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What changed in Vistra Corp.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Vistra Corp.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+532 added−530 removedSource: 10-K (2025-02-28) vs 10-K (2024-02-29)

Top changes in Vistra Corp.'s 2024 10-K

532 paragraphs added · 530 removed · 356 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

120 edited+50 added−48 removed103 unchanged
Biggest changeIn July 2017, California enacted legislation extending its GHG cap-and-trade program through 2030 and the CARB adopted amendments to its cap-and-trade regulations that, among other things, established a framework for extending the program beyond 2020 and linking the program to the new cap-and-trade program in Ontario, Canada beginning in January 2018. 11 Table of Contents Air Emissions The Clean Air Act (CAA) The CAA and comparable state laws and regulations relating to air emissions impose various responsibilities on owners and operators of sources of air emissions, which include requirements to obtain construction and operating permits, pay permit fees, monitor emissions, submit reports and compliance certifications, and keep records.
Biggest changeIn July 2017, California enacted legislation extending its GHG cap-and-trade program through 2030 and the CARB adopted amendments to its cap-and-trade regulations that, among other things, established a framework for extending the program beyond 2020 and linking the program to the new cap-and-trade program in Ontario, Canada beginning in January 2018.
We primarily compete with other electricity generators and retailers based on our ability to generate electric supply, market and sell electricity at competitive prices and to efficiently utilize transportation from third-party pipelines and transmission from electric utilities to deliver electricity to end-users.
We primarily compete with other electricity generators and retailers based on our ability to generate electric supply, market and sell electricity at competitive prices, and efficiently utilize transportation from third-party pipelines and transmission from electric utilities to deliver electricity to end-users.
For all of the above matters, if certain corrective action measures, including groundwater treatment or removal of ash, are required at any of our coal-fueled facilities, we may incur significant costs that could have a material adverse effect on our financial condition, results of operations and cash flows.
For all of the above CCR matters, if certain corrective action measures, including groundwater treatment or removal of ash, are required at any of our coal-fueled facilities, we may incur significant costs that could have a material adverse effect on our financial condition, results of operations, and cash flows.
As a result of the stay, we do not believe the EPA has authority to implement the FIP as to Texas sources pending the resolution of the merits, meaning that Texas will remain in Group 2 and not be subject to any requirements under the FIP at least until the Fifth Circuit Court rules on the merits.
As a result of the stay, we do not believe the EPA has authority to implement the GNP FIP as to Texas sources pending the resolution of the merits, meaning that Texas will remain in Group 2 and not be subject to any requirements under the GNP FIP at least until the Fifth Circuit Court rules on the merits.
The final rule allows a generation plant to seek the EPA's approval to extend this deadline if no alternative disposal capacity is available and either a conversion to comply with the CCR rule is underway or retirement will occur by either 2023 or 2028 (depending on the size of the impoundment at issue).
The 2020 final rule allows a generation plant to seek the EPA's approval to extend this deadline if no alternative disposal capacity is available and either a conversion to comply with the CCR rule is underway or retirement will occur by either 2023 or 2028 (depending on the size of the impoundment at issue).
The capacity market is comprised of Generic, Flexible and Local Resource Adequacy (RA) Capacity and is administered by the California Public Utilities Commission (CPUC). Unlike other centrally cleared capacity markets, the resource adequacy markets in California are primarily bilaterally traded markets. In 2020, the CPUC introduced a central procurement entity for Local RA Capacity effective for the 2023 compliance year.
The capacity market is comprised of Generic, Flexible, and Local Resource Adequacy (RA) Capacity, which is administered by the California Public Utilities Commission (CPUC). Unlike other centrally cleared capacity markets, the resource adequacy markets in California are primarily bilaterally traded markets. In 2020, the CPUC introduced a central procurement entity for Local RA Capacity effective for the 2023 compliance year.
In June 2023, the State of Texas, Luminant and various other parties also filed challenges to the FIP in the Fifth Circuit Court, filed a motion to stay the FIP and confirm venue for this dispute in the Fifth Circuit Court.
In June 2023, the State of Texas, Luminant and various other parties also filed challenges to the GNP FIP in the Fifth Circuit Court, filed a motion to stay the FIP and confirm venue for this dispute in the Fifth Circuit Court.
After the motion to stay and to confirm venue was filed, the EPA signed an interim final rule on June 29, 2023 that confirms the FIP as to Texas is stayed.
After the motion to stay and to confirm venue was filed, the EPA signed an interim final rule on June 29, 2023 that confirms the GNP FIP as to Texas is stayed.
Luminant stores its used nuclear fuel on-site in storage pools or dry cask storage facilities and believes its on-site used nuclear fuel storage capability is sufficient for the foreseeable future. Corporate Information Vistra is a Delaware corporation whose common stock is listed and trade on the NYSE. Our principal executive office is located at 6555 Sierra Drive, Irving, Texas 75039.
Luminant stores its used nuclear fuel on-site in storage pools or dry cask storage facilities and believes its on-site used nuclear fuel storage capability is sufficient for the foreseeable future. Corporate Information Vistra is a Delaware corporation whose common stock is listed and traded on the NYSE. Our principal executive office is located at 6555 Sierra Drive, Irving, Texas 75039.
In September 2021, the TCEQ considered a proposal for its nonattainment SIP revision for the Martin Lake area and an agreed order to reduce SO 2 emissions from the plant. The proposed agreed order associated with the SIP proposal reduces emission limits as of January 2022. Emission reductions required are those necessary to demonstrate attainment with the NAAQS.
In September 2021, the TCEQ considered a proposal for its nonattainment SIP revision for the Martin Lake area and an agreed order to reduce SO 2 emissions from the plant. The proposed agreed order associated with the SIP proposal reduced emission limits as of January 2022. Emission reductions required are those necessary to demonstrate attainment with the NAAQS.
The TCEQ's SIP action was finalized in February 2022 and has been submitted to the EPA for review and approval. In January 2024, in a split decision, the Fifth Circuit Court denied the petitions for review we and the State of Texas filed over EPA' 2016 nonattainment designation for SO 2 for the area around Martin Lake.
The TCEQ's SIP action was finalized in February 2022 and has been submitted to the EPA for review and approval. In January 2024, in a split decision, the Fifth Circuit Court denied the petitions for review we and the State of Texas filed over the EPA's 2016 nonattainment designation for SO 2 for the area around Martin Lake.
The integrated model enables us to structure products and contracts in a way that offers significant value compared to stand-alone retail electric providers. The Company brings its products and services to market in 20 states and the District of Columbia, including all major competitive wholesale power markets in the U.S.
The integrated model enables us to structure products and contracts in a way that offers significant value compared to stand-alone retail electric providers. The Company brings its products and services to market in 18 states and the District of Columbia, including all major competitive wholesale power markets in the U.S.
NYISO — NYISO is an ISO that manages the flow of electricity from approximately 37,000 MW of installed summer generation capacity to approximately 20 million New York customers. NYISO dispatches power plants to meet system energy and reliability needs and settles physical power deliveries at LMPs.
NYISO — NYISO is an ISO that manages the flow of electricity from approximately 37,100 MW of installed summer generation capacity to approximately 20 million New York customers. NYISO dispatches power plants to meet system energy and reliability needs and settles physical power deliveries at LMPs.
The Water Infrastructure Improvements for the Nation Act (the WIIN Act), which was enacted in December 2016, provides for EPA review and approval of state CCR permit programs. 14 Table of Contents In August 2018, the D.C. Circuit Court issued a decision that vacates and remands certain provisions of the 2015 CCR rule, including an applicability exemption for legacy impoundments.
The Water Infrastructure Improvements for the Nation Act (the WIIN Act), which was enacted in December 2016, provides for EPA review and approval of state CCR permit programs. In August 2018, the D.C. Circuit Court issued a decision that vacates and remands certain provisions of the 2015 CCR rule, including an applicability exemption for legacy impoundments.
We satisfy our fuel requirements at these facilities through a combination of spot market and near-term purchase contracts. Additionally, we have near-term natural gas transportation agreements and natural gas storage agreements in place to ensure reliable fuel supply. Our coal/lignite-fueled generation fleet is comprised of seven generation facilities totaling 8,428 MW of generation capacity.
We satisfy our fuel requirements at these facilities through a combination of spot market and near-term purchase contracts. Additionally, we have near-term natural gas transportation agreements and natural gas storage agreements in place to ensure fleet reliability. Our coal/lignite-fueled generation fleet is comprised of seven generation facilities totaling 8,428 MW of generation capacity.
Per the terms of the agreed interim consent order, DMG is required to evaluate the closure alternatives under the requirements of the newly implemented Illinois Coal Ash regulation (discussed below) and close the site by removal.
Per the terms of the agreed interim consent order, DMG is required to evaluate the closure alternatives under the requirements of the Illinois Coal Ash regulation (discussed below) and close the site by removal.
An independent market monitor continually monitors PJM markets to ensure a robust, competitive market and to identify improper behavior by any entity. ISO-NE — ISO-NE is an ISO that manages the flow of electricity from approximately 32,400 MW of winter generation capacity to approximately 15 million customers in the states of Vermont, New Hampshire, Massachusetts, Connecticut, Rhode Island and Maine.
An independent market monitor continually monitors PJM markets to ensure a robust, competitive market and to identify improper behavior by any entity. ISO-NE — ISO-NE is an ISO that manages the flow of electricity from approximately 30,600 MW of winter generation capacity to approximately 15 million customers in the states of Vermont, New Hampshire, Massachusetts, Connecticut, Rhode Island, and Maine.
Texas would be moved into the revised Group 3 trading program previously established in the Revised CSAPR Update Rule that includes emission budgets for 2023 that the EPA says are achievable through existing controls installed at power plants.
Texas would be moved into the revised (and more restrictive) Group 3 trading program previously established in the Revised CSAPR Update Rule that includes emission budgets for 2023 that the EPA says are achievable through existing controls installed at power plants.
Regular full-time employees are eligible for short-term disability benefits, and all employees are eligible for the employee assistance program, parental leave, maternity leave and a 401(k) plan through which the Company matches employee contributions up to 6%. 8 Table of Contents Wellness We believe a healthy workforce leads to greater well-being at work and at home.
Regular full-time employees are eligible for short-term disability benefits, and all employees are eligible for the employee assistance program, parental leave, maternity leave and a 401(k) plan through which the Company matches employee contributions up to 6%. Wellness We believe a healthy workforce leads to greater well-being at work and at home.
PJM also administers a forward capacity auction, the Reliability Pricing Model (RPM), which establishes a long-term market for capacity. We have participated in RPM auctions for years up to and including PJM's planning year 2024-2025, which ends May 31, 2025. PJM's RPM auction for planning year 2025-2026 was delayed and is expected to be run in June 2024.
PJM also administers a forward capacity auction, the Reliability Pricing Model (RPM), which establishes a long-term market for capacity. We have participated in RPM auctions for years up to and including PJM's planning year 2025-2026, which ends May 31, 2026. PJM's RPM auction for planning year 2026-2027 was delayed and is expected to be run in July 2025.
The CAA requires that fossil-fueled electricity generation plants meet certain pollutant emission standards and have sufficient emission allowances to cover SO 2 emissions and in some regions NO X emissions. In order to ensure continued compliance with the CAA and related rules and regulations, we utilize various emission reduction technologies.
The CAA requires that fossil-fueled electricity generation plants meet certain pollutant emission standards and have sufficient emission allowances to cover SO 2 emissions and in some regions NO X emissions. 11 Table of Contents In order to ensure continued compliance with the CAA and related rules and regulations, we utilize various emission reduction technologies.
Our Retail operations are engaged in retail sales of electricity, natural gas and related services to approximately 4 million customers. Substantially all of our retail activities are conducted by TXU Energy, Ambit Energy, Dynegy Energy Services, Homefield Energy, and U.S. Gas & Electric across 19 U.S. states and the District of Columbia.
Our retail operations are engaged in retail sales of electricity, natural gas, and related services to approximately 5 million customers. Substantially all of our retail activities are conducted by TXU Energy, Ambit Energy, Dynegy Energy Services, Homefield Energy, and U.S. Gas & Electric across 16 U.S. states and the District of Columbia.
We serve approximately 4 million residential, commercial, and industrial retail customers with electricity and natural gas. Our generation fleet totals approximately 37,000 megawatts of generation capacity powered by a diverse portfolio, including natural gas, nuclear, coal, solar, and battery energy storage facilities.
We serve approximately 5 million residential, commercial, and industrial retail customers with electricity and natural gas. Our generation fleet totals approximately 41,000 megawatts of generation capacity powered by a diverse portfolio, including natural gas, nuclear, coal, solar, and battery energy storage facilities.
Cross-State Air Pollution Rule (CSAPR) In 2016, the EPA finalized the Cross-State Air Pollution Rule Update (CSAPR Update) to address 22 states' obligations with respect to the 2008 ozone National Ambient Air Quality Standards (NAAQS). In 2019, following challenges by numerous parties, the D.C.
Cross-State Air Pollution Rule (CSAPR) and Good Neighbor Plan In 2016, the EPA finalized the Cross-State Air Pollution Rule Update (CSAPR Update) to address 22 states' obligations with respect to the 2008 ozone National Ambient Air Quality Standards (NAAQS). In 2019, following challenges by numerous parties, the D.C.
Market Discussion The operations of Vistra, as an integrated retail electricity and power generation company, are further aligned into six reportable business segments: (i) Retail, (ii) Texas, (iii) East, (iv) West, (v) Sunset and (vi) Asset Closure.
Market Discussion The operations of Vistra, as an integrated retail electricity and power generation company, are further aligned into five reportable business segments: (i) Retail, (ii) Texas, (iii) East, (iv) West, and (v) Asset Closure.
We have completed closure activities at those ponds at our Baldwin facility. At our retired Vermilion facility, which was not potentially subject to the EPA's 2015 CCR rule until the aforementioned D.C.
We have completed closure activities at those ponds at our Baldwin facility. 15 Table of Contents At our retired Vermilion facility, which was not potentially subject to the EPA's 2015 CCR rule until the aforementioned D.C.
The Vermilion ash ponds discussed below are the only unit which we believe qualify as a legacy CCR surface impoundment and given our closure plan for that site we do not believe this proposal, if finalized, will have any impact on that site.
The Vermilion ash ponds discussed below are the only unit which we believe qualify as a legacy CCR surface impoundment and given our closure plan for that site we do not believe the rule will have any impact on that site.
Since 2010, Vistra has retired more than 15,100 MW of coal and natural gas power plants resulting in a 50% reduction in carbon dioxide (CO 2 ) emissions, a 68% reduction in nitrogen oxide (NO X ) emissions, and an 89% reduction in sulfur dioxide (SO 2 ) emissions through year-end 2023, compared to a 2010 baseline.
Since 2010, Vistra has retired more than 15,100 MW of coal and natural gas power plants resulting in a 50% reduction in carbon dioxide (CO 2 ) emissions, a 66% reduction in nitrogen oxide (NO X ) emissions, and an 90% reduction in sulfur dioxide (SO 2 ) emissions through year-end 2024, compared to a 2010 baseline.
Each of our coal-fueled plants has at least one CCR surface impoundment. Coal Combustion Residuals The EPA's CCR rule, which took effect in October 2015, establishes minimum federal requirements for the construction, retrofitting, operation and closure of, and corrective action with respect to, existing and new CCR landfills and surface impoundments, as well as inactive CCR surface impoundments.
Each of our coal-fueled plants has at least one CCR surface impoundment. 14 Table of Contents CCR Rule Revisions and Extension Applications The EPA's CCR rule, which took effect in October 2015, establishes minimum federal requirements for the construction, retrofitting, operation and closure of, and corrective action with respect to, existing and new CCR landfills and surface impoundments, as well as inactive CCR surface impoundments.
ERCOT currently procures ancillary services in the day-ahead market, but plans to implement co-optimization of energy and ancillary services in the real-time market in 2026.
ERCOT currently procures ancillary services in the day-ahead market, but plans to implement co-optimization of energy and ancillary services in the real-time market by the end of 2025.
We, along with many other companies, trade groups, states and ISOs, including ERCOT, PJM and MISO, filed responsive comments to the EPA's proposal in June 2022, expressing concerns about certain elements of the proposal, particularly those that may result in challenges to electric reliability under certain conditions. In March 2023, the EPA administrator signed its final FIP.
We, along with many other companies, trade groups, states and ISOs, including ERCOT, PJM and MISO, filed responsive comments to the EPA's proposal in June 2022, expressing concerns about certain elements of the proposal, particularly those that may result in challenges to electric reliability under certain conditions.
Under the proposal, states would be required to submit plans to the EPA within 24 months of the rule's effective date that provide for the establishment, implementation, and enforcement of standards of performance for existing sources. These state plans must generally establish standards that are at least as stringent as the EPA's emission guidelines.
Under the rule, states would be required to submit plans to the EPA within 24 months of the rule's publication in the Federal Register that provide for the establishment, implementation, and enforcement of standards of performance for existing sources. These state plans must generally establish standards that are at least as stringent as the EPA's emission guidelines.
We will not know the full range of decommissioning costs, including groundwater remediation, if any, that ultimately may be required under the Illinois rule until permit applications have been approved by the IEPA.
We will not know the full range of decommissioning costs, including groundwater remediation, if any, that ultimately may be required under the Illinois rule until permit applications have been approved by the IEPA and as such, an estimate of such costs cannot be made.
We are addressing these CCR surface impoundments in accordance with the federal CCR rule. In June 2018, the IEPA issued a violation notice for alleged seep discharges claimed to be coming from the surface impoundments at our retired Vermilion facility, which is owned by our subsidiary DMG, and that notice was referred to the Illinois Attorney General.
In June 2018, the IEPA issued a violation notice for alleged seep discharges claimed to be coming from the surface impoundments at our retired Vermilion facility, which is owned by our subsidiary DMG, and that notice was referred to the Illinois Attorney General.
MISO — MISO is an RTO that manages the flow of electricity from approximately 190,000 MW of installed generation capacity to approximately 45 million customers in all or parts of Iowa, Minnesota, North Dakota, Wisconsin, Michigan, Kentucky, Indiana, Illinois, Missouri, Arkansas, Mississippi, Texas, Louisiana, Montana, South Dakota and Manitoba, Canada.
The balance is cleared through the seasonal and monthly capacity auctions. 4 Table of Contents MISO — MISO is an RTO that manages the flow of electricity from approximately 202,000 MW of installed generation capacity to approximately 45 million customers in all or parts of Iowa, Minnesota, North Dakota, Wisconsin, Michigan, Kentucky, Indiana, Illinois, Missouri, Arkansas, Mississippi, Texas, Louisiana, Montana, South Dakota, and Manitoba, Canada.
Based on 2020-2022 design value associated with the rule, we have just five plants (Oakland (California), Calumet (Illinois), Liberty (Pennsylvania), Miami Fort (Ohio) and Lake Hubbard (Texas)) operating in areas where the air quality monitoring data are currently exceeding the new PM2.5 standard. We have previously announced that our Miami Fort generation facility will close by the end of 2027.
Based on 2021-2023 design value associated with the rule, we have just four plants (Calumet (Illinois), Dicks Creek and Miami Fort (Ohio), and Lake Hubbard (Texas)) operating in areas where the air quality monitoring data are currently exceeding the new PM2.5 standard. We have previously announced that our Miami Fort generation facility will close by the end of 2027.
Additionally, 32 of our power plants and mine locations have adopted a proactive Behavior Based Safety approach to safety which focuses on identifying and providing feedback on at-risk behaviors observed. Diversity, Equity and Inclusion We recognize the value of having a diverse and inclusive workforce.
Additionally, 32 of our power plants and mine locations have adopted a proactive Behavior Based Safety approach to safety which focuses on identifying and providing feedback on at-risk behaviors observed. 7 Table of Contents Our People We recognize the value of having an inclusive workforce.
We have launched key programs to develop leaders at all levels of the organization. Vistra's Essentials of Leadership provides new managers with skills to lead organizations in situational leadership, business acumen, inclusive leadership, and exposes them to best practices from across the company. We continue to evaluate and refine our programs as the development needs of our employees change.
Vistra's Essentials of Leadership provides new managers with skills to lead organizations in situational leadership, business acumen, and exposes them to best practices from across the company. We continue to evaluate and refine our programs as the development needs of our employees change.
In December 2017, the RGGI states released an updated model rule with changes to the CO 2 budget trading program, including an additional 30 percent reduction in the CO 2 annual cap by the year 2030, relative to 2020 levels.
In December 2017, the RGGI states released an updated model rule with changes to the CO 2 budget trading program, including an additional 30 percent reduction in the CO 2 annual cap by the year 2030, relative to 2020 levels. RGGI is currently conducting its third program review which may include an updated model rule.
ISO-NE offers the Forward Capacity Market where capacity prices are determined through auctions. Performance incentive rules have the potential to increase capacity payments for those resources that are providing excess energy or reserves during a shortage event, while penalizing those that produce less than the required level.
Performance incentive rules have the potential to increase capacity payments for those resources that are providing excess energy or reserves during a shortage event, while penalizing those that produce less than the required level.
Green Finance Framework In December 2021, we announced the publication of our Green Finance Framework, which allows us to issue green financial instruments to fund new or existing projects that support renewable energy and energy efficiency with alignment to our ESG strategy.
We will only invest in growth projects if we are confident in the expected returns. 9 Table of Contents Green Finance Framework In December 2021, we announced the publication of our Green Finance Framework, which allows us to issue green financial instruments to fund new or existing projects that support renewable energy and energy efficiency with alignment to our ESG strategy.
We are committed to each other, everything we do and to the success of our company. • We care about our key stakeholders. We respect our fellow employees, we focus on our customers and we care about our communities where we live and do business.
We are committed to each other, everything we do and to the success of our company. • We care about our key stakeholders. We respect our fellow employees, we focus on our customers, and we care about our communities where we live and do business. We will maintain productive and respectful relationship with our legislators, regulators and community leaders.
In addition, in January 2022, the EPA also made a series of public statements, including in a press release, that purported to impose new, more onerous closure requirements for CCR units. The EPA issued these new purported requirements without prior notice and without following the legal requirements for adopting new rules.
In addition, in January 2022, the EPA also made a series of public statements, including in a press release, that purported to impose new, more onerous closure requirements for CCR units.
In August 2019, the EPA issued a proposed Error Correction Rule for all three areas, which, if finalized, would have revised its previous nonattainment designations and each area at issue would be designated unclassifiable.
In February 2017, the State of Texas and Luminant filed challenges to the nonattainment designations in the Fifth Circuit Court. In August 2019, the EPA issued a proposed Error Correction Rule for all three areas, which, if finalized, would have revised its previous nonattainment designations and each area at issue would be designated unclassifiable.
The balance is cleared through the seasonal and monthly capacity auctions. 4 Table of Contents CAISO — CAISO is an ISO that manages the flow of electricity to approximately 32 million customers primarily in California, representing approximately 80% percent of the state's electric load. Energy is priced in CAISO utilizing an LMP methodology.
CAISO — CAISO is an ISO that manages the flow of electricity to approximately 32 million customers primarily in California, representing approximately 80% percent of the state's electric load. Energy is priced in CAISO utilizing an LMP methodology.
Our Texas, East, West and Sunset segments include our electricity generation operations, and our Asset Closure segment is engaged in the decommissioning and reclamation of retired plants and mines. Retail Operations Vistra is one of the largest competitive residential retail electricity providers in the U.S.
Our Texas, East, and West segments include our electricity generation operations, and our Asset Closure segment is engaged in the decommissioning and reclamation of retired plants and mines.
These new purported requirements announced by the EPA are contrary to existing regulations and the EPA's prior positions. In April 2022, we, along with the Utility Solid Waste Activities Group (USWAG), a trade association of over 130 utility operating companies, energy companies, and certain other industry associations, filed petitions for review with the D.C.
In April 2022, we, along with the Utility Solid Waste Activities Group (USWAG), a trade association of over 130 utility operating companies, energy companies, and certain other industry associations, filed petitions for review with the D.C.
The pattern of this fluctuation may change depending on, among other things, the retail load served and the terms of contracts to purchase or sell electricity. 5 Table of Contents Competition Competition in the markets in which we operate is impacted by electricity and fuel prices, congestion along the power grid, subsidies provided by state and federal governments for new and existing generation facilities, including renewables generation and battery ESS, new market entrants, construction of new generation assets, technological advances in power generation, the actions of environmental and other regulatory authorities, and other factors.
Competition Competition in the markets in which we operate is impacted by electricity and fuel prices, congestion along the power grid, subsidies provided by state and federal governments for new and existing generation facilities, including renewables generation and battery ESS, new market entrants, construction of new generation assets, technological advances in power generation, the actions of environmental and other regulatory authorities, and other factors.
In 2023, Vistra refreshed our Front-Line Leader development program focusing on the development of supervisors and managers at our plants. Vistra also provides many other training and development programs to help grow and develop employees at every level, including online learning platform courses, learning management system courses, recorded webinars and presentations, self-paced development and employee-specific skill training.
Vistra also provides many other training and development programs to help grow and develop employees at every level, including online learning platform courses, learning management system courses, recorded webinars and presentations, self-paced development and employee-specific skill training.
Fitness centers in multiple facilities offer cardio equipment, a selection of free weights and exercise mats. Our employee-led wellness team engages our people to get active and support causes that promote healthy living. With support from the company, the wellness team covers the registration costs for employees to participate in running and cycling events throughout the year.
Fitness centers in multiple facilities offer cardio equipment, a selection of free weights and exercise mats. Our employee-led wellness team engages our people to get active and support causes that promote healthy living.
The FIP applies to 22 states beginning with the 2023 ozone seasons. States where Vistra operates electric generation units that would be subject to this rule are Illinois, New Jersey, New York, Ohio, Pennsylvania, Texas, Virginia and West Virginia.
