffs filed a notice of appeal with the Ninth Circuit. GenOn has agreed to indemnify CenterPoint against certain losses relating to these lawsuits.

In September 2012, the State of Nevada Supreme Court, which was handling the remaining case, affirmed dismissal by the Eighth Judicial District Court for Clark County, Nevada of all plaintiffs' claims against GenOn. In February 2013, the plaintiffs in the Nevada case filed a petition for a writ of certiorari to the U.S. Supreme Court. In June 2013, the Supreme Court denied the petition for a writ of certiorari, thereby ending one of the five lawsuits.

125

Maryland Department of the Environment v. GenOn Chalk Point and GenOn Mid-Atlantic — On January 25, 2013, Food & Water Watch, the Patuxent Riverkeeper and the Potomac Riverkeeper (together, the Citizens Group) sent GenOn Mid-Atlantic a letter alleging that the Chalk Point, Dickerson and Morgantown generating facilities were violating the terms of the three National Pollution Discharge Elimination System permits by discharging nitrogen and phosphorous in excess of the limits in each permit. On March 21, 2013, the MDE sent GenOn Mid-Atlantic a similar letter with respect to the Chalk Point and Dickerson generating facilities, threatening to sue within 60 days if the generating facilities were not brought into compliance. On June 11, 2013, the Maryland Attorney General on behalf of the MDE filed a complaint in the U.S. District Court for the District of Maryland alleging violations of the CWA and Maryland environmental laws related to water.

In August 2016, the court approved a consent decree to settle the matter. The consent decree requires: (1) improving the wastewater treatment systems at the Chalk Point and Dickerson facilities which was completed in October 2016; (2) completing supplemental environmental projects worth $1 million; and (3) paying a civil penalty of $1 million. The Registrants have improved the wastewater treatment systems at the Chalk Point and Dickerson facilities and paid the civil penalty of $1 million.

Chapter 11 Proceedings (GenOn and GenOn Americas Generation) — In July 2003, and various dates thereafter, the Mirant Debtors filed voluntary petitions in the Bankruptcy Court for relief under Chapter 11 of the U.S. Bankruptcy Code. GenOn Energy Holdings and most of the other Mirant Debtors emerged from bankruptcy on January 3, 2006, when the Plan became effective. The remaining Mirant Debtors emerged from bankruptcy on various dates in 2007. Approximately 461,000 of the shares of GenOn Energy Holdings common stock to be distributed under the Plan have not yet been distributed and have been reserved for distribution with respect to claims disputed by the Mirant Debtors that have not been resolved. Upon the Mirant/RRI Merger, those reserved shares converted into a reserve for approximately 1.3 million shares of GenOn common stock. Upon the NRG Merger, those reserved shares converted into a reserve for approximately 159,000 shares of NRG common stock. Under the terms of the Plan, upon the resolution of such a disputed claim, the claimant will receive the same pro rata distributions of common stock, cash, or both as previously allowed claims, regardless of the price at which the common stock is trading at the time the claim is resolved. If the aggregate amount of any such payouts results in the number of reserved shares being insufficient, additional shares of common stock may be issued to address the shortfall.

Potomac River Environmental Investigation — In March 2013, NRG Potomac River LLC received notice that the District of Columbia Department of Environment (now renamed the Department of Energy and Environment, or DOEE) was investigating potential discharges to the Potomac River originating from the Potomac River Generating facility site, a site where the generation facility is no longer in operation. In connection with that investigation, DOEE served a civil subpoena on NRG Potomac River LLC requesting information related to the site and potential discharges occurring from the site. NRG Potomac River LLC provided various responsive materials. In January 2016, DOEE advised NRG Potomac River LLC that DOEE believed various environmental violations had occurred as a result of discharges DOEE believes occurred to the Potomac River from the Potomac River Generating facility site and as a result of associated failures to accurately or sufficiently report such discharges. DOEE has indicated it believes that penalties are appropriate in light of the violations. The Registrants are currently reviewing the information provided by DOEE.

GenOn Noteholders' Lawsuit — On December 13, 2016, certain indenture trustees for an ad hoc group of holders, or the Noteholders, of the GenOn Energy, Inc. 7.875% Senior Notes due 2017, 9.500% Notes due 2018, and 9.875% Notes due 2020, and the GenOn Americas Generation, LLC 8.50% Senior Notes due 2021 and 9.125% Senior Notes due 2031, or collectively, the GenOn Notes, along with certain of the Noteholders, filed a complaint in the Superior Court of the State of Delaware against NRG and GenOn alleging certain claims related to a services agreement between NRG and GenOn. Plaintiffs generally seek recovery of all monies paid under the services agreement and any other damages that the court deems appropriate. On February 3, 2017, the court entered an order approving a Standstill Agreement whereby the parties agreed to suspend all deadlines in the case until March 1, 2017. This agreement may be extended by mutual agreement of the parties.

Note 15 — Regulatory Matters (GenOn, GenOn Americas Generation, GenOn Mid-Atlantic)

The Registrants operate in a highly regulated industry and are subject to regulation by various federal and state agencies. As such, the Registrants are affected by regulatory developments at both the federal and state levels and in the regions in which they operate. In addition, the Registrants are subject to the market rules, procedures, and protocols of the various ISO and RTO markets in which they participate. These power markets are subject to ongoing legislative and regulatory changes that may impact the Registrants' wholesale business.

In addition to the regulatory proceedings noted below, the Registrants are parties to other regulatory proceedings arising in the ordinary course of business or have other regulatory exposure. In management's opinion, the disposition of these ordinary course matters will not materially adversely affect the Registrants’ respective consolidated financial position, results of operations, or cash flows.

126

National

Zero-Emission Credits for Nuclear Plants — Pursuant to legislation in Illinois, the Illinois Power Agency, or IPA, is to procure contracts for ZECs. The IPA is to procure ZECs through a process that would take into account environmental benefits, including the preservation of zero emission facilities. In New York, on August 1, 2016, the NYSPSC issued its Clean Energy Standard, or CES, which provided for ZECs which would provide more than $7.6 billion over 12 years in out-of-market subsidy payments to certain selected nuclear generating units in the state. Other states located in organized markets may also be considering the implementation of ZECs. These ZECs are out-of-market subsidies that threaten to artificially suppress market prices and interferer with the wholesale power market.

East

Montgomery County Station Power Tax — On December 20, 2013, NRG received a letter from Montgomery County, Maryland requesting payment of an energy tax for the consumption of station power at the Dickerson Facility over the previous three years. Montgomery County seeks payment in the amount of $22 million, which includes tax, interest and penalties. NRG disputed the applicability of the tax. On December 11, 2015, the Maryland Tax Court reversed Montgomery County's assessment. Montgomery County filed an appeal, and on February 2, 2017, the Montgomery County Circuit Court affirmed the decision of the tax court. On February 17, 2017, the County filed a notice of appeal.

Note 16 — Environmental Matters (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

The Registrants are subject to a wide range of environmental laws in the development, construction, ownership and operation of projects. These laws generally require that governmental permits and approvals be obtained before construction and during operation of power plants. The electric generation industry is facing new requirements regarding GHGs, combustion byproducts, water discharge and use, and threatened and endangered species. In general, future laws are expected to require the addition of emissions controls or other environmental controls or to impose certain restrictions on the operations of the Registrants' facilities, which could have a material effect on the Registrants' respective consolidated financial position, results of operations, or cash flows. Federal and state environmental laws generally have become more stringent over time, although this trend could change in the near term with respect to federal laws under the new U.S. presidential administration.

The EPA finalized CSAPR in 2011, which was intended to replace CAIR in January 2012, to address certain states' obligations to reduce emissions so that downwind states can achieve federal air quality standards. In December 2011, the D.C. Circuit stayed the implementation of CSAPR and then vacated CSAPR in August 2012 but kept CAIR in place until the EPA could replace it. In April 2014, the U.S. Supreme Court reversed and remanded the D.C. Circuit's decision. In October 2014, the D.C. Circuit lifted the stay of CSAPR. In response, the EPA in November 2014 amended the CSAPR compliance dates. Accordingly, CSAPR replaced CAIR on January 1, 2015. On July 28, 2015, the D.C. Circuit held that the EPA had exceeded its authority by requiring certain reductions that were not necessary for downwind states to achieve federal standards. Although the D.C. Circuit kept the rule in place, the court ordered the EPA to revise the Phase 2 (or 2017) (i) SO₂budgets for four states and (ii) ozone-season NO_xbudgets for 11 states including Maryland, New Jersey, New York, Ohio and Pennsylvania. On October 26, 2016, the EPA finalized the CSAPR Update Rule, which reduces future NOx allocations and discounts the current banked allowances to account for the more stringent 2008 Ozone NAAQS and to address the D.C. Circuit's July 2015 decision. This rule has been challenged in the D.C. Circuit. The Registrants believe their investment in pollution controls and cleaner technologies leave the fleet well positioned for compliance.

In February 2012, the EPA promulgated standards (the MATS rule) to control emissions of HAPs from coal and oil-fired electric generating units. The rule established limits for mercury, non-mercury metals, certain organics and acid gases, which had to be met beginning in April 2015 (with some units getting a 1-year extension). In June 2015, the U.S. Supreme Court issued a decision in the case of Michigan v. EPA, and held that the EPA unreasonably refused to consider costs when it determined that it was "appropriate and necessary" to regulate HAPs emitted by electric generating units. The U.S. Supreme Court did not vacate the MATS rule but rather remanded it to the D.C. Circuit for further proceedings. In December 2015, the D.C. Circuit remanded the MATS rule to the EPA without vacatur. On April 25, 2016, the EPA released a supplemental finding that the benefits of this regulation outweigh the costs to address the U.S. Supreme Court's ruling that the EPA had not properly considered costs. This finding has been challenged in the D.C. Circuit. While the Registrants cannot predict the final outcome of this rulemaking, the Registrants believe that because they have already invested in pollution controls and cleaner technologies, their fleet is well positioned to comply with the MATS rule.

127

Water

In August 2014, the EPA finalized the regulation regarding the use of water for once through cooling at existing facilities to address impingement and entrainment concerns. The Registrants anticipate that more stringent requirements will be incorporated into some of their water discharge permits over the next several years as NPDES permits are renewed.

Byproducts, Wastes, Hazardous Materials and Contamination

In April 2015, the EPA finalized the rule regulating byproducts of coal combustion (e.g., ash and gypsum) as solid wastes under the RCRA. The Registrants have evaluated the impact of the new rule on their results of operations, financial condition and cash flows and have accrued their environmental and asset retirement obligations under the rule based on current estimates as of December 31, 2016.

East

For further discussion of these matters, refer to Note 14, Commitments and Contingencies – Contingencies.

Note 17 — Guarantees (GenOn and GenOn Americas Generation)

GenOn and GenOn Americas Generation and their respective subsidiaries enter into various contracts that include indemnification and guarantee provisions as a routine part of their business activities. Examples of these contracts include asset purchases and sale agreements, commodity sale and purchase agreements, retail contracts, EPC agreements, operation and maintenance agreements, service agreements, settlement agreements, and other types of contractual agreements with vendors and other third parties, as well as affiliates. These contracts generally indemnify the counterparty for tax, environmental liability, litigation and other matters, as well as breaches of representations, warranties and covenants set forth in these agreements. In some cases, GenOn’s and GenOn Americas Generation’s maximum potential liability cannot be estimated, since the underlying agreements contain no limits on potential liability.

