Dive Brief:

• NRG Energy announced a net loss of $56 million for Q1 2014, up from a net loss of $332 million in the same period last year. Earnings before interest, taxes, depreciation and amortization rose from $383 million in Q1 last year to $816 million in Q1 this year.
• Despite posting a net loss, NRG was very active positioning itself for future success in Q1 2014: The company closed the acquisition of Edison Mission Energy and its 7,700 MW generation fleet; the company purchased Dominion's retail business, expanding its "Northeast retail footprint" by 500,000 customers; and the company purchased Roof Diagnostics Solar, the 8th-largest solar installer in the U.S.

Dive Insight:

NRG CEO David Crane is not a man to mince words.

"Our industry is on the cusp of disruptive change," he warned during the earnings call. "New energy technologies now cost effective and available to be deployed at scale will transform the traditional power sector and the vertically integrated utilities which have dominated it since the 1930s."

While the "strength" of the company's financial performance "has been commonly attributed to the severe weather," CEO David Crane pointed to "the different financial outcomes experienced by the power companies active in our core markets that operated their businesses under the very same weather conditions."

"Plenty" of conventional power companies "performed well during the Polar Vortex" and boasted strong Q1 2014 earnings, Crane said, but "what is the long-term future for companies that depend exclusively on the sale of system power delivered over an increasingly obsolete and unreliable grid to a population of consumers and businesses that more and more will be relying less and less on grid delivered power for their energy needs?"

NRG does not see itself as a "conventional" power company. Instead, it is positioning itself to capitalize on the organic deregulation of the electric utility monopoly through technologies and services that empower the American energy consumer. 

"Think of 50 million American homes each with a distributed solar system at $20,000 a pop on average," Crane said. "That represents a trillion dollar market opportunity."

NRG aims to "build a top tier residential solar franchise," Crane said. "Our goal of course is to seamlessly offer residential solar to our three million conventional retail customers and conversely to offer system power and other energy products and services to our much smaller but very fast growing roster of residential solar customers."

"We have made no secret in recent years of our belief that the future of competitive retail energy supply lay in providing a broader range of energy and energy related products and services, both inside the home and on the home," he said. "And the key to future success in retail will be to win the hearts and minds and loyalty of home-owners in all of the markets in which we participate."