In March 2023, the EPA administrator signed its final FIP, called the Good Neighbor Plan (GNP). The FIP applied to 22 states beginning with the 2023 ozone seasons. States where Vistra operates generation units that would be subject to this rule are Illinois, New Jersey, New York, Ohio, Pennsylvania, Texas, Virginia, and West Virginia.
The new GHG proposal sets limits for (a) new natural gas-fired combustion turbines, (b) existing coal-, oil- and natural gas-fired steam generation units, and (c) certain existing natural gas-fired combustion turbines. The proposed standards are based on technologies such as carbon capture and sequestration/storage (CCS), low-GHG hydrogen co-firing, and natural gas co-firing.
In May 2024, the EPA published a final GHG rule that repealed the ACE rule and sets limits for (a) new natural gas-fired combustion turbines and (b) existing coal-, oil- and natural gas-fired steam generation units. The standards are based on technologies such as carbon capture and sequestration/storage (CCS) and natural gas co-firing.
The states develop recommendations about the boundaries of the nonattainment counties and the EPA must finalize the designations including the boundaries of each nonattainment area. CCR/Groundwater The combustion of coal to generate electric power creates large quantities of ash and byproducts that are managed at power generation facilities in dry form in landfills and in wet form in surface impoundments.
Coal Combustion Residuals (CCR)/Groundwater The combustion of coal to generate electric power creates large quantities of ash and byproducts that are managed at power generation facilities in dry form in landfills and in wet form in surface impoundments.
Each state is responsible for developing a SIP that will attain and maintain the NAAQS. These plans may result in the imposition of emission limits on our facilities. SO 2 Designations for Texas In November 2016, the EPA finalized its nonattainment designations for counties surrounding our Martin Lake generation plant and our now retired Big Brown and Monticello plants.
These plans may result in the imposition of emission limits on our facilities. 13 Table of Contents SO 2 Designations for Texas In November 2016, the EPA finalized its nonattainment designations for counties surrounding our Martin Lake generation plant and our now retired Big Brown and Monticello plants. The final designations require Texas to develop nonattainment plans for these areas.
Our generation operations by segment are represented in the following table: Segment Net Capacity (MW) % of Net Capacity ISO/RTO Texas 18,151 49% ERCOT East 12,093 33% PJM, ISO-NE and NYISO West 1,880 5% CAISO Sunset 4,578 13% MISO, PJM and ERCOT Total 36,702 100% 2 Table of Contents Independent System Operators (ISOs) and Regional Transmission Organizations (RTOs) — Separate from our operations, ISOs/RTOs administer the transmission infrastructure and markets across a regional footprint in most of the markets in which we operate.
Our generation operations by segment are represented in the following table: Segment Net Capacity (MW) % of Net Capacity ISO/RTO Texas 19,031 47% ERCOT East 19,746 49% PJM, ISO-NE, MISO, and NYISO West 1,880 4% CAISO Total 40,657 100% 2 Table of Contents Independent System Operators (ISOs) and Regional Transmission Organizations (RTOs) — ISOs and RTOs manage the transmission infrastructure and markets across regions, separate from our operations.
If the peaker net margin exceeds a certain threshold, the system-wide offer cap is reduced to the low system-wide offer cap of $2,000/MWh for the remainder of the calendar year.
ERCOT also calculates the "peaker net margin" based on revenues a hypothetical unhedged peaking unit would collect in the market. If the peaker net margin exceeds a certain threshold, the system-wide offer cap is reduced to the low system-wide offer cap of $2,000/MWh for the remainder of the calendar year.
Maintenance outages at these units are scheduled during the spring or fall off-peak demand periods. We meet our fuel requirements at our coal-fueled generation facilities in PJM and MISO with coal purchased from multiple suppliers under contracts of various lengths and transported to the facilities by either railcar or barges.
We meet our fuel requirements at our coal-fueled generation facilities in PJM and MISO with coal purchased from multiple suppliers under contracts of various lengths and transported to the facilities by either railcar or barges. We meet our fuel requirements in ERCOT using lignite that we mine at our generation facilities and coal purchased and transported by railcar.
We have also acquired the trade names for Ambit Energy, Dynegy Energy Services, Homefield Energy, TriEagle Energy, Public Power and U.S. Gas & Electric through the Ambit Transaction, Crius Transaction and the Dynegy Merger, as the case may be.
We also own the trade names for Ambit Energy, Dynegy Energy Services, Homefield Energy, TriEagle Energy, Public Power, and U.S. Gas & Electric.
We have announced our plans to develop: ◦ additional solar generation facilities in Texas, with expected commercial operation dates beginning in 2025, and ◦ up to 300 MW of solar generation facilities at retired or to-be retired plant sites in Illinois with expected commercial operation dates ranging from 2024 to 2026. • Battery Energy Storage Projects — We operate battery ESS totaling 270 MW in Texas and 750 MW in California.
We have announced our plans to develop additional solar generation facilities in Texas, with expected commercial operation dates beginning in 2025, and additional solar generation facilities at retired or to-be retired plant sites in Illinois with expected commercial operation dates beginning in 2026.
At December 31, 2023, our generating capacity was powered by the following: Primary Fuel Technology Net Capacity (MW) % of Net Capacity Natural Gas CCGT, CT or ST 24,313 66% Coal ST 8,428 23% Nuclear Nuclear 2,400 7% Renewable Solar/Battery 1,358 4% Fuel Oil CT 203 —% Total 36,702 100% Our natural gas-fueled generation fleet is comprised of 23 CCGT generation facilities totaling 19,512 MW and 11 peaking generation facilities totaling 4,801 MW.
At December 31, 2024, our generating capacity was powered by the following: Primary Fuel Technology Net Capacity (MW) % of Net Capacity Natural Gas CCGT, CT or ST 24,120 59% Coal ST 8,428 21% Uranium Nuclear 6,448 16% Renewable Solar/Battery 1,474 4% Fuel Oil CT 187 —% Total 40,657 100% Our natural gas-fueled generation fleet is comprised of 23 CCGT generation facilities totaling 19,742 MW and 10 peaking generation facilities totaling 4,378 MW.
Our TXU Energy brand, which has been used to sell electricity to customers in the competitive retail electricity market in Texas for approximately 20 years, is registered and protected by trademark law and is the only material intellectual property asset that we own.
The largest portion of our retail operations are in Texas, where we provide retail electricity to approximately 2.6 million customers. Our TXU Energy brand, which has been used to sell electricity to customers in the competitive retail electricity market in Texas for over 20 years, is registered and protected by trademark law.
In August 2023, opponents of the state's action filed suit seeking a stay alleging withdrawal from RGGI is impermissible without new legislation. Virginia is not participating in RGGI at this time.
In August 2023, opponents of the state's action filed suit seeking a stay alleging withdrawal from RGGI is impermissible without new legislation. In November 2024, a state circuit court judge ruled that the removal of Virginia from RGGI was unlawful, but the state has moved to stay the circuit court's judgment. Virginia is not participating in RGGI at this time.
Beginning in July 2021, ERCOT has increased its ancillary service procurement volumes to maintain a more conservative level of operating reserves. ERCOT implemented the ERCOT Contingency Reserve Service (ECRS) in June 2023 to further address the need for operating reserves to manage load and intermittent resource output uncertainty.
ERCOT implemented the ERCOT Contingency Reserve Service (ECRS) in June 2023 to further address the need for operating reserves to manage load and intermittent resource output uncertainty.
Our commodity risk management group also enters into electricity, natural gas and other commodity derivative contracts to reduce exposure to changes in prices primarily to mitigate the volatility of future revenues and fuel costs for our generation facilities and purchased power costs for our Retail segment.
Our commodity risk management group enters into electricity, natural gas, and other commodity derivative contracts to reduce exposure to price fluctuations with the goal of reducing volatility of future revenues and fuel costs for our generation facilities and purchased power costs for our Retail segment. 5 Table of Contents Seasonality The demand for and market prices of electricity and natural gas are affected by weather.
Seasonality The demand for and market prices of electricity and natural gas are affected by weather. As a result, our operating results are impacted by extreme or sustained weather conditions and may fluctuate on a seasonal basis.
As a result, our operating results are impacted by extreme or sustained weather conditions and may fluctuate on a seasonal basis. Typically, demand for and the price of electricity is higher in the summer and winter seasons, when the temperatures are more extreme, and the demand for and price of natural gas is also generally higher in the winter.
Integrating retail with power generation stands as a fundamental competitive advantage that mitigates the impact of commodity price fluctuations and enhances the stability and predictability of our cash flows. Stability and predictability of cash flows are essential as we evaluate economically attractive investments. Strategic energy transition that supports the reliability and affordability of electricity.
We believe integrating retail with power generation stands as a fundamental competitive advantage that mitigates the impact of commodity price fluctuations and enhances the stability and predictability of our cash flows. Disciplined capital allocation.
The law tasks the IEPA and the IPCB to set up a series of guidelines, rules and permit requirements for closure of ash ponds.
In July 2019, coal ash disposal and storage legislation in Illinois was enacted. The legislation addresses state requirements for the proper closure of coal ash ponds in the state of Illinois. The law tasks the IEPA and the IPCB to set up a series of guidelines, rules, and permit requirements for closure of ash ponds.
Our Hopewell, Ontelaunee and Independence generation facilities completed reevaluations and were re-certified as VPP Star in 2023. VPP Star status is the highest designation of OSHA's Voluntary Protection Programs.
Our Casco Bay, Forney, Lamar, and Liberty generation facilities completed reevaluations and were recommended to continue as VPP Star in 2024. VPP Star status is the highest designation of OSHA's Voluntary Protection Programs.
We encourage near-miss reporting and review of events to promote a learning environment. In 2023, safety learning calls were held every week where near-miss and safety events were reviewed by our operating teams to promote learning across the fleet. All Vistra employees are covered by our safety program.
In 2024, safety learning calls were held every week where near-miss and safety events were reviewed by our operating teams to promote learning across the fleet. All Vistra employees are covered by our safety program. Corporate and retail employees are required to complete periodic training on safety topics through our online learning management system.
Eligible full- and part-time employees are provided access to medical, prescription drug, dental, vision, life insurance, accidental death and dismemberment, long-term disability coverage, accident coverage, critical illness coverage and hospital indemnity coverage.
We are committed to maintaining an equitable compensation structure, including performing annual salary reviews by employee category level within significant locations of operations. Eligible full- and part-time employees are provided access to medical, prescription drug, dental, vision, life insurance, accidental death and dismemberment, long-term disability coverage, accident coverage, critical illness coverage and hospital indemnity coverage.
In ISO/RTO regions with centrally dispatched market structures (e.g., ERCOT, PJM, ISO-NE, NYISO, MISO, and CAISO), all generators selling into the centralized market receive the same price for energy sold based on the bid price associated with the production of the last MWh that is needed to balance supply with demand within a designated zone or at a given location.
In centrally dispatched market structures (e.g., ERCOT, PJM, ISO-NE, NYISO, MISO, CAISO), all generators receive the same price for energy based on the bid price of the last MWh needed to balance supply and demand. Prices vary within different zones due to transmission losses and congestion.
While the way we generate electricity may be changing, our essential role in providing reliable and affordable electricity is not. Significant and consistent shareholder return of capital.
While the way we generate electricity may be changing, our essential role in providing reliable and affordable electricity is not. Human Capital Resources Vistra's approach to human capital management is guided by our core values.
All of our power plant facilities have effective health and safety programs and comply with OSHA regulations.
In addition, we work closely with our suppliers and contractors to ensure our safety practices are upheld. All of our power plant facilities have effective health and safety programs and comply with OSHA regulations.
In July 2023, the Fifth Circuit Court ruled that the FIP challenge would be held in abeyance pending the resolution of the litigation on the SIP disapproval and denied the motion to stay as not needed given the EPA's administrative stay. 12 Table of Contents Regional Haze — Reasonable Progress and Best Available Retrofit Technology (BART) for Texas The Regional Haze Program of the CAA establishes "as a national goal the prevention of any future, and the remedying of any existing, impairment of visibility in mandatory class I federal areas which impairment results from man-made pollution." There are two components to the Regional Haze Program.
Circuit Court denied a motion filed by the Department of Justice on behalf of the EPA, seeking to hold the litigation in abeyance for a period of 60 days while the new leadership at the EPA evaluates the rule and determines how it wishes to proceed. 12 Table of Contents Regional Haze — Reasonable Progress and Best Available Retrofit Technology (BART) for Texas The Regional Haze Program of the CAA establishes "as a national goal the prevention of any future, and the remedying of any existing, impairment of visibility in mandatory class I federal areas which impairment results from man-made pollution." There are two components to the Regional Haze Program.
Notifications were made to Texas, Illinois and Ohio state agencies on the retirement exemption for applicable coal plants by the regulatory deadline of October 13, 2021. In March 2023, the EPA published its proposed supplemental ELG rule, which retains the retirement exemption from the 2020 ELG rule and sets new limits for plants that are continuing to operate.
Notifications were made to Texas, Illinois, and Ohio state agencies on the retirement exemption for applicable coal plants by the regulatory deadline of October 13, 2021. In May 2024, the EPA published the final ELG rule revisions, which contain new requirements for legacy wastewater and combustion residual leachate.
Circuit Court and have asked the court to determine that the EPA cannot implement or enforce the new purported requirements because the EPA has not followed the required procedures.
Circuit Court and asked the court to determine that the EPA cannot implement or enforce the new purported requirements because the EPA has not followed the required procedures. The State of Texas and the TCEQ intervened in support of the petitions filed by the Vistra subsidiaries and USWAG, and various environmental groups have intervened on behalf of the EPA.
While the cost of allowances required to operate our RGGI-affected facilities is expected to increase in future years, we expect that the cost of compliance would be reflected in the power market, and the actual impact to gross margin would be largely offset by an increase in revenue.
While the cost of allowances required to operate our RGGI-affected facilities is expected to increase in future years, we expect that the cost of compliance would be reflected in the power market, and the actual impact to gross margin would be largely offset by an increase in revenue. 10 Table of Contents Massachusetts — In August 2017, the Massachusetts Department of Environmental Protection (MassDEP) adopted final rules establishing an annual declining limit on aggregate CO 2 emissions from 21 in-state fossil-fueled electricity generation units.
We place a high importance on continuous improvement, along with a keen focus on numerous learning and error-prevention tools. To facilitate a learning environment, our various operating plants share their investigations and learnings of all safety events with all operations employees on weekly calls. The information is presented by front-line employees and supported by management.
To facilitate a learning environment, our various operating plants share their investigations and learnings of all safety events with all operations employees on weekly calls. The information is presented by front-line employees and supported by management. The lessons from each event are shared across the fleet to prevent similar incidents at other locations.
However, the CCR surface impoundment and landfill closure costs currently reflected in our existing ARO liabilities, reflect the costs of closure methods that our operations and environmental services teams believe are appropriate based on existing closure requirements and protective of the environment for each location.
The CCR surface impoundment and landfill closure costs currently reflected in our existing ARO liabilities reflect the costs of closure methods that our operations and environmental services teams determined were appropriate based on the existing closure requirements at the time we recorded those ARO liabilities, and is reasonably possible for those to increase once the IEPA determines final closure requirements.
As an energy-only market, ERCOT's market design is distinct from other competitive electricity markets in the U.S. Other markets maintain a minimum planning reserve margin through regulated planning, resource adequacy requirements and/or capacity markets. In contrast, ERCOT's resource adequacy is currently predominately dependent on energy-market price signals.
Other markets maintain a minimum planning reserve margin through regulated planning, resource adequacy requirements and/or capacity markets. In contrast, ERCOT's resource adequacy is currently predominately dependent on energy-market price signals. The Texas Legislature mandated the development of an ancillary service, the Dispatchable Reliability Reserve Service (DRRS), to address intra-hour operations challenges.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAny such erosion of stakeholder trust and confidence, evolving expectations from stakeholders on such ESG issues, and such parties' resulting actions or decisions about our company and our industry could have negative impacts on our business, operations, financial results, and stock price, including: • negative stakeholder sentiment toward us and our industry, including concerns over environmental or sustainability matters and potential changes in federal and state regulatory actions related thereto; • loss of business or loss of market share, including to competitors who do not have any, or comparable amounts, of operations involving fossil fuels; • loss of ability to secure growth opportunities; • the inability to, or increased difficulties and costs of, obtaining services, materials, or insurance from third parties; • reductions in our credit ratings or increased costs of, or limited access to, capital; • delays in project execution; • legal action; • inability or limitations on ability to receive applicable government subsidies, or competitors with smaller or no fossil operations receiving subsidies for which we are not eligible, or in larger amounts; • increased regulatory oversight; • loss of ability to obtain and maintain necessary approvals and permits from governments and regulatory agencies on a timely basis and on acceptable terms; • impediments on our ability to acquire or renew rights-of-way or land rights on a timely basis and on acceptable terms; • changing investor sentiment regarding investment in the power and utilities industry or our company; • restricted access to and cost of capital; and • loss of ability to hire and retain top talent.
Biggest changeAny such erosion of stakeholder trust and confidence, evolving expectations from stakeholders on such ESG issues, and such parties' resulting actions or decisions about our company and our industry could have negative impacts on our business, operations, financial results, and stock price, including: • negative stakeholder sentiment toward us and our industry, including concerns over environmental or sustainability matters and potential changes in federal and state regulatory actions related thereto; • loss of business or loss of market share, including to competitors who do not have any, or comparable amounts, of operations involving fossil fuels; • loss of ability to hire and retain top talent; • loss of ability to secure growth opportunities; • the inability to, or increased difficulties and costs of, obtaining services, materials, or insurance from third parties; • reductions in our credit ratings or increased costs of, or limited access to, capital; • delays in project execution; • legal action; • increased regulatory oversight; • impediments on our ability to acquire or renew rights-of-way or land rights on a timely basis and on acceptable terms; • changing investor sentiment regarding investment in the power and utilities industry or our company; and • restricted access to and cost of capital.
Volatility in market prices for fuel and power results from, among other factors: • demand for energy commodities and general economic conditions, including impacts of inflation and the relative strength or weakness of U.S. dollar compared to other currencies; • volatility in commodity prices and the supply of commodities, including but not limited to natural gas, coal and fuel oil; • volatility in Market Heat Rates; • volatility in coal and rail transportation prices; • volatility in nuclear fuel and related enrichment and conversion services; 21 Table of Contents • transmission or transportation disruptions, constraints, congestion, inoperability or inefficiencies of electricity, natural gas or coal transmission or transportation, or other changes in power transmission infrastructure; • severe, sustained or unexpected weather conditions, including extreme cold, drought and limitations on access to water; • seasonality; • changes in electricity and fuel usage resulting from conservation efforts, changes in technology or other factors; • illiquidity in the wholesale power or other commodity markets; • importation of liquified natural gas to certain markets; • development and availability of new fuels, new technologies and new forms of competition for the production and storage of power, including competitively priced alternative energy sources or storage; • changes in market structure and liquidity; • changes in the way we operate our facilities, including curtailed operation due to market pricing, environmental regulations and legislation, safety or other factors; • changes in generation capacity or efficiency; • outages or otherwise reduced output from our generation facilities or those of our competitors; • changes in electric capacity, including the addition of new supplies of power as a result of the development of new plants, expansion of existing plants, the continued operation of uneconomic power plants due to federal, state or local subsidies, or additional transmission capacity; • local, regional, national, or global supply chain constraints or shortages; • our creditworthiness and liquidity and the willingness of fuel suppliers and transporters to do business with us; • changes in the credit risk, payment practices, or financial condition of market participants; • changes in production and storage levels of natural gas, lignite, coal, uranium, diesel and other refined products; • pandemics and epidemics (including the impacts thereto, or recovery therefrom), natural disasters, wars, sabotage, terrorist acts, embargoes and other catastrophic events; and • changes in law, including judicial decisions, federal, state and local energy, environmental and other regulation and legislation.
Volatility in market prices for fuel and power results from, among other factors: • demand for energy commodities and general economic conditions, including impacts of inflation and the relative strength or weakness of U.S. dollar compared to other currencies; • volatility in commodity prices and the supply of commodities, including but not limited to natural gas, coal and fuel oil; • volatility in Market Heat Rates; • volatility in coal and rail transportation prices; • volatility in nuclear fuel and related enrichment and conversion services; • transmission or transportation disruptions, constraints, congestion, inoperability or inefficiencies of electricity, natural gas or coal transmission or transportation, or other changes in power transmission infrastructure; • severe, sustained or unexpected weather conditions, including extreme cold, drought and limitations on access to water; • seasonality; • changes in electricity and fuel usage resulting from conservation efforts, changes in technology or other factors; • illiquidity in the wholesale power or other commodity markets; • importation of liquified natural gas to certain markets; • development and availability of new fuels, new technologies and new forms of competition for the production and storage of power, including competitively priced alternative energy sources or storage; 21 Table of Contents • changes in market structure and liquidity; • changes in the way we operate our facilities, including curtailed operation due to market pricing, environmental regulations and legislation, safety or other factors; • changes in generation capacity or efficiency; • outages or otherwise reduced output from our generation facilities or those of our competitors; • changes in electric capacity, including the addition of new supplies of power as a result of the development of new plants, expansion of existing plants, the continued operation of uneconomic power plants due to federal, state or local subsidies, or additional transmission capacity; • local, regional, national, or global supply chain constraints or shortages; • our creditworthiness and liquidity and the willingness of fuel suppliers and transporters to do business with us; • changes in the credit risk, payment practices, or financial condition of market participants; • changes in production and storage levels of natural gas, lignite, coal, uranium, diesel and other refined products; • pandemics and epidemics (including the impacts thereto, or recovery therefrom), natural disasters, wars, sabotage, terrorist acts, embargoes and other catastrophic events; and • changes in law, including judicial decisions, federal, state and local energy, environmental and other regulation and legislation.
Our access to capital and the cost and other terms of acquiring capital are dependent upon, and could be adversely impacted by, various factors, including: • general economic and capital markets conditions, including changes in financial markets that reduce available liquidity or the ability to obtain or renew credit facilities on favorable terms or at all; • conditions and economic weakness in the U.S. power markets; • regulatory developments; • changes in interest rates; • a deterioration, or perceived deterioration, of our creditworthiness, enterprise value or financial or operating results; • a downgrade of Vistra's or its applicable subsidiaries' credit ratings, or credit ratings of its issuances; • our level of indebtedness and compliance with covenants in our debt agreements; • our ability to meet our sustainability targets in our secured credit facilities; • a deterioration of the creditworthiness or bankruptcy of one or more lenders or counterparties under our credit facilities that affects the ability of such lender(s) to make loans to us; • credit, security, or collateral requirements, including those relating to volatility in commodity prices; • general credit availability from banks or other lenders for us and our industry peers; • investor and lender confidence in and sentiment of the industry, our business, and the wholesale electricity markets in which we operate; • a material breakdown in or oversight in effectuating our risk management procedures; • the occurrence of changes in our businesses; 25 Table of Contents • disruptions, constraints, or inefficiencies in the continued reliable operation of our generation facilities and battery ESS; and • changes in or the operation of provisions of tax and regulatory laws.
Our access to capital and the cost and other terms of acquiring capital are dependent upon, and could be adversely impacted by, various factors, including: • general economic and capital markets conditions, including changes in financial markets that reduce available liquidity or the ability to obtain or renew credit facilities on favorable terms or at all; • conditions and economic weakness in the U.S. power markets; • regulatory developments; • changes in interest rates; • a deterioration, or perceived deterioration, of our creditworthiness, enterprise value or financial or operating results; • a downgrade of Vistra's or its applicable subsidiaries' credit ratings, or credit ratings of its issuances; • our level of indebtedness and compliance with covenants in our debt agreements; • our ability to meet our sustainability targets in our secured credit facilities; • a deterioration of the creditworthiness or bankruptcy of one or more lenders or counterparties under our credit facilities that affects the ability of such lender(s) to make loans to us; • credit, security, or collateral requirements, including those relating to volatility in commodity prices; • general credit availability from banks or other lenders for us and our industry peers; • investor and lender confidence in and sentiment of the industry, our business, and the wholesale electricity markets in which we operate; 25 Table of Contents • a material breakdown in or oversight in effectuating our risk management procedures; • the occurrence of changes in our businesses; • disruptions, constraints, or inefficiencies in the continued reliable operation of our generation facilities and battery ESS; and • changes in or the operation of provisions of tax and regulatory laws.
Regulatory and Legislative Risks • Our businesses are subject to ongoing complex governmental regulations and legislation that have adversely impacted, and may in the future adversely impact, our businesses, results of operations, liquidity and financial condition. • Our cost of compliance with existing and new environmental laws could have a material adverse effect on us. 18 Table of Contents • Pending or proposed laws or regulations, or the repeal of existing beneficial laws or regulations, including those proposed or implemented under the Biden administration, could have a material adverse effect on our businesses, results of operations, liquidity and financial condition. • Changes to laws, rules or regulations related to market structures in the markets in which we participate may have a material adverse effect on our businesses, results of operation, liquidity and financial condition. • We could be materially and adversely affected if current regulations are implemented or if new federal or state legislation or regulations are adopted to address global climate change, or if we are subject to lawsuits for alleged damage to persons or property resulting from greenhouse gas emissions. • Litigation, legal proceedings, regulatory investigations or other administrative proceedings could expose us to significant liabilities and reputational damage that could have a material adverse effect on us.
