UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

þx QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~March 3031, ~~2011~~ 2012

¨o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 333-63240

GenOn Americas Generation, LLC

(Exact Name of Registrant as Specified in Its Charter)

51-0390520

(I.R.S. Employer Identification No.)

Commission File Number: 333-61668

GenOn Mid-Atlantic, LLC

(Exact Name of Registrant as Specified in Its Charter)

Delaware		58-2574140
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)
1000 Main Street,
Houston, Texas		77002
(Address of Principal Executive Offices)		(Zip Code)

58-2574140

(~~832)~~I.R.S. Employer ~~357-3000~~Identification No.)

Delaware (~~Registrant’s~~State ~~Telephone~~or ~~Number,~~Other ~~Including~~Jurisdiction ~~Area~~of ~~Code)~~Incorporation or Organization)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. (As a voluntary filer not subject to filing requirements, the registrant nevertheless filed all reports which would have been required to be filed by Section 15(d) of the Exchange Act during the preceding 12 months had the registrant been required to file reports pursuant to Section 15(d) of the Securities Exchange Act of 1934 solely as a result of having registered debt securities under the Securities Act of 1933.)

1000 Main Street,
Houston, Texas		77002
(Address of Principal Executive Offices)		(Zip Code)

~~GenOn~~(832) ~~Americas Generation, LLC ¨ Yes ¨ No GenOn Mid~~357-~~Atlantic, LLC ¨ Yes ¨ No~~3000

~~Indicate~~(Registrant’s byTelephone ~~check mark whether the registrant has submitted electronically and posted on its corporate Web site~~Number, Including ifArea ~~any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter~~Code) ~~during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).~~

~~GenOn~~Indicate ~~Americas~~by ~~Generation~~check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), ~~LLC~~and þ(2) has ~~Yes~~been ¨subject Noto ~~GenOn~~such ~~Mid-Atlantic~~filing requirements for the past 90 days. (As a voluntary filer not subject to filing requirements, ~~LLC~~the þregistrant ~~Yes~~nevertheless ¨filed Noall reports which would have been required to be filed by Section 15(d) of the Exchange Act during the preceding 12 months had the registrant been required to file reports pursuant to Section 15(d) of the Securities Exchange Act of 1934 solely as a result of having registered debt securities under the Securities Act of 1933.)

~~Indicate~~GenOn byAmericas ~~check~~Generation, ~~mark~~LLC ~~whether~~o ~~the~~Yes ~~registrant~~o isNo aGenOn ~~large accelerated filer, an accelerated filer, a non~~Mid-~~accelerated filer~~Atlantic, orLLC ao ~~smaller~~Yes ~~reporting~~o ~~company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.~~ No

~~Large~~Indicate ~~accelerated~~by ~~filer~~check ~~Accelerated~~mark ~~filer~~whether ~~Non-accelerated~~the ~~filer~~registrant ~~Smaller~~has ~~reporting~~submitted ~~company~~electronically ~~GenOn~~and ~~Americas~~posted ~~Generation~~on its corporate Web site, ~~LLC~~if ¨any, ¨every þInteractive ¨Data ~~GenOn~~File ~~Mid~~required to be submitted and posted pursuant to Rule 405 of Regulation S-~~Atlantic,~~T ~~LLC~~(§232.405 ¨of ¨this þchapter) ¨during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

~~(Do not check if a smaller reporting company)~~GenOn Americas Generation, LLC x Yes o No GenOn Mid-Atlantic, LLC x Yes o No

Indicate by check mark whether the registrant is a ~~shell~~large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. ~~(as~~See ~~defined~~the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act).

Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company GenOn Americas Generation, LLC ¨o ~~Yes~~o þx Noo GenOn Mid-Atlantic, LLC ¨o ~~Yes~~o þx Noo

~~All of the registrant’s outstanding membership interests are held by its parent and there are no membership interest held by nonaffiliates.~~ (Do not check if a smaller reporting company)

~~Registrant~~Indicate ~~Parent~~by ~~GenOn~~check ~~Americas~~mark ~~Generation,~~whether ~~LLC~~the ~~GenOn~~registrant ~~Americas,~~is ~~Inc.~~a ~~GenOn~~shell ~~Mid-Atlantic,~~company ~~LLC~~(as ~~GenOn~~defined ~~North~~in ~~America,~~Rule 12b-2 ~~LLC~~of the Exchange Act).

~~This combined Form 10-Q is separately filed by~~ GenOn Americas Generation, LLC ~~and~~o ~~GenOn~~Yes ~~Mid-Atlantic, LLC.~~x ~~Information~~No ~~contained in this combined Form 10-Q relating to~~ GenOn ~~Americas Generation, LLC and GenOn~~ Mid-Atlantic, LLC iso ~~filed~~Yes byx ~~such registrant on its own behalf and each registrant makes no representation as to information relating to registrants other than itself.~~ No

~~NOTE:~~All ~~WHEREAS~~of ~~GENON~~the ~~AMERICAS~~registrant’s ~~GENERATION,~~outstanding ~~LLC~~membership ~~AND~~interests ~~GENON~~are ~~MID-ATLANTIC,~~held ~~LLC~~by ~~MEET~~its ~~THE~~parent ~~CONDITIONS~~and ~~SET~~there ~~FORTH~~are ~~IN GENERAL~~no ~~INSTRUCTION~~membership ~~H(1)(a)~~interest ~~AND~~held ~~(b) OF~~by ~~FORM 10-Q, THIS COMBINED FORM 10-Q IS BEING FILED WITH THE REDUCED DISCLOSURE FORMAT PURSUANT TO GENERAL INSTRUCTION H(2)~~nonaffiliates.

~~Table~~Registrant ofParent ~~Contents~~GenOn Americas Generation, LLC GenOn Americas, Inc. GenOn Mid-Atlantic, LLC GenOn North America, LLC

~~TABLE~~This OFcombined ~~CONTENTS~~Form 10-Q is separately filed by GenOn Americas Generation, LLC and GenOn Mid-Atlantic, LLC. Information contained in this combined Form 10-Q relating to GenOn Americas Generation, LLC and GenOn Mid-Atlantic, LLC is filed by such registrant on its own behalf and each registrant makes no representation as to information relating to registrants other than itself.

Glossary of Certain Defined Terms		iv
Cautionary Statement Regarding Forward-Looking Information		vii
PART I
FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS	1
	GenOn Americas Generation, LLC:
	Condensed Consolidated Statements of Operations (Unaudited) Three and Nine Months Ended September 30, 2011 and 2010	1
	Condensed Consolidated Balance Sheets (Unaudited) September 30, 2011 and December 31, 2010	2
	Condensed Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended September 30, 2011 and 2010	3
	GenOn Mid-Atlantic, LLC:
	Condensed Consolidated Statements of Operations (Unaudited) Three and Nine Months Ended September 30, 2011 and 2010	4
	Condensed Consolidated Balance Sheets (Unaudited) September 30, 2011 and December 31, 2010	5
	Condensed Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended September 30, 2011 and 2010	6
	Combined Notes to Condensed Consolidated Financial Statements (Unaudited)	7
ITEM 2.	MANAGEMENT’S NARRATIVE ANALYSIS OF THE RESULTS OF OPERATIONS AND FINANCIAL CONDITION	42
	GenOn Americas Generation, LLC:
	Overview	42
	Merger of Mirant and RRI Energy	42
	Hedging Activities	42
	Capital Expenditures and Capital Resources	44
	Environmental Matters	44
	Potrero Shutdown	47
	Potomac River Retirement	47
	Commodity Prices	48
	Results of Operations	48
	Financial Condition	54
	Historical Cash Flows	57
	Recently Adopted Accounting Guidance	59
	GenOn Mid-Atlantic, LLC:
	Overview	60
	Merger of Mirant and RRI Energy	60
	Hedging Activities	60
	Capital Expenditures and Capital Resources	62
	Environmental Matters	62
	Potomac River Retirement	62
	Commodity Prices	62
	Results of Operations	63
	Financial Condition	66
	Historical Cash Flows	68
	Recently Adopted Accounting Guidance	68

NOTE: WHEREAS GENON AMERICAS GENERATION, LLC AND GENON MID-ATLANTIC, LLC MEET THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b) OF FORM 10-Q, THIS COMBINED FORM 10-Q IS BEING FILED WITH THE REDUCED DISCLOSURE FORMAT PURSUANT TO GENERAL INSTRUCTION H(2).

iiTable of Contents

~~Table~~TABLE ofOF ~~Contents~~CONTENTS

ITEM 3.		QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS	69
	Glossary of Certain Defined Terms	iii
ITEM 4.		CONTROLS AND PROCEDURES	69
	Cautionary Statement Regarding Forward-Looking Information	vi
		Effectiveness of Disclosure Controls and Procedures	69
PART I
		Changesin Internal Control Over Financial Reporting	69
FINANCIAL INFORMATION
PART II
ITEM 1.	FINANCIAL STATEMENTS	1
ITEM 1.		LEGAL PROCEEDINGS	70
	GenOn Americas Generation, LLC:
ITEM 6.		EXHIBITS
	Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended March 31, 2012 and 2011	1
		GenOn Americas Generation, LLC	70
	Condensed Consolidated Balance Sheets (Unaudited) March 31, 2012 and December 31, 2011	2
		GenOn Mid-Atlantic, LLC	71
	Condensed Consolidated Statements of Cash Flows (Unaudited) Three Months Ended March 31, 2012 and 2011	3
	GenOn Mid-Atlantic, LLC:
	Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended March 31, 2012 and 2011	4
	Condensed Consolidated Balance Sheets (Unaudited) March 31, 2012 and December 31, 2011	5
	Condensed Consolidated Statements of Cash Flows (Unaudited) Three Months Ended March 31, 2012 and 2011	6
	Combined Notes to Condensed Consolidated Financial Statements (Unaudited)	7
ITEM 2.	MANAGEMENT’S NARRATIVE ANALYSIS OF THE RESULTS OF OPERATIONS AND FINANCIAL CONDITION	36
	Overview	36
	Hedging Activities	36
	Dodd-Frank Act	37
	Capital Expenditures and Capital Resources	37
	Environmental Matters	38
	Regulatory Matters	38
	Commodity Prices and Generation Volumes	39
	Results of Operations	39
	Financial Condition	44
	Liquidity and Capital Resources	44
	Historical Cash Flows	46
	Recently Adopted Accounting Guidance	48
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	49
ITEM 4.	CONTROLS AND PROCEDURES	49
	Effectiveness of Disclosure Controls and Procedures	49
	Changes in Internal Control over Financial Reporting	49
PART II
OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	50
ITEM 6.	EXHIBITS
	GenOn Americas Generation, LLC	50
	GenOn Mid-Atlantic, LLC	51