The following table summarizes the maximum potential exposures that can be estimated for guarantees, indemnities, and other contingent liabilities by maturity:

GenOn



	By Remaining Maturity at December 31,										December 31,
	2016										2015
Guarantees	Under 1 Year		1-3 Years		3-5 Years		Over 5 Years		Total		Total
	(In millions)										(In millions)

Letters of credit and surety bonds	$	378	$	2	$	—	$	—	$	380	$	350
Other guarantees	—		365		—		118		483		46
Total guarantees	$	378	$	367	$	—	$	118	$	863	$	396

GenOn Americas Generation



	By Remaining Maturity at December 31,										December 31,
	2016										2015
Guarantees	Under 1 Year		1-3 Years		3-5 Years		Over 5 Years		Total		Total
	(In millions)										(In millions)

Letters of credit and surety bonds	$	201	$	—	$	—	$	—	$	201	$	229
Total guarantees	$	201	$	—	$	—	$	—	$	201	$	229

128

Letters of credit and surety bonds — As of December 31, 2016, GenOn and GenOn Americas Generation and their respective subsidiaries were contingently obligated for a total of $108 million and $2 million under surety bonds, respectively. In addition, GenOn had $272 million of letters of credit that were issued under the NRG credit agreement. See Note 13, Related Party Transactions. Of those letters of credit, $199 million were issued on behalf of GenOn Americas Generation's subsidiaries and $128 million were issued on behalf of GenOn Mid-Atlantic. Most of these letters of credit and surety bonds are issued in support of their obligations to perform under commodity agreements and obligations associated with future closure and maintenance of ash sites, as well as for financing or other arrangements. A majority of these letters of credit and surety bonds expire within one year of issuance, and it is typical for the Registrants to renew them on similar terms.

Other guarantees — GenOn has issued guarantees of obligations that its subsidiaries may incur as a provision for environmental site remediation, payment of debt obligations, rail car leases, performance under purchase, EPC and operating and maintenance agreements. GenOn does not believe that they will be required to make any material payments under these guarantees.

Other indemnities — Other indemnifications GenOn and GenOn Americas Generation have provided cover operational, tax, litigation and breaches of representations, warranties and covenants. GenOn and GenOn Americas Generation have also indemnified, on a routine basis in the ordinary course of business, financing parties, consultants or other vendors who have provided services to them. GenOn’s and GenOn Americas Generation’s maximum potential exposure under these indemnifications can range from a specified dollar amount to an indeterminate amount, depending on the nature of the transaction. Total maximum potential exposure under these indemnifications is not estimable due to uncertainty as to whether claims will be made or how they will be resolved. GenOn and GenOn Americas Generation do not believe that they will be required to make any material payments under these indemnity provisions.

Because many of the guarantees and indemnities GenOn and GenOn Americas Generation issue to third parties and affiliates do not limit the amount or duration of their obligations to perform under them, there exists a risk that GenOn or GenOn Americas Generation may have obligations in excess of the amounts described above. For those guarantees and indemnities that do not limit the liability exposure, it may not be possible to estimate what GenOn’s or GenOn Americas Generation’s liability would be, until a claim is made for payment or performance, due to the contingent nature of these contracts.

129

Schedule I

GENON ENERGY, INC. (PARENT)

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED STATEMENTS OF OPERATIONS



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Operating Loss	$	(15	)	$	—		$	—
Other Income/(Expense)
Equity in income/(losses) of consolidated subsidiaries	160			(98		)	242
Other income, net	68			85			84
Gain on debt extinguishment	—			23			—
Interest expense	(121		)	(128		)	(129		)
Total other income/(expense)	107			(118		)	197
Income/(Loss) Before Income Taxes	92			(118		)	197
Income tax expense/(benefit)	11			(3		)	—
Net Income/(Loss)	$	81		$	(115	)	$	197

See notes to condensed financial statements.

130

Schedule I

GENON ENERGY, INC. (PARENT)

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED BALANCE SHEETS



	As of December 31,
	2016			2015
	(In millions)
ASSETS
Current Assets
Cash and cash equivalents	$	461		$	226
Due from affiliates	—			300
Taxes receivable and other current assets	7			254
Total current assets	468			780
Other Assets
Investment in subsidiaries	1,602			456
Notes receivable — affiliate	500			1,025
Other non-current assets	36			—
Total other assets	2,138			1,481
Total Assets	$	2,606		$	2,261
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities
Current portion of long-term debt	$	699		$	—
Due to affiliates	309			—
Accrued expenses and other current liabilities	45			31
Total current liabilities	1,053			32
Other Liabilities
Long-term debt	1,212			1,956
Other non-current liabilities	1			1
Total non-current liabilities	1,213			1,957
Total Liabilities	2,266			1,989
Commitments and Contingencies
Stockholder's Equity
Common stock: $0.001 par value, 1 share authorized and issued at December 31, 2016 and 2015	—			—
Additional paid-in capital	325			325
Retained Earnings / (accumulated deficit)	44			(37		)
Accumulated other comprehensive loss	(29		)	(16		)
Total Stockholder's Equity	340			272
Total Liabilities and Stockholder's Equity	$	2,606		$	2,261

See notes to condensed financial statements.

131

Schedule I

GENON ENERGY, INC. (PARENT)
CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED STATEMENTS OF CASH FLOWS



	For the Year Ended December 31,
	2016		2015			2014
	(In millions)
Cash Flows from Operating Activities
Net cash provided/(used) by operating activities	$	235	$	(159	)	$	(165	)
Cash Flows from Investing Activities
Proceeds from sale of equity method investments	—		—			35
Net cash provided by investing activities	—		—			35
Cash Flows from Financing Activities
Payments of short and long-term debt	—		(105		)	(1		)
Net cash used by financing activities	—		(105		)	(1		)
Net Increase/(Decrease) in Cash and Cash Equivalents	235		(264		)	(131		)
Cash and Cash Equivalents at Beginning of Period	226		490			621
Cash and Cash Equivalents at End of Period	$	461	$	226		$	490
Supplemental Disclosures
Cash paid for interest, net of amounts capitalized	$	163	$	176		$	240

See notes to condensed financial statements.

132

Schedule I

GENON ENERGY, INC. (PARENT)
NOTES TO CONDENSED FINANCIAL STATEMENTS


1.	Background and Basis of Presentation

Background

The condensed parent company financial statements have been prepared in accordance with Rule 12-04, Schedule I of Regulation S-X, as the restricted net assets of GenOn Energy Inc.’s subsidiaries exceed 25% of the consolidated net assets of GenOn Energy, Inc. These statements should be read in conjunction with the consolidated statements and notes thereto of the Registrants.

RRI Energy (a Delaware corporation) changed its name from Reliant Energy, Inc. effective May 2009 in connection with the sale of its retail business. GenOn changed its name from RRI Energy effective December 3, 2010 in connection with the merger with Mirant. “GenOn” refers to GenOn Energy, Inc. and, except where the context indicates otherwise, its subsidiaries, after giving effect to the Mirant/RRI Merger.

Basis of Presentation

The condensed financial statements herein are the condensed financial statements and other financial information of GenOn Energy, Inc.

Equity in income/loss of affiliates consists of earnings of direct subsidiaries of GenOn Energy, Inc. (parent).

Liquidity and Ability to Continue as a Going Concern

The accompanying condensed financial statements have been prepared assuming GenOn will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities in the normal course of business. As such, the accompanying condensed financial statements do not include any adjustments relating to the recoverability and classification of assets and their carrying amounts, or the amount and classification of liabilities that may result should GenOn be unable to continue as a going concern. Such adjustments could have a material adverse impact on GenOn's results of operations, cash flows and financial position.

As disclosed in Note 1, Nature of Business and Note 9, Debt and Capital Leases to the Registrants' consolidated financial statements, as of December 31, 2016, $691 million of GenOn's Senior Notes outstanding, excluding $8 million of associated premiums, are current within the GenOn consolidated balance sheet and are due on June 15, 2017. GenOn's future profitability continues to be adversely affected by (i) a sustained decline in natural gas prices and its resulting effect on wholesale power prices and capacity prices, and (ii) the inability of GenOn Mid-Atlantic and REMA to make distributions of cash and certain other restricted payments to GenOn. Based on current projections, GenOn is not expected to have sufficient liquidity exclusive of cash subject to the restrictions under the GenOn Mid-Atlantic and REMA operating leases to repay the senior notes due in June 2017. As a result of these factors, there is substantial doubt about GenOn's ability to continue as a going concern.

NRG, GenOn's parent company, has no obligation to provide any financial support other than the credit agreement between NRG and GenOn which provides for a $500 million revolving credit facility, all of which can be utilized for revolving loans and letters of credit as further described in Note 13, Related Party Transactions to the Registrants' consolidated financial statements. As controlled group members, ERISA requires that NRG and GenOn are jointly and severally liable for the NRG Pension Plan for Bargained Employees and the NRG Pension Plan, including the pension liabilities associated with GenOn employees.

133

As of December 31, 2016, GenOn Americas Generation, a consolidated subsidiary of GenOn, has a note receivable due from GenOn Energy Holdings, a consolidated subsidiary of GenOn, of $315 million and an accounts payable due to GenOn Energy Holdings of $43 million under the intercompany cash management program as further described in Note 13, Related Party Transactions. The terms of the intercompany note do not provide for priority to GenOn Americas Generation and as such, there is no assurance that options pursued by GenOn will not have an adverse impact on GenOn Americas Generation’s liquidity. As such, there is substantial doubt about GenOn Americas Generation’s ability to continue as a going concern.

Due to Affiliates

Due to affiliates on GenOn Energy Inc.'s condensed balance sheet as of December 31, 2016 includes notes payable - affiliate of $10 million and accounts payable - affiliate of $299 million. Due from affiliates as of December 31, 2015 includes notes receivable - affiliate of $654 million and accounts payable - affiliate of $354 million as of December 31, 2015.

Cash Dividends Received

For the year ended December 31, 2016, 2015, and 2014, GenOn Energy, Inc. did not receive any cash dividends from its subsidiaries.


2.	Long-Term Debt

For a discussion of GenOn Energy, Inc.’s long-term debt, see Note 9, Debt and Capital Leases, to the Registrants’ consolidated financial statements.

Debt maturities of GenOn Energy, Inc. as of December 31, 2016 are:



	(In millions)
2017	$	691
2018	649
2019	—
2020	490
2021	—
Thereafter	—
Total	$	1,830


3.	Commitments, Contingencies and Guarantees

See Note 12, Income Taxes and Note 14, Commitments and Contingencies to the Registrants’ consolidated financial statements for a detailed discussion of GenOn Energy, Inc.’s contingencies.

As of December 31, 2016, GenOn Energy, Inc. had $408 million of guarantees, which are included in Note 17, Guarantees, to the Registrants’ consolidated financial statements.