Regulatory and Legislative Risks • Our businesses are subject to ongoing complex governmental regulations and legislation that have adversely impacted, and may in the future adversely impact, our businesses, results of operations, liquidity and financial condition. 18 Table of Contents • Our cost of compliance with existing and new environmental laws could have a material adverse effect on us. • Pending or proposed laws or regulations, or the repeal of existing beneficial laws or regulations, including those proposed or implemented under the Trump administration, could have a material adverse effect on our businesses, results of operations, liquidity and financial condition. • Changes to laws, rules or regulations related to market structures in the markets in which we participate may have a material adverse effect on our businesses, results of operation, liquidity and financial condition. • We could be materially and adversely affected if current regulations are implemented or if new federal or state legislation or regulations are adopted to address global climate change, or if we are subject to lawsuits for alleged damage to persons or property resulting from greenhouse gas emissions. • Litigation, legal proceedings, regulatory investigations or other administrative proceedings could expose us to significant liabilities and reputational damage that could have a material adverse effect on us.
There is no assurance that we will be able to prevent any such impacts in the future. In the event of a material cyber breach, critical operational capabilities to support our generation, commercial, or retail operations could be disrupted or lost. Additionally, customer, confidential, or proprietary data could be compromised, misused, or inappropriately disclosed.
There is no assurance that we will be able to prevent or mitigate any such impacts in the future. In the event of a material cyber breach, critical operational capabilities to support our generation, commercial, or retail operations could be disrupted or lost. Additionally, customer, confidential, or proprietary data could be compromised, misused, or inappropriately disclosed.
The agreements and instruments governing our debt, including the Vistra Operations Credit Facilities and indentures, contain restrictions that could adversely affect us by limiting our ability to operate our businesses and plan for, or react to, market conditions or to meet our capital needs and could result in an event of default under the Vistra Operations Credit Facilities and/or indentures.
The agreements and instruments governing our debt, including the Vistra Operations Credit Facilities and indentures, contain restrictions that could adversely affect us by limiting our ability to operate our businesses and plan for, or react to, market conditions or to meet our capital needs and could result in an event of default under the Vistra Operations Credit Facilities, indentures and/or our other debt facilities.
Attacks on our infrastructure that breach cyber/data security measures could expose us to significant liabilities, reputational damage, regulatory action, and disrupt business operations, which could have a material adverse effect on us. • We may suffer material losses, costs and liabilities due to operational risks, regulatory risks, and the risk of nuclear accidents arising from the ownership and operation of the Comanche Peak nuclear generation facility. • The operation and maintenance of power generation facilities and related mining operations are capital intensive and involve significant risks that could adversely affect our results of operations, liquidity and financial condition. • We may be materially and adversely affected by obligations to comply with federal and state regulations, laws, and other legal requirements that govern the operations, assessments, storage, closure, corrective action, disposal and monitoring relating to CCR. • We have been and may in the future be materially and adversely affected by the effects of extreme weather conditions and seasonality. • Events outside of our control, including an epidemic or outbreak of an infectious disease may materially adversely affect our business. • Changes in technology, increased electricity conservation efforts, or energy sustainability efforts may reduce the value of our business, introduce new or emerging risks and may otherwise have a material adverse effect on us.
Attacks on our infrastructure that breach cyber/data security measures could expose us to significant liabilities, reputational damage, regulatory action, and disrupt business operations, which could have a material adverse effect on us. • We may suffer material losses, costs and liabilities due to operational risks, regulatory risks, and the risk of nuclear accidents arising from the ownership and operation of the nuclear generation facilities. • The operation and maintenance of power generation facilities and related mining operations are capital intensive and involve significant risks that could adversely affect our results of operations, liquidity and financial condition. • We may be materially and adversely affected by obligations to comply with federal and state regulations, laws, and other legal requirements that govern the operations, assessments, storage, closure, corrective action, disposal and monitoring relating to CCR. • We have been and may in the future be materially and adversely affected by the effects of extreme weather conditions and seasonality. • Events outside of our control, including an epidemic or outbreak of an infectious disease may materially adversely affect our business. • Changes in technology, increased electricity conservation efforts, or energy sustainability efforts may reduce the value of our business, introduce new or emerging risks and may otherwise have a material adverse effect on us.
Previously announced or future legal proceedings, regulatory actions, investigations, or other administrative proceedings involving market participants may lead to adverse determinations or other findings of violations of laws, rules, or regulations, any of which may impact the ability of market participants to satisfy, in whole or in part, their respective obligations.
Previously announced or future legal proceedings, regulatory actions, or other administrative proceedings involving market participants may lead to adverse determinations or other findings of violations of laws, rules, or regulations, any of which may impact the ability of market participants to satisfy, in whole or in part, their respective obligations.
Winter Storm Elliott, in December 2022, has also led to regulatory requests for information and notices of investigation by NERC, FERC, regional reliability entities, and independent market monitors for regions across the country.
Winter Storm Elliott, in December 2022, also led to regulatory requests for information and notices of investigation by NERC, FERC, regional reliability entities, and independent market monitors for regions across the country.
The global or national outbreak of an illness or other communicable disease, or any other public health crisis may cause disruptions to our business and operational plans, as a result of a number of factors, including (a) a protracted slowdown of broad sectors of the economy, (b) changes in demand or supply for commodities, (c) significant changes in legislation or regulatory policy to address the pandemic (including prohibitions on certain marketing channels, moratoriums or conditions on disconnections or limits or restrictions on late fees), (d) reduced demand for electricity (particularly from commercial and industrial customers), (e) increased late or uncollectible customer payments, (f) negative impacts on the health of our workforce, (g) a deterioration of our ability to ensure business continuity (including increased vulnerability to cyber and other information technology risks as a result of a significant portion of our workforce continuing to work from home), and (h) the inability of the Company's contractors, suppliers, and other business partners to fulfill their contractual obligations. 40 Table of Contents Changes in technology, increased electricity conservation efforts, or energy sustainability efforts may reduce the value of our business, introduce new or emerging risks, and may otherwise have a material adverse effect on us.
The global or national outbreak of an illness or other communicable disease, or any other public health crisis may cause disruptions to our business and operational plans, as a result of a number of factors, including (a) a protracted slowdown of broad sectors of the economy, (b) changes in demand or supply for commodities, (c) significant changes in legislation or regulatory policy to address the pandemic (including prohibitions on certain marketing channels, moratoriums or conditions on disconnections or limits or restrictions on late fees), (d) reduced demand for electricity (particularly from commercial and industrial customers), (e) increased late or uncollectible customer payments, (f) negative impacts on the health of our workforce, (g) a deterioration of our ability to ensure business continuity (including increased vulnerability to cyber and other information technology risks), and (h) the inability of the Company's contractors, suppliers, and other business partners to fulfill their contractual obligations. 40 Table of Contents Changes in technology, increased electricity conservation efforts, or energy sustainability efforts may reduce the value of our business, introduce new or emerging risks, and may otherwise have a material adverse effect on us.
The price of wholesale electricity supply purchases associated with the retail businesses' energy commitments can be different than that reflected in the rates charged to customers due to, among other factors: • varying supply procurement contracts used and the timing of entering into related contracts; • subsequent changes in the overall price of natural gas; • daily, monthly or seasonal fluctuations in the price of natural gas relative to the 12-month forward prices; • transmission constraints and the Company's ability to move power to our customers; • out-of-market payments, uplifts, or other non-pass through charges, and • changes in Market Heat Rate.
The price of wholesale electricity supply purchases associated with the retail businesses' energy commitments can be different than that reflected in the rates charged to customers due to, among other factors: • varying supply procurement contracts used and the timing of entering into related contracts; • subsequent changes in the overall price of natural gas; • daily, monthly or seasonal fluctuations in the price of natural gas relative to the 12-month forward prices; • transmission constraints and the Company's ability to move power to our customers; • out-of-market payments, uplifts, or other non-pass through charges, and 34 Table of Contents • changes in Market Heat Rate.
Companies across all industries are facing evolving expectations or increasing scrutiny from stakeholders related to their approach to ESG matters. For Vistra, climate change, safety and stakeholder relations remain primary focus areas, and changing expectations of our practices and performance across these and other ESG areas may impose additional costs or create exposure to new or additional risks.
Companies across all industries are facing evolving expectations or increasing scrutiny from stakeholders related to their approach to ESG matters. For Vistra, reliability, affordability, safety, climate change, and stakeholder relations remain primary focus areas, and changing expectations of our practices and performance across these and other ESG areas may impose additional costs or create exposure to new or additional risks.
Our operations, projects and growth opportunities require us to have strong relationships with key stakeholders, including local communities and other groups directly impacted by our activities, as well as governments and government agencies, investor advocacy groups, certain institutional investors, investment funds and others which are increasingly focused on ESG practices.
Our operations, projects and growth opportunities require us to have strong relationships with key stakeholders, including local communities and other groups directly impacted by our activities, as well as governments and government agencies, investor advocacy groups, certain institutional investors, investment funds and others which are increasingly focused on sustainability practices.
We could be materially and adversely affected if new federal and/or state legislation or regulations are adopted to address global climate change that could require efforts that exceed or are more expensive than our currently planned initiatives or if we are subject to lawsuits for alleged damage to persons or property resulting from GHG emissions.
We could be materially and adversely affected if federal and/or state legislation or regulations that address global climate change require efforts that exceed or are more expensive than our currently planned initiatives or if we are subject to lawsuits for alleged damage to persons or property resulting from GHG emissions.
Should the counterparties to these arrangements fail to perform, we could be forced to enter into alternative hedging arrangements or honor the underlying commitment at then-current market prices. Additionally, our counterparties may seek bankruptcy protection under Chapter 11 or liquidation under Chapter 7 of the Bankruptcy Code.
Should the counterparties to these arrangements fail to perform, we could be forced to enter into alternative hedging arrangements or honor the underlying commitment at then-current market prices. Additionally, our counterparties may seek bankruptcy protection under Chapter 11 or liquidation under Chapter 7 of the U.S. Bankruptcy Code.
There is no assurance that the Board will declare, or that we will pay, any dividends on our common stock in the future. The Board has approved a share repurchase program in an aggregate authorized amount of $5.75 billion.
There is no assurance that the Board will declare, or that we will pay, any dividends on our common stock in the future. The Board has approved a share repurchase program in an aggregate authorized amount of $6.75 billion.
Any such stoppage, disruption, curtailment, modification or additional costs could have a material adverse effect on us. In addition, we may be responsible for any on-site liabilities associated with the environmental condition of facilities that we have acquired, leased, developed or sold, regardless of when the liabilities arose and whether they are now known or unknown.
Any such stoppage, disruption, curtailment, modification or additional costs could have a material adverse effect on us. 32 Table of Contents In addition, we may be responsible for any on-site liabilities associated with the environmental condition of facilities that we have acquired, leased, developed or sold, regardless of when the liabilities arose and whether they are now known or unknown.
If we fail to comply with the covenants in the Vistra Operations Credit Facilities and/or indentures and are unable to obtain a waiver or amendment, or a default exists and is continuing, the lenders under such agreements or notes, as the case may be, could give notice and declare outstanding borrowings thereunder immediately due and payable.
If we fail to comply with the covenants in the Vistra Operations Credit Facilities, indentures and/or our other debt facilities and are unable to obtain a waiver or amendment, or a default exists and is continuing, the lenders under such agreements or notes, as the case may be, could give notice and declare outstanding borrowings thereunder immediately due and payable.
The terms of all current collective bargaining agreements covering represented personnel engaged in lignite mining operations, lignite-, coal-, natural gas- and nuclear-fueled generation operation, as well as some battery operations, expire on various dates between March 2024 and March 2028, but remain effective thereafter unless and until terminated by either party.
The terms of all current collective bargaining agreements covering represented personnel engaged in lignite mining operations, lignite-, coal-, natural gas- and nuclear-fueled generation operation, as well as some battery operations, expire on various dates between February 2025 and March 2028, but remain effective thereafter unless and until terminated by either party.
Some of the recent regulatory actions, such as the EPA's Good Neighbor Plan for the 2015 Ozone NAAQS, May 2023 proposal to regulated GHG emissions that would replace the ACE rule, and actions under the Regional Haze program, could require us to install significant additional control equipment, resulting in potentially material costs of compliance for our generation units, including capital expenditures, higher operating and fuel costs and potential production curtailments or plant retirements.
Some of the recent regulatory actions, such as the EPA's Good Neighbor Plan for the 2015 Ozone NAAQS, the final rule to regulated GHG emissions that would replace the ACE rule, and actions under the Regional Haze program, could require us to install significant additional control equipment, resulting in potentially material costs of compliance for our generation units, including capital expenditures, higher operating and fuel costs and potential production curtailments or plant retirements.
The following factors could result in harm to our business, financial condition, results of operations, cash flows, and prospects, among other impacts: Market, Financial and Economic Risks • Our revenues, results of operations and operating cash flows are affected by price fluctuations in the wholesale power market and other market factors beyond our control. • We purchase natural gas, coal, fuel oil, and nuclear fuel for our generation facilities, and higher than expected fuel costs or disruptions in these fuel markets may have an adverse impact on, our costs, revenues, results of operations, financial condition and cash flows. • We have retired, announced planned retirements of, and may be forced to retire or idle additional underperforming generation units which could result in significant costs and have an adverse effect on our operating results. • Our assets or positions cannot be fully hedged against changes in commodity prices and Market Heat Rates, and hedging transactions may not work as planned or hedge counterparties may default on their obligations. • Competition, changes in market structure, and/or state or federal interference in the wholesale and retail power markets, together with subsidized generation, may have a material adverse effect on our financial condition, results of operations and cash flows. • Our results of operations and financial condition could be materially and adversely affected by energy market participants continuing to construct new generation facilities or expanding or enhancing existing generation facilities despite relatively low power prices and such additional generation capacity results in a reduction in wholesale power prices. • Our liquidity needs could be difficult to satisfy, particularly during times of uncertainty in the financial markets or during times of significant fluctuation in commodity prices, and we may be unable to access capital on favorable terms or at all in the future, which could have a material adverse effect on us. • The agreements and instruments governing our debt, including the Vistra Operations Credit Facilities and indentures, contain restrictions and limitations that could affect our ability to operate our business, our liquidity, and our results of operations, and any failure to comply with these restrictions could have a material adverse effect on us. • We may not be able to complete future acquisitions on favorable terms or at all, successfully integrate future acquisitions into our business, or effectively identify and invest in value-creating businesses, assets or projects, which could result in unanticipated expenses and losses or otherwise hinder or delay our growth strategy. • Our ability to achieve the expected growth of our Vistra Zero portfolio, consisting of our solar generation, battery ESS, and other renewables development projects, is subject to substantial capital requirements and other significant uncertainties. • Tax legislation initiatives or challenges to our tax positions, or potential future legislation or the imposition of new or increased taxes or fees, could have a material adverse effect on our financial condition, results of operations and cash flows.
The following factors could result in harm to our business, financial condition, results of operations, cash flows, and prospects, among other impacts: Market, Financial, and Economic Risks • Our revenues, results of operations, and operating cash flows are affected by price fluctuations in the wholesale power market and other market factors beyond our control. • We purchase natural gas, coal, fuel oil, and nuclear fuel for our generation facilities, and higher than expected fuel costs or disruptions in these fuel markets may have an adverse impact on, our costs, revenues, results of operations, financial condition, and cash flows. • We have retired, announced planned retirements of, and may be forced to retire or idle additional underperforming generation units which could result in significant costs and have an adverse effect on our operating results. • Our assets or positions cannot be fully hedged against changes in commodity prices and Market Heat Rates, and hedging transactions may not work as planned or hedge counterparties may default on their obligations. • Competition, changes in market structure, and/or state or federal interference in the wholesale and retail power markets, together with subsidized generation, may have a material adverse effect on our financial condition, results of operations, and cash flows. • Our results of operations and financial condition could be materially and adversely affected by energy market participants continuing to construct new generation facilities or expanding or enhancing existing generation facilities despite relatively low power prices and such additional generation capacity results in a reduction in wholesale power prices. • Our liquidity needs could be difficult to satisfy, particularly during times of uncertainty in the financial markets or during times of significant fluctuation in commodity prices, and we may be unable to access capital on favorable terms or at all in the future, which could have a material adverse effect on us. • The agreements and instruments governing our debt, including the Vistra Operations Credit Facilities and indentures, contain restrictions and limitations that could affect our ability to operate our business, our liquidity, and our results of operations, and any failure to comply with these restrictions could have a material adverse effect on us. • We may not be able to complete future acquisitions on favorable terms or at all, successfully integrate future acquisitions into our business, or effectively identify and invest in value-creating businesses, assets or projects, which could result in unanticipated expenses and losses or otherwise hinder or delay our growth strategy. • Our ability to achieve the expected growth of our Vistra Zero portfolio, consisting of our solar generation, battery ESS, and other renewables development projects, is subject to substantial capital requirements and other significant uncertainties. • Tax legislation initiatives or challenges to our tax positions, or potential future legislation or the imposition of new or increased taxes or fees, could have a material adverse effect on our financial condition, results of operations, and cash flows. • If electricity demand does not grow at the rate expected, or if we are unable to execute on large load offtake opportunities, our financial performance, growth opportunities, and stock price could be adversely impacted.
If these development efforts are not successful, we may abandon a project under development and write off the costs incurred in connection with such project and could incur additional losses associated with any related contingent liabilities. Circumstances associated with potential divestitures could adversely affect our results of operations and financial condition.
If these development efforts are not successful, we may abandon a project under development and write off the costs incurred in connection with such project and could incur additional losses associated with any related contingent liabilities. 28 Table of Contents Circumstances associated with potential divestitures could adversely affect our results of operations and financial condition.
If the Company is unable to identify and consummate future acquisitions, it may impede the Company's ability to execute its growth strategy. 28 Table of Contents Our ability to achieve the expected growth of our Vistra Zero portfolio, consisting of our solar generation, battery ESS, and other renewables development projects, is subject to substantial capital requirements and other significant uncertainties.
If the Company is unable to identify and consummate future acquisitions, it may impede the Company's ability to execute its growth strategy. Our ability to achieve the expected growth of our Vistra Zero portfolio, consisting of our solar generation, battery ESS, and other renewables development projects, is subject to substantial capital requirements and other significant uncertainties.
We may not be successful in managing these or any other significant risks that we may encounter in divesting any asset, which could adversely affect our results of operations and financial condition. 29 Table of Contents If our goodwill, intangible assets, or long-lived assets become impaired, we may be required to record a significant charge to earnings.
We may not be successful in managing these or any other significant risks that we may encounter in divesting any asset, which could adversely affect our results of operations and financial condition. If our goodwill, intangible assets, or long-lived assets become impaired, we may be required to record a significant charge to earnings.
Our debt could have negative consequences for our financial condition including: • increasing our vulnerability to general economic and industry conditions; • requiring a significant portion of our cash flows from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to pay dividends to holders of our common stock or to fund our operations, capital expenditures and future business opportunities; • limiting our ability to enter into long-term power sales or fuel purchases which require credit support; • limiting our ability to fund operations or future acquisitions; • limiting our ability to repurchase shares under the share repurchase program; • restricting our ability to make distributions or pay dividends with respect to our common and preferred stock and the ability of our subsidiaries to make distributions to us, in light of restricted payment and other financial covenants in our credit facilities and other financing agreements; • inhibiting the growth of our stock price; • exposing us to the risk of increased interest rates because certain of our borrowings, including borrowings under the Vistra Operations Credit Facilities, are at variable rates of interest, only a portion of which are hedged; • limiting our ability to obtain additional financing for working capital including collateral postings, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; and • limiting our ability to adjust to changing market conditions and placing us at a competitive disadvantage compared to our competitors who may have less debt.
Our debt could have negative consequences for our financial condition including: • increasing our vulnerability to general economic and industry conditions; • requiring a significant portion of our cash flows from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to pay dividends to holders of our common stock or to fund our operations, capital expenditures and future business opportunities; • limiting our ability to enter into long-term power sales or fuel purchases which require credit support; • limiting our ability to fund operations or future acquisitions; • limiting our ability to repurchase shares under the share repurchase program; • restricting our ability to make distributions or pay dividends with respect to our common and preferred stock and the ability of our subsidiaries to make distributions to us, in light of restricted payment and other financial covenants in our credit facilities and other financing agreements; • inhibiting the growth of our stock price; • exposing us to the risk of increased interest rates because certain of our borrowings, including borrowings under the Vistra Operations Credit Facilities, are at variable rates of interest, only a portion of which are hedged; • limiting our ability to obtain additional financing for working capital including collateral postings, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes; and • limiting our ability to adjust to changing market conditions and placing us at a competitive disadvantage compared to our competitors who may have less debt. 26 Table of Contents We may not be successful in obtaining additional capital for these or other reasons.
Winter Storm Elliott, in December 2022, and Winter Storm Heather, in January 2024, were other examples of extreme weather across the U.S. that resulted in widespread wholesale power market volatility. 20 Table of Contents The majority of our facilities operate as "merchant" facilities without long-term power sales agreements.
Winter Storm Elliott, in December 2022, and Winter Storm Heather, in January 2024, were other examples of extreme weather across the U.S. that resulted in widespread wholesale power market volatility. The majority of our facilities operate as "merchant" facilities without long-term power sales agreements.
To grow and remain competitive, we will need to adapt to changes in available technology like generative AI, continually invest in our assets, increase generation capacity, increase our use of renewable technologies, enhance our existing offerings, and introduce new offerings to meet our current and potential customers’ changing service demands.
To grow and remain competitive, we will need to adapt to changes in available technology like generative AI, continually invest in our assets, increase generation capacity, increase our use of low-carbon technologies, enhance our existing offerings, and introduce new offerings to meet our current and potential customers’ changing service demands.
Failure to timely and effectively ensure transfer of knowledge and smooth transitions involving senior management and other key personnel could hinder our strategic planning and execution. We could be materially and adversely impacted by strikes or work stoppages by our unionized employees. As of December 31, 2023, we had approximately 1,200 employees covered by collective bargaining agreements.
Failure to timely and effectively ensure transfer of knowledge and smooth transitions involving senior management and other key personnel could hinder our strategic planning and execution. We could be materially and adversely impacted by strikes or work stoppages by our unionized employees. As of December 31, 2024, we had approximately 1,940 employees covered by collective bargaining agreements.
In conjunction with Luminant's announcements in 2017 to retire several power generation assets and related mining operations, along with the continuous reclamation activity at its continuing mining operations for its mines related to the Oak Grove generation asset, Luminant is expected to spend a significant amount of money, internal resources and time to complete the required reclamation activities.
In conjunction with Luminant's announcements in 2017 to retire several power generation assets and related mining operations, along with the reclamation obligations at the closed Martin Lake mines and continuous reclamation activity at its continuing mining operations for its mines related to the Oak Grove generation asset, Luminant is expected to spend a significant amount of money, internal resources and time to complete the required reclamation activities.
As of December 31, 2023, 1,000,000 shares of Series A Preferred Stock, 1,000,000 shares of Series B Preferred Stock, and 476,081 shares of Series C Preferred Stock were issued and outstanding.
As of December 31, 2024, 1,000,000 shares of Series A Preferred Stock, 1,000,000 shares of Series B Preferred Stock, and 476,081 shares of Series C Preferred Stock were issued and outstanding.
Our efforts to deter, identify, and mitigate future breaches may require additional, significant capital and operating costs and may not be successful. We may suffer material losses, costs and liabilities due to operation risks, regulatory risks, and the risk of nuclear accidents arising from the ownership and operation of the Comanche Peak nuclear generation facility.
Our efforts to deter, identify, and mitigate future breaches may require additional, significant capital and operating costs and may not be successful. We may suffer material losses, costs and liabilities due to operation risks, regulatory risks, and the risk of nuclear accidents arising from the ownership and operation of the nuclear generation facilities.
We currently maintain non-investment grade credit ratings that could negatively affect our ability to access capital on favorable terms or result in higher collateral requirements, particularly if our credit ratings were to be downgraded in the future. Our businesses are capital intensive.
Vistra currently maintains non-investment grade credit ratings that could negatively affect our ability to access capital on favorable terms or result in higher collateral requirements, particularly if our credit ratings were to be downgraded in the future. Our businesses are capital intensive.
We are required to obtain, and to comply with, government permits and approvals. We are required to obtain, and to comply with, numerous permits and licenses from federal, state and local governmental agencies.
We are required to obtain, and to comply with, numerous permits and licenses from federal, state and local governmental agencies.
Any decision by a subsidiary to provide Vistra with funds to satisfy its obligations, including those under the TRA, whether by dividends, distributions, loans or otherwise, will depend on, among other things, such subsidiary's results of operations, financial condition, cash flows, cash requirements, contractual prohibitions and other restrictions, applicable law and other factors.
Any decision by a subsidiary to provide Vistra with funds to satisfy its obligations, whether by dividends, distributions, loans or otherwise, will depend on, among other things, such subsidiary's results of operations, financial condition, cash flows, cash requirements, contractual prohibitions and other restrictions, applicable law and other factors.
Some of these competitors or potential competitors may be larger than we are or have greater resources or access to capital than we have. Competitors may also incorporate AI into their businesses, services, and products more quickly or more successfully than we do.
Some of these competitors or potential competitors may be larger than we are or have greater resources or access to capital than we have. Competitors may also incorporate emerging technology like generative AI into their businesses, services, and products more quickly or more successfully than we do.
Additionally, large-scale cryptocurrency mining is becoming increasingly prevalent in certain markets, including ERCOT, and many of these cryptocurrency mining facilities are "behind-the-meter." Such emerging technologies could affect the price of energy, levels of customer-owned generation, customer expectations and current business models and make portions of our electric system power supply and transmission and/or distribution facilities obsolete prior to the end of their useful lives.
Additionally, large-scale cryptocurrency mining, AI data centers, and increased industrial electrification are becoming increasingly prevalent in certain markets, including ERCOT, and many of these facilities are "behind-the-meter." Such emerging technologies could affect the price of energy, levels of customer-owned generation, customer expectations and current business models and make portions of our electric system power supply and transmission and/or distribution facilities obsolete prior to the end of their useful lives.
