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CORRESP
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CORRESP

    NRG Energy, Inc.

    211 Carnegie Center

    Princeton, NJ 08540

    Phone: 609-524-4591

    Fax: 609-524-4589

May 18, 2005

VIA EDGAR and VIA FASCIMILE

Securities and Exchange Commission

Division of Corporation Finance

Mail Stop 0308

450 Fifth Street, N.W.

Washington, D.C. 20549

Attn: H. Christopher Owings, Assistant Director

    RE:

    NRG Energy, Inc.

    Registration Statement on Form S-3

    Filed March 30, 2005

    File No. 333-123677

    Annual Report on Form 10-K for the Period Ended December 31, 2004

    Filed March 30, 2005

    Preliminary Proxy Statement on Schedule 14A

    Filed March 30, 2005

    File No. 1-15891

Dear Mr. Owings:

     We hereby respond to the comments made by the Staff in your letter dated May 16, 2005 relating
to NRG Energy, Inc.’s (“NRG” or the “Company”) Annual Report on Form 10-K for the Period Ended
December 31, 2004, filed on March 30, 2005 (the “Form 10-K”) and Form 8-K filed on May 10, 2005
(the “Form 8-K”). We acknowledge that we are responsible for the accuracy and adequacy of the
disclosure in the filings reviewed by the Staff to be certain that we have provided all information
investors require for an informed decision. Since the Company and management are in possession of
all the facts relating to the Company’s disclosure, we are responsible for the accuracy and
adequacy of the disclosures we have made. We look forward to working with the Staff and improving
the disclosures in our filings.

     The Staff’s comments, indicated in bold and NRG’s responses are as follows:

Mr. H. Christopher Owings

May 18, 2005

Form 10-K

    1.
    We have considered your response to prior comment 5. We assume from your response that
load-following contracts not concluded on a net payment basis are reflected gross
in the income statement. Please supplementally explain, in detail, your application of
EITF 99-19 with respect to load-following contracts not concluded on a net basis.
We assume based on your description of load-following contracts that the ISO delivers the
power to the counterparty on your behalf whether the contract is net settled or not. Since
it appears that the party exposed to credit risk varies depending upon the settlement
alternative, help us understand how you determined that the load-following contracts that
are not net settled should be recorded on a gross basis.

With respect to load-following contracts within an ISO region, all of our
purchases and sales are recorded on a net basis consistent with industry
practice.

With respect to load-following contracts within a non-ISO region, the
transactions are reported on a gross presentation per the guidance of EITF
99-19.

Using EITF 99-19, “Reporting Revenue as a Principal Versus Net as an
Agent” as a means to analyze gross versus net presentation, we used the
relevant indicators to test the gross/net revenue presentation of non-ISO
related load-following contracts:

    Applicable (Yes,

    Strength of

    Indicators of Gross Revenue Reporting

    Key Question(s) for Gross vs. Net Evaluation

    No or N/A)

    Indicator

    Decision

                    NRG is the primary obligor in the
arrangement.

    Is NRG responsible for fulfillment,
including the acceptability of the
product(s) or service(s) ordered or
purchased by counterparty?

    Yes

    Strong indicator

    Record revenue and
costs gross.

    NRG has general inventory risk (before
customer order is placed or upon
customer return).

    Does NRG take title to a product before
that product is ordered by counterparty
(that is, maintains the product in
inventory), or
Will NRG take title to the product if it is
returned by counterparty (that is, back-end
inventory risk), and does counterparty have
a right of return?

    No – Power does not
have return
policies – N/A

    Strong indicator

    N/A

    NRG has latitude in establishing price.

    Does NRG have reasonable latitude, within
economic constraints, to establish the
exchange price with counterparty for the
power?
If so, this may indicate that NRG has risks
and rewards of a principal in the
transaction.

    Yes – NRG
established price
at time of contract

    Strong indicator

    Record revenue and
costs gross.

    NRG changes the product or performs part
of the service.

    Does NRG physically change the product
(beyond its packaging) or perform part of
the service (i.e., power) ordered by
counterparty?
If so, this may indicate that NRG is
primarily responsible for fulfillment,
including the ultimate acceptability of the
product component or portion of the total
services furnished by ISO.

    Yes – Process
whereby contract is
fulfilled requires
performance by NRG.