134

SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS
GENON ENERGY, INC. AND SUBSIDIARIES

For the Years Ended December 31, 2016, 2015, and 2014



	Balance at Beginning of Period			Charged to Costs and Expenses			Charged to Other Accounts			Deductions			Balance at End of Period
	(In millions)
Provision for uncollectible accounts ^(a)
Year Ended December 31, 2016	$	(1	)	$	—		$	—		$	2		$	1
Year Ended December 31, 2015	—			—			—			(1		)	(1		)
Year Ended December 31, 2014	1			—			—			(1		)	—

Income tax valuation allowance, deducted from deferred tax assets^(b)
Year Ended December 31, 2016	$	2,194		$	(92	)	$	(15	)	$	—		$	2,087
Year Ended December 31, 2015	2,779			16			—			(601		)	2,194
Year Ended December 31, 2014	2,672			—			107			—			2,779


(a)	Provision for uncollectible accounts represents credit reserves for derivative contract assets.


(b)	The December 31, 2015 income tax valuation allowance reflects a decrease of $270 million as further described in Item 15 — Note 12, Income Taxes. The adjustment had no impact to results from operations, net assets or cash flows.

135

Schedule I

GENON AMERICAS GENERATION, LLC (PARENT)

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED STATEMENTS OF OPERATIONS



	For the Year Ended December 31,
	2016			2015			2014
				(In millions)
Operating Income	$	—		$	—		$	—
Other Income/(Expense)
Equity in earnings of consolidated subsidiaries	172			138			371
Gain on debt extinguishment	—			42			—
Interest expense	(51		)	(64		)	(66		)
Total other income	121			116			305
Income Before Income Taxes	121			116			305
Income tax	—			—			—
Net Income	$	121		$	116		$	305

See notes to condensed financial statements.

136

Schedule I

GENON AMERICAS GENERATION, LLC (PARENT)
CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED BALANCE SHEETS



	As of December 31,
	2016		2015
	(In millions)
ASSETS
Other Assets
Investment in subsidiaries	$	1,846	$	1,907
Total other assets	1,846		1,907
Total Assets	$	1,846	$	1,907

LIABILITIES AND MEMBER’S EQUITY
Current Liabilities
Accounts payable — affiliate	$	24	$	199
Note payable — affiliate	11		11
Accrued expenses and other current liabilities	13		13
Total current liabilities	48		223
Other Liabilities
Long-term debt	745		752
Total non-current liabilities	745		752
Total Liabilities	793		975
Commitments and Contingencies
Member's Equity
Member's interest	1,053		932
Total member's equity	1,053		932
Total Liabilities and Member's Equity	$	1,846	$	1,907

See notes to condensed financial statements.

137

Schedule I

GENON AMERICAS GENERATION, LLC (PARENT)
CONDENSED FINANCIAL INFORMATION OF REGISTRANT

CONDENSED STATEMENTS OF CASH FLOWS



	For the Year Ended December 31,
	2016			2015			2014
	(In millions)
Cash Flows from Operating Activities
Net cash provided by operating activities	$	3		$	128		$	197
Cash Flows from Investing Activities
Capitalized interest	(3		)	(2		)	(1		)
Proceeds from sale of assets	—			—			50
Net cash used by investing activities	(3		)	(2		)	49
Cash Flows from Financing Activities
Capital contributions	—			—			74
Distributions to member	—			—			(320		)
Payments of short and long-term debt	—			(126		)	—
Net cash used by financing activities	—			(126		)	(246		)
Net Increase/(Decrease) in Cash and Cash Equivalents	—			—			—
Cash and Cash Equivalents at Beginning of Period	—			—			—
Cash and Cash Equivalents at End of Period	$	—		$	—		$	—
Supplemental Disclosures
Cash paid for interest, net of amounts capitalized	$	58		$	76		$	74

See notes to condensed financial statements.

138

Schedule I

GENON AMERICAS GENERATION, LLC (PARENT)
NOTES TO CONDENSED FINANCIAL STATEMENTS


1.	Background and Basis of Presentation

Background

The condensed parent company financial statements have been prepared in accordance with Rule 12-04, Schedule I of Regulation S‑X, as the restricted net assets of GenOn Americas Generation, LLC’s subsidiaries exceed 25% of the consolidated net assets of GenOn Americas Generation, LLC. These statements should be read in conjunction with the consolidated statements and notes thereto of the Registrants.

GenOn Americas Generation, LLC is a Delaware limited liability company and indirect wholly-owned subsidiary of GenOn Energy, Inc.

Basis of Presentation

The condensed financial statements presented herein are the condensed financial statements and other financial information of GenOn Americas Generation, LLC.

Equity in income/loss of affiliates consists of earnings of direct subsidiaries of GenOn Americas Generation, LLC (parent).

Liquidity and Ability to Continue as a Going Concern

139

NRG, GenOn's parent company, has no obligation to provide any financial support other than the credit agreement between NRG and GenOn which provides for a $500 million revolving credit facility, all of which can be utilized for revolving loans and letters of credit as further described in Note 13, Related Party Transactions to the Registrants' consolidated financial statements. As controlled group members, ERISA requires that NRG and GenOn are jointly and severally liable for the NRG Pension Plan for Bargained Employees and the NRG Pension Plan, including the pension liabilities associated with GenOn employees.

As of December 31, 2016, GenOn Americas Generation, a consolidated subsidiary of GenOn, has a note receivable due from GenOn Energy Holdings, a consolidated subsidiary of GenOn, of $315 million and an accounts payable due to GenOn Energy Holdings of $43 million under the intercompany cash management program as further described in Note 13, Related Party Transactions. The terms of the intercompany note do not provide for priority to GenOn Americas Generation and as such, there is no assurance that options pursued by GenOn will not have an adverse impact on GenOn Americas Generation’s liquidity. As such, there is substantial doubt about GenOn Americas Generation’s ability to continue as a going concern.

Cash Dividends and Distributions

For the years ended December 31, 2016, 2015, and 2014, GenOn Americas Generation, LLC, received cash dividends from its subsidiaries of $0, $0 and $320 million, respectively. GenOn Americas Generation, subsequently made distributions in the same amount, through its parent company NRG Americas, Inc. to GenOn Energy Holdings, Inc., a consolidated subsidiary of GenOn.


2.	Long-Term Debt

For a discussion of GenOn Americas Generation, LLC’s long-term debt, see Note 9, Debt and Capital Leases, to the Registrants’ consolidated financial statements.

Debt maturities of GenOn Americas Generation, LLC as of December 31, 2016 are:



	(In millions)
2021	$	366
Thereafter	329
Total	$	695


3.	Commitments, Contingencies and Guarantees

See Note 14, Commitments and Contingencies, to the Registrants’ consolidated financial statements for a detailed discussion of GenOn Americas Generation, LLC’s contingencies. At December 31, 2016, GenOn Americas Generation, LLC did not have any guarantees.

140

SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS
GENON AMERICAS GENERATION, LLC AND SUBSIDIARIES

For the Years Ended December 31, 2016, 2015, and 2014



	Balance at Beginning of Period		Charged to Costs and Expenses		Charged to Other Accounts		Deductions			Balance at End of Period
	(In millions)
Provision for uncollectible accounts ^(a)
Year Ended December 31, 2016	$	—	$	—	$	—	$	1		$	1
Year Ended December 31, 2015	—		—		—		—			—
Year Ended December 31, 2014	1		—		—		(1		)	—


(a)	Provision for uncollectible accounts represents credit reserves for derivative contract assets.

141

SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS

GENON MID-ATLANTIC, LLC AND SUBSIDIARIES

For the Years Ended December 31, 2016, 2015, and 2014



	Balance at Beginning of Period		Charged to Costs and Expenses		Charged to Other Accounts		Deductions			Balance at End of Period
	(In millions)
Provision for uncollectible accounts ^(a)
Year Ended December 31, 2016	$	4	$	—	$	—	$	(4	)	$	—
Year Ended December 31, 2015	2		—		—		2			4
Year Ended December 31, 2014	3		—		—		(1		)	2


(a)	Provision for uncollectible accounts represents credit reserves for derivative contract assets.

142

GenOn Energy, Inc. Exhibit Index



Exhibit No.		Exhibit Name
2.1		Stock and Note Purchase Agreement by and among Mirant Asia-Pacific Ventures, Inc., Mirant Asia-Pacific Holdings, Inc., Mirant Sweden International AB (publ), and Tokyo Crimson Energy Holdings Corporation, dated at December 11, 2006 (Incorporated herein by reference to Exhibit 2.1 to the Mirant Corporation Current Report on Form 8-K filed December 13, 2006)
2.2**		Agreement and Plan of Merger, dated as of July 20, 2012, by and among NRG Energy, Inc., Plus Merger Corporation and GenOn Energy, Inc. (Incorporated herein by reference to Exhibit 2.1 to the Registrant's Form 8-K filed July 23, 2012)
3.1		Fourth Amended and Restated Certificate of Incorporation of GenOn Energy, Inc., effective as of December 14, 2012 (Incorporated herein by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed December 14, 2012)
3.2		Eighth Amended and Restated By-Laws of GenOn Energy, Inc., effective as of December 14, 2012 (Incorporated herein by reference to Exhibit 3.2 to the Registrant's Current Report on Form 8-K filed December 14, 2012)
4.1		Form of Stock Certificate (Incorporated herein by reference to Exhibit 4.1 to the Registrant's Quarterly Report on Form 10-Q filed May 10, 2012)
4.2		Form of Rights Agreement between Reliant Resources, Inc. and The Chase Manhattan Bank, as Rights Agent, including a form of Rights Certificates, dated at January 15, 2001 (Incorporated herein by reference to Exhibit 4.2 to the Registrant's Registration Statement on Form S-1/A Amendment No. 8, Registration No. 333-48038)
4.3		Amendment No. 1 to Rights Agreement, by and between RRI Energy, Inc., JPMorgan Chase Bank, N.A., and Computershare Trust Company, N.A., dated at November 23, 2010 (Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed November 24, 2010)
4.4		Senior Indenture between Reliant Energy, Inc. and Wilmington Trust Company, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed December 27, 2004)
4.5		Indenture between Orion Power Holdings, Inc. and Wilmington Trust Company, dated at April 27, 2000 (Incorporated herein by reference to Exhibit 4.1 to the Orion Power Holdings, Inc. Registration Statement on Form S-1, Registration No. 333-44118 filed August 18, 2000)
4.6		Fifth Supplemental Indenture relating to the 7.875% Senior Notes due 2017, between Reliant Energy, Inc. and Wilmington Trust Company, dated at June 13, 2007 (Incorporated herein by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K filed June 15, 2007)
4.7		Indenture between Mirant Americas Generation, Inc. and Bankers Trust Company, as trustee, relating to Senior Notes, dated at May 1, 2001 (Incorporated herein by reference to Exhibit 4.1 to the Mirant Americas Generation, Inc. Registration Statement on Form S-4, Registration No. 333-63240 filed June 18, 2001)
4.8		Third Supplemental Indenture from Mirant Americas Generation, Inc. to Bankers Trust Company, relating to 9.125% Senior Notes due 2031, dated at May 1, 2001 (Incorporated herein by reference to Exhibit 4.4 to the Mirant Americas Generation, Inc. Registration Statement on Form S-4, Registration No. 333-63240)
4.9		Fifth Supplemental Indenture from Mirant Americas Generation, Inc. to Bankers Trust Company, relating to 8.50% Senior Note due 2021, dated at October 9, 2001 (Incorporated herein by reference to Exhibit 4.6 to the Mirant Americas Generation, Inc. Registration Statement on Form S-4/A Amendment No. 1, Registration No. 333-85124)
4.10		Form of Sixth Supplemental Indenture from Mirant Americas Generation, LLC to Bankers Trust Company, dated at November 1, 2001, relating to indenture dated May 1, 2001 (Incorporated herein by reference to Exhibit 4.6 to the Mirant Corporation Annual Report on Form 10‑K filed February 27, 2009)
4.11		Seventh Supplemental Indenture from Mirant Americas Generation, LLC to Wells Fargo Bank, National Association, dated at January 3, 2006, relating to indenture dated May 1, 2001 (Incorporated herein by reference to Exhibit 4.1 to the Mirant Americas Generation, LLC Quarterly Report on Form 10-Q filed May 14, 2007)
4.12		Form of 8.625% Series A Pass Through Certificate (Incorporated herein by reference to Exhibit 4.1 to the Mirant Mid‑Atlantic, LLC Registration Statement on Form S-4, Registration No. 333‑61668)
4.13		Form of 9.125% Series B Pass Through Certificate (Incorporated herein by reference to Exhibit 4.2 to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333‑61668)
4.14		Form of 10.060% Series C Pass Through Certificate (Incorporated herein by reference to Exhibit 4.3 to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333‑61668)
4.15(a)		Pass Through Trust Agreement A between Southern Energy Mid-Atlantic, LLC and State Street Bank and Trust Company of Connecticut, National Association, as Pass Through Trustee, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 4.4(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)