As a result, employees, contractors, customers and the general public are at risk for serious injury, including loss of life. The occurrence of any one of these events may result in us being named as a defendant in lawsuits asserting claims for substantial damages, including for environmental cleanup costs, personal injury and property damage and fines and/or penalties.
As a result, employees, contractors, customers, and the general public are at risk for serious injury, including loss of life. 38 Table of Contents The occurrence of any one of these events has in the past and may in the future result in us being named as a defendant in lawsuits asserting claims for substantial damages, including for environmental cleanup costs, personal injury and property damage and fines and/or penalties.
If such degradations were to occur at the Comanche Peak Facility, the process of identifying and correcting the causes of the operational downgrade to return the facility to operation could require significant time and expense, resulting in both lost revenue and increased fuel and purchased power expense to meet supply commitments.
If such degradations were to occur at a nuclear generation facility, the process of identifying and correcting the causes of the operational downgrade to return the facility to operation could require significant time and expense, resulting in both lost revenue and increased fuel and purchased power expense to meet supply commitments.
For the next five years, Vistra is projected to spend approximately $245 million (on a nominal basis) to achieve its mining reclamation objectives. Litigation, legal proceedings, regulatory investigations or other administrative proceedings could expose us to significant liabilities and reputational damage that could have a material adverse effect on us.
For the next five years, Vistra is projected to spend approximately $238 million (on a nominal basis) to achieve its mining reclamation objectives. 33 Table of Contents Litigation, legal proceedings, regulatory investigations or other administrative proceedings could expose us to significant liabilities and reputational damage that could have a material adverse effect on us.
The EPA has been directed by the Biden Administration to review a number of environmental rules adopted by the EPA during the Trump Administration, including the CCR rule, the ELG rule, the ACE rule and the particulate matter (PM) and NAAQS rules.
The EPA was directed by the Biden Administration to review a number of environmental rules adopted by the EPA during the first Trump Administration, including the CCR rule, the ELG rule, the ACE rule and the particulate matter (PM), and NAAQS rules.
Limitations on our access to, or increases in our cost of, capital could have a material adverse effect on us. In addition, we currently maintain non-investment grade credit ratings.
Limitations on our access to, or increases in our cost of, capital could have a material adverse effect on us. In addition, Vistra currently maintains non-investment grade credit ratings.
These risks include: • unscheduled outages or unexpected costs due to equipment, mechanical, structural, cybersecurity, insider threat, third-party compromise or other problems; • inadequacy or lapses in maintenance protocols; • the impairment of reactor operation and safety systems due to human error or force majeure; • the costs of, and liabilities relating to, storage, handling, treatment, transport, release, use and disposal of radioactive materials; • the costs of procuring nuclear fuel, including impacts from restrictions on imports from Russia or China (see Item 7.
These risks include: • unscheduled outages or unexpected costs due to equipment, mechanical, structural, cybersecurity, insider threat, third-party compromise or other problems; • inadequacy or lapses in maintenance protocols; • the impairment of reactor operation and safety systems due to human error or force majeure; • the costs of, and liabilities relating to, storage, handling, treatment, transport, release, use and disposal of radioactive materials; • the costs of procuring nuclear fuel, including impacts from trade restrictions such as tariffs, embargoes, and quotas (see Item 7.
Management's Discussion and Analysis of Financial Condition, and Results of Operations – Significant Activities and Events, and Items Influencing Future Performance – Macroeconomic Conditions ); • the costs of storing and maintaining spent nuclear fuel at our on-site dry cask storage facility; • terrorist or cybersecurity attacks by nation-states or other threat actors and the cost to protect and recover against any such attack; • the impact of a natural disaster; • limitations on the amounts and types of insurance coverage commercially available; and • uncertainties with respect to the technological and financial aspects of modifying or decommissioning nuclear facilities at the end of their useful lives.
Management's Discussion and Analysis of Financial Condition, and Results of Operations – Significant Activities and Events, and Items Influencing Future Performance – Macroeconomic Conditions ); • the costs of storing and maintaining spent nuclear fuel at our on-site dry cask storage facility; • terrorist or cybersecurity attacks by nation-states or other threat actors and the cost to protect and recover against any such attack; • the impact of a natural disaster; • financial risk associated with retrospective insurance premium that could become due under secondary coverage required by the Price Anderson Act; • limitations on the amounts and types of insurance coverage commercially available; and • uncertainties with respect to the technological and financial aspects of modifying or decommissioning nuclear facilities at the end of their useful lives.
These federal and state laws, regulations and other legal requirements may require or result in additional expenditures, increased operating and maintenance costs and/or result in closure of certain power generation facilities, which could affect the results of operations, financial position and cash flows of the Company. We have recognized ARO related to these CCR-related requirements.
These federal and state laws, regulations and other legal requirements may require or result in additional expenditures, increased operating and maintenance costs and/or result in closure of certain power generation facilities, which could affect the results of operations, financial position and cash flows of the Company.
It could also expose us to the risk of increased interest rates and limit our ability to react to changes in the economy, or our industry, as well as impact our cash available for distribution. As of December 31, 2023, we had approximately $14.4 billion of total indebtedness and approximately $10.9 billion of indebtedness net of cash.
It could also expose us to the risk of increased interest rates and limit our ability to react to changes in the economy, or our industry, as well as impact our cash available for distribution. As of December 31, 2024, we had approximately $18.4 billion of total indebtedness and approximately $17.2 billion of indebtedness net of cash.
We have been and may in the future be materially and adversely affected by the effects of extreme weather conditions and seasonality. We have been and may in the future be materially affected by weather conditions and our businesses may fluctuate substantially on a seasonal basis as the weather changes.
We have been and may in the future be materially affected by weather conditions and our businesses may fluctuate substantially on a seasonal basis as the weather changes.
As a result, our quarterly and annual financial results in accordance with GAAP are subject to significant fluctuations caused by changes in forward commodity prices. 23 Table of Contents Competition, changes in market structure, and/or state or federal interference in the wholesale and retail power markets, together with subsidized generation, may have a material adverse effect on our financial condition, results of operations and cash flows.
As a result, our quarterly and annual financial results, prepared in accordance with GAAP, are subject to increased volatility. 23 Table of Contents Competition, changes in market structure, and/or state or federal interference in the wholesale and retail power markets, together with subsidized generation, may have a material adverse effect on our financial condition, results of operations and cash flows.
Any of the foregoing could have a material adverse effect on us. 32 Table of Contents The EPA has recently finalized or proposed several regulatory actions establishing new requirements for control of certain emissions from sources, including electricity generation facilities.
Any of the foregoing could have a material adverse effect on us. The Biden Administration recently finalized or proposed several regulatory actions establishing new requirements for control of certain emissions from sources, including electricity generation facilities.
As a result, power prices are subject to significant volatility due to supply and demand imbalances, especially in the day-ahead and spot markets. Demand for electricity can fluctuate dramatically, creating periods of substantial under- or over-supply. Over-supply can occur as a result of the construction of new power generation sources, as we have observed in recent years.
As a result, power prices are subject to significant volatility due to supply and demand imbalances, especially in the day-ahead and spot markets. Demand for electricity can fluctuate dramatically, creating periods of substantial under- or over-supply. Over-supply can occur as a result of the construction of new power generation sources. During periods of over-supply, electricity prices might be depressed.
International conflict increases the risk of state-sponsored cyber threats and escalated use of cybercriminal and cyber-espionage activities. In particular, the current geopolitical climate has further escalated cybersecurity risk, with various government agencies, including the Federal Bureau of Investigation (FBI) and the U.S. Cybersecurity & Infrastructure Security Agency, issuing warnings of increased cyber threats, particularly for U.S. critical infrastructure.
In particular, the current geopolitical climate has further escalated cybersecurity risk, with various government agencies, including the Federal Bureau of Investigation (FBI) and the U.S. Cybersecurity & Infrastructure Security Agency, issuing warnings of increased cyber threats, particularly for U.S. critical infrastructure.
We may potentially be affected by emerging technologies that may over time affect change in capacity markets and the energy industry overall including distributed generation and clean technology. Some of these emerging technologies are shale gas production, distributed renewable energy technologies, energy efficiency, broad consumer adoption of electric vehicles, distributed generation and energy storage devices.
We may potentially be affected by emerging technologies that may over time affect change in capacity markets and the energy industry overall including distributed generation and clean technology. Some of these emerging technologies are distributed renewable energy technologies, energy efficiency, broad consumer adoption of electric vehicles, distributed generation, energy storage devices, fuel cells, nuclear small modular reactors, and linear generators.
Our businesses are subject to numerous state and federal laws (including, but not limited to, Texas Public Utility Regulatory Act, the Federal Power Act, the Natural Gas Policy Act, the Atomic Energy Act, the Public Utility Regulatory Policies Act of 1978, the Clean Air Act (CAA), the Clean Water Act (CWA), the Resource Conservation and Recovery Act (RCRA), the Energy Policy Act of 2005, the Dodd-Frank Wall Street Reform and the Consumer Protection Act and the Telephone Consumer Protection Act), changing governmental policy and regulatory actions (including those of the FERC, the NERC, the RCT, the MSHA, the EPA, the NRC, the DOJ, the FTC, the CFTC, state public utility commissions and state environmental regulatory agencies), and the rules, guidelines and protocols of ERCOT, CAISO, ISO-NE, MISO, NYISO and PJM with respect to various matters, including, but not limited to, market structure and design, operation of nuclear generation facilities, construction and operation of other generation facilities, development, operation and reclamation of lignite mines, recovery of costs and investments, decommissioning costs, market behavior rules, present or prospective wholesale and retail competition, administrative pricing mechanisms (and adjustments thereto), rates for wholesale sales of electricity, mandatory reliability standards and environmental matters.
Compliance with, or changes to, the requirements under these legal and regulatory regimes, including those proposed or implemented under the current presidential administration or during any future change of administration, or any repeal of existing beneficial laws or regulations, may adversely impact our businesses, results of operations, liquidity, financial condition, and cash flows. 30 Table of Contents Our businesses are subject to numerous state and federal laws (including, but not limited to, Texas Public Utility Regulatory Act, the Federal Power Act, the Natural Gas Policy Act, the Atomic Energy Act, the Public Utility Regulatory Policies Act of 1978, the Clean Air Act (CAA), the Clean Water Act (CWA), the Resource Conservation and Recovery Act (RCRA), the Energy Policy Act of 2005, the Dodd-Frank Wall Street Reform and the Consumer Protection Act and the Telephone Consumer Protection Act), changing governmental policy and regulatory actions (including those of the FERC, the NERC, the RCT, the MSHA, the EPA, the NRC, the DOJ, the FTC, the CFTC, state public utility commissions and state environmental regulatory agencies), and the rules, guidelines and protocols of ERCOT, CAISO, ISO-NE, MISO, NYISO and PJM with respect to various matters, including, but not limited to, market structure and design, operation of nuclear generation facilities, construction and operation of other generation facilities, development, operation and reclamation of lignite mines, recovery of costs and investments, decommissioning costs, market behavior rules, present or prospective wholesale and retail competition, administrative pricing mechanisms (and adjustments thereto), rates for wholesale sales of electricity, mandatory reliability standards and environmental matters.
The Vistra Operations Credit Facilities and indentures contain events of default customary for financings of this type.
The Vistra Operations Credit Facilities, indentures and our other debt facilities contain events of default customary for financings of such type.
Technological advances have improved, and are likely to continue to improve, for existing and alternative methods to produce and store power, including natural gas turbines, wind turbines, fuel cells, hydrogen, micro turbines, photovoltaic (solar) cells, batteries and concentrated solar thermal devices, along with improvements in traditional technologies.
Technological advances have improved, and are likely to continue to improve, for existing and alternative methods to produce and store power, including natural gas turbines, wind turbines, fuel cells, hydrogen, micro turbines, photovoltaic (solar) cells, batteries, concentrated solar thermal devices, novel nuclear technologies (including small modular reactors), geothermal energy (including enhanced geothermal systems and advanced geothermal systems), and long duration energy storage, along with improvements in traditional technologies.
As we adopt new technologies, like AI, there is a risk that the content, analyses, recommendations, or judgments that AI applications assist in producing are alleged to be deficient, inaccurate, biased, or infringe on other’s rights or property interests.
This, in turn could result in significant costs or reduce the anticipated benefits of the technology change. As we adopt new technologies, like AI, there is a risk that the content, analyses, recommendations, or judgments that AI applications assist in producing are alleged to be deficient, inaccurate, biased, or infringe on other’s rights or property interests.
In many instances, energy from these sources are bid into the relevant spot market at a price of zero or close to zero during certain times of the day, lowering the clearing price for all power wholesalers in such market.
For example, in many instances, energy from renewable resources, such as solar, wind and battery ESS, are bid into the relevant spot market at a price of zero or close to zero during certain times of the day, lowering the clearing price for all power wholesalers in such market.
Potential disruptions from cyber/data and physical security breaches to "critical cyber assets" that interrupt the delivery of power to the Bulk Electric System could incur penalties of up to $1 million per violation for failure to comply with mandatory electric reliability standards by FERC under the Energy Policy Act of 2005.
Potential disruptions from cyber/data and physical security breaches to "critical cyber assets" that interrupt the delivery of power to the Bulk Electric System could incur penalties of up to $1 million per violation for failure to comply with mandatory electric reliability standards by FERC under the Energy Policy Act of 2005. 35 Table of Contents Further, our retail business requires us to regularly access, collect, store, and transmit customer data, including sensitive customer data.
Multiple potential changes have been and are being evaluated by the PUCT and the Texas legislature for the ERCOT market, including the PCM that would align a required reliability standard with resource availability during higher-risk system conditions, the ultimate resolution of which is unknown.
Multiple potential changes have been and are being evaluated by the PUCT and the Texas Legislature for the ERCOT market, including Dispatchable Reliability Reserve Service that would facilitate compliance with a required reliability standard, the ultimate resolution of which is unknown.
We may not be successful in obtaining additional capital for these or other reasons. Furthermore, we may be unable to refinance or replace our existing indebtedness on favorable terms or at all upon the expiration or termination thereof.
Furthermore, we may be unable to refinance or replace our existing indebtedness on favorable terms or at all upon the expiration or termination thereof.
We may not be able to complete future acquisitions on favorable terms or at all, successfully integrate future acquisitions into our business, or effectively identify and invest in value-creating businesses, assets or projects, which could result in unanticipated expenses and losses or otherwise hinder or delay our growth strategy.
A material increase in the amount of letters of credit or cash collateral required to be provided to our counterparties may have a material adverse effect on us. 27 Table of Contents We may not be able to complete future acquisitions on favorable terms or at all, successfully integrate future acquisitions into our business, or effectively identify and invest in value-creating businesses, assets or projects, which could result in unanticipated expenses and losses or otherwise hinder or delay our growth strategy.
The passage of any legislation as a result of these proposals and other similar changes in U.S. federal income tax laws or the imposition of new or increased taxes or fees could have a material adverse effect on our financial condition, results of operations and cash flows. 30 Table of Contents Regulatory and Legislative Risks Our businesses are subject to ongoing complex governmental regulations and legislation that have adversely impacted, and may in the future adversely impact, our businesses, results of operations, liquidity, financial condition, and cash flows.
The passage of any legislation as a result of these proposals and other similar changes in U.S. federal income tax laws or the imposition of new or increased taxes or fees could have a material adverse effect on our financial condition, results of operations and cash flows.
FERC and regional ISOs are working to address these backlogs, including with potential regulatory rule changes, which would change the interconnection process, the results of which are currently unknown.
FERC and regional ISOs are working to address these backlogs, including with regulatory rule changes, changing the interconnection process, the impacts of which are currently unknown because the changes have only been partially implemented.
Any such regulatory investigation or administrative proceeding could result in us incurring penalties and other costs which may have a material adverse effect on us. 34 Table of Contents Our retail businesses, which each have REP certifications that are subject to review of the public utility commissions in the states in which we operate, are subject to changing state rules and regulations that could have a material impact on the profitability of our business.
Our retail businesses, which each have REP certifications that are subject to review of the public utility commissions in the states in which we operate, are subject to changing state rules and regulations that could have a material impact on the profitability of our business.
Technological advances in demand-side management and increased conservation efforts have resulted, and are expected to continue to result, in a decrease in electricity demand. A significant decrease in electricity demand as a result of such efforts would significantly reduce the value of our generation assets.
Technological advances in demand-side management, large-scale residential or commercial virtual power plants, and increased conservation efforts could result in a decrease in electricity demand. A significant decrease in electricity demand as a result of such efforts would significantly reduce the value of our generation assets.
Given the volatility of commodity power prices, to the extent we are unable to hedge or otherwise secure long-term power sales agreements for the output of our power generation facilities, our revenues and profitability will be subject to volatility, and our financial condition, results of operations and cash flows could be materially adversely affected.
Given the volatility of commodity power prices, to the extent we are unable to hedge or otherwise secure long-term power sales agreements for the output of our power generation facilities, our revenues and profitability will be subject to volatility, and our financial condition, results of operations and cash flows could be materially adversely affected. 20 Table of Contents We purchase natural gas, coal, fuel oil, and nuclear fuel for our generation facilities, and higher than expected fuel costs, volatility, or disruption in these fuel markets may have an adverse impact on our costs, revenues, results of operations, financial condition and cash flows.
While we maintain insurance, obtain warranties from vendors and obligate contractors to meet certain performance levels, the proceeds of such insurance, warranties or performance guarantees may not be adequate to cover our lost revenues, increased expenses or liquidated damages payments should we experience equipment breakdown or non-performance by contractors or vendors. 38 Table of Contents Operation of power generation facilities involves significant risks and hazards customary to the power industry that could have a material adverse effect on our revenues and results of operations, and we may not have adequate insurance to cover these risks and hazards.
While we maintain insurance, obtain warranties from vendors and obligate contractors to meet certain performance levels, the proceeds of such insurance, warranties or performance guarantees may not be adequate to cover our lost revenues, increased expenses or liquidated damages payments should we experience equipment breakdown or non-performance by contractors or vendors.
We own and operate a nuclear generation facility in Glen Rose, Texas (Comanche Peak Facility). The ownership and operation of a nuclear generation facility involves certain risks.
We own and operate nuclear generation facilities in Texas, Ohio, and Pennsylvania. The ownership and operation of nuclear generation facilities involves certain risks.
The scope and cost of that closure work could increase significantly based on new or potential requirements imposed by the EPA or state agencies, including the EPA's interpretations on requirements for closure of CCR units. There is no assurance that our current assumptions for closure activities will be accepted by the EPA or state agencies.
The EPA is reviewing applications submitted by us to extend closure deadlines for many of our CCR impoundments. The scope and cost of that closure work could increase significantly based on new or potential requirements imposed by the EPA or state agencies, including the EPA's interpretations on requirements for closure of CCR units.
The operation and maintenance of power generation facilities and related mining operations are capital intensive and involve significant risks that could adversely affect our results of operations, liquidity and financial condition.
If a serious nuclear incident were to occur, our business, reputation, financial condition and results of operations could be materially adversely affected. 37 Table of Contents The operation and maintenance of power generation facilities and related mining operations are capital intensive and involve significant risks that could adversely affect our results of operations, liquidity and financial condition.
Any such resulting liability from a nuclear accident could exceed our resources, including insurance coverage, and could ultimately result in the suspension or termination of power generation from the Comanche Peak Facility.
Any such resulting liability from a nuclear accident could exceed our resources, including insurance coverage, and could ultimately result in the suspension or termination of power generation from the impacted facility. Such accidents could also result in property damage to our nuclear plant and equipment, which could exceed coverage available under insurance provided by Nuclear Electric Insurance Limited.
Our failure to obtain additional capital or enter into new or replacement financing arrangements when due may constitute a default under such existing indebtedness and may have a material adverse effect on our business, financial condition, results of operations and cash flows. 26 Table of Contents The agreements and instruments governing our debt, including the Vistra Operations Credit Facilities and indentures, contain restrictions and limitations that could affect our ability to operate our business, or liquidity, and results of operations, and any failure to comply with these restrictions could have a material adverse effect on us.
The agreements and instruments governing our debt, including the Vistra Operations Credit Facilities and indentures, contain restrictions and limitations that could affect our ability to operate our business, or liquidity, and results of operations, and any failure to comply with these restrictions could have a material adverse effect on us.
Furthermore, a shut-down or failure at any other nuclear generation facility could cause regulators to require a shut-down or reduced availability at the Comanche Peak Facility. • Regulatory Risk — The NRC may modify, suspend or revoke licenses and impose civil penalties for failure to comply with the Atomic Energy Act, the regulations under it or the terms of the licenses of nuclear generation facilities.
The NRC may modify, suspend or revoke licenses and impose civil penalties for failure to comply with the Atomic Energy Act, the regulations under it or the terms of the licenses of nuclear generation facilities.
Without enough working capital or other sources of available liquidity to post as collateral, we may not be able to manage price volatility effectively or to implement our strategy. A material increase in the amount of letters of credit or cash collateral required to be provided to our counterparties may have a material adverse effect on us.
Without enough working capital or other sources of available liquidity to post as collateral, we may not be able to manage price volatility effectively or to implement our strategy.
The Tax Cuts and Jobs Act of 2017 (TCJA), enacted December 22, 2017, and the Inflation Reduction Act (IRA), enacted August 16, 2022, both introduced significant changes to current U.S. federal tax law.
There can be no assurance that our effective tax rate or tax payments will not be adversely affected by these legislative measures. The Tax Cuts and Jobs Act of 2017 (TCJA), enacted December 22, 2017, and the Inflation Reduction Act (IRA), enacted August 16, 2022, both introduced significant changes to current U.S. federal tax law.
Further, our retail business requires us to regularly access, collect, store, and transmit customer data, including sensitive customer data. New data privacy and data protection laws and regulations, increased enforcement, and other government actions could impact our businesses and failure to comply with them could adversely affect our business and financial results.
New data privacy and data protection laws and regulations, increased enforcement, and other government actions could impact our businesses, increase compliance costs, and failure to comply with these laws and regulations could adversely affect our business and financial results.
These and other hazards can cause significant personal injury 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. Further, our employees and contractors work in, and customers and the general public may be exposed to, potentially dangerous environments at or near our operations.
These and other hazards have and may in the future cause significant personal injury 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.
Our retail business may need to provide access to customer data, including sensitive customer data, to third parties and service providers to provide services, such as call center operations.
Our retail business may need to provide access to customer data, including sensitive customer data, to third parties and service providers to provide services, such as call center operations. In certain circumstances, Vistra could incur liability for a third-party or service provider's misuse or loss of the data.
For example, in new markets, our principal competitor for new customers may be the incumbent REP, which has the advantage of long-standing relationships with its customers, including well-known brand recognition.
As we try to grow our retail business and operate our business strategy, we compete with various other REPs that may have certain advantages over us. For example, in new markets, our principal competitor for new customers may be the incumbent REP, which has the advantage of long-standing relationships with its customers, including well-known brand recognition.
Unless we have received the affirmative vote or consent of the holders of at least two-thirds of the outstanding Series A Preferred Stock, the holders of at least two-thirds of the outstanding Series B Preferred Stock and the holders of at least two-thirds of the outstanding Series C Preferred Stock, each voting as a separate class, we may not adopt any amendment to our certificate of incorporation (including the applicable Certificates of Designation) that would have a material adverse effect on the powers, preferences, duties, or special rights of such series of Preferred Stock, subject to certain exceptions.
Upon the liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, after payment or provision for payment of the debts and other liabilities of the Company, the holders of Preferred Stock will be entitled to receive, pro rata and in preference to the holders of any other capital stock, an amount per share equal to $1,000 plus accrued and unpaid dividends thereon, if any. 43 Table of Contents Unless we have received the affirmative vote or consent of the holders of at least two-thirds of the outstanding Series A Preferred Stock, the holders of at least two-thirds of the outstanding Series B Preferred Stock and the holders of at least two-thirds of the outstanding Series C Preferred Stock, each voting as a separate class, we may not adopt any amendment to our certificate of incorporation (including the applicable Certificates of Designation) that would have a material adverse effect on the powers, preferences, duties, or special rights of such series of Preferred Stock, subject to certain exceptions.
Adopting new and sophisticated technologies may result in implementation issues, such as scheduling and supplier delays, unexpected or increased costs, technological constraints, regulatory issues, customer dissatisfaction, and other issues that could cause delays in launching new technological capabilities, which in turn could result in significant costs or reduce the anticipated benefits of the upgrades.
Competitors may incorporate new technologies into their businesses, services, and products more quickly or more successfully than we do. Adopting new and sophisticated technologies may result in implementation issues, such as scheduling and supplier delays, unexpected or increased costs, technological constraints, regulatory issues, customer dissatisfaction, and other issues that could cause delays in launching new technological capabilities.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFor additional information on risks from cybersecurity threats, see Item 1A. Risk Factors . While the Board has established a separate Risk and Sustainability Committee to oversee enterprise risk processes, the Board maintains oversight of Vistra's Information Security.
Biggest changeFor additional information on risks from cybersecurity threats, see Item 1A. Risk Factors . The Sustainability and Risk Committee of the Board has been delegated oversight responsibility of Vistra's Information Security. Vistra periodically engages third-party advisors to provide cybersecurity oversight and tabletop training to the full Board to further our commitment to responsible oversight of cybersecurity risk management.
Cybersecurity represents an important component of the Company's overall approach to enterprise risk management and is integrated into the risk management process and ongoing assessment. In addition to an internal security program, we strive to stay ahead of the threat landscape by working to conduct due diligence on key third-party vendors' Information Security programs and risks.
Cybersecurity represents an important component of the Company's overall approach to enterprise risk management and is integrated into the risk management process and ongoing assessment. In addition to an internal security program, we strive to stay ahead of the threat landscape by actively monitoring and conducting due diligence on key third-party vendors' Information Security programs and risks.