~~iii~~ ii

Table of Contents

Glossary of Certain Defined Terms

AB 32		California’s Global Warming Solutions Act.
ancillary services		services that ensure reliability and support the transmission of electricity from generation sites to customer loads. Such services include regulation service, reserves and voltage support.
ancillary services		Services that ensure reliability and support the transmission of electricity from generation sites to customer loads. Such services include regulation service, spinning and non-spinning reserves and voltage support.
Administrative Services Agreement		Management, personnel and services agreement with GenOn Energy Services, effective January 3, 2006.
Bankruptcy Court		United States Bankruptcy Court for the Northern District of Texas, Fort Worth Division.
baseload generating units		~~Units~~units designed to satisfy minimum baseload requirements of the system and produce electricity at an essentially constant rate and run continuously.
CAIR		Clean Air Interstate Rule.
CAISO		California Independent System Operator.
capacity		~~Energy~~amount of energy that could have been generated at continuous full-power operation during the period.
CARB		California Air Resources Board.
CFTC		Commodity Futures Trading Commission.
Clean Air Act		Federal Clean Air Act.
CO2		Carbon dioxide.
Clean Water Act		Federal Water Pollution Control Act.
CSAPR		Cross-State Air Pollution Rule.
CO2		carbon dioxide.
dark spread		~~The~~the difference between power prices and ~~coal~~the ~~fuel~~cost ~~costs~~to generate electricity with coal.
D.C. Circuit		The United States Court of Appeals for the District of Columbia Circuit.
Dodd-Frank Act		the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Dodd-Frank Act		The Dodd-Frank Wall Street Reform and Consumer Protection Act.
EPA		United States Environmental Protection Agency.
EPC		~~Engineering~~engineering, procurement and construction.
Exchange Act		Securities Exchange Act of 1934, as amended.
FASB		Financial Accounting Standards Board.
FERC		Federal Energy Regulatory Commission.
GAAP		United States generally accepted accounting principles.
GenOn		GenOn Energy, Inc. (formerly known as RRI Energy, Inc.) and, except where the context indicates otherwise, its subsidiaries, after giving effect to the Merger.
GenOn Americas		GenOn Americas, Inc. ~~(formerly known as Mirant Americas, Inc.).~~
GenOn Americas Generation		GenOn Americas Generation, LLC ~~(formerly known as Mirant Americas Generation, LLC)~~.
GenOn California North		GenOn California North, LLC ~~(formerly known as Mirant California, LLC)~~.
GenOn Chalk Point		GenOn Chalk Point, LLC ~~(formerly known as Mirant Chalk Point, LLC)~~.
GenOn credit facilities		~~Senior~~senior secured term loan and revolving credit facility of GenOn and certain of its subsidiaries.
GenOn Energy Holdings		GenOn Energy Holdings, Inc. (formerly known as Mirant Corporation) and, except where the context indicates otherwise, its subsidiaries.
GenOn Energy Management		GenOn Energy Management, LLC.
GenOn Energy Services		GenOn Energy Services, LLC.
GenOn Marsh Landing		GenOn Marsh Landing, LLC.
GenOn Mid-Atlantic		GenOn Mid-Atlantic, LLC and its subsidiaries, which include the baseload units at two generating facilities under operating leases.

iv iii

Table of Contents

GenOn Energy Holdings		GenOn Energy Holdings, Inc. (formerly known as Mirant Corporation) and, except where the context indicates otherwise, its subsidiaries.
GenOn North America		GenOn North America, LLC.
GenOn Energy Management		GenOn Energy Management, LLC (formerly known as Mirant Energy Trading, LLC).
GenOn Potomac River		GenOn Potomac River, LLC.
GenOn Energy Services		GenOn Energy Services, LLC (formerly known as Mirant Services, LLC).
intermediate generating units		units designed to satisfy system requirements that are greater than baseload and less than peaking.
GenOn Kendall		GenOn Kendall, LLC (formerly known as Mirant Kendall, LLC).
ISO		independent system operator.
GenOn Marsh Landing		GenOn Marsh Landing, LLC (formerly known as Mirant Marsh Landing, LLC).
GenOn Mid-Atlantic		GenOn Mid-Atlantic, LLC (formerly known as Mirant Mid-Atlantic, LLC) and, except where the context indicates otherwise, its subsidiaries.
GenOn North America		GenOn North America, LLC (formerly known as Mirant North America, LLC).
GenOn Potomac River		GenOn Potomac River, LLC (formerly known as Mirant Potomac River, LLC).
HAPs		Hazardous Air Pollutants.
Hudson Valley Gas		Hudson Valley Gas Corporation.
intermediate generating units		Units designed to satisfy system requirements that are greater than baseload and less than peaking.
ISO		Independent system operator.
ISO-NE		Independent System Operator-New England.
LIBOR		London InterBank Offered Rate.
MADEP		Massachusetts’ Department of Environmental Protection.
MDE		Maryland Department of the Environment.
Merger		~~The~~the merger completed on December 3, 2010 pursuant to the Merger Agreement.
Merger Agreement		~~The~~the agreement by and among Mirant Corporation, RRI Energy, Inc. and RRI Energy Holdings, Inc. dated as of April 11, 2010.
Mirant		GenOn Energy Holdings, Inc. (formerly known as Mirant Corporation) and, except where the context indicates otherwise, its subsidiaries.
MW		Megawatt.
Mirant Debtors		GenOn Energy Holdings, Inc. (formerly known as Mirant Corporation) and certain of its subsidiaries.
MWh		Megawatt hour.
MPSC		Maryland Public Service Commission.
MW		megawatt.
MWh		megawatt hour.
NAAQS		National Ambient Air Quality Standards.
net generating capacity		~~Net~~net summer capacity.
NOV		~~Notice~~notice of violation.
NOx		~~Nitrogen~~nitrogen oxides.
NPDES		~~National~~national pollutant discharge elimination system.
NYISO		New York Independent System Operator.
NYMEX		New York Mercantile Exchange.
OTC		~~Over~~over-the-counter.
peaking generating units		~~Units~~units designed to satisfy demand requirements during the periods of greatest or peak load on the system.
PEPCO		Potomac Electric Power Company.
PG&E		Pacific Gas & Electric Company.
PJM		PJM Interconnection, LLC.
Plan		the plan of reorganization that was approved in conjunction with Mirant Corporation’s, GenOn Americas Generation’s and GenOn Mid-Atlantic’s emergence from bankruptcy protection on January 3, 2006.

v iv

Table of Contents

PG&E		Pacific Gas & Electric Company.
PPA		power purchase agreement.
PJM		PJM Interconnection, LLC.
retirement		the unit has been removed from service and is unavailable for service and not expected to return to service in the future.
Plan		The plan of reorganization that was approved in conjunction with Mirant Corporation’s, GenOn Americas Generation, LLC’s and GenOn Mid-Atlantic, LLC’s emergence from bankruptcy protection on January 3, 2006.
RMR		reliability-must-run.
Power Sale, Fuel Supply and Services Agreement		Power sale, fuel supply and services agreement with Mirant Americas Energy Marketing, LP. effective January 3, 2006. As of February 1, 2006, the agreement was transferred to GenOn Energy Management.
ROC		Risk Oversight Committee.
PPA		Power purchase agreement.
RGGI		Regional Greenhouse Gas Initiative.
RMR		Reliability-must-run.
RRI Energy		RRI Energy, Inc., which changed its name to GenOn Energy, Inc. in connection with the Merger.
RTO		~~Regional~~regional ~~Transmission~~transmission ~~Organization~~organization.
SCR		Selective catalytic reduction emissions controls.
scrubbers		flue gas desulfurization emissions controls.
scrubbers		Flue gas desulfurization emissions controls.
SEC		United States Securities and Exchange Commission.
Securities Act		Securities Act of 1933, as amended.
SO2		~~Sulfur~~sulfur dioxide.
spark spread		~~The~~the difference between power prices and ~~natural~~the ~~gas~~cost ~~fuel~~to ~~costs~~generate electricity with natural gas.
Stone & Webster		Stone & Webster, Inc.
swaption		An option that grants the holder the right, but not the obligation, to enter into the underlying swap.
SWD		surface water discharge.
WCI		Western Climate Initiative.

vi v

Table of Contents

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

In addition to historical information, the information presented in this ~~combined~~report ~~Form 10-Q~~ includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements involve known and unknown risks and uncertainties and relate to our revenues, income, capital structure and other financial items, future events, our future financial performance or our projected business results and our view of economic and market conditions. In some cases, one can identify forward-looking statements by ~~terminology~~words such as “may,” “will,” “should,” “could,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “expect,” “intend,” “seek,” “plan,” “think,” “anticipate,” “estimate,” “predict,” “target,” “potential” or “continue” or the negative of these terms or ~~other~~ comparable ~~terminology~~words.