143



4.15(b)		Schedule identifying substantially identical agreement to Pass Through Trust Agreement A (Incorporated herein by reference to Exhibit 4.4(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.16(a)		Participation Agreement (L1) among Southern Energy Mid-Atlantic, LLC, as Lessee, Dickerson OL1 LLC, as Owner Lessor, Wilmington Trust Company, as Owner Manager, SEMA OP3 LLC, as Owner Participant and State Street Bank and Trust Company of Connecticut, National Association, as Lease Indenture Trustee and as Pass Through Trustee, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 4.5(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.16(b)		Schedule identifying substantially identical agreements to Participation Agreement (Incorporated herein by reference to Exhibit 4.5(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.17(a)		Participation Agreement (L1) among Southern Energy Mid-Atlantic, LLC, as Lessee, Morgantown OL1 LLC, as Owner Lessor, Wilmington Trust Company, as Owner Manager, SEMA OP1 LLC, as Owner Participant and State Street Bank and Trust Company of Connecticut, National Association, as Lease Indenture Trustee and as Pass Through Trustee, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 4.6 (a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.17(b)		Schedule identifying substantially identical agreement to Participation Agreement (Incorporated herein by reference to Exhibit 4.6(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-6166 filed May 25, 2001)
4.18(a)		Facility Lease Agreement (L1) between Southern Energy Mid-Atlantic, LLC, as Facility Lessee and Dickerson OL1 LLC, as Owner Lessor, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.7(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.18(b)		Schedule identifying substantially identical agreement to Facility Lease Agreement (Incorporated herein by reference to Exhibit 4.7(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.19(a)		Facility Lease Agreement (L1) between Southern Energy Mid-Atlantic, LLC, as Facility Lessee and Morgantown OL1 LLC, as Owner Lessor, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.8(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.19(b)		Schedule identifying substantially identical agreement to Facility Lease Agreement (Incorporated herein by reference to Exhibit 4.8(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.20(a)		Indenture of Trust, Mortgage and Security Agreement (L1) between Dickerson OL1 LLC, as Owner Lessor, and State Street Bank and Trust Company of Connecticut, National Association, as Lease Indenture Trustee, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.9(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.20(b)		Schedule identifying substantially identical agreement to Indenture of Trust, Mortgage and Security Agreement (Incorporated herein by reference to Exhibit 4.9(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.21(a)		Indenture of Trust, Mortgage and Security Agreement (L1) between Morgantown OL1 LLC, as Owner Lessor, and State Street Bank and Trust Company of Connecticut, National Association, as Lease Indenture Trustee, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.10(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.21(b)		Schedule identifying substantially identical agreement to Indenture of Trust, Mortgage and Security Agreement (Incorporated herein by reference to Exhibit 4.10(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.22(a)		Series A Lessor Note Due June 20, 2012 for Dickerson OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.11(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.22(b)		Schedule identifying substantially identical notes to Lessor Notes (Incorporated herein by reference to Exhibit 4.11(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.23(a)		Series A Lessor Note Due June 30, 2008, for Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.12(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.23(b)		Schedule identifying substantially identical notes to Series A Lessor Notes (Incorporated herein by reference to Exhibit 4.12(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)

144



4.24(a)		Series B Lessor Note Due June 30, 2015, for Dickerson OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.13(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.24(b)		Schedule identifying substantially identical notes to Series B Lessor Note (Incorporated herein by reference to Exhibit 4.13(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.25(a)		Series B Lessor Note Due June 30, 2017, for Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.14(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.25(b)		Schedule identifying substantially identical notes to Series B Lessor Notes (Incorporated herein by reference to Exhibit 4.14(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.26(a)		Series C Lessor Note Due June 30, 2020, for Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.15(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668)
4.26(b)		Schedule identifying substantially identical notes to Series C Lessor Notes (Incorporated herein by reference to Exhibit 4.15(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668)
4.27(a)		Supplemental Pass Through Trust Agreement A between Mirant Mid-Atlantic, LLC and State Street Bank and Trust Company of Connecticut, National Association, as Pass Through Trustee, dated at June 29, 2001 (Incorporated herein by reference to Exhibit 4.17(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4/A Registration No. 333-61668 filed July 3, 2001)
4.27(b)		Schedule identifying substantially identical agreements to Supplemental Pass Through Trust Agreement constituting Exhibit 4.36(a) (Incorporated herein by reference to Exhibit 4.17(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4/A, Registration No. 333-61668 filed July 3, 2001)
4.28		Senior Notes Indenture, relating to the 9.50% Senior Notes Due 2018 and the 9.875% Senior Notes Due 2020, by GenOn Escrow Corp. and Wilmington Trust Company as trustee, dated at October 4, 2010 (Incorporated by reference to Exhibit 4.4 to the Mirant Corporation Quarterly Report on Form 10-Q filed November 5, 2010)
4.29		Supplemental Indenture, relating to the 9.50% Senior Notes due 2018 and the 9.875% Senior Notes Due 2020, by and among GenOn Escrow Corp., GenOn Energy, Inc. and Wilmington Trust Company as trustee, dated at December 3, 2010 (Incorporated by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K filed December 7, 2010)
4.30		Amendment No. 2, dated as of December 14, 2012, to the Rights Agreement dated as of January 15, 2001 between RRI Energy, Inc., JP Morgan Chase and Computershare Trust Company, N.A., as successor to JP Morgan Chase Rights Agent (Incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed December 14, 2012)
10.1.1(a)		Master Separation Agreement between Reliant Resources, Inc. and Reliant Energy, Incorporated, dated at December 31, 2000 (Incorporated herein by reference to Exhibit 10.1 to the CenterPoint Energy Houston Electric, LLC Quarterly Report on Form 10-Q filed May 14, 2001)
10.1.1(b)		Schedules to Master Separation Agreement between Reliant Resources, Inc. and Reliant Energy, Incorporated, dated at December 31, 2000 (Incorporated herein by reference to Exhibit 10.1B to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.2(a)		Tax Allocation Agreement by and among Reliant Resources, Inc., and its affiliated companies and Reliant Energy, Incorporated and its affiliate companies dated at December 31, 2000 (Incorporated herein by reference to Exhibit 10.8 to the CenterPoint Energy Houston Electric, LLC Quarterly Report on Form 10-Q filed May 14, 2001)
10.1.2(b)		Exhibit to Tax Allocation Agreement between Reliant Resources, Inc. and Reliant Energy, Incorporated, dated at December 31, 2000 (Incorporated herein by reference to Exhibit 10.2B to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.3		Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2001A, Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed December 27, 2004)
10.1.4(a)		Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002A, among Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K filed December 27, 2004)

145



10.1.4(b)		Exhibit C Form of Supplement to Exhibit B to Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002A, among Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.5B to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.5(a)		Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002B, among Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.4 to the Registrant's Current Report on Form 8-K filed December 27, 2004)
10.1.5(b)		Exhibit C Form of Supplement to Exhibit B to Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002B, among Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.6B to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.6(a)		Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2003A, among Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.5 to the Registrant's Current Report on Form 8-K filed December 27, 2004)
10.1.6(b)		Exhibit C Form of Supplement to Exhibit B to Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2003A, among Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.7B to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.7(a)		Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2004A, among Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.6 to the Registrant's Current Report on Form 8-K filed December 27, 2004)
10.1.7(b)		Exhibit C Form of Supplement to Exhibit B to Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2004A, among Reliant Energy, Inc., the Subsidiary Guarantors defined therein and J.P. Morgan Trust Company, National Association, as trustee, dated at December 22, 2004 (Incorporated herein by reference to Exhibit 10.8B to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.8		Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2001A, among Reliant Energy Power Supply, LLC, Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and J.P. Morgan Trust Company, National Association, as trustee, dated at September 21, 2006 (Incorporated herein by reference to Exhibit 10.14 to the Registrant's Annual Report on Form 10-K filed February 28, 2007)
10.1.9		Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002A, among Reliant Energy Power Supply, LLC, Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and J.P. Morgan Trust Company, National Association, as trustee, dated at September 21, 2006 (Incorporated herein by reference to Exhibit 10.15 to the Registrant's Annual Report on Form 10-K filed February 28, 2007)
10.1.10		Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002B, among Reliant Energy Power Supply, LLC, Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and J.P. Morgan Trust Company, National Association, as trustee, dated at September 21, 2006 (Incorporated herein by reference to Exhibit 10.16 to the Registrant's Annual Report on Form 10-K filed February 28, 2007)
10.1.11		Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2003A, among Reliant Energy Power Supply, LLC, Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and J.P. Morgan Trust Company, National Association, as trustee, dated at September 21, 2006 (Incorporated herein by reference to Exhibit 10.17 to the Registrant's Annual Report on Form 10-K filed February 28, 2007)
10.1.12		Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2004A, among Reliant Energy Power Supply, LLC, Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and J.P. Morgan Trust Company, National Association as trustee, dated at September 21, 2006 (Incorporated herein by reference to Exhibit 10.18 to the Registrant's Annual Report on Form 10-K filed February 28, 2007)