We make strategic investments in our perimeter and internal defenses, cyber security operations center, and regulatory compliance activities with the advice of consultants and third parties. Moreover, to minimize risk, we maintain an insurance policy that provides coverage for matters relating to Information Security.
This includes qualitative assessments to gain a deeper understanding of their security posture and potential vulnerabilities. We make strategic investments in our perimeter and internal defenses, cyber security operations center, and regulatory compliance activities with the advice of consultants and third parties. Moreover, to minimize risk, we maintain an insurance policy that provides coverage for matters relating to Information Security.
The CIO has served in various senior information technology roles in public companies for over 30 years, including Keurig Dr. Pepper Inc., General Motors, Pfizer, and Electronic Data Systems. Our CISO also has over 35 years of information technology experience. He is a 10-year U.S.
The CIO has served in various senior information technology roles in public companies for over 30 years, including Keurig Dr. Pepper Inc., General Motors, Pfizer, and Electronic Data Systems. Our CISO has over 23 years of information technology experience.
Our CISO and his Information Security team are responsible for leading the enterprise-wide information security strategy, policy, standards, architecture, and processes and our Cyber Incident Response Teams under the CISO are responsible for monitoring and analyzing the Company's cybersecurity posture in partnership with Risk and Legal.
Additionally, our Cyber Incident Response Teams under the CISO are responsible for monitoring and analyzing the Company's cybersecurity posture in partnership with Risk and Legal.
Vistra's Chief Information Officer (CIO) ensures Information Security is built into the Company's larger technology strategy and oversees our Chief Information Security Officer (CISO).
Vistra's Chief Information Officer (CIO) ensures Information Security is built into the Company's larger technology strategy and oversees our Chief Information Security Officer (CISO). Our CISO and his Information Security team are responsible for leading the enterprise-wide information security strategy, policy, standards, architecture, and processes.
Removed
Vistra engaged a third-party advisor to provide cybersecurity oversight and tabletop training to the full Board in 2023 to further our commitment to responsible oversight of cybersecurity risk management.
Added
He has held technology positions across various areas — including infrastructure management, application management, architecture, operations, and cybersecurity — and brings expertise from Farmers Insurance and Zurich Insurance.
Removed
Air Force veteran and has held technology positions in infrastructure management and operations with Raytheon and Blockbuster. He also maintains Certified Information Systems Security Professional (CISSP) and Certified Information Security Manager (CISM) certifications.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeFacility Location ISO/RTO Technology Primary Fuel Net Capacity (MW) (a) Texas Segment Ennis Ennis, TX ERCOT CCGT Natural Gas 366 Forney Forney, TX ERCOT CCGT Natural Gas 1,912 Hays San Marcos, TX ERCOT CCGT Natural Gas 1,047 Lamar Paris, TX ERCOT CCGT Natural Gas 1,076 Midlothian Midlothian, TX ERCOT CCGT Natural Gas 1,596 Odessa Odessa, TX ERCOT CCGT Natural Gas 1,054 Wise Poolville, TX ERCOT CCGT Natural Gas 787 Martin Lake Tatum, TX ERCOT ST Coal 2,250 Oak Grove Franklin, TX ERCOT ST Coal 1,600 DeCordova Granbury, TX ERCOT CT Natural Gas 260 Graham Graham, TX ERCOT ST Natural Gas 630 Lake Hubbard Dallas, TX ERCOT ST Natural Gas 921 Morgan Creek Colorado City, TX ERCOT CT Natural Gas 390 Permian Basin Monahans, TX ERCOT CT Natural Gas 325 Stryker Creek Rusk, TX ERCOT ST Natural Gas 685 Trinidad Trinidad, TX ERCOT ST Natural Gas 244 Comanche Peak (b) Glen Rose, TX ERCOT Nuclear Nuclear 2,400 Brightside Live Oak County, TX ERCOT Solar Renewable 50 Emerald Grove Crane County, TX ERCOT Solar Renewable 108 Upton 2 Upton County, TX ERCOT Solar/Battery Renewable 190 DeCordova Granbury, TX ERCOT Battery Renewable 260 Total Texas Segment 18,151 46 Table of Contents Facility Location ISO/RTO Technology Primary Fuel Net Capacity (MW) (a) East Segment Fayette Masontown, PA PJM CCGT Natural Gas 726 Hanging Rock Ironton, OH PJM CCGT Natural Gas 1,430 Hopewell Hopewell, VA PJM CCGT Natural Gas 370 Kendall Minooka, IL PJM CCGT Natural Gas 1,288 Liberty Eddystone, PA PJM CCGT Natural Gas 607 Ontelaunee Reading, PA PJM CCGT Natural Gas 600 Sayreville Sayreville, NJ PJM CCGT Natural Gas 349 Washington Beverly, OH PJM CCGT Natural Gas 711 Calumet Chicago, IL PJM CT Natural Gas 380 Dicks Creek Monroe, OH PJM CT Natural Gas 155 Miami Fort (CT) North Bend, OH PJM CT Fuel Oil 77 Pleasants Saint Marys, WV PJM CT Natural Gas 388 Richland (c) Defiance, OH PJM CT Natural Gas 423 Stryker (c) Stryker, OH PJM CT Fuel Oil 16 Bellingham Bellingham, MA ISO-NE CCGT Natural Gas 566 Blackstone Blackstone, MA ISO-NE CCGT Natural Gas 544 Casco Bay Veazie, ME ISO-NE CCGT Natural Gas 543 Lake Road Dayville, CT ISO-NE CCGT Natural Gas 827 Masspower Indian Orchard, MA ISO-NE CCGT Natural Gas 281 Milford Milford, CT ISO-NE CCGT Natural Gas 600 Independence Oswego, NY NYISO CCGT Natural Gas 1,212 Total East Segment 12,093 West Segment Moss Landing 1 & 2 Moss Landing, CA CAISO CCGT Natural Gas 1,020 Moss Landing Moss Landing, CA CAISO Battery Renewable 750 Oakland Oakland, CA CAISO CT Fuel Oil 110 Total West Segment 1,880 Sunset Segment Coleto Creek Goliad, TX ERCOT ST Coal 650 Baldwin Baldwin, IL MISO ST Coal 1,185 Newton Newton, IL MISO ST Coal 615 Kincaid Kincaid, IL PJM ST Coal 1,108 Miami Fort 7 & 8 North Bend, OH PJM ST Coal 1,020 Total Sunset Segment 4,578 Total capacity 36,702 ___________ (a) Approximate net generation capacity.
Biggest changeFacility Location ISO/RTO Technology Primary Fuel Net Capacity (MW) (a) Texas Segment Ennis Ennis, TX ERCOT CCGT Natural Gas 366 Forney Forney, TX ERCOT CCGT Natural Gas 1,912 Hays San Marcos, TX ERCOT CCGT Natural Gas 1,047 Lamar Paris, TX ERCOT CCGT Natural Gas 1,180 Midlothian Midlothian, TX ERCOT CCGT Natural Gas 1,596 Odessa Odessa, TX ERCOT CCGT Natural Gas 1,180 Wise Poolville, TX ERCOT CCGT Natural Gas 787 DeCordova Granbury, TX ERCOT CT Natural Gas 260 Morgan Creek Colorado City, TX ERCOT CT Natural Gas 390 Permian Basin Monahans, TX ERCOT CT Natural Gas 325 Graham Graham, TX ERCOT ST Natural Gas 630 Lake Hubbard Dallas, TX ERCOT ST Natural Gas 921 Stryker Creek Rusk, TX ERCOT ST Natural Gas 685 Trinidad Trinidad, TX ERCOT ST Natural Gas 244 Coleto Creek Goliad, TX ERCOT ST Coal 650 Martin Lake Tatum, TX ERCOT ST Coal 2,250 Oak Grove Franklin, TX ERCOT ST Coal 1,600 Comanche Peak (b) Glen Rose, TX ERCOT Nuclear Uranium 2,400 Brightside Live Oak County, TX ERCOT Solar Renewable 50 Emerald Grove Crane County, TX ERCOT Solar Renewable 108 Upton 2 Upton County, TX ERCOT Solar/Battery Renewable 190 DeCordova Granbury, TX ERCOT Battery Renewable 260 Total Texas Segment 19,031 46 Table of Contents Facility Location ISO/RTO Technology Primary Fuel Net Capacity (MW) (a) East Segment Independence Oswego, NY NYISO CCGT Natural Gas 1,212 Bellingham Bellingham, MA ISO-NE CCGT Natural Gas 566 Blackstone Blackstone, MA ISO-NE CCGT Natural Gas 544 Casco Bay Veazie, ME ISO-NE CCGT Natural Gas 543 Lake Road Dayville, CT ISO-NE CCGT Natural Gas 827 Masspower Indian Orchard, MA ISO-NE CCGT Natural Gas 281 Milford Milford, CT ISO-NE CCGT Natural Gas 600 Baldwin Baldwin, IL MISO Solar/Battery Renewable 70 Coffeen Coffeen, IL MISO Solar/Battery Renewable 46 Baldwin Baldwin, IL MISO ST Coal 1,185 Newton Newton, IL MISO ST Coal 615 Kincaid Kincaid, IL PJM ST Coal 1,108 Miami Fort 7 & 8 North Bend, OH PJM ST Coal 1,020 Fayette Masontown, PA PJM CCGT Natural Gas 726 Hanging Rock Ironton, OH PJM CCGT Natural Gas 1,430 Hopewell Hopewell, VA PJM CCGT Natural Gas 370 Kendall Minooka, IL PJM CCGT Natural Gas 1,288 Liberty Eddystone, PA PJM CCGT Natural Gas 607 Ontelaunee Reading, PA PJM CCGT Natural Gas 600 Sayreville Sayreville, NJ PJM CCGT Natural Gas 349 Washington Beverly, OH PJM CCGT Natural Gas 711 Calumet Chicago, IL PJM CT Natural Gas 380 Dicks Creek Monroe, OH PJM CT Natural Gas 155 Pleasants Saint Marys, WV PJM CT Natural Gas 388 Miami Fort (CT) North Bend, OH PJM CT Fuel Oil 77 Beaver Valley 1 & 2 Shippingport, PA PJM Nuclear Uranium 1,872 Perry Perry, OH PJM Nuclear Uranium 1,268 Davis-Besse Oak Harbor, OH PJM Nuclear Uranium 908 Total East Segment 19,746 West Segment Moss Landing 1 & 2 Moss Landing, CA CAISO CCGT Natural Gas 1,020 Moss Landing Moss Landing, CA CAISO Battery Renewable 750 Oakland Oakland, CA CAISO CT Fuel Oil 110 Total West Segment 1,880 Total capacity 40,657 ___________ (a) Approximate net generation capacity.
Item 2. PROPERTIES The following table presents our asset fleet as of December 31, 2023 by segment. All of our facilities are 100% (fee simple) owned.
Item 2. PROPERTIES The following table presents our asset fleet as of December 31, 2024 by segment. All of our facilities are 100% (fee simple) owned.
Because they cannot be relied upon to meet demand continuously due to their dependence on weather and time of day, these generation sources are categorized as non-dispatchable and create the need for intermediate/load-following resources to respond to changes in their output. Item 3.
Because they cannot be relied upon to meet demand continuously due to their dependence on weather and time of day, these generation sources are categorized as non-dispatchable and create the need for intermediate/load-following resources to respond to changes in their output. Item 3. LEGAL PROCEEDINGS See Note 15 to the Financial Statements for additional information.
Actual net generation capacity may vary based on a number of factors, including ambient temperature. We have not included units that have been retired or are out of operation. (b) In October 2022, we announced the submission of our application to the NRC for license renewal at our two-unit Comanche Peak Nuclear Plant.
Actual net generation capacity may vary based on a number of factors, including ambient temperature. We have not included units that have been retired or are out of operation.
Our wholesale commodity risk management group also procures renewable energy credits from renewable generation in ERCOT to support our electricity sales to wholesale and retail customers to satisfy the increasing demand for renewable resources from such customers. As of December 31, 2023, Vistra had long-term agreements to procure renewable energy credits from approximately 885 MW of renewable generation.
See Note 6 to the Financial Statements for additional information. 47 Table of Contents Our wholesale commodity risk management group also procures renewable energy credits from renewable generation in ERCOT and PJM to support our electricity sales to wholesale and retail customers to satisfy the increasing demand for renewable resources from such customers.
These renewable generation sources deliver electricity when conditions make them available, and, when on-line, they generally compete with baseload units.
As of December 31, 2024, Vistra had long-term agreements to procure renewable energy credits from approximately 950 MW of renewable generation. These renewable generation sources deliver electricity when conditions make them available, and, when on-line, they generally compete with baseload units.
Removed
The current licenses for Units 1 and 2 extend into 2030 and 2033, respectively, and we are applying to renew the licenses into 2050 and 2053, respectively.
Removed
(c) We have entered into an agreement to sell the Richland and Stryker generation facilities, and closing is expected in early March 2024. 47 Table of Contents See Note 3 to the Financial Statements for discussion of our solar and battery energy storage projects currently under development and Note 4 to the Financial Statements for discussion of our retirement of certain generation facilities, including the Zimmer, Joppa and Edwards generation facilities that we retired in June 2022, September 2022 and January 2023, respectively, that are reported in our Asset Closure segment and excluded from the table above.
Removed
LEGAL PROCEEDINGS See Note 14 to the Financial Statements for discussion of material litigation matters to which Vistra is a party.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeThese mining operations are regulated by the MSHA under the Federal Mine Safety and Health Act of 1977, as amended (the Mine Act), as well as other federal and state regulatory agencies such as the RCT and Office of Surface Mining.
Biggest changeThese mining operations are regulated by the MSHA under the Federal Mine Safety and Health Act of 1977, as amended (the Mine Act), along with other federal and state regulatory agencies such as the RCT and Office of Surface Mining.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of a Publicly Announced Program Maximum Dollar Amount of Shares that may yet be Purchased under the Program (in millions) October 1 - October 31, 2023 4,246,310 $ 32.15 4,246,310 $ 993 November 1 - November 30, 2023 3,682,876 $ 34.81 3,682,876 $ 865 December 1 - December 31, 2023 3,061,650 $ 37.55 3,061,650 $ 750 For the quarter ended December 31, 2023 10,990,836 $ 34.54 10,990,836 $ 750 In October 2021, we announced that the Board had authorized a share repurchase program (Share Repurchase Program) under which up to $2.0 billion of our outstanding common stock may be repurchased.
Biggest changePeriod Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of a Publicly Announced Program Maximum Dollar Amount of Shares that may yet be Purchased under the Program (in millions) October 1 - October 31, 2024 464,487 $ 126.99 464,487 $ 2,177 November 1 - November 30, 2024 425,674 $ 144.66 425,674 $ 2,115 December 1 - December 31, 2024 735,536 $ 144.52 735,536 $ 2,009 For the quarter ended December 31, 2024 1,625,697 $ 139.55 1,625,697 $ 2,009 In October 2021, the Board authorized a share repurchase program (Share Repurchase Program).
The graph below compares the return in each period assuming that $100 was invested at December 31, 2018 in Vistra's common stock, the S&P 500 and the S&P Utilities, and that all dividends were reinvested.
The graph below compares the return in each period assuming that $100 was invested at December 31, 2019 in Vistra's common stock, the S&P 500 and the S&P Utilities, and that all dividends were reinvested.
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Vistra's common stock is listed and traded on the NYSE under the symbol "VST". Vistra's authorized capital stock consists of 1,800,000,000 shares of common stock with a par value of $0.01 per share. As of February 23, 2024, there were 472 stockholders of record.
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Vistra's common stock is listed and traded on the NYSE under the symbol "VST". Vistra's authorized capital stock consists of 1,800,000,000 shares of common stock with a par value of $0.01 per share. As of February 24, 2025, there were 403 stockholders of record.
Stock Performance Graph The performance graph below compares Vistra's cumulative total return on common stock during the five-year period from December 31, 2018 through December 31, 2023 with the cumulative total returns of the S&P 500 Stock Index (S&P 500) and the S&P Utility Index (S&P Utilities).
Stock Performance Graph The performance graph below compares Vistra's cumulative total return on common stock during the five-year period from December 31, 2019 through December 31, 2024 with the cumulative total returns of the S&P 500 Stock Index (S&P 500) and the S&P Utility Index (S&P Utilities).
Removed
December 31, 2018 2019 2020 2021 2022 2023 Vistra Corp. $ 100.00 $ 102.48 $ 90.41 $ 108.08 $ 113.57 $ 193.89 S&P 500 $ 100.00 $ 131.47 $ 155.65 $ 200.59 $ 163.98 $ 207.04 S&P Utilities $ 100.00 $ 126.35 $ 127.01 $ 149.46 $ 151.79 $ 141.05 The stock price performance included in this graph is not necessarily indicative of future stock price performance. 49 Table of Contents Purchases of Equity Securities by the Issuer The following table provides information about our repurchase of common stock, during the three months ended December 31, 2023.
Added
December 31, 2019 2020 2021 2022 2023 2024 Vistra Corp. $ 100.00 $ 88.22 $ 105.47 $ 110.83 $ 189.20 $ 683.61 S&P 500 $ 100.00 $ 118.39 $ 152.34 $ 124.73 $ 157.48 $ 196.85 S&P Utilities $ 100.00 $ 100.52 $ 118.29 $ 120.14 $ 111.63 $ 137.79 49 Table of Contents The stock price performance included in this graph is not necessarily indicative of future stock price performance.
Removed
The Share Repurchase Program became effective on October 11, 2021. In August 2022, March 2023 and February 2024, the Board authorized incremental amounts of $1.25 billion, $1.0 billion and $1.5 billion, respectively, for repurchases to bring the total authorized under the Share Repurchase Program to $5.75 billion.
Added
Purchases of Equity Securities by the Issuer The following table provides information about our repurchase of common stock, during the three months ended December 31, 2024.
Removed
We expect to complete repurchases under the Share Repurchase Program by the end of 2025. See Note 15 to the Financial Statements for more information concerning the Share Repurchase Program. Item 6. [RESERVED] Not applicable.
Added
Under this program, shares of the Company's common stock may be repurchased in open market transactions, privately negotiated transactions, or other means in accordance with federal securities laws.
Added
The timing, number, and value of shares repurchased will be determined at our discretion, considering factors such as capital allocation priorities, stock market price, general market and economic conditions, legal requirements, and compliance with debt agreements and preferred stock certificates of designation. We expect to complete repurchases under the Share Repurchase Program by the end of 2026.
Added
Amount Authorized for Share Repurchases (in billions) Board Authorization Dates: October 2021 $ 2.00 August 2022 1.25 March 2023 1.00 February 2024 1.50 October 2024 1.00 Cumulative authorization at December 31, 2024 $ 6.75 See Note 16 to the Financial Statements for additional information. Item 6. [RESERVED] Not applicable.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeTransaction Agreement 91 3. Development of Generation Facilities 93 4. Retirement of Generation Facilities 94 5. Revenue 95 6. Goodwill and Identifiable Intangible Assets and Liabilities 99 7. Income Taxes 102 8. Tax Receivable Agreement Obligation 105 i Table of Contents 9. Earnings Per Share 107 10. Accounts Receivable Financing 107 11. Collateral Financing Agreement with Affiliate 108 12.
Biggest changeIncome Taxes 99 6. Property, Plant , and Equipment 102 7. Goodwill and Identifiable Intangible Assets and Liabilities 103 8. Collateral Financing Agreement with Affiliate 106 9. Debt, Credit Facilities , and Financings 107 10. Leases 116 i Table of Contents 11. Derivatives 117 12. Fair Value Measurements 121 1 3 . Asset Retirement Obligations 126 1 4 .
Item 6. [RESERVED] 50 Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION, AND RESULTS OF OPERATIONS 50 Significant Activities and Events, and Items Influencing Future Performance 50 C ritical Accounting Estimates 55 R esults of Operations 59 F inancial Condition 67 C ommit ments and Contingencies 72 Changes in Accounting Standards 72 Item 7A.
Item 6. [RESERVED] 50 Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION, AND RESULTS OF OPERATIONS 50 Significant Activities and Events, and Items Influencing Future Performance 51 Critical Accounting Estimates 57 Results of Operations 60 Financial Condition 66 Commitments and Contingencies 72 Changes in Accounting Standards 72 Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 72 Item 8.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 73 Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 77 Consolidated Statements of Operations 79 Consolidated Statements of Comprehensive Income (Loss) 79 Consolidated Statements of Cash Flows 80 Consolidated Balance Sheets 82 Consolidated Statement of Changes in Equity 84 Notes to Consolidated Financial Statements: 85 1. Business and Significant Accounting Policies 85 2.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 75 Consolidated Statements of Operations 78 Consolidated Statements of Comprehensive Income (Loss) 78 Consolidated Balance Sheets 79 Consolidated Statements of Cash Flows 81 Consolidated Statement of Changes in Equity 83 Notes to Consolidated Financial Statements: 85 1. Business and Significant Accounting Policies 85 2. Acquisit ions 91 3. Revenue 94 4. Government Assistance 98 5.
Removed
Debt 109 13. Leases 117 14. Commitments and Contingencies 119 15. Equity 128 16. Fair Value Measurements 132 17. Commodity and Other Derivative Contractual Assets and Liabilities 135 18. Pension and Other Postretirement Employee Benefits (OPEB) 139 19. Stock-Based Compensation 146 20. Related Party Transactions 148 21. Segment Information 149 22. Supplementary Financial Information 150
Added
Pension and Other Postretirement Employee Benefits (OPEB) 127 1 5 . Commitments and Contingencies 132 1 6 . Equity 142 1 7 . Earnings Per Share 144 1 8 . Stock-Based Compensation 145 19 . Segment Information 146 2 0 . Supplementary Financial Information 148

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

98 edited+74 added−69 removed41 unchanged
Biggest changeThe following table presents net income (loss), EBITDA and adjusted EBITDA for the year ended December 31, 2022: Year Ended December 31, 2022 Retail Texas East West Sunset Asset Closure Eliminations / Corporate and Other Vistra Consolidated Operating revenues $ 9,455 $ 3,733 $ 3,706 $ 336 $ 868 $ 384 $ (4,754) $ 13,728 Fuel, purchased power costs and delivery fees (7,169) (2,968) (3,546) (481) (670) (322) 4,755 (10,401) Operating costs (143) (808) (255) (42) (251) (145) (1) (1,645) Depreciation and amortization (145) (537) (706) (42) (66) (31) (69) (1,596) Selling, general and administrative expenses (826) (131) (66) (21) (35) (44) (66) (1,189) Impairment of long-lived assets — — — — (74) — — (74) Operating income (loss) 1,172 (711) (867) (250) (228) (158) (135) (1,177) 61 Table of Contents Year Ended December 31, 2022 Retail Texas East West Sunset Asset Closure Eliminations / Corporate and Other Vistra Consolidated Other income 2 78 2 6 — 16 13 117 Other deductions (2) (2) — — 1 (2) 1 (4) Interest expense and related charges (14) 20 (3) 6 (3) (3) (371) (368) Impacts of Tax Receivable Agreement — — — — — — (128) (128) Income (loss) before income taxes 1,158 (615) (868) (238) (230) (147) (620) (1,560) Income tax benefit — — — — — — 350 350 Net income (loss) $ 1,158 $ (615) $ (868) $ (238) $ (230) $ (147) $ (270) $ (1,210) Income tax benefit — — — — — — (350) (350) Interest expense and related charges (a) 14 (20) 3 (6) 3 3 371 368 Depreciation and amortization (b) 145 623 706 42 66 31 69 1,682 EBITDA before Adjustments 1,317 (12) (159) (202) (161) (113) (180) 490 Unrealized net (gain) loss resulting from commodity hedging transactions (291) 1,610 759 351 100 (19) — 2,510 Generation plant retirement expenses — — — — 7 (3) — 4 Fresh start/purchase accounting impacts — (2) (1) — 9 — — 6 Impacts of Tax Receivable Agreement — — — — — — 128 128 Non-cash compensation expenses — — — — — — 65 65 Transition and merger expenses 7 — 1 — — — 5 13 Impairment of long-lived assets — — — — 74 — — 74 Winter Storm Uri (c) (141) (178) — — — — — (319) Other, net 31 20 8 3 13 10 (62) 23 Adjusted EBITDA $ 923 $ 1,438 $ 608 $ 152 $ 42 $ (125) $ (44) $ 2,994 ____________ (a) Includes $250 million of unrealized mark-to-market net gains on interest rate swaps.
