NRG to Sell Six Gas Plants Totaling 4.9 GW to LS Power for $4 Billion

NRG Energy Inc. agreed on Nov. 9, 2026, to sell six natural gas-fired power plants totaling 4.9 gigawatts to LS Power for $4 billion in cash, a transaction that pulls the Houston-based power company out of the New York and New England markets and expands LS Power's gas fleet across the Northeast and Texas. The plants sit in New York City, Rhode Island, Connecticut and Texas, and the companies expect the sale to close in the second quarter of 2027.

Deal background

The transaction reverses part of a relationship that reshaped NRG less than a year ago. NRG completed its acquisition of a generation portfolio and the CPower demand response business from LS Power in January 2026, according to its third-quarter results released the same day. The assets now being sold come from NRG's legacy fleet rather than that PJM portfolio, and NRG said CPower and its PJM plants are excluded from the sale.

The six plants span a range of technologies. Ravenswood in Queens, which serves the New York Independent System Operator market, includes combined-cycle, simple-cycle and steam turbine units. Ocean State Power is a combined-cycle plant and Wallingford is a simple-cycle peaking plant, both in the ISO New England market. In the Electric Reliability Council of Texas grid, Jack County and Johnson County are combined-cycle plants, while R.W. Miller has simple-cycle and steam turbine units.

NRG President and CEO Robert Gaudette said the company is "unlocking substantial value from a select group of assets." Barclays served as lead financial adviser to NRG, with White & Case as legal counsel. LS Power used Scotiabank and Evercore as financial advisers and Milbank as legal adviser.

Industry implications

The sale shows how differently two large owners now value conventional gas generation. NRG is concentrating on two markets, saying it will own about 20 GW after closing, split evenly between ERCOT and the PJM Interconnection, with another 1.1 GW expected in ERCOT by 2028 from two projects backed by the Texas Energy Fund. Before the sale, NRG described a fleet of roughly 25 GW serving about 8 million customers. It also reported that its previously disclosed 1.2 GW "Bring Your Own Power" data center project remains on track.

LS Power is moving the other way. CEO Paul Segal said significant investment in firm, dispatchable power remains essential to grid reliability and argued that plants already built, permitted and interconnected can supply that power today. That view reflects a wider pattern in U.S. power markets, where long interconnection queues and multiyear lead times for new turbines have made operating plants more valuable to buyers who want capacity now rather than in the next decade.

For NRG, the transaction converts plants in markets outside its core into cash for buybacks and balance sheet repair. The company said remaining proceeds after buybacks and debt reduction are reserved for contracted growth investments or further debt reduction, and that its total planned 2027 debt reduction would reach $3 billion.

Competitive and supply chain implications

The deal deepens consolidation among independent generators. LS Power agreed in March 2026 to buy about 4.4 GW of mostly gas-fired generation in Delaware and Pennsylvania from Constellation for $5 billion before closing adjustments. Those plants, including Bethlehem, York 1, York 2, Hay Road and Edge Moor, are part of the divestitures required by FERC and the U.S. Department of Justice after Constellation completed its acquisition of Calpine on Jan. 7, 2026. With both transactions, LS Power would control gas plants in PJM, New York, New England and Texas.

Ownership of existing gas capacity is becoming a strategic asset because the supply chain for new plants remains strained. Developers face long waits for large gas turbines, transformers and interconnection agreements, so buyers increasingly pay for megawatts that are already connected. Large owners with diverse fleets can also contract that capacity with utilities, retail suppliers and large industrial or data center customers.

Regional implications

Ravenswood is a large generating station inside New York City, a load zone where reliability rules require a share of capacity to be located locally. The New York State Public Service Commission approval is a listed closing condition for the transfer.

In New England, Ocean State Power and Wallingford provide flexible output in a region that relies heavily on natural gas and faces pipeline constraints during winter peaks. In Texas, the three ERCOT plants will move to a new owner as the grid manages fast load growth from industrial projects and data centers. NRG remains a major Texas generator through its remaining plants and new Texas Energy Fund projects.

What comes next

• Filing for Hart-Scott-Rodino antitrust review and applications to FERC and the New York State Public Service Commission.
• Launch of NRG's incremental $1 billion share repurchase before the end of the fourth quarter of 2026.
• Closing of LS Power's separate acquisition of Constellation's PJM plants, which Constellation expected later in 2026.
• Targeted closing of the NRG sale in the second quarter of 2027, followed by $2 billion of NRG debt reduction.
• Commissioning of NRG's two Texas Energy Fund projects, adding 1.1 GW in ERCOT by 2028.

Sources

• NRG Energy: Announcement of sale of six natural gas assets to LS Power (SEC Form 8-K, Exhibit 99.1)
• LS Power: LS Power to Acquire Six Natural Gas Power Generation Assets from NRG Energy
• NRG Energy: Third quarter 2026 results (SEC Form 8-K, Exhibit 99.1)
• Constellation: Agreement to sell PJM generation assets to LS Power

Image: Ravenswood Generating Station in Queens, New York, by Rhododendrites via Wikimedia Commons, CC BY-SA 4.0. Cropped and edited by Credence Research.