146



10.1.13		Second Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2001A, among Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Trust Company, N.A., as trustee, dated at December 1, 2006 (Incorporated herein by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed December 7, 2006)
10.1.14		Second Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002A, among Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Trust Company, N.A., as trustee, dated at December 1, 2006 (Incorporated herein by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed December 7, 2006)
10.1.15		Second Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002B, among Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Trust Company, N.A., as trustee, dated at December 1, 2006 (Incorporated herein by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K filed December 7, 2006)
10.1.16		Second Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2003A, among Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Trust Company, N.A., as trustee, dated at December 1, 2006 (Incorporated herein by reference to Exhibit 10.4 to the Registrant's Current Report on Form 8-K filed December 7, 2006)
10.1.17		Third Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2004A, among Reliant Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Trust Company, N.A., as trustee, dated at December 1, 2006 (Incorporated herein by reference to Exhibit 10.5 to the Registrant's Current Report on Form 8-K filed December 7, 2006)
10.1.18		Third Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2001A, among RRI Energy Solutions East, LLC, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at June 1, 2009 (Incorporated herein by reference to Exhibit 10.2 to the Registrant's Quarterly Report on Form 10-Q filed November 5, 2009)
10.1.19		Third Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2002A, among, RRI Energy Solutions East, LLC, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at June 1, 2009 (Incorporated herein by reference to Exhibit 10.3 to the Registrant's Quarterly Report on Form 10-Q filed November 5, 2009)
10.1.20		Third Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2002B, among RRI Energy Solutions East, LLC, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at June 1, 2009 (Incorporated herein by reference to Exhibit 10.4 to the Registrant's Quarterly Report on Form 10-Q filed November 5, 2009)
10.1.21		Third Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2003A, among RRI Energy Solutions East, LLC, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at June 1, 2009 (Incorporated herein by reference to Exhibit 10.5 to the Registrant's Quarterly Report on Form 10-Q filed November 5, 2009)
10.1.22		Fourth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2004A, among RRI Energy Solutions East, LLC, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Trust Company, N.A., as trustee, dated at June 1, 2009 (Incorporated herein by reference to Exhibit 10.6 to the Registrant's Quarterly Report on Form 10-Q filed November 5, 2009)
10.1.23		Fourth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002A, among RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at August 20, 2009 (Incorporated herein by reference to Exhibit 99.3 to the Registrant's Current Report on Form 8-K filed August 24, 2009)
10.1.24		Fourth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2002B, among RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at August 20, 2009 (Incorporated herein by reference to Exhibit 99.4 to the Registrant's Current Report on Form 8-K filed August 24, 2009)

147



10.1.25		Fourth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (Reliant Energy Seward, LLC Project), Series 2003A, among RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at August 20, 2009 (Incorporated herein by reference to Exhibit 99.5 to the Registrant's Current Report on Form 8-K filed August 24, 2009)
10.1.26		Fifth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenues Bonds (Reliant Energy Seward, LLC Project), Series 2004A, among RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at August 20, 2009 (Incorporated herein by reference to Exhibit 99.6 to the Registrant's Current Report on Form 8-K filed August 24, 2009)
10.1.27		Fifth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2001A, among RRI Energy Channelview LP, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at December 1, 2009 (Incorporated herein by reference to Exhibit 10.29 to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.28		Fifth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2002A, among RRI Energy Channelview LP, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at December 1, 2009 (Incorporated herein by reference to Exhibit 10.30 to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.29		Fifth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2002B, among RRI Energy Channelview LP, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at December 1, 2009 (Incorporated herein by reference to Exhibit 10.31 to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.30		Fifth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2003A, among RRI Energy Channelview LP, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at December 1, 2009 (Incorporated herein by reference to Exhibit 10.32 to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.31		Sixth Supplemental Guarantee Agreement relating to Pennsylvania Economic Development Financing Authority's Exempt Facilities Revenue Bonds (RRI Energy Seward, LLC Project), Series 2004A, among RRI Energy Channelview LP, RRI Energy, Inc., the Subsidiary Guarantors as defined in the Guarantee Agreement and The Bank of New York Mellon Trust Company, N.A., as trustee, dated at December 1, 2009 (Incorporated herein by reference to Exhibit 10.33 to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.32(a)		Credit and Guaranty Agreement among Reliant Energy, Inc., as Borrower, the Other Loan Parties referred to therein as guarantors, the Other Lenders Party thereto, Deutsche Bank AG New York Branch, as Administrative Agent and Collateral Agent, Deutsche Bank Securities Inc. and J.P. Morgan Securities Inc., as Joint Lead Arrangers, Deutsche Bank Securities Inc., J.P. Morgan Securities Inc., Goldman Sachs Credit Partners L.P., Merrill Lynch Capital Corporation and ABN AMRO Bank N.V., as Joint Bookrunners with respect to the Revolving Credit Facility and Deutsche Bank Securities Inc., J.P. Morgan Securities Inc., Goldman Sachs Credit Partners L.P., Merrill Lynch Capital Corporation and Bear, Sterns & Co. Inc., as Joint Bookrunners with respect to the Pre-Funded L/C Facility, dated at June 12, 2007 (Incorporated herein by reference to Exhibit 1.1 to the Registrant's Current Report on Form 8-K filed June 15, 2007)
10.1.32(b)†		Exhibits and Schedules to Credit and Guaranty Agreement among Reliant Energy, Inc., as Borrower, the Other Loan Parties referred to therein as guarantors, the Other Lenders Party thereto, Deutsche Bank AG New York Branch, as Administrative Agent and Collateral Agent, Deutsche Bank Securities Inc. and J.P. Morgan Securities Inc., as Joint Lead Arrangers, Deutsche Bank Securities Inc., J.P. Morgan Securities Inc., Goldman Sachs Credit Partners L.P., Merrill Lynch Capital Corporation and ABN AMRO Bank N.V., as Joint Bookrunners with respect to the Revolving Credit Facility and Deutsche Bank Securities Inc., J.P. Morgan Securities Inc., Goldman Sachs Credit Partners L.P., Merrill Lynch Capital Corporation and Bear, Sterns & Co. Inc., as Joint Bookrunners with respect to the Pre-Funded L/C Facility, dated at June 12, 2007 (Incorporated herein by reference to Exhibit 10.34B to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.33(a)		Pass Through Trust Agreement A between Reliant Energy Mid-Atlantic Power Holdings, LLC and Bankers Trust Company, made with respect to the formation of the Series A Pass Through Trust and the issuance of 8.554% Series A Pass Through Certificates, due 2005 dated as of August 24, 2000 (Incorporated herein by reference to Exhibit 4.4a to the Reliant Energy Mid-Atlantic Power Holdings, LLC Registration Statement on Form S-4, Registration No. 333-51464 filed December 8, 2000)
10.1.33(b)		Schedule identifying substantially identical agreements to Pass Through Trust Agreement constituting Exhibit 10.1.33(a) (Incorporated herein by reference to Exhibit 4.4b to the Reliant Energy Mid-Atlantic Power Holdings, LLC Registration Statement on Form S-4, Registration No. 333-51464 filed December 8, 2000)

148



10.1.34		Participation Agreement among Conemaugh Lessor Genco LLC, as Owner Lessor, Reliant Energy Mid‑Atlantic Power Holdings, LLC, as Facility Lessee, Wilmington Trust Company, as Lessor Manager, PSEGR Conemaugh Generation, LLC, as Owner Participant, Bankers Trust Company, as Lease Indenture Trustee, and Bankers Trust Company, as Pass Through Trustee, dated at August 24, 2000 (Incorporated herein by reference to Exhibit 4.5a to the Reliant Energy Mid-Atlantic Power Holdings, LLC Registration Statement on Form S-4, Registration No. 333-51464 filed December 8, 2000)
10.1.35		Schedule identifying substantially identical agreements to Participation Agreement constituting Exhibit 10.1.34 (Incorporated herein by reference to Exhibit 4.5b to the Reliant Energy Mid-Atlantic Power Holdings, LLC Registration Statement on Form S-4, Registration No. 333-51464 filed December 8, 2000)
10.1.36(a)		First Amendment to Participation Agreement constituting Exhibit 10.1.34, dated at November 15, 2001 (Incorporated herein by reference to Exhibit 10.20 to the Registrant's Annual Report on Form 10-K filed March 15, 2006)
10.1.36(b)		Exhibit M to First Amendment to Participation Agreement constituting Exhibit 10.1.36(a), dated at November 15, 2001 (Incorporated herein by reference to Exhibit 10.41B to the Registrant's Annual Report on Form 10-K filed February 25, 2010)
10.1.37		Schedule identifying substantially identical agreements to First Amendment to Participation Agreement constituting Exhibit 10.1.36(a) (Incorporated herein by reference to Exhibit 10.21 to the Registrant's Annual Report on Form 10-K filed March 15, 2006)
10.1.38		Second Amendment to Participation Agreement, dated at June 18, 2003 (Incorporated herein by reference to Exhibit 10.22 to the Registrant's Annual Report on Form 10-K filed March 15, 2006)
10.1.39		Schedule identifying substantially identical agreements to Second Amendment to Participation Agreement constituting Exhibit 10.1.38 (Incorporated herein by reference to Exhibit 10.23 to the Registrant's Annual Report on Form 10-K filed March 15, 2006)
10.1.40		Guarantee by NRG Energy, Inc., as Guarantor, in favor of Reliant Energy, Inc., dated at February 28, 2009 (Incorporated herein by reference to Exhibit 10.84 to the Registrant's Annual Report on Form 10-K filed March 2, 2009)
10.1.41(a)		Guaranty Agreement (Dickerson L1) between Southern Energy, Inc. and Dickerson OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.21(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.1.41(b)		Schedule identifying substantially identical agreements to Guaranty Agreement constituting Exhibit 10.1.42(a) (Incorporated herein by reference to Exhibit 10.21(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.1.42(a)		Guaranty Agreement (Morgantown L1) between Southern Energy, Inc. and Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.22(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.1.42(b)		Schedule identifying substantially identical agreements to Guaranty Agreement constituting Exhibit 10.1.43(a) (Incorporated herein by reference to Exhibit 10.22(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 May 25, 2001)
10.1.43		Purchase Agreement by and among RRI Energy, Inc., Mirant Corporation, GenOn Escrow Corp. and J.P. Morgan Securities LLC, as representative of the several initial purchasers, dated at September 20, 2010 (Incorporated herein by reference to Exhibit 10.2 to the Mirant Corporation Quarterly Report on Form 10-Q filed November 5, 2010)
10.1.44(a)		Revolving Credit Agreement among GenOn Energy, Inc., as Borrower, GenOn Americas, Inc., as Borrower, the several lenders from time to time parties hereto, and NRG Energy, Inc., as Administrative Agent, dated as of December 14, 2012 (Incorporated by reference to Exhibit 10.1.51 to the Registrant's Annual Report on Form 10-K filed February 27, 2013)
10.1.44(b)*		Amendment No. 1 to Revolving Credit Agreement by and among GenOn Energy, Inc., NRG Americas, Inc. (f/k/a GenOn Americas, Inc.), the subsidiary guarantors thereto and NRG Energy, Inc., dated as of December 13, 2015.
10.2.1		Facility Lease Agreement between Conemaugh Lessor Genco LLC and Reliant Energy Mid-Atlantic Power Holdings, LLC, dated at August 24, 2000 (Incorporated herein by reference to Exhibit 4.6a to the RRI Energy Mid-Atlantic Power Holdings, LLC Registration Statement on Form S-4, Registration No. 333-51464 filed December 8, 2000)
10.2.2		Schedule identifying substantially identical agreements to Facility Lease Agreement constituting Exhibit 10.2.1 (Incorporated herein by reference to Exhibit 4.6b to the Reliant Energy Mid-Atlantic Power Holdings, LLC Registration Statement on Form S-4, Registration No. 333-51464 filed December 8, 2000)
10.2.3		Lease Indenture of Trust, Mortgage and Security Agreement between Conemaugh Lessor Genco LLC, as Owner Lessor, and Bankers Trust Company, as Lease Indenture Trustee, dated at August 24, 2000 (Incorporated herein by reference to Exhibit 4.8a to the Reliant Energy Mid-Atlantic Power Holdings, LLC Registration Statement on Form S-4, Registration No. 333-51464 filed December 8, 2000)