Forward-looking statements are only predictions. Actual events or results may differ materially from any forward-looking statement as a result of various factors, which include:

•· more stringent (or changes in the application of) environmental laws and regulations (including the cumulative effect of many such regulations) that restrict our ability or render it uneconomic to ~~integrate~~operate ~~successfully~~our ~~the~~assets, ~~businesses~~including ~~following~~regulations ~~the~~related ~~Merger~~to orair ~~realize~~emissions, ~~cost~~disposal ~~savings~~of ash and ~~any~~ other ~~synergies~~byproducts, aswastewater adischarge ~~result~~and ofcooling ~~the~~water ~~Merger~~systems;

•· changes ~~our~~in ~~ability~~market toconditions, ~~enter~~including ~~into~~developments ~~intermediate~~in the supply, demand, volume and ~~long-term~~pricing ~~contracts~~of toelectricity ~~sell~~and ~~power~~other orcommodities tosuch ~~hedge~~as ~~economically~~coal ~~our~~and ~~expected~~natural ~~future~~gas ~~generation~~in ofthe ~~power~~energy markets, ~~and~~including efforts to ~~obtain~~reduce ~~adequate~~demand ~~supply~~for electricity and ~~delivery~~to ofencourage ~~fuel~~the ~~for~~development ~~our~~of ~~generating~~renewable ~~facilities,~~sources atof ~~our~~electricity, ~~required~~and ~~specifications~~the extent and ontiming ~~terms~~of ~~and~~the ~~prices~~entry ~~acceptable~~of toadditional uscompetition in our markets;

•· legislative ~~failure~~and toregulatory ~~obtain~~initiatives ~~adequate~~regarding ~~fuel~~deregulation, ~~supply~~regulation or restructuring of the industry of generating, transmitting and distributing electricity (the electricity industry); changes in state, federal and other regulations affecting the electricity industry (including ~~from~~rate ~~curtailments~~and ofother regulations); changes in tax laws and regulations to which we and our subsidiaries are subject; and changes in, or changes in the ~~transportation~~application of, ~~fuel~~other laws and regulations to which we and our subsidiaries and affiliates are or could become subject;

•· conflicts ~~changes~~between inreliability ~~market~~needs ~~conditions, including developments in the supply, demand, volume~~ and ~~pricing~~environmental ~~of electricity and other commodities such as coal and natural gas in the energy markets~~rules, ~~including~~particularly ~~efforts~~with toincreasingly ~~reduce~~stringent ~~demand~~environmental ~~for electricity and to encourage the development of renewable sources of electricity, and the extent and timing of the entry of additional competition in our markets~~restrictions;

•· price ~~deterioration~~mitigation instrategies ~~the~~employed ~~financial~~by ~~condition~~ISOs ofor ~~our~~RTOs ~~counterparties,~~that ~~including~~reduce ~~financial~~our ~~counterparties~~revenue and ~~affiliates,~~may ~~and~~result ~~the~~in a failure ~~of such parties~~ to ~~pay~~compensate ~~amounts~~our ~~owed~~generating tounits usadequately ~~beyond~~for ~~collateral~~all ~~posted~~of ortheir ~~to perform obligations or services due to us~~costs;

•· legal ~~the~~and ~~failure~~political ofchallenges ~~our~~to ~~generating~~or ~~facilities~~changes in the rules used to ~~perform~~calculate aspayments ~~expected~~for capacity, ~~including~~energy ~~outages~~and ~~for~~ancillary ~~unscheduled~~services ~~maintenance~~or the establishment of bifurcated markets, incentives or ~~repair~~other market design changes that give preferential treatment to new generating facilities over existing generating facilities;

~~• hazards customary to~~ · the ~~power~~failure ~~generation~~of ~~industry~~our ~~and~~generating ~~the~~facilities ~~possibility~~to ~~that~~perform weas ~~may~~expected, ~~not~~including ~~have~~outages ~~adequate~~for ~~insurance~~unscheduled tomaintenance ~~cover losses resulting from such hazards~~ or ~~the inability of our insurers to provide agreed upon coverage~~repair;

• · our failure to ~~utilize~~use new, or ~~advancements~~advanced ~~in,~~ power generation technologies;

• · strikes, union activity or labor unrest;

• · our ability to develop or recruit capable leaders and our ability to retain or replace the services of key employees;

• · weather and other natural phenomena, including hurricanes and earthquakes;

~~• the cost and availability of emissions allowances;~~vi

•Table ~~the curtailment~~ of ~~operations and reduced prices for electricity resulting from transmission constraints;~~Contents

•· our ~~the~~failure ~~ability~~to ofprovide ~~GenOn~~a ~~Americas~~safe ~~Generation~~working toenvironment ~~execute~~for ~~its~~our ~~business~~employees ~~plan~~and invisitors ~~northern~~thereby ~~California,~~increasing ~~including~~our ~~entering~~exposure ~~into~~to ~~new~~additional ~~arrangements~~liability, ~~for~~loss ~~sales~~ of ~~capacity~~productive time, ~~energy and~~ other ~~products~~costs ~~from~~and ~~its~~a ~~existing~~damaged ~~generating facilities~~reputation;

~~vii~~ · hazards customary to the power generation industry, including those listed in this cautionary statement and elsewhere in this report, and the possibility that we may not have adequate insurance to cover losses resulting from such hazards or the inability of our insurers to provide agreed upon coverage;

~~Table~~· the ability of ~~Contents~~GenOn Americas Generation to execute the business plan in northern California, including entering into new arrangements for sales of capacity, energy and other products from its existing generating facilities;

• · our relative lack of geographic diversification of revenue sources resulting in concentrated exposure to the PJM market;

•· our ~~war,~~ability ~~terrorist~~to ~~activities,~~enter ~~cyberterrorism~~into intermediate and ~~inadequate~~long-term ~~cybersecurity,~~contracts to sell power or ~~the~~to ~~occurrence~~hedge economically our expected future generation of apower, ~~catastrophic~~and ~~loss~~to obtain adequate supplies and deliveries of fuel for our generating facilities, at our required specifications and on terms and prices acceptable to us;

~~• our~~ · failure to ~~provide~~obtain aadequate ~~safe~~supplies ~~working~~of ~~environment~~fuels, ~~for~~including ~~our~~from ~~employees~~curtailments ~~and~~of ~~visitors~~the ~~thereby~~transportation ~~increasing our exposure to additional liability, loss~~ of ~~productive time, other costs and a damaged reputation~~fuels;

~~• poor economic and financial market conditions, including impacts on financial institutions and other current and potential counterparties, and negative impacts on liquidity in~~ · the ~~power~~cost and ~~fuel~~availability ~~markets~~of inemissions ~~which we hedge economically and transact~~allowances;

•· the ~~increased~~curtailment credit standards, margin requirements, market volatility or other market conditions that could increase our obligations to post collateral beyond amounts that are expected, including additional collateral costs associated with OTC hedging activities as a result of ~~new~~operations ~~or proposed laws, rules~~ and ~~regulations~~reduced ~~governing~~prices ~~derivative~~for ~~financial~~electricity ~~instruments~~resulting ~~(such~~from astransmission ~~the Dodd-Frank Act and related pending rulemaking proceedings)~~constraints;

•· terrorist ~~our~~activities, ~~inability~~cyberterrorism ~~to access effectively the OTC~~ and ~~exchange-based~~inadequate ~~commodity~~cybersecurity, ~~markets~~ or ~~changes~~the inoccurrence ~~commodity~~of ~~market conditions and liquidity, including as~~ a ~~result~~catastrophic ofloss ~~new or proposed laws, rules~~ and ~~regulations governing derivative financial instruments (such as~~ the ~~Dodd-Frank~~possibility ~~Act~~that ~~and~~we ~~related pending rulemaking proceedings), which~~ may ~~affect~~not ~~our~~have ~~ability~~adequate insurance to ~~engage~~cover inlosses ~~asset~~resulting ~~management~~from ~~and,~~such ~~for~~hazards ~~GenOn~~or ~~Americas~~the ~~Generation,~~inability ~~proprietary~~of ~~trading~~our ~~and~~insurers ~~fuel~~to ~~oil~~provide ~~management~~agreed ~~activities~~upon ~~as expected, or may result in material losses from open positions~~coverage;

•· deterioration ~~volatility~~ in ~~our gross margin as a result of changes in~~ the ~~fair~~financial ~~value~~condition of our ~~derivative~~counterparties, including financial ~~instruments~~counterparties, ~~used in our asset management~~ and ~~GenOn~~the ~~Americas~~failure ~~Generation’s~~of ~~proprietary~~such ~~trading~~parties ~~and~~to ~~fuel~~pay ~~oil~~amounts ~~management~~owed ~~activities~~to ~~and~~us ~~volatility~~beyond incollateral ~~our~~posted ~~cash~~or ~~flow~~to ~~from~~perform ~~operations~~obligations ~~resulting~~or ~~from~~services ~~working~~due ~~capital requirements, including collateral,~~ to ~~support our asset management and GenOn Americas Generation’s proprietary trading and fuel oil management activities~~us;

•· poor ~~legislative~~economic and ~~regulatory~~financial ~~initiatives~~market ~~regarding deregulation~~conditions, ~~regulation~~including orimpacts ~~restructuring~~on offinancial ~~the~~institutions ~~industry of generating, transmitting~~ and ~~distributing electricity (the electricity industry); changes in state, federal and~~ other ~~regulations~~current ~~affecting the electricity industry (including rate~~ and ~~other~~potential ~~regulations);~~counterparties, ~~changes in tax laws~~ and ~~regulations~~negative toimpacts ~~which~~on weliquidity ~~and our subsidiaries are subject; and changes~~ in, ~~or changes in~~ the ~~application~~power ~~of, environmental~~ and ~~other~~fuel ~~laws~~markets ~~and~~in ~~regulations to~~ which we ~~and~~hedge ~~our~~economically ~~subsidiaries~~ and ~~affiliates are or could become subject~~transact;

•· increased ~~more~~credit ~~stringent~~standards, ~~environmental~~margin ~~laws~~requirements, ~~and~~market ~~regulations~~volatility ~~(including~~or ~~the~~other ~~cumulative~~market ~~effect~~conditions ofthat ~~many~~could ~~such~~increase ~~regulations)~~our obligations to post collateral beyond amounts that ~~restrict~~are ~~our~~expected, ~~ability~~including oradditional ~~render~~collateral itcosts ~~uneconomic~~associated towith ~~operate~~OTC ~~our~~hedging ~~assets~~activities as a result of new or proposed laws, ~~including~~rules and regulations governing derivative financial instruments (such as the Dodd-Frank Act and related topending ~~air~~rulemaking ~~emissions~~proceedings);

