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Demand Response & Energy Management
NRG's CPower Expansion: What Texas C&I Buyers Should Do Now
May 17, 2026
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7 min read
NRG Energy, the parent of Reliant and the largest retail electricity provider in Texas, has made demand response a centerpiece of its growth plan under new CEO Robert Gaudette. The company's acquisition of CPower from LS Power gives Texas C&I customers a direct route to enroll in demand response through their existing Reliant relationship. NRG reached 200 MW of virtual power plant capacity in 2025 against an initial 20 MW target, a 10x overshoot that signals how aggressively the company plans to monetize flexible load. If you buy commercial electricity in Texas, demand response is no longer a side conversation. It is now a negotiable line item that belongs in your next REP contract review, and Texas commercial demand response programs deserve a seat at your procurement table.
What Happened
NRG closed its roughly $10 billion acquisition of LS Power assets in early 2026, bringing both CPower, a commercial and industrial demand response operator, and a 13 GW conventional generation fleet into the NRG portfolio. Robert Gaudette took over as CEO at the end of April 2026 with a stated mandate to integrate CPower (C&I), Reliant (Texas retail), and Vivint (residential VPP) into a single energy stack. According to a May 2026 Fortune interview, Gaudette is positioning the combined business around what NRG calls "bring your own power," a strategy aimed at AI hyperscale buyers and commercial customers who can put flexible load or behind-the-meter generation to work in the wholesale market.
NRG also has 1 GW of battery storage and 1.5 GW of new gas capacity under construction in Texas. On the Q1 2026 earnings call, management cited an ERCOT all-time peak of 85+ GW and a long-term ERCOT load forecast of 367 GW of large-load requests by 2033. The strategic implication is straightforward: NRG expects volatility and reserve margin tightening, and it is building the products, including CPower demand response, to monetize both.
Impact on Commercial Electricity Buyers
Three things change for Texas C&I buyers because of this expansion. First, demand response enrollment has gotten simpler for Reliant customers. Second, the value of flexible load is rising as ERCOT scarcity events get more expensive. Third, the contract conversation now needs to cover curtailment rights and 4CP interaction, not just $/kWh.
Pricing impact. Demand response participants are paid for reducing load during qualifying events, which directly offsets supply costs. NRG management has previously discussed Texas margin targets in the range of $25 per MWh against retail prices above $80 per MWh, per Utility Dive's coverage of NRG's Texas Energy Fund gas plant. When wholesale prices spike, those margins compress for the REP and the value of curtailment rises for the customer. A facility that can shed 500 kW for 60 to 90 minutes during a scarcity event can earn meaningful event payments and avoid coincident peak charges in the same window.
Contract implications. Demand response typically requires a curtailment agreement that sits next to your REP supply contract. If your supply contract has tight load-shape requirements or penalties for under-consumption, those clauses can conflict with curtailment commitments. Read the early termination, baseline, and curtailment language carefully before enrolling.
Operational reality. Demand response works best where you have identifiable flexible loads: HVAC pre-cooling, lighting, non-critical processes, EV charging, and cold storage. ERCOT's load programs documentation covers Emergency Response Service and other ancillary markets that aggregators like CPower use to monetize this flexibility. Battery storage compresses that operational lift significantly, because the storage system absorbs the curtailment rather than the production process.
The Texas Commercial Buyer's Demand Response Readiness Checklist
Run this five-question check before you take any meeting with CPower, Reliant, or another aggregator. If you cannot answer all five with specifics, you are not ready to negotiate terms.
Question 1. What flexible loads do you actually have?
List every load segment that can be reduced for 30 to 120 minutes without operational damage. HVAC, lighting, non-critical pumps, cold storage holding capacity, EV charging, process scheduling. Estimate kW per segment. If the total is under 100 kW, demand response economics are usually marginal.
Question 2. Do your contract terms allow demand response participation?
Check your supply contract for load shape, take-or-pay, and third-party demand response clauses. Some REP contracts penalize under-consumption or restrict outside aggregator participation. Resolve this before signing any curtailment agreement.
Question 3. What is your curtailment tolerance, in events per year and minutes per event?