Biggest changeVistra Consolidated Financial Results — Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 The following table presents Net income (loss), EBITDA and Adjusted EBITDA for the year ended December 31, 2024: Year Ended December 31, 2024 Retail Texas East West Asset Closure Eliminations / Corporate and Other Vistra Consolidated (in millions) Operating revenues $ 12,797 $ 5,394 $ 5,661 $ 877 $ 1 $ (7,506) $ 17,224 Fuel, purchased power costs, and delivery fees (10,276) (1,596) (2,698) (221) (3) 7,509 (7,285) Operating costs (159) (996) (1,103) (72) (81) (3) (2,414) Depreciation and amortization (114) (581) (996) (86) — (66) (1,843) Selling, general, and administrative expenses (977) (169) (148) (25) (43) (239) (1,601) Operating income (loss) 1,271 2,052 716 473 (126) (305) 4,081 Other income 1 39 181 3 16 72 312 Other deductions (2) (4) (4) (6) (2) (3) (21) Interest expense and related charges (54) 46 9 1 (4) (898) (900) Impacts of Tax Receivable Agreement — — — — — (5) (5) Income (loss) before income taxes 1,216 2,133 902 471 (116) (1,139) 3,467 Income tax expense — — — — — (655) (655) Net income (loss) $ 1,216 $ 2,133 $ 902 $ 471 $ (116) $ (1,794) $ 2,812 Income tax expense — — — — — 655 655 Interest expense and related charges (a) 54 (46) (9) (1) 4 898 900 Depreciation and amortization (b) 114 686 1,278 86 — 66 2,230 EBITDA before Adjustments 1,384 2,773 2,171 556 (112) (175) 6,597 60 Table of Contents Year Ended December 31, 2024 Retail Texas East West Asset Closure Eliminations / Corporate and Other Vistra Consolidated Unrealized net (gain) loss resulting from commodity hedging transactions 52 (790) (76) (332) (9) — (1,155) Purchase accounting impacts — 1 (12) — — (14) (25) Impacts of Tax Receivable Agreement (c) — — — — — (5) (5) Non-cash compensation expenses — — — — — 100 100 Transition and merger expenses 2 1 22 — — 111 136 Decommissioning-related activities (d) — 26 (91) 2 — — (63) ERP system implementation expenses 8 7 5 1 2 — 23 Other, net 17 14 (2) 11 2 (111) (69) Adjusted EBITDA $ 1,463 $ 2,032 $ 2,017 $ 238 $ (117) $ (94) $ 5,539 ____________ (a) Includes $53 million of unrealized mark-to-market net gains on interest rate swaps.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION, AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and related notes included in Item 8. Financial Statements and Supplementary Data . See Item 7.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION, AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations should be read together with the consolidated financial statements and related notes included in Item 8. Financial Statements and Supplementary Data . See Item 7.
An event of a default by Vistra Operations or any of its subsidiaries relating to indebtedness equal to or above a threshold defined in the applicable agreement that results in the acceleration of such debt, would give such counterparty under these hedging agreements the right to terminate its hedge or interest rate swap agreement with Vistra Operations (or its applicable subsidiary) and require all outstanding obligations under such agreement to be settled. 71 Table of Contents Under the Vistra Operations Senior Unsecured Indentures, the Vistra Operations Senior Secured Indenture and the Indenture governing the 7.233% Senior Secured Notes, a default under any document evidencing indebtedness for borrowed money by Vistra Operations or any Guarantor Subsidiary for failure to pay principal when due at final maturity or that results in the acceleration of such indebtedness in an aggregate amount of $300 million or more may result in a cross default under the Vistra Operations Senior Unsecured Notes, the Senior Secured Notes, the 7.233% Senior Secured Notes, the Vistra Operations Credit Facilities, the Receivables Facility, the Commodity-Linked Facility and other current or future documents evidencing any indebtedness for borrowed money by the applicable borrower or issuer, as the case may be, and the applicable Guarantor Subsidiaries party thereto.
An event of a default by Vistra Operations or any of its subsidiaries relating to indebtedness equal to or above a threshold defined in the applicable agreement that results in the acceleration of such debt, would give such counterparty under these hedging agreements the right to terminate its hedge or interest rate swap agreement with Vistra Operations (or its applicable subsidiary) and require all outstanding obligations under such agreement to be settled. 70 Table of Contents Under the Vistra Operations Senior Unsecured Indentures, the Vistra Operations Senior Secured Indenture and the Indenture governing the 7.233% Senior Secured Notes, a default under any document evidencing indebtedness for borrowed money by Vistra Operations or any Guarantor Subsidiary for failure to pay principal when due at final maturity or that results in the acceleration of such indebtedness in an aggregate amount of $300 million or more may result in a cross default under the Vistra Operations Senior Unsecured Notes, the Senior Secured Notes, the 7.233% Senior Secured Notes, the Vistra Operations Credit Facilities, the Receivables Facility, the Commodity-Linked Facility and other current or future documents evidencing any indebtedness for borrowed money by the applicable borrower or issuer, as the case may be, and the applicable Guarantor Subsidiaries party thereto.
In addition, non-GAAP financial measures are not standardized; therefore, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. We strongly encourage investors to review our consolidated financial statements and publicly filed reports in their entirety and not rely on any single financial measure.
In addition, non-GAAP financial measures are not standardized; therefore, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. We strongly encourage investors to review the consolidated financial statements and publicly filed reports in their entirety and not rely on any single financial measure.
The cross-default provision applies, among other instances, if TXU Energy, Dynegy Energy Services, Ambit Texas, Value Based Brands, TriEagle Energy, each indirect subsidiaries of Vistra and originators under the Receivables Facility (Originators), and Vistra or any of their respective subsidiaries fails to make a payment of principal or interest on any indebtedness that is outstanding in a principal amount of at least $300 million, in the case of Vistra, and in a principal amount of at least $50 million, in the case of TXU Energy or any of the other Originators, after the expiration of any applicable grace period, or if other events occur or circumstances exist under such indebtedness which give rise to a right of the debtholder to accelerate such indebtedness, or if such indebtedness becomes due before its stated maturity.
The cross-default provision applies, among other instances, if TXU Energy, Dynegy Energy Services, Ambit Texas, Value Based Brands, Energy Harbor LLC, TriEagle Energy, each indirect subsidiaries of Vistra and originators under the Receivables Facility (Originators), and Vistra or any of their respective subsidiaries fails to make a payment of principal or interest on any indebtedness that is outstanding in a principal amount of at least $300 million, in the case of Vistra Operations, and in a principal amount of at least $50 million, in the case of TXU Energy or any of the other Originators, after the expiration of any applicable grace period, or if other events occur or circumstances exist under such indebtedness which give rise to a right of the debtholder to accelerate such indebtedness, or if such indebtedness becomes due before its stated maturity.
Under the Vistra Operations Senior Unsecured Indenture and the Vistra Operations Senior Secured Indenture governing the 7.750% Senior Unsecured Notes and 6.950% Senior Secured Notes, respectively, a default under any document evidencing indebtedness for borrowed money by Vistra Operations or any Guarantor Subsidiary for failure to pay principal when due at final maturity or that results in the acceleration of such indebtedness in an aggregate amount that exceeds the greater of 1.5% of total assets and $600 million may result in a cross default under the respective notes and other current or future documents evidencing any indebtedness for borrowed money by the applicable borrower or issuer, as the case may be, and the applicable Guarantor Subsidiaries party thereto.
Under the Vistra Operations Senior Unsecured Indenture and the Vistra Operations Senior Secured Indenture governing the 7.750% Senior Unsecured Notes, the 6.875% Senior Unsecured Notes, the 6.950% Senior Secured Notes and the 6.000% Senior Secured Notes, a default under any document evidencing indebtedness for borrowed money by Vistra Operations or any Guarantor Subsidiary for failure to pay principal when due at final maturity or that results in the acceleration of such indebtedness in an aggregate amount that exceeds the greater of 1.5% of total assets and $600 million may result in a cross default under the respective notes and other current or future documents evidencing any indebtedness for borrowed money by the applicable borrower or issuer, as the case may be, and the applicable Guarantor Subsidiaries party thereto.
Actual income taxes could vary from estimated amounts due to the future impacts of various items, including changes in income tax laws, our forecasted financial condition and results of operations in future periods, as well as final review of filed tax returns by taxing authorities. 56 Table of Contents Income tax returns are regularly subject to examination by applicable tax authorities.
Actual income taxes could vary from estimated amounts due to the future impacts of various items, including changes in income tax laws, our forecasted financial condition and results of operations in future periods, as well as final review of filed tax returns by taxing authorities. Income tax returns are regularly subject to examination by applicable tax authorities.
We are proactively managing the increased costs of materials and supply chain disruptions and continuing to prudently re-evaluate the business cases and timing of our planned development projects, which has resulted in a deferral of some of our planned capital spend for our renewables projects.
We are proactively managing the increased costs of materials and supply chain disruptions and continuing to prudently re-evaluate the business cases and timing of our planned development projects, which has resulted in a deferral of some of our planned capital spend for our renewables projects and could impact the feasibility of additional projects.
Management's Discussion and Analysis of Financial Condition, and Results of Operations in our 202 2 Form 10-K for a discussion of our financial condition and results of operations for the year ended December 31, 2021 and for the year ended December 31, 2022 compared to the year ended December 31, 2021, which is incorporated here by reference.
Management's Discussion and Analysis of Financial Condition, and Results of Operations in our 202 3 Form 10-K for a discussion of our financial condition and results of operations for the year ended December 31, 2022 and for the year ended December 31, 2023 compared to the year ended December 31, 2022, which is incorporated here by reference.
(c) Adjusted EBITDA impacts of Winter Storm Uri reflects $183 million related to a reduction in the allocation of ERCOT default uplift charges which were expected to be paid over several decades under protocols existing at the time of the storm and $144 million related to the application of bill credits to large commercial and industrial customers that curtailed their usage during Winter Storm Uri.
(e) Adjusted EBITDA impacts of Winter Storm Uri reflects the application of bill credits to large commercial and industrial customers that curtailed their usage during Winter Storm Uri and a reduction in the allocation of ERCOT default uplift charges which were expected to be paid over several decades under protocols existing at the time of the storm.
Such a default would allow the lenders under each such facility to accelerate the maturity of outstanding balances under such facilities, which totaled approximately $2.5 billion and zero, respectively, as of December 31, 2023.
Such a default would allow the lenders under each such facility to accelerate the maturity of outstanding balances under such facilities, which totaled approximately $2.475 billion and zero, respectively, as of December 31, 2024.
The following maturity table presents the net commodity contract liability arising from recognition of fair values at December 31, 2023, scheduled by the source of fair value and contractual settlement dates of the underlying positions.
The following maturity table presents the net commodity contract liability arising from recognition of fair values as of December 31, 2024, scheduled by the source of fair value and contractual settlement dates of the underlying positions.
The PUCT has rules in place to assure adequate creditworthiness of each REP, including the ability to return customer deposits, if necessary. Under these rules, at December 31, 2023, Vistra has posted letters of credit in the amount of $91 million with the PUCT, which is subject to adjustments.
The PUCT has rules in place to assure adequate creditworthiness of each REP, including the ability to return customer deposits, if necessary. Under these rules, as of December 31, 2024, Vistra has posted letters of credit in the amount of $86 million with the PUCT, which is subject to adjustments.
A default by Vistra Operations or any of its restricted subsidiaries in respect of certain specified indebtedness in an aggregate amount in excess of the greater of $300 million and 17.5% of Consolidated EBITDA may result in a cross default under the Vistra Operations Credit Facilities and the Commodity-Linked Facility.
Under the Alternative LOC Facilities, a default by Vistra Operations or any of its restricted subsidiaries in respect of certain specified indebtedness in an aggregate amount in excess of the greater of $300 million and 17.5% of Consolidated EBITDA may result in a cross default under the Alternative LOC Facilities.
The income approach involves estimates of future performance that reflect assumptions regarding, among other things, forward natural gas and electricity prices, forward capacity prices, Market Heat Rates, the effects of enacted environmental rules, generation plant performance, forecasted capital expenditures and forecasted fuel prices. Another key assumption in the income approach is the discount rate applied to the forecasted cash flows.
The income approach involves estimates of future performance that reflect assumptions regarding, among other things, forward electricity prices, forward capacity prices, Market Heat Rates, the effects of enacted environmental rules, generation plant performance, forecasted capital expenditures, forecasted fuel prices, and the discount rate applied to the forecasted cash flows.
The net change in these assets and liabilities, excluding "other activity" as described below, reflects $490 million in unrealized net gains and $2.51 billion in unrealized net losses for the years ended December 31, 2023 and 2022, respectively, arising from mark-to-market accounting for positions in the commodity contract portfolio.
The net change in these assets and liabilities, excluding "other activity" as described below, reflects $1.155 billion and $490 million in unrealized net gains for the years ended December 31, 2024 and 2023, respectively, arising from mark-to-market accounting for positions in the commodity contract portfolio.
In management's opinion, the liability recorded pursuant to income tax accounting guidance related to uncertain tax positions reflects future taxes that may be owed as a result of any examination. See Notes 1 and 7 to the Financial Statements for further discussion of income tax matters.
In management's opinion, the liability recorded pursuant to income tax accounting guidance related to uncertain tax positions reflects future taxes that may be owed as a result of any examination. See Notes 1 and 5 to the Financial Statements for additional information.
Depreciation and amortization — Depreciation and amortization expense reported as a reconciling adjustment in the consolidated statements of cash flows exceeds the amount reported in the consolidated statements of operations by $454 million, $451 million and $297 million for the years ended December 31, 2023, 2022 and 2021, respectively.
Depreciation and amortization — Depreciation and amortization expense, as reported as a reconciling adjustment in the consolidated statements of cash flows, exceeded the amount reported in the consolidated statements of operations by $788 million, $454 million, and $451 million for the years ended December 31, 2024, 2023, and 2022, respectively.
Under these rules, Vistra has posted collateral support totaling $554 million in the form of letters of credit, $30 million in the form of a surety bond and $3 million of cash at December 31, 2023 (which is subject to daily adjustments based on settlement activity with the ISOs/RTOs).
Under these rules, Vistra has posted collateral support totaling $960 million in the form of letters of credit, $70 million in the form of a surety bond and $3 million of cash as of December 31, 2024 (which is subject to daily adjustments based on settlement activity with the ISOs/RTOs).
Our approach to managing electricity price risk focuses on the following: • employing disciplined, liquidity-efficient hedging and risk management strategies through physical and financial energy-related contracts intended to partially hedge gross margins; • continuing focus on cost management to better withstand gross margin volatility; • following a retail pricing strategy that appropriately reflects the value of our product offering to customers, the magnitude and costs of commodity price, liquidity risk and retail demand variability; and • improving retail customer service to attract and retain high-value customers.
Our approach to managing electricity price risk focuses on the following: • employing disciplined, liquidity-efficient hedging and risk management strategies through physical and financial energy-related contracts intended to partially hedge gross margins; • continuing focus on cost management to better withstand gross margin volatility; • following a retail pricing strategy that appropriately reflects the value of our product offering to customers, the magnitude and costs of commodity price, liquidity risk and retail demand variability; and • improving retail customer service to attract and retain high-value customers. 56 Table of Contents Critical Accounting Estimates See Note 1 of the consolidated financial statements for a description of our accounting policies.
Accounting standards allow a company to qualitatively assess if the carrying value of a reporting unit with goodwill is more likely than not less than the fair value of that reporting unit. If the entity determines the carrying value, including goodwill, is not more likely greater than the fair value, no further testing of goodwill for impairment is required.
Accounting standards allow a company to qualitatively assess if the carrying value of a reporting unit with goodwill and retail trade name intangible asset is more likely than not less than the fair value. If the entity determines the carrying value is not more likely greater than the fair value, no further testing for impairment is required.
Our capacity sales, aggregated by season through winter 2025-2026, are as follows: East Segment Winter 2023 - 2024 Summer 2024 Winter 2024 - 2025 Summer 2025 Winter 2025 - 2026 Auction capacity sold (MW) 12 — — — — Bilateral capacity sold (MW) 1,132 873 591 175 59 Total capacity sold (MW) 1,144 873 591 175 59 Average price per kW-month $ 2.27 $ 3.80 $ 3.44 $ 4.10 $ 4.10 ISO-NE The most recent Forward Capacity Auction results for ISO-NE Rest-of-Pool, in which most of our assets are located, are as follows for each planning year: 2023-2024 2024-2025 2025-2026 2026-2027 2027-2028 Price per kW-month $ 2.00 $ 2.61 $ 2.59 $ 2.59 $ 3.58 We continue to market and pursue longer term multi-year capacity transactions that extend through planning year 2027-2028.
Our capacity sales, aggregated by season through winter 2026-2027, are as follows: East Segment Winter 2024 - 2025 Summer 2025 Winter 2025 - 2026 Summer 2026 Winter 2026 - 2027 Auction capacity sold (MW) 77 — — — — Bilateral capacity sold (MW) 943 550 268 — — Total capacity sold (MW) 1,020 550 268 — — Average price per kW-month $ 3.09 $ 4.51 $ 4.10 $ — $ — ISO-NE The most recent Forward Capacity Auction results for ISO-NE Rest-of-Pool, in which most of our assets are located, are as follows for each planning year: 2024-2025 2025-2026 2026-2027 2027-2028 Price per kW-month $ 2.61 $ 2.59 $ 2.59 $ 3.58 We continue to market and pursue longer term multi-year capacity transactions that extend through planning year 2027-2028.
Normal purchases and sales (NPNS) are contracts that provide for physical delivery of quantities expected to be used or sold over a reasonable period in the normal course of business and are not subject to mark-to-market accounting if the NPNS election is made and are accounted for on an accrual basis.
Normal purchases and sales (NPNS) are contracts that provide for physical delivery of quantities expected to be used or sold over a reasonable period in the normal course of business and are accounted for on an accrual basis.
Capitalization Our capitalization ratios consisted of 70% and 71% long-term debt (less amounts due currently) and 30% and 29% stockholders' equity at December 31, 2023 and 2022, respectively.
Capitalization Our capitalization ratios consisted of 73% and 70% long-term debt (less amounts due currently) and 27% and 30% stockholders' equity at December 31, 2024 and 2023, respectively.
As of December 31, 2023, we received or posted cash, letters of credit and Eligible Assets for commodity hedging and trading activities as follows: • $1.244 billion in cash and Eligible Assets has been posted with counterparties as compared to $3.137 billion posted as of December 31, 2022; • $45 million in cash has been received from counterparties as compared to $39 million received as of December 31, 2022; • $2.408 billion in letters of credit have been posted with counterparties as compared to $2.314 billion posted as of December 31, 2022; and • $143 million in letters of credit have been received from counterparties as compared to $74 million received as of December 31, 2022.
As of December 31, 2024, we received or posted cash, letters of credit and Eligible Assets for commodity hedging and trading activities as follows: • $841 million in cash and Eligible Assets has been posted with counterparties as compared to $1.244 billion posted as of December 31, 2023; • $49 million in cash has been received from counterparties as compared to $45 million received as of December 31, 2023; • $2.560 billion in letters of credit have been posted with counterparties as compared to $2.408 billion posted as of December 31, 2023; and • $131 million in letters of credit have been received from counterparties as compared to $143 million received as of December 31, 2023.
On the most recent goodwill testing date, we performed a qualitative assessment and determined that it was more likely than not that the fair value of our Retail and Texas Generation reporting units exceeded their carrying value at October 1, 2023.
On the most recent testing date, we performed a qualitative assessment and determined that it was more likely than not that the fair value of our reporting units and retail trade names exceeded their carrying value.
(c) As of December 31, 2023 and 2022, the borrowing bases are less than the facility limits of $1.575 billion and $1.35 billion, respectively. As of December 31, 2023, available capacity reflects the borrowing base of $1.101 billion and no cash borrowings.
(c) As of December 31, 2024 and 2023, the borrowing bases were less than the facility limits of $1.75 billion and $1.575 billion, respectively. As of December 31, 2024, available capacity reflects the borrowing base of $771 million and no cash borrowings. As of December 31, 2023, available capacity reflects the borrowing base of $1.101 billion and no cash borrowings.
Our obligations under commodity purchase and services agreements, including capacity payments, nuclear fuel and natural gas take-or-pay contracts, coal contracts, business services and nuclear-related outsourcing and other purchase commitments, are expected to total approximately $2.615 billion in 2024, $2.192 billion in 2025-2026, $982 million in 2027-2028 and $437 million thereafter.
Our obligations under commodity purchase and services agreements, including capacity payments, nuclear fuel and natural gas take-or-pay contracts, coal contracts, business services and nuclear-related outsourcing and other purchase commitments, are expected to total approximately $3.270 billion in 2025, $2.650 billion in 2026-2027, $1.490 billion in 2028-2029 and $450 million thereafter.
Further, we assess the likelihood that we will be able to realize or utilize our deferred tax assets. If realization is not more likely than not, we would record a valuation allowance against such deferred tax assets for the amount we would not expect to utilize, which would reduce the carrying value of the deferred tax amounts.
If realization is not more likely than not, we would record a valuation allowance against such deferred tax assets for the amount we would not expect to utilize, which would reduce the carrying value of the deferred tax amounts.
For our generation assets, possible indications include an expectation of continuing long-term declines in natural gas prices and/or Market Heat Rates or an expectation that "more likely than not" a generation asset will be sold or otherwise disposed of significantly before the end of its estimated useful life.
Indicators of impairment for our generation facilities include an expectation of continuing long-term declines in natural gas prices and/or Market Heat Rates, an expectation that "more likely than not" a generation asset will be sold or otherwise disposed of significantly before the end of its estimated useful life, or additional environmental regulations significantly decrease the cash flows expected from the associated assets.
In estimating the ARO liability, we are required to make significant estimates and assumptions. 57 Table of Contents For the estimates and assumptions of the nuclear generation plant decommissioning, we use unit-by-unit decommissioning cost studies to provide a marketplace assessment of the expected costs (in current year dollars) and timing of decommissioning activities, which are validated by comparison to current decommissioning projects within the industry and other estimates.
For the estimates and assumptions of the nuclear generation plant decommissioning, we use unit-by-unit decommissioning cost studies to provide a marketplace assessment of the expected costs and estimates of the timing of decommissioning activities, which are validated by comparison to current decommissioning projects within the industry and other estimates.
Any significant changes to these inputs could result in a material change to the value of the assets or liabilities recorded on our consolidated balance sheets and could result in a material change to the unrealized gains or losses recorded in our consolidated statements of operations. We estimate fair value as described in Note 16 to the Financial Statements.
Any significant changes to these inputs could result in a material change to the value of the assets or liabilities recorded in the consolidated balance sheets and could result in a material change to the unrealized gains or losses recorded in the consolidated statements of operations.
Vistra Consolidated Financial Results — Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 The following table presents net income (loss), EBITDA and adjusted EBITDA for the year ended December 31, 2023: Year Ended December 31, 2023 Retail Texas East West Sunset Asset Closure Eliminations / Corporate and Other Vistra Consolidated Operating revenues $ 10,572 $ 3,823 $ 4,215 $ 914 $ 1,831 $ — $ (6,576) $ 14,779 Fuel, purchased power costs and delivery fees (9,046) (1,951) (2,031) (328) (776) (3) 6,578 (7,557) Operating costs (123) (894) (297) (58) (254) (74) (2) (1,702) Depreciation and amortization (102) (544) (647) (79) (62) — (68) (1,502) Selling, general and administrative expenses (858) (134) (82) (24) (51) (34) (125) (1,308) Impairment of long-lived assets — — — — (49) — — (49) Operating income (loss) 443 300 1,158 425 639 (111) (193) 2,661 Other income 1 35 3 21 1 110 86 257 Other deductions — (2) — — (5) — (7) (14) Interest expense and related charges (20) 21 — 8 (2) (5) (742) (740) Impacts of Tax Receivable Agreement — — — — — — (164) (164) Income (loss) before income taxes 424 354 1,161 454 633 (6) (1,020) 2,000 Income tax expense — — (1) — — — (507) (508) Net income (loss) $ 424 $ 354 $ 1,160 $ 454 $ 633 $ (6) $ (1,527) $ 1,492 60 Table of Contents Year Ended December 31, 2023 Retail Texas East West Sunset Asset Closure Eliminations / Corporate and Other Vistra Consolidated Income tax expense — — 1 — — — 507 508 Interest expense and related charges (a) 20 (21) — (8) 2 5 742 740 Depreciation and amortization (b) 102 635 647 79 62 — 68 1,593 EBITDA before Adjustments 546 968 1,808 525 697 (1) (210) 4,333 Unrealized net (gain) loss resulting from commodity hedging transactions 586 799 (1,117) (267) (455) (36) — (490) Impacts of Tax Receivable Agreement (c) — — — — — — 135 135 Non-cash compensation expenses — — — — — — 78 78 Transition and merger expenses — 1 1 — 1 — 47 50 Impairment of long-lived assets — — — — 49 — — 49 PJM capacity performance default impacts (d) — — 3 — 6 — — 9 Winter Storm Uri impacts (e) (52) 4 — — — — — (48) Other, net 25 (2) 12 5 60 (2) (113) (15) Adjusted EBITDA $ 1,105 $ 1,770 $ 707 $ 263 $ 358 $ (39) $ (63) $ 4,101 ____________ (a) Includes $36 million of unrealized mark-to-market net losses on interest rate swaps.
The following table presents Net income (loss), EBITDA, and Adjusted EBITDA for the year ended December 31, 2023: Year Ended December 31, 2023 Retail Texas East West Asset Closure Eliminations / Corporate and Other Vistra Consolidated (in millions) Operating revenues $ 10,572 $ 3,979 $ 5,890 $ 914 $ — $ (6,576) $ 14,779 Fuel, purchased power costs, and delivery fees (9,046) (2,028) (2,730) (328) (3) 6,578 (7,557) Operating costs (123) (917) (528) (58) (74) (2) (1,702) Depreciation and amortization (102) (550) (703) (79) — (68) (1,502) Selling, general, and administrative expenses (858) (140) (127) (24) (34) (125) (1,308) Impairment of long-lived assets — — (49) — — — (49) Operating income (loss) 443 344 1,753 425 (111) (193) 2,661 Other income 1 35 4 21 110 86 257 Other deductions — (2) (5) — — (7) (14) Interest expense and related charges (20) 21 (2) 8 (5) (742) (740) Impacts of Tax Receivable Agreement — — — — — (164) (164) Income (loss) before income taxes 424 398 1,750 454 (6) (1,020) 2,000 Income tax expense — — (1) — — (507) (508) Net income (loss) $ 424 $ 398 $ 1,749 $ 454 $ (6) $ (1,527) $ 1,492 Income tax expense — — 1 — — 507 508 Interest expense and related charges (a) 20 (21) 2 (8) 5 742 740 Depreciation and amortization (b) 102 641 703 79 — 68 1,593 EBITDA before Adjustments 546 1,018 2,455 525 (1) (210) 4,333 Unrealized net (gain) loss resulting from commodity hedging transactions 586 813 (1,586) (267) (36) — (490) 61 Table of Contents Year Ended December 31, 2023 Retail Texas East West Asset Closure Eliminations / Corporate and Other Vistra Consolidated Impacts of Tax Receivable Agreement (c) — — — — — 135 135 Non-cash compensation expenses — — — — — 78 78 Transition and merger expenses — 1 2 — — 47 50 Impairment of long-lived assets — — 49 — — — 49 PJM capacity performance default impacts (d) — — 9 — — — 9 Winter Storm Uri impacts (e) (52) 4 — — — — (48) Other, net 25 (2) 72 5 (2) (113) (15) Adjusted EBITDA $ 1,105 $ 1,834 $ 1,001 $ 263 $ (39) $ (63) $ 4,101 ____________ (a) Includes $36 million of unrealized mark-to-market net losses on interest rate swaps.