•· our ~~increased~~inability ~~regulation~~to ~~that~~access ~~limits~~effectively ~~our~~the ~~access~~OTC toand ~~adequate~~exchange-based ~~water~~commodity ~~supplies~~markets or changes in commodity market conditions and ~~landfill~~liquidity, ~~options~~including ~~needed~~as toa ~~support~~result ~~power~~of ~~generation~~new or ~~that~~proposed ~~increases~~laws, ~~the~~rules and ~~costs~~regulations ofgoverning ~~cooling~~derivative ~~water~~financial instruments (such as the Dodd-Frank Act and ~~handling~~related pending rulemaking proceedings), ~~transporting~~which ~~and~~may ~~disposing~~affect ofour ~~ash~~ability to engage in hedging and, ~~other~~for ~~byproducts~~GenOn Americas Generation, proprietary trading activities as expected, or may result in material losses from open positions;

•· volatility ~~price~~in ~~mitigation~~our ~~strategies~~gross ~~employed~~margin byas ~~ISOs~~a orresult ~~RTOs~~of ~~that~~changes ~~reduce~~in the fair value of our ~~revenue~~derivative financial instruments used in our hedging and ~~may~~GenOn ~~result~~Americas Generation’s proprietary trading activities and volatility in aour ~~failure~~cash flow from operations resulting from working capital requirements, including collateral, to ~~compensate~~support our ~~generating~~hedging ~~units~~and ~~adequately~~GenOn ~~for~~Americas ~~all~~Generation’s ofproprietary ~~their~~trading ~~costs~~activities;

~~• legal and political challenges to or changes in~~ · the ~~rules~~disposition ~~used~~of topending ~~calculate payments for capacity, energy and ancillary services~~ or ~~the~~threatened ~~establishment of bifurcated markets~~litigation, ~~incentives~~including orenvironmental ~~other market design changes that give preferential treatment to new generating facilities over existing generating facilities~~litigation;

~~• the disposition of pending or threatened litigation, including environmental litigation;~~vii

~~viii~~ Table of Contents

~~Table~~· our ofability ~~Contents~~to access contractors and equipment necessary to operate and maintain our generating facilities and to design, engineer, procure and construct capital improvements required or deemed advisable;

• · the inability of GenOn Americas Generation’s operating subsidiaries to generate sufficient cash to support their operations;

• · the ability of lenders under GenOn’s revolving credit facility to perform their obligations;

• · GenOn Americas Generation’s consolidated indebtedness and the possibility that GenOn Americas Generation or its subsidiaries may incur additional indebtedness in the future;

• · restrictions on the ability of GenOn Americas Generation’s subsidiaries to pay dividends, make distributions or otherwise transfer funds to GenOn Americas Generation, including restrictions on GenOn Mid-Atlantic contained in its operating lease documents, which may affect GenOn Americas Generation’s ability to access the cash flows of those subsidiaries to make debt service and other payments;

• · failure or inability to comply with provisions of GenOn Mid-Atlantic’s ~~operating~~ leases, GenOn Americas Generation’s ~~debt and~~ affiliates’ loan agreements and debt, which may lead to a breach and, if not remedied, result in an event of default thereunder, which could result in such lessors, lenders and debt holders exercising remedies, limit access to needed liquidity and damage our reputation and relationships with financial institutions;

• · covenants contained in our ~~affiliates’~~ credit facilities, debt and leases that restrict our current and future operations, particularly our ability to respond to changes or take certain actions that may be in our long-term best interests; and

• · our ~~and our affiliates’~~ ability to borrow additional funds and access capital markets.

Many of these risks, uncertainties and assumptions are beyond our ability to control or predict. All forward-looking statements contained herein are expressly qualified in their entirety by cautionary statements contained throughout this report. Because of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements. Furthermore, forward-looking statements speak only as of the date they are made. We undertake no obligation to update publicly or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this report.

WeIn ~~undertake~~addition noto ~~obligation~~the discussion of certain risks in “Management’s Narrative of the Results of Operations and Financial Condition” and the accompanying combined notes to ~~update~~GenOn ~~publicly~~Americas orGeneration’s ~~revise any~~and ~~forward~~GenOn Mid-~~looking~~Atlantic’s interim financial statements, toother ~~reflect~~factors ~~events~~that orcould ~~circumstances~~affect ~~that~~our ~~may~~future ~~arise~~performance ~~after~~are ~~the~~set ~~date~~forth ofin ~~this~~our ~~report.~~2011 Annual Report on Form 10-K. Our filings and other important information are also available on our investor relations page at www.genon.com/investors.aspx.

InCertain addition to the discussion of certain risks in “Management’s Narrative of the Results of Operations and Financial Condition” and the accompanying combined notes to GenOn Americas Generation, LLC’s and GenOn Mid-Atlantic, LLC’s interim financial statements, other factors that could affect our future performance are set forth in our 2010 Annual Report on Form 10-K. Terms

~~Certain~~As ~~Terms~~used in this report, unless the context requires otherwise, “we,” “us,” “our” and “GenOn Americas Generation” refer to GenOn Americas Generation, LLC and its consolidated subsidiaries and “GenOn Mid-Atlantic” refer to GenOn Mid-Atlantic, LLC and its consolidated subsidiaries.

As used in this report, unless the context requires otherwise, “we,” “us,” “our” and “GenOn Americas Generation” refer to GenOn Americas Generation, LLC and its consolidated subsidiaries and “GenOn Mid-Atlantic” refer to GenOn Mid-Atlantic, LLC and its consolidated subsidiaries. viii

ixTable of Contents

~~Table of Contents~~PART I

~~PART~~FINANCIAL I INFORMATION

~~FINANCIAL~~ITEM ~~INFORMATION~~1. FINANCIAL STATEMENTS

~~ITEM 1.~~GENON ~~FINANCIAL~~AMERICAS ~~STATEMENTS~~GENERATION, LLC AND SUBSIDIARIES

~~GENON~~(Wholly-Owned ~~AMERICAS~~Indirect ~~GENERATION,~~Subsidiary ~~LLC~~of ~~AND~~GenOn ~~SUBSIDIARIES~~ Energy, Inc.)

~~(Wholly-Owned~~CONDENSED ~~Indirect~~CONSOLIDATED ~~Subsidiary~~STATEMENTS ofOF ~~GenOn~~OPERATIONS ~~Energy, Inc.~~(UNAUDITED)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

	Three Months Ended March 31,
	2012			2011
	(in millions)

Operating revenues (including unrealized gains (losses) of $138 and $(95), respectively)	$	682		$	538
Operating revenues—affiliate (including unrealized gains (losses) of $(63) and $10, respectively)	(30		)	11
Total operating revenues	652			549
Cost of fuel, electricity and other products (including unrealized (gains) losses of $35 and $(14), respectively)	183			165
Cost of fuel, electricity and other products—affiliate (including unrealized (gains) losses of $(9) and $0, respectively)	224			170
Total cost of fuel, electricity and other products	407			335
Gross Margin (excluding depreciation and amortization)	245			214
Operating Expenses:
Operations and maintenance	82			79
Operations and maintenance—affiliate	58			60
Depreciation and amortization	40			40
Total operating expenses	180			179
Operating Income	65			35
Other Income (Expense), net:
Interest expense	(18		)	(30		)
Interest expense—affiliate	(1		)	—
Other, net	—			(23		)
Total other expense, net	(19		)	(53		)
Net Income (Loss)	$	46		$	(18	)

		September 30,			September 30,			September 30,			September 30,
	Three Months Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
	(in millions)
Operating revenues (including unrealized gains (losses) of $37 million, $154 million, $(70) million and $286 million, respectively)	$	929		$	775		$	2,182		$	1,899
Operating revenues—affiliate (including unrealized gains (losses) of $(27) million, $0, $(19) million and $0, respectively)		(16	)		—			(3	)		—
Total operating revenues		913			775			2,179			1,899
Cost of fuel, electricity and other products (including unrealized (gains) losses of $11 million, $(13) million, $(18) million and $107 million, respectively)		210			245			513			720
Cost of fuel, electricity and other products—affiliate (including unrealized (gains) losses of $(1) million, $0, $(1) million and $0, respectively)		494			2			994			6
Total cost of fuel, electricity and other products		704			247			1,507			726
Gross Margin (excluding depreciation and amortization)		209			528			672			1,173
Operating Expenses:
Operations and maintenance		73			88			270			270
Operations and maintenance—affiliate		53			74			172			216
Depreciation and amortization		42			52			124			151
Impairment losses		128			—			128			—
Gain on sales of assets, net		(6	)		(1	)		(5	)		(4	)
Loss on sales of assets, net—affiliate		2			—			2			—
Total operating expenses		292			213			691			633
Operating Income (Loss)		(83	)		315			(19	)		540
Other Income (Expense), net:
Interest expense		(19	)		(51	)		(70	)		(150	)
Interest expense—affiliate		(4	)		—			(4	)		—
Other, net		—			1			(23	)		(1	)
Total other expense, net		(23	)		(50	)		(97	)		(151	)
Income (Loss) Before Income Taxes		(106	)		265			(116	)		389
Benefit for income taxes		—			(1	)		—			(1	)
Net Income (Loss)	$	(106	)	$	266		$	(116	)	$	390

The accompanying combined notes are an integral part of these unaudited condensed consolidated financial statements

~~The accompanying combined notes are an integral part of these unaudited condensed consolidated financial statements~~ 1

1Table of Contents

~~Table~~GENON AMERICAS GENERATION, LLC AND SUBSIDIARIES (Wholly-Owned Indirect Subsidiary of ~~Contents~~GenOn Energy, Inc.)

~~GENON~~CONDENSED ~~AMERICAS~~CONSOLIDATED ~~GENERATION,~~BALANCE ~~LLC~~SHEETS ~~AND SUBSIDIARIES~~ (UNAUDITED)

(Wholly-Owned Indirect Subsidiary of GenOn Energy, Inc.)

