NRG May Follow Demand-Response Purchase With More Renewable Buys

NRG Energy Inc., the largest independent U.S. electricity generator, may further expand its clean-energy portfolio after its purchase of Energy Curtailment Specialists Inc., an analyst said.

“We see the transaction as among a series of other potential moves for NRG,” Julien Dumoulin-Smith, an analyst with UBS Securities LLC in New York, wrote in a research note today. “Other potential ‘alternative energy’ investments to complement NRG’s retail offerings could include distributed solar generation.”

NRG, based in Princeton, New Jersey, announced the purchase of Energy Curtailment in a statement yesterday without giving a price. Energy Curtailment manages more than 2 gigawatts of demand response for at least 5,000 customers.

The deal “represents a global trend of large energy companies adopting demand-side management business,” Brian Warshay, a Bloomberg New Energy Finance analyst in New York, said in an interview today. Demand-response providers help power companies better manage demand for electricity and reduce strain on the electrical grid.

The deal follows Constellation Energy Group Inc.’s purchase of CPower Inc. and Honeywell International Inc.’s deal forAkuacom, both in 2010, and Johnson Controls Inc.’s 2011 acquisition of EnergyConnect Group Inc.

Avoiding peak electricity usage conserves resources for power producers, Warshay said. “Instead of a utility flipping on generation at a gas power plant for 200 hours a year, demand management is almost always cheaper, and there’s lower emissions.’”

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