Impairment of Goodwill and Other Long-Lived Assets We evaluate long-lived assets (including intangible assets with finite lives) for impairment, in accordance with accounting standards related to impairment or disposal of long-lived assets, whenever events or changes in circumstances indicate that their carrying amount may not be recoverable.
Long-Lived Assets We evaluate long-lived assets (including intangible assets with finite lives) for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable.
We are taking affirmative action by building strategic inventory and deploying mitigating strategies in our procurement portfolio to ensure we can secure the nuclear fuel needed to continue to operate our nuclear facility through potential Russian supply disruption.
We have nuclear fuel contracted to support all our refueling needs through 2029. We continue to take affirmative action by building strategic inventory and deploying mitigating strategies in our procurement portfolio to ensure we can secure the nuclear fuel needed to continue to operate our nuclear facilities through potential Russian supply disruption.
During the year ended December 31, 2023, our operating segments delivered strong operating performance with a disciplined focus on cost management, while generating and selling essential electricity in a safe and reliable manner.
During the year ended December 31, 2024, our operating segments delivered strong operating performance with a disciplined focus on cost management, while generating and selling essential electricity in a safe and reliable manner. Our performance reflected strong plant operating performance, growth of our retail business and the effectiveness of our comprehensive hedging strategy.
Total long-term debt (including amounts due currently) to capitalization was 73% and 71% at December 31, 2023 and 2022, respectively. 70 Table of Contents Financial Covenants The Vistra Operations Credit Agreement and the Vistra Operations Commodity-Linked Credit Agreement each includes a covenant, solely with respect to the Revolving Credit Facility and the Commodity-Linked Facility and solely during a compliance period (which, in general, is applicable when the aggregate revolving borrowings and issued revolving letters of credit exceed 30% of the revolving commitments, provided that solely with respect to the Revolving Credit Facility only such amounts in excess of $300 million are taken into account for purposes of determining whether a compliance period is in effect), that requires the consolidated first-lien net leverage ratio not to exceed 4.25 to 1.00 (or, during a collateral suspension period, the consolidated total net leverage ratio not to exceed 5.50 to 1.00).
Total long-term debt (including amounts due currently) to capitalization was 75% and 73% at December 31, 2024 and 2023, respectively. 69 Table of Contents Financial Covenants The Vistra Operations Credit Agreement and the Vistra Operations Commodity-Linked Credit Agreement each includes a covenant, solely with respect to the Revolving Credit Facility and the Commodity-Linked Facility and solely during a compliance period (which, in general, is applicable when the aggregate revolving borrowings and revolving letters of credit outstanding (excluding all undrawn revolving letters of credit and cash collateralized backstopped revolving letters of credit) exceed 35% of the revolving commitments), that requires the consolidated first-lien net leverage ratio not to exceed 4.25 to 1.00 (or, during a collateral suspension period, the consolidated total net leverage ratio not to exceed 5.50 to 1.00).
Year Ended December 31, 2023 2022 Commodity contract net liability at beginning of period $ (3,148) $ (866) Settlements/termination of positions (a) 1,643 1,218 Changes in fair value of positions in the portfolio (b) (1,153) (3,728) Other activity (c) (82) 228 Commodity contract net liability at end of period $ (2,740) $ (3,148) ____________ (a) Represents reversals of previously recognized unrealized gains and losses upon settlement/termination (offsets realized gains/(losses) recognized in the settlement period).
Year Ended December 31, 2024 2023 (in millions) Commodity contract net liability as of January 1 $ (2,740) $ (3,148) Settlements/termination of positions (a) 1,213 1,643 Changes in fair value of positions in the portfolio (b) (58) (1,153) Acquired commodity contracts (c) (50) — Other activity (d) 175 (82) Commodity contract net liability as of December 31 $ (1,460) $ (2,740) ____________ (a) Represents reversals of previously recognized unrealized gains and losses upon settlement/termination (offsets realized gains/(losses) recognized in the settlement period).
We participate in these capacity market auctions and also enter into bilateral capacity sales, and a portion of our East, West and Sunset segment revenues are impacted by the capacity auction results or bilateral contracts.
We participate in these capacity market auctions and also enter into bilateral capacity sales, and a portion of our East, and West segment revenues are impacted by the capacity auction results or bilateral contracts. The following information summarizes the auction pricing for zones in which we operate as well as our capacity auction and bilateral capacity sales by planning period.
If it is determined that a transaction designated as a normal purchase or sale no longer meets the scope exception due to changes in estimates, the related contract would be recorded on the balance sheet at fair value with immediate recognition through earnings. See Note 17 to the Financial Statements for further discussion regarding derivative instruments.
If it is determined that a transaction designated as a normal purchase or sale no longer meets the scope exception, the related contract would be recorded on the balance sheet at fair value with immediate recognition through earnings.
Available Liquidity The following table summarizes changes in available liquidity for the year ended December 31, 2023: December 31, 2023 December 31, 2022 Change Cash and cash equivalents (a) $ 3,485 $ 455 $ 3,030 Vistra Operations Credit Facilities — Revolving Credit Facility (b) 1,213 1,236 (23) Vistra Operations — Commodity-Linked Facility (c) 1,101 808 293 Total available liquidity (d)(e) $ 5,799 $ 2,499 $ 3,300 ____________ (a) See the Consolidated Statements of Cash Flows in the Financial Statements and Cash Flows above for details of the increase in cash and cash equivalents for the year ended December 31, 2023.
Available Liquidity The following table summarizes changes in available liquidity for the year ended December 31, 2024: December 31, 2024 December 31, 2023 Change (in millions) Cash and cash equivalents (a) $ 1,188 $ 3,485 $ (2,297) Vistra Operations Credit Facilities — Revolving Credit Facility (b) 2,162 1,213 949 Vistra Operations — Commodity-Linked Facility (c) 771 1,101 (330) Total available liquidity (d)(e) $ 4,121 $ 5,799 $ (1,678) ____________ (a) See the consolidated statements of cash flows in the Financial Statements and Cash Flows above for details of the decrease in cash and cash equivalents for the year ended December 31, 2024.
Vistra is not subject to the CAMT in the 2023 tax year since it only applies to corporations that have a three-year average annual adjusted financial statement income in excess of $1 billion.
We do not expect Vistra to be subject to the CAMT in the 2024 tax year as it applies only to corporations with a three-year average annual adjusted financial statement income in excess of $1 billion.
In 2023, forward power prices decreased slightly which resulted in unrealized gains in our generation segments which is partially offset by unrealized losses in our retail segment. 65 Table of Contents The table below summarizes the changes in commodity contract assets and liabilities for the years ended December 31, 2023 and 2022.
In the Texas segment, forward power prices materially increased in the year ended December 31, 2023, which resulted in unrealized losses partially offset by unrealized gains in the Retail segment. The table below summarizes the changes in commodity contract assets and liabilities for the years ended December 31, 2024 and 2023.
East Segment 2023-2024 2024-2025 2025-2026 2026-2027 2027-2028 Auction capacity sold (MW) 3,213 3,103 3,032 2,836 3,261 Bilateral capacity sold (MW) 22 78 78 58 8 Total capacity sold (MW) 3,235 3,181 3,110 2,894 3,269 Average price per kW-month $ 2.22 $ 3.12 $ 2.72 $ 2.60 $ 3.58 MISO The capacity auction results for MISO Local Resource Zone 4, in which our assets are located, are as follows for each planning year: 2023-2024 Price per MW-day $ 9.25 MISO capacity sales through planning year 2026-2027 are as follows: Sunset Segment 2023-2024 2024-2025 2025-2026 2026-2027 Bilateral capacity sold in MISO (MW) 1,702 984 423 101 Total MISO segment capacity sold (MW) 1,702 984 423 101 Average price per kW-month $ 4.36 $ 4.34 $ 4.94 $ 4.59 54 Table of Contents CAISO Our capacity sales as part of the California Public Utilities Commission Resource Adequacy (RA) Program in California, aggregated by calendar year for 2024 through 2027 for Moss Landing, are as follows: West Segment 2024 2025 2026 2027 Bilateral capacity sold (Avg MW) 1,880 1,770 1,250 750 Electricity Prices The price of electricity has a significant impact on our operating revenues and purchased power costs.
East Segment 2024-2025 2025-2026 2026-2027 2027-2028 Auction capacity sold (MW) 3,221 3,032 2,960 3,261 Bilateral capacity sold (MW) 78 78 58 8 Total capacity sold (MW) 3,299 3,110 3,018 3,269 Average price per kW-month $ 3.10 $ 2.72 $ 2.60 $ 3.58 MISO The capacity auction results for MISO Local Resource Zone 4, in which our assets are located, are as follows for each planning year: 2024-2025 Price per MW-day $ 20.08 55 Table of Contents MISO capacity sales through planning year 2027-2028 are as follows: East Segment 2024-2025 2025-2026 2026-2027 2027-2028 Auction capacity sold (MW) 1,095 — — — Bilateral capacity sold (MW) 682 891 515 24 Total MISO segment capacity sold (MW) 1,777 891 515 24 Average price per kW-month $ 3.02 $ 4.52 $ 4.44 $ 4.96 CAISO Our capacity sales as part of the California Public Utilities Commission Resource Adequacy (RA) Program in California, aggregated by calendar year for 2025 through 2028 for Moss Landing, are as follows: West Segment 2025 2026 2027 2028 Bilateral capacity sold (Avg MW) 1,816 1,575 1,275 750 Electricity Prices The price of electricity has a significant impact on our operating revenues and purchased power costs.
PJM Reliability Pricing Model (RPM) auction results, for the zones in which our assets are located, are as follows for each planning year: 2023-2024 2024-2025 (average price per MW-day) RTO zone $ 34.13 $ 28.92 ComEd zone 34.13 28.92 MAAC zone 49.49 49.49 EMAAC zone 49.49 54.95 ATSI zone 34.13 28.92 DEOK zone 34.13 96.24 Our capacity sales in PJM, net of purchases, aggregated by planning year and capacity type through planning year 2024-2025, are as follows: 2023-2024 2024-2025 East Segment Sunset Segment East Segment Sunset Segment CP auction capacity sold, net (MW) 5,811 1,667 5,567 1,338 Bilateral capacity sold, net (MW) 378 166 400 38 Total segment capacity sold, net (MW) 6,189 1,833 5,967 1,376 Average price per MW-day $ 38.61 $ 36.82 $ 36.80 $ 75.11 53 Table of Contents NYISO The most recent seasonal auction results for NYISO's Rest-of-State zones, in which the capacity for our Independence plant clears, are as follows for each planning period: Winter 2023 - 2024 Price per kW-month $ 3.83 Due to the short-term, seasonal nature of the NYISO capacity auctions, we monetize the majority of our capacity through bilateral trades.
PJM Reliability Pricing Model (RPM) auction results, for the zones in which our assets are located, are as follows for each planning year: 2024-2025 2025-2026 (average price per MW-day) RTO zone $ 28.92 $ 269.92 ComEd zone 28.92 269.92 MAAC zone 49.49 269.92 EMAAC zone 53.60 269.92 ATSI zone 28.92 269.92 DEOK zone 96.24 269.92 DOM zone 28.92 444.26 54 Table of Contents Our capacity sales in PJM, net of purchases, aggregated by planning year and capacity type through planning year 2025-2026, are as follows: East Segment 2024-2025 2025-2026 CP auction capacity sold, net (MW) 9,935 10,255 Bilateral capacity sold, net (MW) 2,127 330 Total segment capacity sold, net (MW) 12,062 10,585 Average price per MW-day $ 41.38 $ 267.12 NYISO The most recent seasonal auction results for NYISO's Rest-of-State zones, in which the capacity for our Independence plant clears, are as follows for each planning period: Winter 2024 - 2025 Price per kW-month $ 2.00 Due to the short-term, seasonal nature of the NYISO capacity auctions, we monetize the majority of our capacity through bilateral trades.
We use cash, letters of credit, Eligible Assets (see Note 11 to the Financial Statements) and other forms of credit support to satisfy such collateral posting obligations. See Note 12 to the Financial Statements for discussion of the Vistra Operations Credit Facilities and the Commodity-Linked Facility.
We use cash, letters of credit, Eligible Assets (see Note 8 to the Financial Statements) and other forms of credit support to satisfy such collateral posting obligations. See Note 9 to the Financial Statements for additional information.
Our operational cash flows tend to be seasonal and weighted toward the second half of the year. Interest payments on long-term debt are expected to total approximately $744 million in 2024, $1.293 billion in 2025-2026, $955 million in 2027-2028 and $1.052 billion thereafter. See Note 12 to the Financial Statements for details of our long-term debt maturities.
Our operational cash flows tend to be seasonal and weighted toward the second half of the year. Interest payments on long-term debt, after taking into account interest rate swaps, are expected to total approximately $905 million in 2025, $1.595 billion in 2026-2027, $1.180 billion in 2028-2029 and $1.305 billion thereafter. See Note 9 to the Financial Statements for additional information.
Estimated hedging levels for generation volumes in our Texas, East, West and Sunset segments as of December 31, 2023 were as follows: 2024 2025 Nuclear/Renewable/Coal Generation: Texas 96 % 93 % Sunset 96 % 58 % Natural Gas Generation: Texas 89 % 80 % East 99 % 80 % West 100 % 81 % 66 Table of Contents Financial Condition Cash Flows Operating Cash Flows Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 — Cash provided by operating activities totaled $5.453 billion and $485 million in the years ended December 31, 2023 and 2022, respectively.
Estimated hedging levels for generation volumes in our Texas, East and West segments as of December 31, 2024 were as follows: 2025 2026 Nuclear/Renewable/Coal Generation: Texas 100 % 100 % East 84 % 55 % Natural Gas Generation: Texas 100 % 57 % East 100 % 77 % West 100 % 37 % Financial Condition Cash Flows Operating Cash Flows Cash provided by operating activities totaled $4.563 billion and $5.453 billion for the years ended December 31, 2024 and 2023, respectively.
We have taken the CAMT and relevant extensions or expansions of existing tax credits applicable to projects in our immediate development pipeline into account when forecasting cash taxes for periods after the law takes effect. See Note 1 for our accounting policy related to refundable and transferable PTCs and ITCs.
We have taken the CAMT and relevant extensions or expansions of existing tax credits applicable to projects in our immediate development pipeline into account when forecasting cash taxes.
See Collateral Support Obligations below for information related to collateral posted in accordance with the PUCT and ISO/RTO rules. Income Tax Payments In the next 12 months, we do not expect to make federal income tax payments due to Vistra's NOL carryforwards.
See Collateral Support Obligations below for information related to collateral posted in accordance with the PUCT and ISO/RTO rules. Income Tax Payments In the next 12 months, we expect to make approximately $31 million in federal income tax payments, $81 million in state income tax payments and $2 million in TRA payments, offset by $14 million in state tax refunds.
Results of Operations Net income (loss) attributable to Vistra common stock increased $2.6 billion to income of $1.5 billion for the year ended December 31, 2023 from a loss of $1.2 billion for the year ended December 31, 2022. For additional information see the following discussion of our results of operations.
Results of Operations Net income increased $1.32 billion to Net income of $2.812 billion for the year ended December 31, 2024 compared to the year ended December 31, 2023. For additional information see the following discussion of our results of operations.
These obligations are adjusted on a regular basis to reflect the passage of time and to incorporate revisions to the following significant estimates and assumptions: • estimation of dates for retirement, which can be dependent on environmental and other legislation; • amounts and timing of future cash expenditures associated with retirement, settlement or remediation activities; • discount rates; • cost escalation factors; • market risk premium; • inflation rates; and • if applicable, past experience with government regulators regarding similar obligations.
Our AROs are adjusted on a regular basis to reflect the passage of time and to incorporate revisions to estimates and judgments including, planned plant retirement dates, amounts and timing of future cash expenditures, discount rates, cost escalation factors, market risk premiums, inflation rates, and if applicable, experience with government regulators regarding similar obligations.
The following information summarizes the auction pricing for zones in which we operate as well as our capacity auction and bilateral capacity sales by planning period. Performance incentive rules increase capacity payments for those resources that are providing excess energy or reserves during a shortage event, while penalizing those that produce less than the required level.
Performance incentive rules increase capacity payments for those resources that are providing excess energy or reserves during a shortage event, while penalizing those that produce less than the required level.
Financial and Operating Performance The following are financial and operating highlights we achieved in the execution of our four strategic priorities: Long-term, attractive earnings profile through the integrated business model. • We continued to execute our integrated business model through exceptional operational performance and capitalization of market opportunities which drove strong earnings during the year ended December 31, 2023, highlighting our competitive advantage of coupling retail with our reliable and efficient generation fleet and wholesale commodity risk management capabilities which reduces the effects of commodity price movements and contributes to the stability and predictability of our cash flows. • Our commercial team focused on effectively and efficiently managing risk by opportunistically hedging for 2023 and beyond and optimizing our assets and business positions which led to strong plant operating performance and energy margins. 51 Table of Contents • Our retail brands served the retail electricity and natural gas needs of end-use residential, small business and commercial and industrial electricity customers through multiple sales and marketing channels through products and solutions that differentiate from our competitors leading to an increase in residential customer counts within markets we continue to operate.
This highlights our competitive advantage of coupling retail with our reliable and efficient generation fleet and wholesale commodity risk management capabilities, which reduces the effects of commodity price movements and contributes to the stability and predictability of our cash flows. • Our commercial team focused on effectively and efficiently managing risk by opportunistically hedging and optimizing our assets and business positions, which led to strong plant operating performance and energy margins. • Our retail brands served the retail electricity and natural gas needs of end-use residential, small business, and commercial and industrial electricity customers through multiple sales and marketing channels with products and solutions that differentiates Vistra from our competitors.
The carrying value of such asset groups is determined to be unrecoverable if the projected undiscounted cash flows are less than the carrying value. 58 Table of Contents If an asset group carrying value is determined to be unrecoverable, fair value will be calculated based on a market participant view and a loss will be recorded for the amount the carrying value exceeds the fair value.
If an asset group carrying value is determined to be unrecoverable, fair value will be calculated based on a market participant view and a loss will be recorded for the amount the carrying value exceeds the fair value. Fair value is determined primarily by discounted cash flows (income approach) and supported by available market valuations, if applicable.
Maturity dates of unrealized commodity contract net liability at December 31, 2023 Source of Fair Value Less than 1 year 1-3 years 4-5 years Excess of 5 years Total Prices actively quoted $ (725) $ (207) $ 3 $ — $ (929) Prices provided by other external sources (358) (409) — — (767) Prices based on models (355) (454) (138) (97) (1,044) Total $ (1,438) $ (1,070) $ (135) $ (97) $ (2,740) We have engaged in natural gas hedging activities to mitigate the risk of higher or lower wholesale electricity prices that have corresponded to increases or declines in natural gas prices.
Maturity dates of unrealized commodity contract net liability as of December 31, 2024 Source of Fair Value Less than 1 year 1-3 years 4-5 years Excess of 5 years Total (in millions) Prices actively quoted $ (205) $ 11 $ (1) $ — $ (195) Prices provided by other external sources (423) (91) 1 — (513) Prices based on models (162) (507) (75) (8) (752) Total $ (790) $ (587) $ (75) $ (8) $ (1,460) 65 Table of Contents We have engaged in natural gas hedging activities to mitigate the risk of higher or lower wholesale electricity prices that have corresponded to increases or declines in natural gas prices.
The estimates and assumptions required for the mining land reclamation related to lignite mining, such as costs to fill in mining pits and interpretation of the mining permit closure requirements, are complex and require a significant amount of judgment.
The estimates and assumptions required for the lignite mining land reclamation include, estimates such as costs to fill in mining pits and interpretation of the mining permit closure requirements. We estimate the costs to fill in mining pits utilizing a proprietary model to determine the volume of the pit.
Our 2024 refueling has not been affected by the Russia and Ukraine conflict, nor have we seen any disruption to the delivery of nuclear fuel.
Our 2024 and 2025 refueling plans have not been affected by the Russia and Ukraine conflict, nor have we seen any disruption to the delivery of nuclear fuel impacting our refueling schedules. We work with a diverse set of global nuclear fuel cycle suppliers to procure our nuclear fuel years in advance.
We expect to make approximately $35 million in state income tax payments offset by $10 million in state tax refunds. For the year ended December 31, 2023, there were no federal income tax payments, $44 million in state income tax payments, $13 million in state income tax refunds and $9 million in TRA payments.
For the year ended December 31, 2024, there were $5 million federal income tax payments, $59 million in state income tax payments, $9 million in state income tax refunds and no TRA payments.
Because EBITDA and Adjusted EBITDA are financial measures that management uses to allocate resources, determine our ability to fund capital expenditures, assess performance against our peers, and evaluate overall financial performance, we believe they provide useful information for investors. 59 Table of Contents These non-GAAP financial measures should not be relied upon to the exclusion of GAAP financial measures and are, by definition, an incomplete understanding of Vistra and must be considered in conjunction with GAAP measures.
Because EBITDA and Adjusted EBITDA are financial measures that management uses to allocate resources, determine our ability to fund capital expenditures, assess performance against our peers, and evaluate overall financial performance, we believe they provide useful information for investors.
(e) Excludes any additional letters of credit that may be issued under the Secured LOC Facilities. See Note 12 to the Financial Statements for detail on our Secured LOC Facilities.
(d) Excludes amounts available to be borrowed under the Receivables Facility and the Repurchase Facility, respectively. See Note 9 to the Financial Statements for additional information. (e) Excludes any additional letters of credit that may be issued under the Secured LOC Facilities or the Alternative LOC Facilities. See Note 9 to the Financial Statements for additional information.
Amounts are generally related to premiums related to options purchased or sold as well as certain margin deposits classified as settlement for certain transactions executed on the CME.
(d) Primarily represents changes in fair value of positions due to receipt or payment of cash not reflected in unrealized gains or losses. Amounts are generally related to premiums related to options purchased or sold as well as certain margin deposits classified as settlement for certain transactions executed on the CME.
The difference represents amortization of nuclear fuel, which is reported as fuel costs in the consolidated statements of operations consistent with industry practice, and amortization of intangible net assets and liabilities that are reported in various other consolidated statements of operations line items including operating revenues and fuel and purchased power costs and delivery fees (see Note 6 to the Financial Statements).
This difference represents amortization of nuclear fuel, which is reported as fuel costs in the consolidated statements of operations consistent with industry practice, as well as the amortization of intangible net assets and liabilities.
The determination of the existence of these and other indications of impairment involves judgments that are subjective in nature and may require the use of estimates in forecasting future results and cash flows related to an asset or group of assets.
The determination of the existence of these and other indications of impairment involves judgments that are subjective in nature and may require the use of estimates in forecasting future results and cash flows given the diverse fuel mix and output rates of our generation asset groups. See Note 20 to the Financial Statements for additional information.
Any significant change to one or more of these factors can have a material impact on the fair value measurement of our long-lived assets.
Any significant change to one or more of these factors can have a material impact on the fair value measurement of our long-lived assets. Nuclear PTC Revenues Nuclear PTC revenues are accounted for by analogy to the grant model within International Accounting Standards 20, Accounting for Government Grants and Disclosures of Government Assistance.
The inflationary environment continues to drive elevated interest rates, resulting in increased expected refinancing or borrowing costs, including project financing for our development projects and refinancing expected in connection with debt due in 2024 and beyond. 52 Table of Contents We are closely monitoring developments in the Russia and Ukraine conflict, specifically with regards to, (i) sanctions (or potential sanctions) against Russian energy exports and Russian nuclear fuel supply and enrichment activities, and (ii) actions by Russia to limit energy deliveries, which may further impact commodity prices in Europe and globally.
We continue to closely monitor developments in the Russia and Ukraine conflict, specifically with regards to, (i) sanctions (or potential sanctions) against Russian energy exports and Russian nuclear fuel supply and enrichment activities, and (ii) actions by Russia to limit energy deliveries, which may further impact commodity prices in Europe and globally.
Year Ended December 31, Increase (Decrease) 2023 2022 Capital expenditures, including LTSA prepayments $ (764) $ (628) (136) Nuclear fuel purchases (214) (198) (16) Growth and development expenditures (698) (475) (223) Total capital expenditures (1,676) (1,301) (375) Net sales (purchases) of environmental allowances (571) (28) (543) Net sales of (investments in) nuclear decommissioning trust fund securities (23) (23) 0 Proceeds from sales of property, plant and equipment 115 78 37 Other investing activity 10 35 (25) Cash used in investing activities $ (2,145) $ (1,239) $ (906) 67 Table of Contents Financing Cash Flows Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 — Cash used in financing activities totaled $294 million and $80 million in the years ended December 31, 2023 and 2022, respectively.