	March 31, 2012			December 31, 2011
	(in millions)
ASSETS
Current Assets:
Cash and cash equivalents	$	395		$	267
Funds on deposit	322			316
Receivables, net	249			288
Receivables, net—affiliate	26			22
Notes receivable—affiliate	163			181
Derivative contract assets	1,208			977
Derivative contract assets—affiliate	88			44
Inventories	268			257
Prepaid rent and other expenses	113			113
Total current assets	2,832			2,465
Property, plant and equipment, gross	3,902			3,894
Accumulated depreciation and amortization	(989		)	(960		)
Property, Plant and Equipment, net	2,913			2,934
Noncurrent Assets:
Intangible assets, net	27			28
Derivative contract assets	817			731
Derivative contract assets—affiliate	49			29
Prepaid rent	362			386
Debt issuance costs, net	6			6
Other	20			10
Total noncurrent assets	1,281			1,190
Total Assets	$	7,026		$	6,589

LIABILITIES AND MEMBER’S EQUITY
Current Liabilities:
Current portion of long-term debt	$	4		$	4
Accounts payable and accrued liabilities	571			509
Payables, net—affiliate	83			93
Notes payable—affiliate	62			47
Derivative contract liabilities	865			700
Derivative contract liabilities—affiliate	166			76
Other	25			25
Total current liabilities	1,776			1,454
Noncurrent Liabilities:
Long-term debt, net of current portion	861			862
Derivative contract liabilities	149			100
Derivative contract liabilities—affiliate	118			89
Other	111			119
Total noncurrent liabilities	1,239			1,170
Commitments and Contingencies
Member’s Equity:
Member’s interest	4,011			3,965
Total member’s equity	4,011			3,965
Total Liabilities and Member’s Equity	$	7,026		$	6,589

~~CONDENSED~~The ~~CONSOLIDATED~~accompanying ~~BALANCE~~combined ~~SHEETS~~notes ~~(UNAUDITED)~~are an integral part of these unaudited condensed consolidated financial statements

		September 30,			September 30,
	September 30, 2011			December 31, 2010
	(in millions)
ASSETS
Current Assets:
Cash and cash equivalents	$	200		$	514
Funds on deposit		301			949
Receivables		230			363
Receivables—affiliate		29			4
Notes receivable—affiliate		164			—
Derivative contract assets		658			1,288
Derivative contract assets—affiliate		24			5
Inventories		256			295
Prepaid expenses and other current assets		105			124
Total current assets		1,967			3,542
Property, plant and equipment, gross		3,878			3,946
Accumulated depreciation and amortization		(920	)		(869	)
Property, Plant and Equipment, net		2,958			3,077
Noncurrent Assets:
Intangible assets, net		26			101
Derivative contract assets		546			689
Derivative contract assets—affiliate		13			3
Prepaid rent		374			348
Debt issuance costs, net		6			12
Other		43			41
Total noncurrent assets		1,008			1,194
Total Assets	$	5,933		$	7,813
LIABILITIES AND MEMBER’S EQUITY
Current Liabilities:
Current portion of long-term debt	$	4		$	1,389
Accounts payable and accrued liabilities		324			527
Payables—affiliate		141			54
Notes payable—affiliate		32			—
Derivative contract liabilities		516			1,130
Derivative contract liabilities—affiliate		16			3
Other		17			8
Total current liabilities		1,050			3,111
Noncurrent Liabilities:
Long-term debt, net of current portion		863			866
Derivative contract liabilities		65			173
Derivative contract liabilities—affiliate		32			—
Other		90			90
Total noncurrent liabilities		1,050			1,129
Commitments and Contingencies
Member’s Equity:
Member’s interest		3,833			3,573
Total member’s equity		3,833			3,573
Total Liabilities and Member’s Equity	$	5,933		$	7,813

~~The~~Table ~~accompanying combined notes are an integral part~~ of ~~these unaudited condensed consolidated financial statements~~ Contents

2GENON AMERICAS GENERATION, LLC AND SUBSIDIARIES (Wholly-Owned Indirect Subsidiary of GenOn Energy, Inc.)

~~Table~~CONDENSED ofCONSOLIDATED ~~Contents~~STATEMENTS OF CASH FLOWS (UNAUDITED)

GENON AMERICAS GENERATION, LLC AND SUBSIDIARIES

	Three Months Ended March 31,
	2012			2011
	(in millions)
Cash Flows from Operating Activities:
Net income (loss)	$	46		$	(18	)
Adjustments to reconcile net income (loss) and changes in operating assets and liabilities to net cash provided by operating activities:
Depreciation and amortization	40			41
Net changes in derivative contracts	(49		)	71
Excess materials and supplies inventory reserve	6			—
Lower of cost or market inventory adjustments	25			—
Loss on early extinguishment of debt	—			23
Changes in operating assets and liabilities	50			127
Total adjustments	72			262
Net cash provided by operating activities	118			244
Cash Flows from Investing Activities:
Capital expenditures	(22		)	(21		)
Proceeds from the sales of assets	—			4
Restricted funds on deposit, net	—			723
Issuance of notes receivable—affiliate	18			(122		)
Net cash provided by (used in) investing activities	(4		)	584
Cash Flows from Financing Activities:
Repayment of long-term debt	(1		)	(867		)
Issuance of notes payable—affiliate	15			8
Capital contributions	—			19
Distributions to member	—			(100		)
Net cash provided by (used in) financing activities	14			(940		)
Net Increase (Decrease) in Cash and Cash Equivalents	128			(112		)
Cash and Cash Equivalents, beginning of period	267			514
Cash and Cash Equivalents, end of period	$	395		$	402

~~(Wholly-Owned~~The ~~Indirect~~accompanying ~~Subsidiary~~combined notes are an integral part of ~~GenOn~~these ~~Energy,~~unaudited ~~Inc.)~~condensed consolidated financial statements

~~CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)~~ 3

		September 30,			September 30,
	Nine Months Ended September 30,
	2011			2010
	(in millions)
Cash Flows from Operating Activities:
Net income (loss)	$	(116	)	$	390
Adjustments to reconcile net income (loss) and changes in other operating assets and liabilities to net cash provided by operating activities:
Depreciation and amortization		122			158
Impairment losses		128			—
Gain on sales of assets, net		(3	)		(4	)
Net changes in derivative contracts		70			(179	)
Lower of cost or market inventory adjustments		1			22
Loss on early extinguishment of debt		23			—
Funds on deposit		(54	)		(25	)
Changes in other operating assets and liabilities		96			59
Total adjustments		383			31
Net cash provided by operating activities		267			421
Cash Flows from Investing Activities:
Capital expenditures		(130	)		(207	)
Proceeds from the sales of assets		9			4
Restricted funds on deposit, net		700			—
Issuance of notes receivable—affiliate		(164	)		—
Net cash provided by (used in) investing activities		415			(203	)
Cash Flows from Financing Activities:
Redemption of preferred stock		—			95
Repayment of long-term debt		(1,404	)		(71	)
Issuance of notes payable—affiliate		34			—
Distributions to member		(100	)		(109	)
Capital contributions		474			—
Net cash used in financing activities		(996	)		(85	)
Net Increase (Decrease) in Cash and Cash Equivalents		(314	)		133
Cash and Cash Equivalents, beginning of period		514			404
Cash and Cash Equivalents, end of period	$	200		$	537
Supplemental Disclosures:
Cash paid for interest, net of amounts capitalized	$	59		$	94
Cash refunds received for income taxes	$	1		$	—
Supplemental Disclosure for Non-Cash Financing Activities:
Conversion to equity of notes payable to affiliate	$	2		$	—

Table of Contents

~~The~~GENON ~~accompanying~~MID-ATLANTIC, ~~combined~~LLC ~~notes~~AND ~~are~~SUBSIDIARIES ~~an integral part of these unaudited condensed consolidated financial statements~~

3(Wholly-Owned Indirect Subsidiary of GenOn Energy, Inc.)

~~Table~~CONDENSED ofCONSOLIDATED ~~Contents~~STATEMENTS OF OPERATIONS (UNAUDITED)

GENON MID-ATLANTIC, LLC AND SUBSIDIARIES

	Three Months Ended March 31,
	2012			2011
	(in millions)

Operating revenues (including unrealized gains (losses) of $56 and $(45), respectively)	$	127		$	(1	)
Operating revenues—affiliate (including unrealized gains (losses) of $11 and $(6), respectively)	193			299
Total operating revenues	320			298
Cost of fuel, electricity and other products (including unrealized (gains) losses of $0 and $0, respectively)	3			7
Cost of fuel, electricity and other products—affiliate (including unrealized (gains) losses of $25 and $(12), respectively)	112			129
Total cost of fuel, electricity and other products	115			136
Gross Margin (excluding depreciation and amortization)	205			162
Operating Expenses:
Operations and maintenance	63			62
Operations and maintenance—affiliate	40			40
Depreciation and amortization	29			29
Total operating expenses	132			131
Operating Income	73			31
Other Income (Expense), net:
Interest expense—affiliate	(1		)	—
Total other expense, net	(1		)	—
Net Income	$	72		$	31

~~(Wholly-Owned~~The ~~Indirect~~accompanying ~~Subsidiary~~combined notes are an integral part of ~~GenOn~~these ~~Energy,~~unaudited ~~Inc.)~~condensed consolidated financial statements

~~CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)~~ 4

		September 30,			September 30,			September 30,			September 30,
	Three Months Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
	(in millions)
Operating revenues (including unrealized gains (losses) of $(3) million, $124 million, $(42) million and $227 million, respectively)	$	41		$	165		$	85		$	384
Operating revenues—affiliate (including unrealized gains (losses) of $0, $32 million, $(39) million and $62 million, respectively)		287			488			821			1,178
Total operating revenues		328			653			906			1,562
Cost of fuel, electricity and other products (including unrealized (gains) losses of $0, $0, $0 and $0, respectively)		4			4			13			13
Cost of fuel, electricity and other products—affiliate (including unrealized (gains) losses of $9 million, $(23) million, $(18) million and $81 million, respectively)		170			178			410			574
Total cost of fuel, electricity and other products		174			182			423			587
Gross Margin (excluding depreciation and amortization)		154			471			483			975
Operating Expenses:
Operations and maintenance		53			65			216			200
Operations and maintenance—affiliate		43			51			125			146
Depreciation and amortization		30			36			89			105
Impairment losses		94			—			94			—
Gain on sales of assets, net—affiliate		—			—			—			(3	)
Total operating expenses		220			152			524			448
Operating Income (Loss)		(66	)		319			(41	)		527
Other Income (Expense), net:
Interest expense		—			(1	)		(1	)		(2	)
Interest expense—affiliate		(3	)		—			(3	)		—
Other, net		—			—			—			(1	)
Total other expense, net		(3	)		(1	)		(4	)		(3	)
Income (Loss) Before Income Taxes		(69	)		318			(45	)		524
Benefit for income taxes		—			(1	)		—			(1	)
Net Income (Loss)	$	(69	)	$	319		$	(45	)	$	525

Table of Contents

~~The~~GENON ~~accompanying~~MID-ATLANTIC, ~~combined~~LLC ~~notes~~AND ~~are~~SUBSIDIARIES (Wholly-Owned anIndirect ~~integral~~Subsidiary ~~part~~ of ~~these~~GenOn ~~unaudited condensed consolidated financial statements~~ Energy, Inc.)

4CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

	March 31, 2012			December 31, 2011
	(in millions)
ASSETS
Current Assets:
Cash and cash equivalents	$	119		$	68
Funds on deposit	198			198
Receivables, net	25			25
Receivables, net—affiliate	46			44
Derivative contract assets	253			208
Derivative contract assets—affiliate	195			191
Inventories	170			167
Prepaid rent	96			96
Prepaid expenses	8			4
Total current assets	1,110			1,001
Property, plant and equipment, gross	3,065			3,054
Accumulated depreciation and amortization	(639		)	(610		)
Property, Plant and Equipment, net	2,426			2,444
Noncurrent Assets:
Intangible assets, net	16			16
Derivative contract assets	537			526
Derivative contract assets—affiliate	140			105
Prepaid rent	362			386
Total noncurrent assets	1,055			1,033
Total Assets	$	4,591		$	4,478

LIABILITIES AND MEMBER’S EQUITY
Current Liabilities:
Current portion of long-term debt	$	4		$	4
Accounts payable and accrued liabilities	82			82
Payables, net—affiliate	41			44
Derivative contract liabilities—affiliate	203			168
Contract retention liability	69			69
Other	24			24
Total current liabilities	423			391
Noncurrent Liabilities:
Long-term debt, net of current portion	13			14
Derivative contract liabilities—affiliate	88			68
Other	68			78
Total noncurrent liabilities	169			160
Commitments and Contingencies
Member’s Equity:
Member’s interest	3,999			3,927
Total member’s equity	3,999			3,927
Total Liabilities and Member’s Equity	$	4,591		$	4,478

~~GENON~~The ~~MID-ATLANTIC,~~accompanying ~~LLC~~combined ~~AND~~notes ~~SUBSIDIARIES~~are an integral part of these unaudited condensed consolidated financial statements

~~(Wholly-Owned Indirect Subsidiary of GenOn Energy, Inc.)~~ 5

~~CONDENSED~~Table ~~CONSOLIDATED~~of ~~BALANCE SHEETS (UNAUDITED)~~ Contents

		September 30,			September 30,
	September 30, 2011			December 31, 2010
	(in millions)
ASSETS
Current Assets:
Cash and cash equivalents	$	84		$	202
Funds on deposit		166			2
Receivables		19			21
Receivables—affiliate		28			169
Derivative contract assets		170			162
Derivative contract assets—affiliate		113			245
Inventories		157			122
Prepaid rent		96			96
Other		6			11
Total current assets		839			1,030
Property, plant and equipment, gross		3,041			3,046
Accumulated depreciation and amortization		(577	)		(513	)
Property, Plant and Equipment, net		2,464			2,533
Noncurrent Assets:
Intangible assets, net		14			71
Derivative contract assets		452			516
Derivative contract assets—affiliate		38			97
Prepaid rent		374			348
Other		32			31
Total noncurrent assets		910			1,063
Total Assets	$	4,213		$	4,626
LIABILITIES AND MEMBER’S EQUITY
Current Liabilities:
Current portion of long-term debt	$	4		$	4
Accounts payable and accrued liabilities		82			63
Payables—affiliate		37			114
Derivative contract liabilities		4			18
Derivative contract liabilities—affiliate		123			231
Contract retention liability		65			132
Other		23			8
Total current liabilities		338			570
Noncurrent Liabilities:
Long-term debt, net of current portion		15			18
Derivative contract liabilities—affiliate		33			94
Other		50			52
Total noncurrent liabilities		98			164
Commitments and Contingencies
Member’s Equity:
Member’s interest		3,777			3,892
Total member’s equity		3,777			3,892
Total Liabilities and Member’s Equity	$	4,213		$	4,626

GENON MID-ATLANTIC, LLC AND SUBSIDIARIES
(Wholly-Owned Indirect Subsidiary of GenOn Energy, Inc.)

~~The~~CONDENSED ~~accompanying~~CONSOLIDATED ~~combined~~STATEMENTS ~~notes~~OF ~~are~~CASH anFLOWS ~~integral part of these unaudited condensed consolidated financial statements~~ (UNAUDITED)

	Three Months Ended March 31,
	2012			2011
	(in millions)

Cash Flows from Operating Activities:
Net income	$	72		$	31
Adjustments to reconcile net income and changes in operating assets and liabilities to net cash provided by operating activities:
Depreciation and amortization	29			29
Net changes in derivative contracts	(42		)	39
Excess materials and supplies inventory reserve	4			—
Lower of cost or market inventory adjustments	25			—
Changes in operating assets and liabilities	(19		)	93
Total adjustments	(3		)	161
Net cash provided by operating activities	69			192
Cash Flows from Investing Activities:
Capital expenditures	(17		)	(19		)
Restricted funds on deposit, net	—			(143		)
Net cash used in investing activities	(17		)	(162		)
Cash Flows from Financing Activities:
Repayment of long-term debt	(1		)	(1		)
Distributions to member	—			(100		)
Net cash used in financing activities	(1		)	(101		)
Net Increase (Decrease) in Cash and Cash Equivalents	51			(71		)
Cash and Cash Equivalents, beginning of period	68			202
Cash and Cash Equivalents, end of period	$	119		$	131

~~Table~~The accompanying combined notes are an integral part of ~~Contents~~these unaudited condensed consolidated financial statements

~~GENON MID-ATLANTIC, LLC AND SUBSIDIARIES~~ 6

~~(Wholly-Owned~~Table ~~Indirect Subsidiary~~ of ~~GenOn Energy, Inc.)~~ Contents

~~CONDENSED~~GENON ~~CONSOLIDATED~~AMERICAS ~~STATEMENTS~~GENERATION, OFLLC ~~CASH~~AND ~~FLOWS~~SUBSIDIARIES ~~(UNAUDITED)~~GENON MID-ATLANTIC, LLC AND SUBSIDIARIES

		September 30,			September 30,
	Nine Months Ended September 30,
	2011			2010
	(in millions)
Cash Flows from Operating Activities:
Net income (loss)	$	(45	)	$	525
Adjustments to reconcile net income (loss) and changes in other operating assets and liabilities to net cash provided by operating activities:
Depreciation and amortization		89			105
Impairment losses		94			—
Gain on sales of assets, net—affiliate		—			(3	)
Net changes in derivative contracts		63			(208	)
Lower of cost or market inventory adjustments		1			13
Changes in other operating assets and liabilities		44			14
Total adjustments		291			(79	)
Net cash provided by operating activities		246			446
Cash Flows from Investing Activities:
Capital expenditures		(126	)		(194	)
Proceeds from the sales of assets		1			4
Restricted funds on deposit, net		(166	)		—
Net cash used in investing activities		(291	)		(190	)
Cash Flows from Financing Activities:
Redemption of preferred stock		—			95
Repayment of long-term debt		(3	)		(3	)
Distributions to member		(100	)		(200	)
Capital contributions		30			—
Net cash used in financing activities		(73	)		(108	)
Net Increase (Decrease) in Cash and Cash Equivalents		(118	)		148
Cash and Cash Equivalents, beginning of period		202			125
Cash and Cash Equivalents, end of period	$	84		$	273
Supplemental Disclosures:
Cash paid for interest	$	—		$	1
Cash refunds received for income taxes	$	1		$	—

COMBINED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~The~~1. Description ~~accompanying combined notes are an integral part~~ of ~~these~~Business ~~unaudited~~and ~~condensed~~Accounting ~~consolidated~~and ~~financial~~Reporting ~~statements~~ Policies

6 Background

~~Table~~GenOn Americas Generation is a wholesale generator with approximately 9,729 MW of ~~Contents~~net electric generating capacity located, in many cases, near major metropolitan load centers in the Eastern PJM and Northeast regions and northern California. GenOn Americas Generation also operates integrated asset management and proprietary trading operations. See note 2 for a discussion of two generating facilities that we expect to retire in 2012 and 2013.

~~GENON~~GenOn ~~AMERICAS~~Mid Atlantic ~~GENERATION~~operates and owns or leases 5,209 MW ~~LLC~~of ~~AND~~net ~~SUBSIDIARIES~~electric generating capacity in the Washington, D.C. area. GenOn Mid-Atlantic’s electric generating capacity is part of the 9,729 MW of net electric generating capacity of GenOn Americas Generation. GenOn Mid-Atlantic’s generating facilities serve the Eastern PJM markets. The PJM ISO operates the largest centrally dispatched control area in the United States.

~~GENON~~We ~~MID~~are Delaware limited liability companies and indirect wholly-~~ATLANTIC,~~owned ~~LLC~~subsidiaries ~~AND~~of ~~SUBSIDIARIES~~GenOn. GenOn Mid-Atlantic is a wholly-owned subsidiary of GenOn North America and an indirect wholly-owned subsidiary of GenOn Americas Generation.

~~COMBINED~~We ~~NOTES~~have TOa ~~CONDENSED~~number ~~CONSOLIDATED~~of ~~FINANCIAL~~service ~~STATEMENTS~~arrangements ~~(UNAUDITED)~~for labor and administrative services with GenOn Energy Services. GenOn Energy Management provides services to certain operating subsidiaries of GenOn Americas, outside of GenOn Americas Generation, which include the bidding and dispatch of the generating units, fuel procurement and the execution of contracts, including economic hedges, to reduce price risk. See note 5.