149



10.2.4		Schedule identifying substantially identical agreements to Lease Indenture of Trust constituting Exhibit 10.3.3 (Incorporated herein by reference to Exhibit 4.8b to the Reliant Energy Mid-Atlantic Power Holdings, LLC Registration Statement on Form S-4, Registration No. 333-51464 filed December 8, 2000)
10.2.5(a)		Facility Site Lease and Easement Agreement (L1) between Southern Energy Mid-Atlantic, LLC, Dickerson OL1 LLC and Southern Energy MD Ash Management, LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.5(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.5(b)		Schedule identifying substantially identical agreements to Facility Site Lease Agreement constituting Exhibit 10.2.5(a) (Incorporated herein by reference to Exhibit 10.5(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.6(a)		Facility Site Lease and Easement Agreement (L1) between Southern Energy Mid-Atlantic, LLC, Morgantown OL1 LLC and Southern Energy MD Ash Management, LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.6(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.6(b)		Schedule identifying substantially identical agreements to Facility Site Lease Agreement constituting Exhibit 10.2.6(a) (Incorporated herein by reference to Exhibit 10.6(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.7(a)		Facility Site Sublease Agreement (L1) between Southern Energy Mid-Atlantic, LLC and Dickerson OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.7(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.7(b)		Schedule identifying substantially identical agreements to Facility Site Sublease Agreement constituting Exhibit 10.2.7(a) (Incorporated herein by reference to Exhibit 10.7(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.8(a)		Facility Site Sublease Agreement (L1) between Southern Energy Mid-Atlantic, LLC and Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.8(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.8(b)		Schedule identifying substantially identical agreements to Facility Site Sublease Agreement constituting Exhibit 10.2.8(a) (Incorporated herein by reference to Exhibit 10.8(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.9(a)		Shared Facilities Agreement among Southern Energy Mid-Atlantic, LLC, Dickerson OL1 LLC, Dickerson OL2 LLC, Dickerson OL3 LLC, and Dickerson OL4 LLC, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 10.15(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.9(b)		Shared Facilities Agreement among Southern Energy Mid-Atlantic, LLC, Morgantown OL1 LLC, Morgantown OL2 LLC, Morgantown OL3 LLC, Morgantown OL4 LLC, Morgantown OL5 LLC, Morgantown OL6 LLC, and Morgantown OL7 LLC, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 10.15(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.10(a)		Assignment and Assumption Agreement among Southern Energy Mid-Atlantic, LLC, Dickerson OL1 LLC, Dickerson OL2 LLC, Dickerson OL3 LLC, and Dickerson OL4 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.16(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.10(b)		Assignment and Assumption Agreement among Southern Energy Mid-Atlantic, LLC, Morgantown OL1 LLC, Morgantown OL2 LLC, Morgantown OL3 LLC, Morgantown OL4 LLC, Morgantown OL5 LLC, Morgantown OL6 LLC, and Morgantown OL7 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.16(b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.11(a)		Ownership and Operation Agreement among Dickerson OL1 LLC, Dickerson OL2 LLC, Dickerson OL3 LLC, Dickerson OL4 LLC, and Southern Energy Mid‑Atlantic, LLC, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 10.17(a) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.2.11(b)		Ownership and Operation Agreement among Morgantown OL1 LLC, Morgantown OL2 LLC, Morgantown OL3 LLC, Morgantown OL4 LLC, Morgantown OL5 LLC, Morgantown OL6 LLC, Morgantown OL7 LLC, and Southern Energy Mid-Atlantic, LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.17 (b) to the Mirant Mid-Atlantic, LLC Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.3.1		Agreement Regarding Prosecution of Litigation by and among Merrill Lynch Commodities, Inc., Merrill Lynch & Co., Inc., Reliant Energy Power Supply, LLC, RERH Holdings, LLC, Reliant Energy Retail Holdings, LLC, Reliant Energy Retail Services, LLC, RE Retail Receivables, LLC and Reliant Energy Solutions East, LLC, dated at February 28, 2009 (Incorporated herein by reference to Exhibit 10.85 to the Registrant's Annual Report on Form 10-K filed March 2, 2009)

150



10.3.2†		Engineering, Procurement and Construction Agreement, dated at July 30, 2007, between Mirant Mid-Atlantic, LLC, Mirant Chalk Point LLC and Stone & Webster, Inc. (Incorporated herein by reference to Exhibit 10.1 to the Mirant Corporation Quarterly Report on Form 10-Q filed November 6, 2009)
10.3.3		Settlement Agreement and Release by and among Mirant Corporation, PEPCO, and PEPCO Settling Parties dated at May 30, 2006 (Incorporated herein by reference to Exhibit 10.1 to the Mirant Corporation Current Report on Form 8-K filed May 31, 2006)
31.1A1*		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Exchange Act
31.2A1*		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Exchange Act
31.3A1*		Certification of Chief Accounting Officer pursuant to Rule 13a-14(a) under the Exchange Act
32.A1*		Section 1350 Certification
99.1		Services Agreement between NRG Energy, Inc. and GenOn Energy, Inc., dated December 20, 2012 (Incorporated herein by reference to Exhibit 99.1 to the NRG Energy, Inc. Current Report on Form 8-K filed December 13, 2016)
101 INS*		XBRL Instance Document
101 SCH*		XBRL Taxonomy Extension Schema
101 CAL*		XBRL Taxonomy Extension Calculation Linkbase
101 DEF*		XBRL Taxonomy Extension Definition Linkbase
101 LAB*		XBRL Taxonomy Extension Label Linkbase
101 PRE*		XBRL Taxonomy Extension Presentation Linkbase


*	Asterisk indicates exhibits filed herewith.

** This filing excludes schedules and exhibits pursuant to Item 601(b)(2) of Regulation S-K, which the registrant agrees to furnish supplementally to the Securities and Exchange Commission upon request by the Commission.


†	The Registrant has requested confidential treatment for certain portions of this Exhibit pursuant to Rule 24b-2 under the Exchange Act.

151

GenOn Americas Generation Exhibit Index



Exhibit No.		Exhibit Name
1.1		Purchase Agreement, dated at October 3, 2001, among Mirant Americas Generation, Inc. and Salomon Smith Barney Inc., Banc of America Securities LLC, Blaylock & Partners, L.P., Scotia Capital (USA) Inc., TD Securities (USA) Inc. and Tokyo-Mitsubishi International plc, as Initial Purchasers (Incorporated herein by reference to Exhibit 1.1 to Registrant's Registration Statement on Form S-4/A Amendment No. 1, Registration No. 333-85124 filed May 7, 2002)
2.1		Purchase and Sale Agreement by and between Mirant Americas, Inc. and LS Power Acquisition Co. I, LLC, dated at January 15, 2007 (Incorporated herein by reference to Exhibit 2.1 to the Mirant Corporation Current Report on Form 8-K filed January 18, 2007)
3.1		Certificate of Formation for Mirant Americas Generation, LLC, filed with the Delaware Secretary of State dated at November 1, 2001 (Incorporated herein by reference to Exhibit 3.1 to Registrant's Quarterly Report on Form 10-Q filed November 9, 2001)
3.2		Certificate of Amendment to Certificate of Formation of Mirant Americas Generation, LLC, filed with the Delaware Secretary of State dated at December 3, 2010 (Incorporated herein by reference to Exhibit 3.2A1 to Registrant's Annual Report on Form 10-K filed March 1, 2011)
3.3		Second Amended and Restated Limited Liability Company Agreement for GenOn Americas Generation, LLC dated December 3, 2010 (Incorporated herein by reference to Exhibit 3.3A1 to Registrant's Annual Report on Form 10-K filed March 1, 2011)
4.1		Indenture between Mirant Americas Generation, Inc. and Bankers Trust Company, as trustee, relating to Senior Notes, dated at May 1, 2001 (Incorporated herein by reference to Exhibit 4.1 to the Registrant's Registration Statement on Form S-4, Registration No. 333-63240 filed June 18, 2001)
4.2		Third Supplemental Indenture from Mirant Americas Generation, Inc. to Bankers Trust Company as trustee, relating to 9.125% Senior Notes due 2031, dated at May 1, 2001 (Incorporated herein by reference to Exhibit 4.4 to Registrant's Registration Statement on Form S-4, Registration No. 333-63240 filed June 18, 2001)
4.3		Fifth Supplemental Indenture from Mirant Americas Generation, Inc. to Bankers Trust Company as trustee, dated at October 9, 2001 relating to 8.50% Senior Notes due 2021 (Incorporated herein by reference to Exhibit 4.6 to Registrant's Registration Statement on Form S-4/A Amendment No. 1, Registration No. 333-85124 filed May 7, 2002)
4.4		Form of Sixth Supplemental Indenture from Mirant Americas Generation LLC, to Bankers Trust Company as trustee, dated at November 1, 2001 relating to indenture dated May 1, 2001 (Incorporated herein by reference to Exhibit 4.6 to the Mirant Corporation Annual Report on Form 10-K filed February 27, 2009)
4.5		Form of Seventh Supplemental Indenture from Mirant Americas Generation LLC, to Wells Fargo Bank National Association as successor indenture trustee, dated at January 3, 2006 relating to indenture dated May 1, 2001(Incorporated herein by reference to Exhibit 4.1 to Registrant's Quarterly Report on Form 10-Q filed May 14, 2007)
4.6		Registration Rights Agreement, dated at October 9, 2001, among Mirant Americas Generation, Inc., Salomon Smith Barney Inc. and Banc of America Securities LLC, Blaylock & Partners, L.P., Scotia Capital (USA) Inc., TD Securities (USA) Inc. and Tokyo-Mitsubishi International plc, as Initial Purchasers (Incorporated herein by reference to Exhibit 4.8 to Registrant's Registration Statement on Form S-4/A Amendment No. 1, Registration No. 333-85124)
10.1†		Engineering, Procurement and Construction Agreement, dated at July 30, 2007, between Mirant Mid-Atlantic, LLC, Mirant Chalk Point, LLC and Stone & Webster, Inc. (Incorporated herein by reference to Exhibit 10.1 to the Mirant Corporation Quarterly Report on Form 10-Q filed November 6, 2009)
10.2		Membership Interest Purchase and Sale Agreement, dated at January 31, 2007, between Mirant New York, Inc. and Alliance Energy Renewables, LLC (Incorporated herein by reference to Exhibit 10.1 to Registrant's Quarterly Report on Form 10-Q filed May 14, 2007)
10.3		Settlement and Release of Claims Agreement, by and among the Mirant Parties, the California Parties and OMOI, dated at January 13, 2005 (Incorporated herein by reference to Exhibit 10.39 to the Mirant Corporation Annual Report on Form 10-K filed March 15, 2005)
10.4		Administrative Services Agreement dated at January 3, 2006 by and between Mirant Americas Generation, LLC and Mirant Services, LLC (Incorporated herein by reference to Exhibit 10.5 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.5		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 among Mirant Americas Energy Marketing, LP, Mirant Bowline, LLC, Mirant Lovett, LLC, and Mirant NY-Gen, LLC (Incorporated herein by reference to Exhibit 10.6 to Registrant's Annual Report on Form 10-K filed March 31, 2006)