Year Ended December 31, Increase (Decrease) 2024 2023 (in millions) Capital expenditures, including LTSA prepayments $ (801) $ (764) (37) Nuclear fuel purchases (477) (214) (263) Growth and development expenditures (800) (698) (102) Total capital expenditures (2,078) (1,676) (402) Energy Harbor acquisition (net of cash acquired) (3,065) — (3,065) Net sales (purchases) of environmental allowances (453) (571) 118 Net sales of (investments in) nuclear decommissioning trust fund securities (23) (23) 0 Proceeds from sales of property, plant, and equipment, including nuclear fuel 196 115 81 Proceeds from sales of transferable ITCs 150 — 150 Other investing activity (3) 10 (13) Cash used in investing activities $ (5,276) $ (2,145) $ (3,131) Financing Cash Flows Cash used in financing activities totaled $1.604 billion and $294 million for the year ended December 31, 2024 and 2023, respectively.
Recoverability of long-lived assets is determined by a comparison of the carrying amount of the long-lived asset group to the net cash flows expected to be generated by the asset group, through considering specific assumptions for forward natural gas and electricity prices, forward capacity prices, the effects of enacted environmental rules, generation plant performance, forecasted capital expenditures, forecasted fuel prices and forecasted operating costs.
Assumptions used in our estimate of net cash flows of the asset group include, forward natural gas and electricity prices, forward capacity prices, the effects of enacted environmental rules, generation plant performance, forecasted capital expenditures, forecasted fuel prices, and forecasted operating costs.
Accounting for Income Taxes Our income tax expense and related consolidated balance sheet amounts involve significant management estimates and judgments. Amounts of deferred income tax assets and liabilities, as well as current and noncurrent accruals, involve estimates and judgments of the timing and probability of recognition of income and deductions by taxing authorities.
Amounts of deferred income tax assets and liabilities, as well as current and noncurrent accruals, involve estimates and judgments of the timing and probability of recognition of income and deductions by taxing authorities. Further, we assess the likelihood that we will be able to realize or utilize our deferred tax assets.
The following is a summary of certain critical accounting estimates that are impacted by judgments and uncertainties and under which different amounts might be reported using different assumptions or estimation methodologies. 55 Table of Contents Derivative Instruments and Mark-to-Market Accounting We enter into contracts for the purchase and sale of energy-related commodities, and also enter into other derivative instruments such as options, swaps, futures and forwards primarily to manage commodity price and interest rate risks.
Derivative Instruments and Mark-to-Market Accounting We enter into contracts for the purchase and sale of energy-related commodities, as well as other derivative instruments such as options, swaps, futures, and forwards, primarily to manage commodity price and interest rate risks.
Operating income increased $3.838 billion to $2.661 billion in the year ended December 31, 2023 compared to the year ended December 31, 2022.
GAAP net income increased $1.32 billion to net income of $2.812 billion in the year ended December 31, 2024 compared to the year ended December 31, 2023.
See Note 2 to the Financial Statements for more information concerning the Transaction Agreement. 50 Table of Contents Inflation Reduction Act of 2022 In August 2022, the U.S. enacted the IRA, which, among other things, implements substantial new and modified energy tax credits, including a nuclear PTC, a solar PTC, a first-time stand-alone battery storage investment tax credit, a 15% corporate alternative minimum tax (CAMT) on book income of certain large corporations, and a 1% excise tax on net stock repurchases.
Inflation Reduction Act of 2022 (IRA) In August 2022, the U.S. enacted the IRA, which, among other things, implements substantial new and modified energy tax credits, including recognizing the value of existing carbon-free nuclear power by providing for a nuclear PTC, a solar PTC, and a first-time stand-alone battery storage investment tax credit.
Guarantees See Note 14 to the Financial Statements for discussion of guarantees. Commitments and Contingencies See Note 14 to the Financial Statements for discussion of commitments and contingencies. Changes in Accounting Standards See Note 1 to the Financial Statements for discussion of changes in accounting standards. 72 Table of Contents
Changes in Accounting Standards See Note 1 to the Financial Statements for additional information.
Liquidity Effects of Commodity Hedging and Trading Activities We have entered into commodity hedging and trading transactions that require us to post collateral if the forward price of the underlying commodity moves such that the hedging or trading instrument we hold has declined in value.
Capital Expenditures Estimated 2025 capital expenditures and nuclear fuel purchases as of December 31, 2024 total approximately $2.275 billion and include: • $925 million for investments in generation and mining facilities; • $725 million for solar and energy storage development; • $300 million for nuclear fuel purchases; and • $325 million for other growth expenditures. 68 Table of Contents Liquidity Effects of Commodity Hedging and Trading Activities We have entered into commodity hedging and trading transactions that require us to post collateral if the forward price of the underlying commodity moves such that the hedging or trading instrument we hold has declined in value.
Excludes changes in fair value in the month the position settled as well as amounts related to positions entered into, and settled, in the same month. (c) Represents changes in fair value of positions due to receipt or payment of cash not reflected in unrealized gains or losses.
Excludes changes in fair value in the month the position settled as well as amounts related to positions entered into, and settled, in the same month. (c) Includes fair value of commodity contracts acquired in the Energy Harbor Merger (see Note 2 to the Financial Statements).
(b) The decrease in availability for the year ended December 31, 2023 was driven by a $73 million increase in letters of credit outstanding under the facility and the maturity of $200 million of commitments under the Non-Extended Revolving Credit Facility, partially offset by $250 million in net repayments of borrowings under the facility.
(b) The increase in availability for the year ended December 31, 2024 was driven by a $684 million decrease in letters of credit outstanding under the facility and the October 2024 amendment to the Revolving Credit Facility which, among other things, increased the revolving credit commitments by $265 million (see Note 9 to the Financial Statements).
As of December 31, 2023, we were in compliance with the Vistra Operations Credit Agreement, Vistra Operations Commodity-Linked Credit Agreement and Secured LOC Facilities financial covenants. See Note 12 to the Financial Statements for discussion of other covenants related to the Vistra Operations Credit Facilities.
Although the period ended December 31, 2024 was not a compliance period, we would have been in compliance with the Vistra Operations Credit Agreement, Vistra Operations Commodity-Linked Credit Agreement and Secured LOC Facilities financial covenants if they were required to be tested at such time. See Note 9 to the Financial Statements for additional information.
Year Ended December 31, Retail Texas East West Sunset 2023 2022 2023 2022 2023 2022 2023 2022 2023 2022 Retail sales volumes (GWh): Retail electricity sales volumes: Sales volumes in ERCOT 70,275 65,207 Sales volumes in Northeast/Midwest 27,147 32,882 Total retail electricity sales volumes 97,422 98,089 Production volumes (GWh): Natural gas facilities 41,849 34,784 60,502 54,569 5,462 5,134 Lignite and coal facilities 23,899 25,211 16,572 21,824 Nuclear facilities 18,893 19,688 Solar facilities 781 822 Capacity factors: CCGT facilities 55.1 % 48.8 % 62.2 % 57.2 % 61.0 % 57.1 % Lignite and coal facilities 70.9 % 74.8 % 41.3 % 54.4 % Nuclear facilities 89.9 % 93.6 % Weather - percent of normal (a): Cooling degree days 115 % 111 % 112 % 109 % 90 % 107 % 79 % 107 % 112 % 113 % Heating degree days 85 % 108 % 88 % 123 % 87 % 99 % 125 % 109 % 86 % 99 % ____________ (a) Reflects cooling degree or heating degree days for the region based on Weather Services International (WSI) data.
Unfavorable impacts: • Increase in depreciation and amortization expense driven by addition of assets acquired from Energy Harbor and reflected in East. • Increase in interest expense driven by higher average borrowings and unrealized mark to market losses on interest rate swaps. • Increase in selling, general, and administrative expenses in Retail segment and Corp. and Other driven primarily by the addition of Energy Harbor. • Increase in income tax expense driven by higher income. 62 Table of Contents Year Ended December 31, Retail Texas East West 2024 2023 2024 2023 2024 2023 2024 2023 Retail electricity sales volumes (GWh): Sales volumes in ERCOT 74,295 70,275 Sales volumes in Northeast/Midwest 59,066 27,147 Total retail electricity sales volumes 133,361 97,422 Production volumes (GWh): Natural gas facilities 44,595 41,849 60,279 60,502 4,175 5,462 Lignite and coal facilities 23,307 26,559 16,938 13,912 Nuclear facilities 19,670 18,893 26,540 Solar facilities 757 781 Capacity factors: CCGT facilities 58.1 % 55.1 % 62.0 % 62.2 % 46.5 % 61.0 % Lignite and coal facilities 59.0 % 67.4 % 49.1 % 40.4 % Nuclear facilities 93.3 % 89.9 % 89.3 % Weather - percent of normal (a): Cooling degree days 112 % 115 % 112 % 112 % 103 % 96 % 90 % 79 % Heating degree days 78 % 85 % 77 % 88 % 88 % 87 % 119 % 125 % ____________ (a) Reflects cooling degree or heating degree days for the region based on Weather Services International (WSI) data.
(b) Includes nuclear fuel amortization of $91 million in the Texas segment. (c) Includes $29 million gain recognized on the repurchase of TRA Rights in December 2023 (see Note 8 to the Financial Statements).
(b) Includes nuclear fuel amortization of $105 million and $282 million, respectively, in the Texas and East segments. (c) Includes $10 million gain recognized on the repurchase of TRA Rights in the year ended December 31, 2024.
This is evident in 2022 as material increase in forward power prices drove material unrealized losses in our generation segment, partially offset by unrealized gains in our retail segment.
In 2024, we saw a decrease in forward power prices in all our generation segments compared to our hedged positions which drove material unrealized gains in those segments, partially offset by unrealized losses in our retail segment.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeVistra has a risk management organization that enforces applicable risk limits, including the respective policies and procedures to ensure compliance with such limits, and evaluates the risks inherent in our businesses. Commodity Price Risk Our business is subject to the inherent risks of market fluctuations in the price of electricity, natural gas and other energy-related products it markets or purchases.
Biggest changeCommodity Price Risk and Oversight Our business is subject to the inherent risks of market fluctuations in the price of commodities for energy-related products we market or purchase in futures markets including electricity, natural gas, uranium, coal, environmental credits and other energy commodities in competitive wholesale markets.
As of December 31, 2023, the potential reduction of annual pretax earnings over the next twelve months due to a one percentage-point (100 basis points) increase in floating interest rates on long-term debt totaled approximately $2 million taking into account the interest rate swaps discussed in Note 12 to Financial Statements.
As of December 31, 2024, the potential reduction of annual pretax earnings over the next twelve months due to a one percentage-point (100 basis points) increase in floating interest rates on long-term debt totaled approximately $12 million after taking into account the interest rate swaps.
In managing energy price risk, we enter into a variety of market transactions including, but not limited to, short- and long-term contracts for physical delivery, exchange-traded and over-the-counter financial contracts and bilateral contracts with customers. Activities include hedging, the structuring of long-term contractual arrangements and proprietary trading.
In managing commodity price risk, we enter into a variety of market transactions including, but not limited to, short- and long-term contracts for physical delivery, exchange-traded and over-the-counter financial contracts and bilateral contracts with customers.
We view exposure to these counterparties to be within an acceptable level of risk tolerance due to the counterparties' credit ratings, the counterparties' market role and deemed creditworthiness and the importance of our business relationship with the counterparty.
We view exposure to this counterparty to be within an acceptable level of risk tolerance due to the counterparty's credit ratings, the counterparty's market role and deemed creditworthiness and the importance of our business relationship with the counterparty. 74 Table of Contents
We also employ certain risk mitigation practices, including utilization of standardized master agreements that provide for netting and setoff rights, as well as credit enhancements such as margin deposits and customer deposits, letters of credit, parental guarantees and surety bonds. See Note 17 to the Financial Statements for further discussion of this exposure.
We also employ certain risk mitigation practices, including utilization of standardized master agreements that provide for netting and setoff rights, as well as credit enhancements such as margin deposits and customer deposits, letters of credit, parental guarantees and surety bonds.
Parametric processes are used to calculate VaR and are considered by management to be the most effective way to estimate changes in a portfolio's value based on assumed market conditions for liquid markets.
Parametric processes are used to calculate VaR and are considered by management to be the most effective way to estimate changes in a portfolio's value based on assumed market conditions for liquid markets. This measurement estimates the potential loss in value, due to changes in market conditions, of all underlying generation assets and contracts.
We actively manage the portfolio of generation assets, fuel supply and retail sales load to mitigate the near-term impacts of these risks on results of operations. Similar to other participants in the market, we cannot fully manage the long-term value impact of structural declines or increases in natural gas and power prices.
Similar to other participants in the market, we cannot fully manage the long-term value impact of structural declines or increases in natural gas and power prices.
Credit Exposure Our gross credit exposure (excluding collateral impacts) associated with retail and wholesale trade accounts receivable and net derivative assets arising from commodity contracts and hedging and trading activities totaled $1.976 billion at December 31, 2023. 75 Table of Contents As of December 31, 2023, Retail segment credit exposure totaled approximately $1.302 billion, including $1.241 billion of trade accounts receivable and $61 million related to derivatives.
See Note 11 to the Financial Statements for additional information. 73 Table of Contents Our gross credit exposure (excluding collateral impacts) associated with retail and wholesale trade accounts receivable and net derivative assets arising from commodity contracts and hedging and trading activities totaled $2.360 billion at December 31, 2024.
Contracts classified as "normal" purchase or sale and non-derivative contractual commitments are not marked-to-market in the financial statements and are excluded from the detail above. Such contractual commitments may contain pricing that is favorable considering current market conditions and therefore represent economic risk if the counterparties do not perform. 76 Table of Contents
Such contractual commitments may contain pricing that is favorable considering current market conditions and therefore represent economic risk if the counterparties do not perform.
Including collateral posted to us by counterparties, our net Texas, East, Sunset and Asset Closure segments exposure was $551 million, as seen in the following table that presents the distribution of credit exposure by counterparty credit quality as of December 31, 2023.
Including collateral posted to us by counterparties, our net exposure was $2.166 billion, as seen in the following table that presents the distribution of credit exposure by counterparty credit quality as of December 31, 2024. Credit collateral includes cash and letters of credit but excludes other credit enhancements such as guarantees or liens on assets.
Credit Risk Credit risk relates to the risk of loss associated with nonperformance by counterparties. We minimize credit risk by evaluating potential counterparties, monitoring ongoing counterparty risk and assessing overall portfolio risk. This includes review of counterparty financial condition, current and potential credit exposures, credit rating and other quantitative and qualitative credit criteria.
This includes review of counterparty financial condition, current and potential credit exposures, credit rating and other quantitative and qualitative credit criteria.
Market risks are monitored by risk management groups that operate independently of the wholesale commercial operations, utilizing defined practices and analytical methodologies.
Market risks are monitored by our risk management group which operates independently of the wholesale commercial operations, utilizing defined practices and analytical methodologies. These practices and methodologies measure the risk of change in value of the portfolio of contracts and the hypothetical effect on this value from changes in market conditions.
Exposure Before Credit Collateral Credit Collateral Net Exposure Investment grade $ 539 $ 26 $ 513 Below investment grade or no rating 135 97 38 Totals $ 674 $ 123 $ 551 Significant ( i.e. , 10% or greater) concentration of credit exposure exists with two counterparties, which represented an aggregate $293 million, or 53%, of our total net exposure as of December 31, 2023.
Significant ( i.e. , 10% or greater) concentration of credit exposure exists with one counterparty, which represented an aggregate $262 million, or 39%, of our total net exposure as of December 31, 2024.
These techniques measure the risk of change in value of the portfolio of contracts and the hypothetical effect on this value from changes in market conditions and include, but are not limited to, position reporting and review, Value at Risk (VaR) methodologies and stress test scenarios.
Measurement techniques include, but are not limited to, position reporting and review, Value at Risk (VaR) methodologies and stress test scenarios. Risk management regularly reports their analysis to the Company's Risk Committee and Executive Committee, and to the Sustainability and Risk Committee of the Board of Directors.
Risk Oversight We manage the commodity price, counterparty credit and commodity-related operational risk related to the competitive energy business within limitations established by senior management and in accordance with overall risk management policies. Interest rate risk is managed centrally by our treasury function.
Factors that influence these market fluctuations are dependent upon many factors outside of our control including seasonal changes in supply and demand, weather conditions, market liquidity, governmental, regulatory, and environmental policies. We manage the commodity price and commodity-related operational risk related to the competitive energy business within limitations established by senior management and in accordance with overall risk management policies.
Year Ended December 31, 2023 2022 Month-end average VaR $ 190 $ 489 Month-end high VaR $ 423 $ 686 Month-end low VaR $ 115 $ 283 The month-end high VaR risk measure in 2023 is currently lower than the prior year due to lower prices and higher hedge levels.
Average VaRs as of December 31 are the average of each month-end average for the years ended December 31, 2024 and 2023, respectively: Year Ended December 31, 2024 2023 Average VaR $ 236 $ 190 High VaR $ 371 $ 423 Low VaR $ 86 $ 115 The month-end average VaR risk measure increased in 2024 due to higher volumes following the Energy Harbor Merger.
The table below details a VaR measure related to various portfolios of contracts. 73 Table of Contents VaR for Underlying Generation Assets and Energy-Related Contracts This measurement estimates the potential loss in value, due to changes in market conditions, of all underlying generation assets and contracts, based on a 95% confidence level and an assumed holding period of 60 days.
The following table summarizes the VaR for Vistra's commodity portfolio based on a 95% confidence level and an assumed holding period of 60 days.
VaR Methodology A VaR methodology is used to measure the amount of market risk that exists within the portfolio under a variety of market conditions.
Beginning in 2024, our nuclear fleet is eligible for the nuclear PTC provided by the IRA which provides increasing levels of support as unit revenues decline below levels established in the IRA and is further adjusted annually for inflation over the duration of the program. 72 Table of Contents VaR Methodology A VaR methodology is used to measure the amount of market risk that exists within the portfolio under a variety of market conditions.
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Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Market risk is the risk that in the normal course of business we may experience a loss in value because of changes in market conditions that affect economic factors such as commodity prices, interest rates and counterparty credit.
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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK In the normal course of business, our financial position is routinely subject to a variety of risks, including market risks associated with (i) changes in commodity prices, (ii) interest rate movements on outstanding debt, and (iii) credit risk, which is the risk of financial loss if a customer, counterparty, or financial institution is unable to perform or pay amounts due to us.
Removed
Our exposure to market risk is affected by several factors, including the size, duration and composition of our energy and financial portfolio, as well as the volatility and liquidity of markets. Instruments used to manage this exposure include interest rate swaps to hedge debt costs, as well as exchange-traded, over-the-counter contracts and other contractual arrangements to hedge commodity prices.
Added
Interest Rate Risk We are exposed to fluctuations in interest rates through our issuance of variable rate debt. We mitigate our exposure to fluctuations in interest rates through entering interest rate swaps. These interest rate swaps limit the impact of interest rate changes on our results of operations and cash flows and to lower our overall borrowing costs.
Removed
Key risk control activities include, but are not limited to, transaction review and approval (including credit review), operational and market risk measurement, transaction authority oversight, validation of transaction capture, market price validation and reporting, and portfolio valuation and reporting, including mark-to-market, VaR and other risk measurement metrics.
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Interest rate risk is managed centrally by our treasury function. As of December 31, 2024, we have approximately $3.5 billion principal amount of variable rate debt consisting of the Vistra Operations Credit Facilities Term Loan B-3 Facility, the BCOP Credit Facilities and the Vistra Zero Term Loan B Facility (see Note 9 to the Financial Statements).
Removed
We continuously monitor the valuation of identified risks and adjust positions based on current market conditions. We strive to use consistent assumptions regarding forward market price curves in evaluating and recording the effects of commodity price risk.
Added
We have entered into net notional interest rate swaps that will hedge $2.3 billion of our exposure to variable rate debt through December 2030 (see Note 11 to Financial Statements).
Removed
The forward period covered by this calculation includes the current and subsequent calendar year at the time of calculation.
Added
Credit Risk Our primary concentration of credit risk is associated with the collection of receivables resulting from sales to retail customers and the risk of a counterparty's failure to meet its obligations under derivative contracts. We minimize our exposure to credit risk by evaluating potential counterparties, monitoring ongoing counterparty risk and assessing overall portfolio risk.
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Price Sensitivities The following sensitivity table provides approximate estimates of the potential impact of movements in power prices and spark spreads (the difference between the power revenue and fuel expense of natural gas-fired generation as calculated using an assumed Heat Rate of 7.2 MMBtu/MWh) on realized pre-tax earnings (in millions) taking into account the hedge positions noted above for the periods presented.
Added
Exposure Before Credit Collateral Trade Accounts Receivable Derivatives Gross Exposure Credit Collateral Net Exposure (in millions) Retail segment $ 1,545 $ — $ 1,545 $ 51 $ 1,494 Texas, East and Asset Closure segments: Investment grade $ 99 $ 451 $ 550 $ 49 $ 501 Below investment grade or no rating 69 196 265 94 171 Texas, East and Asset Closure segments $ 168 $ 647 $ 815 $ 143 $ 672 Totals $ 1,713 $ 647 $ 2,360 $ 194 $ 2,166 Contracts classified as "normal" purchase or sale and non-derivative contractual commitments are not marked-to-market in the financial statements and are excluded from the detail above.
Removed
The residual natural gas position is calculated based on two steps: first, calculating the difference between actual Heat Rates of our natural gas generation units and the assumed 7.2 Heat Rate used to calculate the sensitivity to spark spreads; and second, calculating the residual natural gas exposure that is not already included in the natural gas generation spark spread sensitivity shown in the table below.
Removed
The estimates related to price sensitivity are based on our expected generation, related hedges and forward prices as of December 31, 2023. 2024 2025 Texas: Nuclear/Renewable/Coal Generation: $2.50/MWh increase in power price $ 5 $ 9 Nuclear/Renewable/Coal Generation: $2.50/MWh decrease in power price $ (4) $ (8) Natural Gas Generation: $1.00/MWh increase in spark spread $ 7 $ 10 Natural Gas Generation: $1.00/MWh decrease in spark spread $ (6) $ (9) Residual Natural Gas Position: $0.25/MMBtu increase in natural gas price $ (9) $ 8 Residual Natural Gas Position: $0.25/MMBtu decrease in natural gas price $ 3 $ (11) East: Natural Gas Generation: $1.00/MWh increase in spark spread $ 2 $ 11 Natural Gas Generation: $1.00/MWh decrease in spark spread $ — $ (10) Residual Natural Gas Position: $0.25/MMBtu increase in natural gas price $ (7) $ (25) Residual Natural Gas Position: $0.25/MMBtu decrease in natural gas price $ 7 $ 25 West: Natural Gas Generation: $1.00/MWh increase in spark spread $ — $ 1 Natural Gas Generation: $1.00/MWh decrease in spark spread $ — $ (1) Residual Natural Gas Position: $0.25/MMBtu increase in natural gas price $ 1 $ 2 Residual Natural Gas Position: $0.25/MMBtu decrease in natural gas price $ (1) $ (2) Sunset: Coal Generation: $2.50/MWh increase in power price $ 3 $ 27 Coal Generation: $2.50/MWh decrease in power price $ (2) $ (27) 74 Table of Contents Interest Rate Risk We manage our interest rate risk to limit the impact of interest rate changes on our results of operations and cash flows and to lower our overall borrowing costs.
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To achieve these objectives, a majority of our borrowings have fixed interest rates. The inflationary environment continues to drive elevated interest rates, resulting in increased expected refinancing or borrowing costs. See Item 7. Management's Discussion and Analysis of Financial Condition, and Results of Operations – Significant Activities and Events, and Items Influencing Future Performance – Macroeconomic Conditions.
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The following table provides information concerning our financial instruments at December 31, 2023 and 2022 that are sensitive to changes in interest rates. Debt amounts consist of the Vistra Operations Credit Facilities. See Note 12 to the Financial Statements for further discussion of these financial instruments.
Removed
Expected Maturity Date 2023 Total Carrying Amount 2023 Total Fair Value 2022 Total Carrying Amount 2022 Total Fair Value 2024 2025 2026 2027 2028 There-after Long-term debt, including current maturities (a): Variable rate debt amount $ 25 $ 25 $ 25 $ 25 $ 25 $ 2,375 $ 2,500 $ 2,500 $ 2,514 $ 2,486 Average interest rate (b) 7.36 % 7.36 % 7.36 % 7.36 % 7.36 % 7.36 % 7.36 % 6.12 % Debt swapped to fixed (c): Notional amount $ — $ — $ 2,300 $ — $ — $ 1,625 $ 3,925 $ 4,600 Average pay rate 5.42 % 5.41 % 5.37 % 5.28 % 5.28 % 5.28 % Average receive rate 7.36 % 7.36 % 7.36 % 7.36 % 7.36 % 7.36 % ___________ (a) Unamortized premiums, discounts and debt issuance costs are excluded from the table.
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(b) The weighted average interest rate presented is based on the rates in effect at December 31, 2023. (c) Interest rate swaps have maturity dates through December 2030, of which $1.625 billion become effective in July 2026.
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Maturities are presented net of $600 million and $700 million of debt swapped to variable maturing in 2024 and 2026, respectively, that is matched against the terms of the equivalent amounts of debt swapped to fixed that effectively fix the out-of-the-money position of such swaps (see Note 12 to the Financial Statements).
Removed
Cash deposits and letters of credit held as collateral for these receivables totaled $54 million, resulting in a net exposure of $1.248 billion. Allowances for uncollectible accounts receivable are established for the expected loss from nonpayment by these customers based on historical experience, market or operational conditions and changes in the financial condition of large business customers.
Removed
As of December 31, 2023, aggregate Texas, East, Sunset and Asset Closure segments credit exposure totaled $674 million including $545 million related to derivative assets and $129 million of trade accounts receivable, after taking into account master netting agreement provisions but excluding collateral impacts.
Removed
Credit collateral includes cash and letters of credit but excludes other credit enhancements such as guarantees or liens on assets.

Other VST 10-K year-over-year comparisons