1.Basis ~~Description~~ of ~~Business and Accounting and Reporting Policies~~ Presentation

~~Background~~The consolidated interim financial statements and notes (interim financial statements) are unaudited, omit certain disclosures and should be read in conjunction with our audited consolidated financial statements and notes in our 2011 Annual Report on Form 10-K. These interim financial statements have been prepared in accordance with GAAP from records maintained by us. All significant intercompany accounts and transactions have been eliminated in consolidation. The interim financial statements reflect all normal recurring adjustments necessary, in management’s opinion, to present fairly our financial position and results of operations for the reported periods. Amounts reported for interim periods may not be indicative of a full year period because of seasonal fluctuations in demand for electricity and energy services, changes in commodity prices, and changes in regulations, timing of maintenance and other expenditures, dispositions, changes in interest expense and other factors.

~~GenOn~~At ~~Americas~~December 31, ~~Generation~~2011 ~~provides~~and ~~energy~~March 31, ~~capacity~~2012, ~~ancillary~~substantially ~~and~~all ~~other~~of ~~energy~~our ~~services~~subsidiaries toare ~~wholesale~~wholly-owned ~~customers~~and inlocated ~~competitive energy markets~~ in the United States. We ~~through~~do ~~ownership~~not ~~and~~consolidate ~~operation~~two ~~of, and contracting for,~~ power ~~generation capacity. GenOn Americas Generation is a wholesale generator with approximately 9,724 MW of net electric~~ generating ~~capacity in the Eastern PJM and Northeast regions and northern California. GenOn Americas Generation also operates integrated asset management and energy marketing organizations~~facilities, ~~including~~which ~~proprietary~~are ~~trading~~under ~~operations.~~operating leases.

~~GenOn~~The ~~Mid-Atlantic~~preparation ~~operates~~of ~~and~~interim ~~owns~~financial orstatements ~~leases~~in ~~5,204~~conformity MWwith ofGAAP ~~net~~requires ~~electric~~management ~~generating~~to ~~capacity~~make invarious ~~the~~estimates ~~Washington,~~and ~~D.C.~~assumptions ~~area.~~that ~~GenOn~~affect ~~Mid-Atlantic’s~~the ~~electric~~reported ~~generating~~amounts ~~capacity is part~~ of ~~the~~assets 9and liabilities,~~724~~ MWdisclosures of ~~net~~ ~~electric~~contingent ~~generating~~assets ~~capacity~~and ofliabilities ~~GenOn~~at ~~Americas~~the ~~Generation.~~date ~~GenOn~~of ~~Mid-Atlantic’s~~the ~~generating~~interim ~~facilities~~financial ~~serve~~statements and the ~~Eastern~~reported ~~PJM~~amounts ~~markets.~~of ~~The~~revenues ~~PJM~~and ~~ISO~~expenses ~~operates~~during the ~~largest~~period. Actual ~~centrally~~results ~~dispatched~~could ~~control~~differ ~~area~~from inthose ~~the~~estimates. Our ~~United~~significant ~~States.~~estimates include:

We· estimating ~~are~~the ~~Delaware~~fair ~~limited~~value ~~liability companies and indirect wholly-owned subsidiaries~~ of ~~GenOn.~~certain ~~GenOn~~derivative Mid-Atlantic is a wholly-owned subsidiary of GenOn North America and an indirect wholly-owned subsidiary of GenOn Americas Generation. The chart below is a summary representation of our organizational structure and reportable segments and is not a complete organizational chart of GenOn. contracts;

~~(1)~~· estimating ~~GenOn Power Generation, LLC’s subsidiaries include former RRI Energy generating facilities acquired as a result of~~ the ~~Merger.~~inventory reserve;

We· estimating have a number of service agreements for labor and administrative services with GenOn Energy Services. GenOn Energy Management provides services to certain operating subsidiaries of GenOn Americas, outside of GenOn Americas Generation, which include the ~~bidding~~useful ~~and~~lives ~~dispatch~~ of ~~the~~long-lived ~~generating units, fuel procurement and the execution of contracts, including economic hedges, to reduce price risk. See note 6 for further discussion of arrangements with these related parties.~~ assets;

Table of Contents

~~Merger~~· estimating offuture ~~Mirant~~costs and ~~RRI Energy~~the valuation of asset retirement obligations;

On· estimating ~~December 3,~~future ~~2010,~~cash ~~Mirant~~flows ~~and RRI Energy completed the Merger. See note 1 to our consolidated financial statements~~ in ~~our~~ ~~2010~~determining ~~Annual~~impairments ~~Report~~of ~~on Form 10~~long-Klived ~~for~~assets ~~additional~~and ~~information~~definite-lived onintangible ~~the~~assets; ~~Merger.~~ and

~~Basis~~· estimating oflosses ~~Presentation~~to be recorded for contingent liabilities.

~~The~~We ~~consolidated~~evaluate ~~interim~~events ~~financial~~that ~~statements~~occur ~~and~~after ~~notes~~the ~~(interim~~balance ~~financial~~sheet ~~statements)~~date ~~are~~but ~~unaudited,~~before ~~omit~~the ~~certain disclosures and should be read in conjunction with our audited consolidated~~ financial statements ~~and~~are ~~notes~~issued infor ~~our~~potential ~~2010~~recognition ~~Annual~~or ~~Report~~disclosure. Based on ~~Form~~the 10-K. These interim financial statements have been prepared in accordance with GAAP from records maintained by us. All significant intercompany accounts and transactions have been eliminated in consolidation. The interim financial statements reflect all normal recurring adjustments necessaryevaluation, inwe ~~management’s~~determined ~~opinion,~~that tothere ~~present~~were ~~fairly~~no ~~our~~material ~~financial~~subsequent ~~position~~events ~~and results of operations~~ for ~~the~~recognition ~~reported~~or ~~periods.~~disclosure Amounts reported for interim periods may not be indicative of a full year period because of seasonal fluctuations in demand for electricity and energy services, changes in commodity prices, and changes in regulations, timing of maintenance and other ~~expenditures,~~than ~~dispositions,~~those ~~changes~~disclosed ~~in interest expense and other factors~~herein.

~~At September 30,~~Funds ~~2011,~~on ~~substantially all of our subsidiaries are wholly-owned and located in the United States. We do not consolidate two power generating facilities which are under operating leases.~~ Deposit

~~The~~Funds ~~preparation~~on ofdeposit ~~interim~~are ~~financial~~included ~~statements~~ in ~~conformity~~current ~~with GAAP requires management to make various estimates~~ and ~~assumptions that~~noncurrent ~~affect the reported amounts of~~ assets ~~and~~in ~~liabilities, disclosures of contingent assets and liabilities at~~ the ~~date~~consolidated ofbalance ~~the~~sheets. Funds ~~interim~~on ~~financial~~deposit ~~statements~~include ~~and~~ the ~~reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. Our significant estimates include~~following:

•GenOn ~~estimating~~Americas ~~the fair value of certain derivative contracts;~~Generation

• estimating the useful lives of long-lived assets;

	March 31, 2012		December 31, 2011
	(in millions)

GenOn Mid-Atlantic restricted cash(1)	$	166	$	166
Cash collateral posted — energy trading and marketing	104		118
Cash collateral posted — other operating activities(2)	58		38
Total current and noncurrent funds on deposit	328		322
Less: Current funds on deposit	322		316
Total noncurrent funds on deposit	$	6	$	6

•(1) Represents ~~estimating~~cash ~~future~~reserved ~~costs~~in ~~and~~respect ~~the~~of ~~valuation~~interlocutory ofliens ~~asset~~related ~~retirement~~to ~~obligations;~~the scrubber contract litigation. See note 8.

•(2) Includes ~~estimating~~$32 ~~future~~million ~~cash~~related ~~flows~~to inthe ~~determining~~Potomac ~~impairments~~River ofsettlement. See ~~long-lived~~note ~~assets and definite-lived intangible assets; and~~2.

•GenOn ~~estimating losses to be recorded for contingent liabilities.~~Mid-Atlantic

We evaluate events that occur after the balance sheet date but before the financial statements are issued for potential recognition or disclosure. Based on the evaluation, we determined that there were no material subsequent events for recognition or disclosure other than those disclosed herein.

	March 31, 2012		December 31, 2011
	(in millions)

GenOn Mid-Atlantic restricted cash(1)	$	166	$	166
Cash collateral posted(2)	32		32
Total current and noncurrent funds on deposit	198		198
Less: Current funds on deposit	198		198
Total noncurrent funds on deposit	$	—	$	—

8(1) Represents cash reserved in respect of interlocutory liens related to the scrubber contract litigation. See note 8.

~~Table~~(2) Represents ofamount ~~Contents~~related to the Potomac River settlement. See note 2.

~~Funds on Deposit~~ 8

~~Funds~~Table onof ~~deposit are included in current and noncurrent assets in the consolidated balance sheets. Funds on deposit include the following:~~ Contents

~~GenOn Americas Generation~~ Inventories

		September 30,		September 30,
	September 30,2011		December 31,2010
	(in millions)
Cash collateral posted – energy trading and marketing	$	135	$	80
Cash collateral posted – other operating activities(1)		39		40
GenOn Mid-Atlantic restricted cash(2)		166		—
Funds deposited with the trustee to discharge the GenOn North America senior notes, due 2013(3)		—		866
Total current and noncurrent funds on deposit		340		986
Less: Current funds on deposit		301		949
Total noncurrent funds on deposit	$	39	$	37

Inventories were comprised of the following:

~~(1)~~GenOn ~~Includes~~Americas ~~$32 million related to the Potomac River Settlement (see note 10 to our consolidated financial statements in our 2010 Annual Report on Form 10-K and note 2).~~Generation

(2) Represents cash reserved in respect of interlocutory liens related to the scrubber contract litigation. See note 9.