152



10.6		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 among Mirant Americas Energy Marketing, LP, Mirant Canal, LLC, and Mirant Kendall, LLC (Incorporated herein by reference to Exhibit 10.7 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.7		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 by and between Mirant Americas Energy Marketing, LP and Mirant Chalk Point, LLC (Incorporated herein by reference to Exhibit 10.8 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.8		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 by and between Mirant Americas Energy Marketing, LP and Mirant Mid-Atlantic, LLC (Incorporated herein by reference to Exhibit 10.9 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.9		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 by and between Mirant Americas Energy Marketing, LP and Mirant Potomac River, LLC (Incorporated herein by reference to Exhibit 10.10 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.10		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 among Mirant Americas Energy Marketing, LP, Mirant Delta, LLC, and Mirant Potrero, LLC (Incorporated herein by reference to Exhibit 10.12 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.11		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 by and between Mirant Americas Energy Marketing, LP and Mirant Zeeland, LLC (Incorporated herein by reference to Exhibit 10.13 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
31.1A2*		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Exchange Act
31.2A2*		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Exchange Act
31.3A2*		Certification of Chief Accounting Officer pursuant to Rule 13a-14(a) under the Exchange Act
32.A2*		Section 1350 Certification
101 INS*		XBRL Instance Document
101 SCH*		XBRL Taxonomy Extension Schema
101 CAL*		XBRL Taxonomy Extension Calculation Linkbase
101 DEF*		XBRL Taxonomy Extension Definition Linkbase
101 LAB*		XBRL Taxonomy Extension Label Linkbase
101 PRE*		XBRL Taxonomy Extension Presentation Linkbase


*	Asterisk indicates exhibits filed herewith.


†	The Registrant has requested confidential treatment for certain portions of this Exhibit pursuant to Rule 24b-2 under the Exchange Act.

153

GenOn Mid-Atlantic Exhibit Index



Exhibit No.		Exhibit Name
3.1		Certificate of Formation of Southern Energy Mid-Atlantic, LLC, dated at July 12, 2000 (Incorporated herein by reference to Exhibit 3.1 to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
3.2		Certificate of Amendment to Certificate of Formation of Mirant Mid-Atlantic, LLC, filed with the Delaware Secretary of State dated at January 20, 2011 (Incorporated herein by reference to Exhibit 3.2A2 to Registrant's Annual Report on Form 10-K filed March 1, 2011)
3.3		Second Amended and Restated Limited Liability Company Agreement of GenOn Mid-Atlantic, LLC dated January 20, 2011 (Incorporated herein by reference to Exhibit 3.3A2 to Registrant's Annual Report on Form 10-K filed March 1, 2011)
4.1		Form of 8.625% Series A Pass Through Certificate (Incorporated herein by reference to Exhibit 4.1 to Mirant Mid-Atlantic, LLC's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.2		Form of 9.125% Series B Pass Through Certificate (Incorporated herein by reference to Exhibit 4.2 to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.3		Form of 10.060% Series C Pass Through Certificate (Incorporated herein by reference to Exhibit 4.3 to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.4(a)		Pass Through Trust Agreement A between Southern Energy Mid-Atlantic, LLC and State Street Bank and Trust Company of Connecticut, National Association, as Pass Through Trustee, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 4.4(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.4(b)		Schedule identifying substantially identical agreement to Pass Through Trust Agreement A constituting Exhibit 4.4(a) (Incorporated herein by reference to Exhibit 4.4(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.5(a)		Participation Agreement (L1) among Southern Energy Mid-Atlantic, LLC, as Lessee, Dickerson OL1 LLC, as Owner Lessor, Wilmington Trust Company, as Owner Manager, SEMA OP3 LLC, as Owner Participant and State Street Bank and Trust Company of Connecticut, National Association, as Lease Indenture Trustee and as Pass Through Trustee, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 4.5(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.5(b)		Schedule identifying substantially identical agreements to Participation Agreement constituting Exhibit 4.5(a) (Incorporated herein by reference to Exhibit 4.5(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.6(a)		Participation Agreement (Morgantown L1) among Southern Energy Mid-Atlantic, LLC, as Lessee, Morgantown OL1 LLC, as Owner Lessor, Wilmington Trust Company, as Owner Manager, SEMA OP1 LLC, as Owner Participant and State Street Bank and Trust Company of Connecticut, National Association, as Lease Indenture Trustee and as Pass Through Trustee, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 4.6(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.6(b)		Schedule identifying substantially identical agreements to Participation Agreement constituting Exhibit 4.6(a) hereto (Incorporated herein by reference to Exhibit 4.6(b) to Registrant's Form S-4 in Registration No. 333-61668 filed May 25, 2001)
4.7(a)		Facility Lease Agreement (L1) between Southern Energy Mid-Atlantic, LLC, as Facility Lessee, and Dickerson OL1 LLC, as Owner Lessor, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.7(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.7(b)		Schedule identifying substantially identical agreement to Facility Lease Agreement constituting Exhibit 4.7(a) (Incorporated herein by reference to Exhibit 4.7(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.8(a)		Facility Lease Agreement (L1) between Southern Energy Mid-Atlantic, LLC, as Facility Lessee, and Morgantown OL1 LLC, as Owner Lessor, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.8(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.8(b)		Schedule identifying substantially identical agreement to Facility Lease Agreement constituting Exhibit 4.8(a) (Incorporated herein by reference to Exhibit 4.8(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.9(a)		Indenture of Trust, Mortgage and Security Agreement (L1) between Dickerson OL1 LLC, as Lessor, and State Street Bank and Trust Company of Connecticut, National Association, as Lease Indenture Trustee, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.9(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.9(b)		Schedule identifying substantially identical agreement to Indenture of Trust, Mortgage and Security Agreement constituting Exhibit 4.9(a) (Incorporated herein by reference to Exhibit 4.9(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)

154



4.10(a)		Indenture of Trust, Mortgage and Security Agreement (L1) between Morgantown OL1 LLC, as Lessor, and State Street Bank and Trust Company of Connecticut, National Association, as Lease Indenture Trustee, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.10(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.10(b)		Schedule identifying substantially identical agreement to Indenture of Trust, Mortgage and Security Agreement constituting Exhibit 4.10(a) (Incorporated herein by reference to Exhibit 4.10(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.11(a)		Series A Lessor Note Due June 30, 2012 for Dickerson OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.11(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.11(b)		Schedule identifying substantially identical notes to Lessor Notes constituting Exhibit 4.11(a) (Incorporated herein by reference to Exhibit 4.11(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.12(a)		Series A Lessor Note Due June 30, 2008, for Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.12(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.12(b)		Schedule identifying substantially identical notes to Series A Lessor Notes constituting Exhibit 4.12(a) (Incorporated herein by reference to Exhibit 4.12(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.13(a)		Series B Lessor Note Due June 30, 2015, for Dickerson OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.13(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.13(b)		Schedule identifying substantially identical notes to Lessor Note constituting Exhibit 4.13(a) (Incorporated herein by reference to Exhibit 4.13(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668filed May 25, 2001)
4.14(a)		Series B Lessor Note Due June 30, 2017, for Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.14(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.14(b)		Schedule identifying substantially identical notes to Lessor Notes constituting Exhibit 4.14(a) (Incorporated herein by reference to Exhibit 4.14(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.15(a)		Series C Lessor Note Due June 30, 2020, for Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 4.15(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.15(b)		Schedule identifying substantially identical notes to Lessor Notes constituting Exhibit 4.15(a) (Incorporated herein by reference to Exhibit 4.15(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.16		Registration Rights Agreement, between Southern Energy Mid-Atlantic, LLC and Credit Suisse First Boston, acting for itself on behalf of the Purchasers, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 4.16 to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
4.17(a)		Supplemental Pass Through Trust Agreement A between Mirant Mid-Atlantic, LLC, and State Street Bank and Trust Company of Connecticut, National Association, as Pass Through Trustee, dated at June 29, 2001 (Incorporated herein by reference to Exhibit 4.17(a) to Registrant's Registration Statement on Form S-4/A Registration No. 333-61668 filed July 3, 2001)
4.17(b)		Schedule identifying substantially identical agreements to Supplemental Pass Through Trust Agreement A between Mirant Mid-Atlantic, LLC and State Street Bank and Trust Company of Connecticut, National Association, as Pass Through Trustee, dated at June 29, 2001, constituting Exhibit 4.17(a) (Incorporated herein by reference to Exhibit 4.17(b) to Registrant's Registration Statement on Form S-4/A, Registration No. 333-61668 filed July 3, 2001)
10.1†		Engineering, Procurement and Construction Agreement, dated at July 30, 2007, between Mirant Mid-Atlantic, LLC, Mirant Chalk Point, LLC and Stone & Webster, Inc. (Incorporated herein by reference to Exhibit 10.1 to the Mirant Corporation Quarterly Report on Form 10-Q filed November 6, 2009)
10.2		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 by and between Mirant Americas Energy Marketing, LP and Mirant Mid-Atlantic, LLC (Incorporated herein by reference to Exhibit 10.17 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.3		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 by and between Mirant Americas Energy Marketing, LP and Mirant Chalk Point, LLC (Incorporated herein by reference to Exhibit 10.18 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.4		Power Sale, Fuel Supply and Services Agreement dated at January 3, 2006 by and between Mirant Americas Energy Marketing, LP and Mirant Potomac River, LLC (Incorporated herein by reference to Exhibit 10.19 to Registrant's Annual Report on Form 10-K filed March 31, 2006)