Demand response programs vary on dispatch frequency. ERS programs may dispatch only a handful of times per year. Other programs can dispatch dozens of times during summer. Define your tolerance in advance and match it to a program structure.
Question 4. Is your metering ready?
Interval metering and telemetry are required for most C&I demand response programs. If your facility runs on monthly billing without interval data, plan for a metering upgrade and a baseline establishment period before payments begin.
Question 5. Does your broker or REP relationship cover demand response?
Some brokers run procurement only and never touch demand response. Others run both. Ask whether your broker has placed CPower or equivalent programs for similar facilities, and what their commission structure is on the demand response side.
What You Should Do
1. Audit flexible loads first. HVAC, lighting, refrigeration, non-critical processes, and EV chargers are your demand response assets. Quantify kW per segment before any vendor conversation.
2. **Ask your REP about CPower specifically.** If you are a Reliant customer, request a written eligibility check against CPower and a quote on the available demand response programs.
3. **Get the payment rate in writing.** Demand response economics turn on $/kW-month capacity payments and $/MWh event payments. Both should be in your enrollment agreement before signing.
4. **Review your supply contract for curtailment language.** Look for take-or-pay, load shape, and third-party DR clauses. Resolve conflicts before enrolling.
5. **Model demand response against 4CP exposure.** For facilities above 500 kW, ask your broker to project bill credits against your current 4CP charges so you can compare apples to apples.
6. **Include demand response revenue in any battery ROI model.** Storage on its own may not pencil. Storage plus demand response plus 4CP avoidance often does.
7. **Reschedule high-energy processes.** Even without enrollment, moving process loads off summer afternoon peaks reduces 4CP exposure and supply costs.
Questions to Ask Your REP or Broker
1. Does your REP offer CPower or an equivalent demand response program, and what is the qualifying load threshold?
2. **What is the per-kW capacity payment and per-kWh event payment for demand response at our facility size?**
3. **Will participating in demand response affect our 4CP measurement, transmission capacity charges, or ancillary service pass-through?**
4. **What is the minimum curtailment notice period, and how many events per year are typical for our load segment?**
5. **Does our current supply contract allow third-party demand response participation without penalty, and what metering upgrades would enrollment require?**
FAQs
What is CPower demand response and how does it work for Texas businesses?
CPower is a commercial and industrial demand response aggregator now owned by NRG Energy. CPower enrolls flexible business load into ERCOT and utility programs, dispatches reductions during qualifying events, and shares the resulting payments with the customer. For Texas businesses, that typically means a capacity payment for being available plus an event payment when you actually curtail.
How do virtual power plants work for commercial electricity buyers?
A virtual power plant aggregates distributed resources such as battery storage, flexible loads, and behind-the-meter generation, then dispatches them as a single block of capacity into the wholesale market. For a commercial buyer, joining a VPP usually means letting an operator control specified loads or storage during defined events. Payments flow back through the VPP operator after settlement.
Can any Texas commercial electricity buyer participate in demand response?
No. Most ERCOT and utility demand response programs require a minimum load threshold (often 100 kW or higher), interval metering, and an executed enrollment agreement. Smaller buyers can sometimes participate through aggregation, but the economics weaken below roughly 100 kW of curtailable load.
What is "bring your own power" and is it relevant to my business?
"Bring your own power" is NRG's strategic framing for customers who pair their load with flexibility or generation, often to support large new sites or AI workloads. For most existing commercial buyers, the practical version is simpler: enroll your flexible load in demand response and treat it as part of your supply strategy rather than an afterthought.
How does demand response affect my 4CP charges or capacity tags?
Demand response and 4CP avoidance are related but separate. Curtailing during the four highest ERCOT system peaks each summer reduces your transmission cost allocation for the following year. Curtailing during demand response events earns event payments. Some demand response programs intentionally dispatch on likely 4CP days, but you should confirm program design before assuming overlap. For the latest framework, see NRG's investor disclosures and your REP's most recent rate sheet.
If you want to compare commercial plans by contract type and term length, start with our Texas commercial electricity rates overview.
Originally published at texascommercialplans.com