    Strong indicator

    Record revenue and
costs gross

Mr. H. Christopher Owings

May 18, 2005

    Applicable (Yes,

    Strength of

    Indicators of Gross Revenue Reporting

    Key Question(s) for Gross vs. Net Evaluation

    No or N/A)

    Indicator

    Decision

                    NRG has discretion in supplier selection.

    Does NRG have multiple suppliers for a
product or service ordered by counterparty
and discretion to select the supplier that
will provide the product(s) or service(s)
ordered by a customer?

    Yes – Multiple
suppliers are
available and
contracted in
non-ISO region

    Strong indicator

    Record revenue and
costs gross.

    NRG is involved in determination of
product or service specifications.

    Does NRG determine the nature, type,
characteristics, or specifications of the
product(s) or service(s) ordered by
counterparty?

    N/A – Power does
not have
characteristics to
be determined by
NRG.

    Strong indicator

    N/A

    NRG has physical loss inventory risk
(after counterparty order or during
delivery).

    1) Is title to the power transferred to
non-ISO at non-ISO facilities upon
delivery?
2) Does NRG take title to the power after
counterparty order has been received by NRG
but before the power has been transferred
to non-ISO for ultimate delivery to
counterparty?

    Yes – NRG holds
title until
delivery to
counterparty.

    Strong indicator

    Record revenue and
costs gross.

    NRG has credit risk.

    Is NRG responsible for collecting the sales
price from counterparty but pays the
relevant amounts owed to suppliers after
they perform, regardless of whether the
sales price is fully collected?

    Yes – NRG invoices
counterparty based
on contract, but
must pay suppliers
irrespective of
cash received from
counterparty.

    Strong indicator

    Record revenue and
costs gross.

Accounting guidance under EITF 99-19 “Reporting Revenues Gross as a
Principal versus Net as an Agent” addresses whether an entity should
report revenue based on (a) the gross amount billed to the customer
because it earned revenue from the goods and services or (b) the net
amount retained (that is the amount billed to the customer, less the
amount paid to a supplier) because it has earned a commission or fee. As
can be seen from the table above, the evaluation of load-following
contracts in non-ISO regions per the indicators prescribed by EITF 99-19
clearly indicate the support for a gross presentation of revenues and
costs. As such, NRG’s presentation for load-following contracts in
non-ISO regions follows the gross presentation method.

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Mr. H. Christopher Owings

May 18, 2005

Form 8-K filed May 10, 2005

    2.
    Please revise future filings to provide all disclosures required by Item 10(e)(1)(i) of
Regulation S-K and Question #8 of the Staff’s Frequently Asked Questions Regarding the Use
of Non-GAAP Financial Measures (FAQ) included on the Commission’s website at
http://www.sec.gov. Specifically, with respect to your presentation of Adjusted EBITDA by
Region you have not included a presentation, with equal or greater prominence, of the most
directly comparable financial measure calculated and presented in accordance with GAAP.
Please note that the requirement to present and discuss the most directly
comparable GAAP basis measure is in addition to the requirement to provide a reconciliation
of each non-GAAP measure to the most directly comparable GAAP basis measure. Please
confirm to us that you will revise your future public disclosures accordingly.

In accordance with the Staff’s comments, in future filings, NRG will
provide all disclosures required by Item 10(e)(1)(i) of Regulation S-K
along with question #8 of the Staff’s FAQ. Further, we will include a
presentation and discussion of the most directly comparable GAAP basis
measure, with equal or greater prominence to non-GAAP financial measures.

* * * * * *

     We hope that we were able to clarify your comments and eagerly await the Staff’s response.
Please contact James Ingoldsby, Controller, at (609) 524-4731 or Tanuja Dehne, Assistant General
Counsel, at (609) 524-4592 if you have questions regarding our responses or related matters, or me
at (609) 524-4591 with any other questions.

Sincerely,

/s/ TIMOTHY W.J. O’BRIEN

Timothy W. J. O’Brien

Vice President, General Counsel and Secretary

    cc:

    David Mittelman, Legal Branch Chief, Securities and Exchange Commission

    George Ohsiek, Securities and Exchange Commission

    David DiGiacomo, Securities and Exchange Commission

    Matthew Benson, Staff Attorney, Securities and Exchange Commission

    Robert C. Flexon, NRG Energy, Inc.

    Michael P. Rogan, Esq., Skadden, Arps, Slate, Meagher & Flom LLP

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