155



10.5		Administrative Services Agreement dated at January 3, 2006 by and between Mirant Mid-Atlantic, LLC and Mirant Services, LLC (Incorporated herein by reference to Exhibit 10.20 to Registrant's Annual Report on Form 10-K filed March 31, 2006)
10.6(a)		Asset Purchase and Sale Agreement for Generating Plants and Related Assets by and between Potomac Electric Power Company and Southern Energy, Inc. dated at June 7, 2000 (Incorporated herein by reference to Exhibit 10.1(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.6(b)		Amendment No. 1 to Asset Purchase and Sale Agreement by and between Potomac Electric Power Company and Southern Energy, Inc. dated at September 18, 2000 (Incorporated herein by reference to Exhibit 10.1(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.6(c)		Amendment No. 2 to Asset Purchase and Sale Agreement by and between Potomac Electric Power Company and Southern Energy, Inc. dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.1(c) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.7(a)		Interconnection Agreement (Dickerson) by and between Potomac Electric Power Company and Southern Energy Mid-Atlantic, LLC dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.2(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.7(b)		Schedule identifying substantially identical agreements to Interconnection Agreement constituting Exhibit 10.7(a) hereto (Incorporated herein by reference to Exhibit 10.2(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.8(a)		Easement, License and Attachment Agreement (Dickerson Station) by and between Potomac Electric Power Company, Southern Energy Mid-Atlantic, LLC and Southern Energy MD Ash Management, LLC dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.3(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.8(b)		Schedule identifying substantially identical agreements to Easement, License and Attachment Agreement constituting Exhibit 10.8(a) (Incorporated herein by reference to Exhibit 10.3(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.9(a)		Bill of Sale (SEMA: Dickerson; Morgantown; RR Spur; Production Service Center) by Potomac Electric Power Company, for the benefit of Southern Energy Mid-Atlantic, LLC dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.4(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.9(b)		Schedule identifying substantially identical documents to Bill of Sale constituting Exhibit 10.9(a) hereto (Incorporated herein by reference to Exhibit 10.4(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.10(a)		Facility Site Lease and Easement Agreement (L1) among Southern Energy Mid-Atlantic, LLC, Dickerson OL1 LLC and Southern Energy MD Ash Management, LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.5(a) Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.10(b)		Schedule identifying substantially identical agreements to Facility Site Lease Agreement constituting Exhibit 10.10(a) (Incorporated herein by reference to Exhibit 10.5(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.11(a)		Facility Site Lease and Easement Agreement (L1) among Southern Energy Mid-Atlantic, LLC, Morgantown OL1 LLC and Southern Energy MD Ash Management, LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.6(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.11(b)		Schedule identifying substantially identical agreements to Facility Site Lease Agreement constituting Exhibit 10.11(a) (Incorporated herein by reference to Exhibit 10.6(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.12(a)		Facility Site Sublease Agreement (L1) between Southern Energy Mid-Atlantic, LLC and Dickerson OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.7(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.12(b)		Schedule identifying substantially identical agreements to Facility Site Sublease Agreement constituting Exhibit 10.12(a) (Incorporated herein by reference to Exhibit 10.7(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.13(a)		Facility Site Sublease Agreement (L1) between Southern Energy Mid-Atlantic, LLC and Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.8(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.13(b)		Schedule identifying substantially identical agreements to Facility Site Sublease Agreement constituting Exhibit 10.13(a) (Incorporated herein by reference to Exhibit 10.8(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.14		Capital Contribution Agreement by and between Southern Energy, Inc. and Southern Energy Mid-Atlantic, LLC dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.12 to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)

156



10.15		Promissory Note between Southern Energy Mid-Atlantic, LLC and Southern Energy Peaker, LLC in the original principal amount of $71,110,000 dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.13 to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.16		Promissory Note between Southern Energy Mid-Atlantic, LLC and Southern Energy Potomac River, LLC in the original principal amount of $152,165,000 dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.14 to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.17(a)		Shared Facilities Agreement among Southern Energy Mid-Atlantic, LLC, Dickerson OL1 LLC, Dickerson OL2 LLC, Dickerson OL3 LLC and Dickerson OL4 LLC, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 10.15(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.17(b)		Shared Facilities Agreement among Southern Energy Mid-Atlantic, LLC, Morgantown OL1 LLC, Morgantown OL2 LLC, Morgantown OL3 LLC, Morgantown OL4 LLC, Morgantown OL5 LLC, Morgantown OL6 LLC and Morgantown OL7 LLC, dated at December 18, 2000 (Incorporated herein by reference to Exhibit 10.15(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.18(a)		Assignment and Assumption Agreement between Southern Energy Mid-Atlantic, LLC, Dickerson OL1 LLC, Dickerson OL2 LLC, Dickerson OL3 LLC, and Dickerson OL4 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.16(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.18(b)		Assignment and Assumption Agreement among Southern Energy Mid-Atlantic, LLC, Morgantown OL1 LLC, Morgantown OL2 LLC, Morgantown OL3 LLC, Morgantown OL4 LLC, Morgantown OL5 LLC, Morgantown OL6 LLC and Morgantown OL7 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.16(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.19(a)		Ownership and Operation Agreement between Dickerson OL1 LLC, Dickerson OL2 LLC, Dickerson OL3 LLC, Dickerson OL4 LLC and Southern Energy Mid-Atlantic, LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.17(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.19(b)		Ownership and Operation Agreement between Morgantown OL1 LLC, Morgantown OL2 LLC, Morgantown OL3 LLC, Morgantown OL4 LLC, Morgantown OL5 LLC, Morgantown OL6 LLC, Morgantown OL7 LLC, and Southern Energy Mid-Atlantic, LLC, dated at December 19, 2000 constituting Exhibit 10.19(a) (Incorporated herein by reference to Exhibit 10.17(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.20(a)		Guaranty Agreement (Dickerson L1) between Southern Energy, Inc. and Dickerson OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.21(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.20(b)		Schedule identifying substantially identical agreements to Guaranty Agreement constituting Exhibit 10.20(a) (Incorporated herein by reference to Exhibit 10.21(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.21(a)		Guaranty Agreement (Morgantown L1) between Southern Energy, Inc. and Morgantown OL1 LLC, dated at December 19, 2000 (Incorporated herein by reference to Exhibit 10.22(a) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
10.21(b)		Schedule identifying substantially identical agreements to Guaranty Agreement constituting Exhibit 10.21(a) (Incorporated herein by reference to Exhibit 10.22(b) to Registrant's Registration Statement on Form S-4, Registration No. 333-61668 filed May 25, 2001)
31.1A3*		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Exchange Act
31.2A3*		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Exchange Act
31.3A3*		Certification of Chief Accounting Officer pursuant to Rule 13a-14(a) under the Exchange Act
32.A3*		Section 1350 Certification
101 INS*		XBRL Instance Document
101 SCH*		XBRL Taxonomy Extension Schema
101 CAL*		XBRL Taxonomy Extension Calculation Linkbase
101 DEF*		XBRL Taxonomy Extension Definition Linkbase
101 LAB*		XBRL Taxonomy Extension Label Linkbase
101 PRE*		XBRL Taxonomy Extension Presentation Linkbase


*	Asterisk indicates exhibits filed herewith.


†	The Registrant has requested confidential treatment for certain portions of this Exhibit pursuant to Rule 24b-2 under the Exchange Act.

157

Item 16 — Form 10-K Summary (GenOn, GenOn Americas Generation and GenOn Mid-Atlantic)

None.

158

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.



	GENON ENERGY, INC. (Registrant)

	By:	/s/ MAURICIO GUTIERREZ

		Mauricio Gutierrez Chief Executive Officer

Date: February 28, 2017

POWER OF ATTORNEY

Each person whose signature appears below constitutes and appoints David R. Hill and Brian E. Curci, each or any of them, such person's true and lawful attorney-in-fact and agent with full power of substitution and resubstitution for such person and in such person's name, place and stead, in any and all capacities, to sign any and all amendments to this report on Form 10-K, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing necessary or desirable to be done in and about the premises, as fully to all intents and purposes as such person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them or his or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

In accordance with the Exchange Act, this report has been signed by the following persons on behalf of the registrant in the capacities indicated on February 28, 2017.



Signature	Title	Date
/s/ MAURICIO GUTIERREZ	President and Chief Executive Officer	February 28, 2017
Mauricio Gutierrez	(Principal Executive Officer)	February 28, 2017
/s/ KIRKLAND B. ANDREWS	Executive Vice President and Chief Financial Officer	February 28, 2017
Kirkland B. Andrews	(Principal Financial Officer)	February 28, 2017
/s/ DAVID CALLEN	Vice President and Chief Accounting Officer	February 28, 2017
David Callen	(Principal Accounting Officer)	February 28, 2017
/s/ JAKE BRACE	Director	February 28, 2017
Jake Brace	Director	February 28, 2017
/s/ JOHN CHILLEMI	Director	February 28, 2017
John Chillemi	Director	February 28, 2017
/s/ JONATHAN F. FOSTER	Director	February 28, 2017
Jonathan F. Foster	Director	February 28, 2017
/s/ JUDITH LAGANO	Director	February 28, 2017
Judith Lagano	Director	February 28, 2017
/s/ GLEN E. MACKEY	Director	February 28, 2017
Glen E. Mackey	Director	February 28, 2017

159

SIGNATURES



	GENON AMERICAS GENERATION, LLC (Registrant)

	By:	/s/ MAURICIO GUTIERREZ

		Mauricio Gutierrez Chief Executive Officer

Date: February 28, 2017

POWER OF ATTORNEY

In accordance with the Exchange Act, this report has been signed by the following persons on behalf of the registrant in the capacities indicated on February 28, 2017.



Signature	Title	Date
/s/ MAURICIO GUTIERREZ	President and Chief Executive Officer	February 28, 2017
Mauricio Gutierrez	(Principal Executive Officer)	February 28, 2017
/s/ KIRKLAND B. ANDREWS	Executive Vice President and Chief Financial Officer	February 28, 2017
Kirkland B. Andrews	(Principal Financial Officer)	February 28, 2017
/s/ DAVID CALLEN	Vice President and Chief Accounting Officer	February 28, 2017
David Callen	(Principal Accounting Officer)	February 28, 2017
/s/ JOHN CHILLEMI	Manager	February 28, 2017
John Chillemi	Manager	February 28, 2017
/s/ JUDITH LAGANO	Manager	February 28, 2017
Judith Lagano	Manager	February 28, 2017
/s/ GLEN E. MACKEY	Manager	February 28, 2017
Glen E. Mackey	Manager	February 28, 2017

160

SIGNATURES



	GENON MID-ATLANTIC, LLC (Registrant)

	By:	/s/ MAURICIO GUTIERREZ

		Mauricio Gutierrez Chief Executive Officer

Date: February 28, 2017

POWER OF ATTORNEY

In accordance with the Exchange Act, this report has been signed by the following persons on behalf of the registrant in the capacities indicated on February 28, 2017.



Signature	Title	Date
/s/ MAURICIO GUTIERREZ	President and Chief Executive Officer	February 28, 2017
Mauricio Gutierrez	(Principal Executive Officer)	February 28, 2017
/s/ KIRKLAND B. ANDREWS	Executive Vice President and Chief Financial Officer	February 28, 2017
Kirkland B. Andrews	(Principal Financial Officer)	February 28, 2017
/s/ DAVID CALLEN	Vice President and Chief Accounting Officer	February 28, 2017
David Callen	(Principal Accounting Officer)	February 28, 2017
/s/ JOHN CHILLEMI	Manager	February 28, 2017
John Chillemi	Manager	February 28, 2017
/s/ JUDITH LAGANO	Manager	February 28, 2017
Judith Lagano	Manager	February 28, 2017
/s/ GLEN E. MACKEY	Manager	February 28, 2017
Glen E. Mackey	Manager	February 28, 2017

161

Supplemental Information to be Furnished with Reports Filed Pursuant to
Section 15(d) of the Act by Registrants Which Have Not Registered
Securities Pursuant to Section 12 of the Act

No annual report or proxy materials has been sent to securities holders and no such report or proxy material is to be furnished to securities holders subsequent to the filing of the annual report on this Form 10-K.

162