	March 31, 2012		December 31, 2011
	(in millions)

Fuel inventory:
Coal	$	101	$	92
Fuel oil	63		68
Natural gas	—		1
Other	3		3
Materials and supplies(1)	69		74
Purchased emissions allowances	32		19
Total inventories	$	268	$	257

(31) Amount ~~See~~is ~~note~~net 4of ~~for~~an ~~discussion~~inventory reserve of ~~the~~$6 ~~related~~million ~~debt~~and $0 at March 31, 2012 and December 31, 2011, respectively. See note 2.

GenOn Mid-Atlantic

		September 30,			September 30,
	March 31, 2012		December 31, 2011
	September 30,2011			December 31,2010
	(in millions)
	(in millions)
Fuel inventory:
GenOn Mid-Atlantic restricted cash(1)	$	166		$	—
Coal	$	101	$	92
Cash collateral posted(2)		32			32
Fuel oil	18		20
Total current and noncurrent funds on deposit		198			32
Other	3		3
Less: Current funds on deposit		166			2
Materials and supplies(1)	48		52
Total noncurrent funds on deposit	$	32		$	30
Total inventories	$	170	$	167

(1) Amount ~~Represents~~is ~~cash~~net ~~reserved~~of inan ~~respect~~inventory reserve of ~~interlocutory~~$4 ~~liens~~million ~~related~~and to$0 ~~the~~at ~~scrubber~~March 31, ~~contract~~2012 ~~litigation.~~and December 31, 2011, respectively. See note 92.

~~(2)~~During ~~Represents~~the ~~amount~~three ~~related~~months toended ~~the~~March 31, ~~Potomac~~2012 ~~River~~and ~~Settlement~~2011, ~~(see~~GenOn ~~note~~Americas 10Generation torecorded ~~our~~$25 ~~consolidated~~million ~~financial~~and ~~statements~~$0, respectively, for lower of average cost or market valuation adjustments in ~~our~~cost ~~2010~~of ~~Annual~~fuel, ~~Report~~electricity onand ~~Form~~other ~~10-K~~products.)

~~Inventories~~During the three months ended March 31, 2012 and 2011, GenOn Mid-Atlantic recorded $25 million and $0, respectively, for lower of average cost or market valuation adjustments in cost of fuel, electricity and other products.

~~Inventories~~Capitalization ~~were~~of ~~comprised~~Interest ofCost ~~the~~(GenOn ~~following:~~Americas Generation)

GenOn Americas Generation incurred the following interest costs:

		September 30,				September 30,
	Three Months Ended March 31,
	September 30,2011				December 31,2010
	2012			2011
	(in millions)
Fuel inventory:
Total interest costs	$	19		$	31
Coal	$	84			$	52
Capitalized and included in property, plant and equipment, net	(1		)	(1		)
Fuel oil		72				136
Interest expense	$	18		$	30
Other		3				1
Materials and supplies		74				72
Purchased emissions allowances		23				34
Total inventories	$	256			$	295

9The amounts of capitalized interest above include interest accrued. During the three months ended March 31, 2012 and 2011, no cash was paid for interest.

~~Table of Contents~~9

~~GenOn~~Table ~~Mid-Atlantic~~of Contents

		September 30,		September 30,
	September 30,2011		December 31,2010
	(in millions)
Fuel inventory:
Coal	$	84	$	52
Fuel oil		19		20
Other		2		1
Materials and supplies		52		49
Total inventories	$	157	$	122

Guarantees and Indemnifications (GenOn Americas Generation)

~~During~~GenOn ~~the~~generally ~~three~~conducts ~~months~~its ~~ended~~business ~~September 30,~~through ~~2011~~various ~~and~~holding ~~2010~~companies, including GenOn Americas Generation, ~~recorded~~and $0various ~~and $2~~operating ~~million~~subsidiaries, ~~respectively,~~which ~~and~~enter ~~during~~into contracts as part of their business activities. In certain instances, the ~~nine~~contractual ~~months~~obligations ~~ended~~of ~~September 30~~such subsidiaries are guaranteed by, ~~2011~~or ~~and~~otherwise ~~2010~~supported by, GenOn ~~Americas~~or ~~Generation~~another ~~recorded~~of $1its ~~million~~subsidiaries, ~~and~~including ~~$22~~by letters of credit issued under the GenOn credit facilities. At March ~~million~~31, ~~respectively~~2012, ~~for~~$151 ~~lower~~million of ~~average~~letters ~~cost~~of orcredit ~~market~~was ~~valuation~~posted ~~adjustments~~by inGenOn ~~cost~~for ofthe ~~fuel, electricity~~benefit ~~and~~of ~~other~~GenOn ~~products.~~Americas Generation.

~~During~~In ~~the~~addition, ~~three~~GenOn ~~months~~Americas ~~ended~~Generation ~~September 30,~~and ~~2011~~its ~~and~~subsidiaries ~~2010,~~enter ~~GenOn~~into ~~Mid-Atlantic~~various ~~recorded $0~~contracts ~~and~~that ~~$1 million,~~include ~~respectively,~~indemnification and ~~during~~guarantee ~~the~~provisions. Examples ~~nine~~of ~~months~~these ~~ended~~contracts ~~September 30~~include financing and lease arrangements, ~~2011~~purchase and ~~2010~~sale agreements, ~~GenOn~~agreements ~~Mid-Atlantic~~to ~~recorded~~purchase $1or ~~million~~sell commodities, construction agreements and ~~$13 million,~~agreements ~~respectively,~~with ~~for~~vendors. Although ~~lower~~the primary obligation of ~~average~~GenOn ~~cost~~Americas Generation or ~~market~~a ~~valuation~~subsidiary ~~adjustments~~under insuch ~~cost~~contracts ~~of fuel~~is to pay money or render performance, ~~electricity~~such contracts may include obligations to indemnify the counterparty for damages arising from the breach thereof and, in certain instances, other ~~products~~existing or potential liabilities. In many cases GenOn Americas Generation’s maximum potential liability cannot be estimated because some of the underlying agreements contain no limits on potential liability.

~~Capitalization~~Recently ofAdopted ~~Interest~~Accounting ~~Cost (GenOn Americas Generation)~~ Guidance

~~GenOn~~Fair ~~Americas~~Value ~~Generation~~Measurement ~~incurred~~and Disclosure. We adopted FASB accounting guidance for the ~~following~~quarter ~~interest~~ended ~~costs:~~March 31, 2012 that requires disclosure of the following:

		September 30,			September 30,			September 30,			September 30,
	Three Months EndedSeptember 30,						Nine Months EndedSeptember 30,
	2011			2010			2011			2010
	(in millions)
Total interest costs	$	20		$	52		$	72		$	154
Capitalized and included in property, plant and equipment, net		(1	)		(1	)		(2	)		(4	)
Interest expense	$	19		$	51		$	70		$	150

· quantitative information about the unobservable inputs used in a fair value measurement that is categorized within Level 3 of the fair value hierarchy;

~~The~~· for ~~amounts~~those offair ~~capitalized~~value ~~interest~~measurements ~~above~~categorized ~~include~~within ~~interest~~Level ~~accrued.~~3 ~~During~~of the ~~three~~fair ~~months~~value ~~ended September 30~~hierarchy, ~~2011~~both ~~and~~the ~~2010,~~valuation ~~cash~~processes ~~paid~~used ~~for interest was $0~~ and ~~$2 million,~~the ~~respectively,~~sensitivity ~~and~~of wethe ~~did~~fair ~~not~~value ~~capitalize~~measurement ~~any~~to ~~interest~~changes in ~~either~~unobservable ~~period.~~inputs ~~During~~and the ~~nine~~interrelationships ~~months~~between ~~ended~~those ~~September 30,~~unobservable ~~2011 and 2010~~inputs, ~~cash~~if ~~paid~~any; ~~for interest was $60 million~~ and ~~$97 million, respectively, of which $1 million and $3 million, respectively, were capitalized.~~

~~Recently~~· the ~~Adopted Accounting~~categorization ~~Guidance~~by level of the fair value hierarchy for items that are not measured at fair value in the statement of financial position but for which the fair value is required to be disclosed.

We adopted FASB accounting guidance for the quarter ended March 31, 2011 that requires a reconciliation for Level 3 fair value measurements, including presenting separately the amounts of purchases, issuances and settlements on a gross basis. See note 3 for these additional ~~information on fair value measurements~~disclosures.

New Accounting Guidance Not Yet Adopted at ~~September~~March 3031, ~~2011~~ 2012

~~Fair~~Balance ~~Value~~Sheet ~~Measurement and Disclosure~~Offsetting. In ~~May~~December 2011, the FASB issued ~~new~~updated ~~fair~~guidance ~~value~~to ~~measurement~~provide ~~and~~enhanced ~~disclosure~~disclosures ~~guidance.~~such ~~The~~that ~~new standard~~users ~~does~~of ~~not~~the ~~extend~~financial statements will be able to better evaluate the ~~use~~effect or potential effect of ~~fair~~netting ~~value~~arrangements ~~but~~in ~~rather~~the ~~provides~~balance sheet. The guidance requires improved information about ~~how~~financial ~~fair~~instruments ~~value~~and ~~should~~derivative beinstruments ~~determined~~that ~~and~~are ~~requires~~either ~~additional~~offset ~~disclosures.~~according ~~The~~to specific guidance isor subject to an enforceable master netting agreement or similar arrangement. The disclosures will provide both net and gross information for these assets and liabilities. Although we do not ~~expected~~currently elect to ~~have~~offset aassets ~~material~~and ~~effect~~liabilities onwithin ~~our~~the ~~fair~~scope ~~value~~of ~~measurements~~the guidance, ~~but~~ expanded disclosures will ~~require~~be ~~disclosure~~required ofstarting for the ~~following:~~quarter ended March 31, 2013, along with retrospective presentation of prior periods.

102. Expected Retirements of Generating Facilities

~~Table~~Potomac ofRiver ~~Contents~~Generating Facility

•During ~~quantitative~~2011, ~~information~~GenOn ~~about~~Mid-Atlantic entered into an agreement with the ~~unobservable~~City ~~inputs~~of ~~used~~Alexandria, inVirginia ato ~~fair~~remove ~~value~~permanently ~~measurement~~from ~~that~~service isthe ~~categorized~~Potomac ~~within~~River ~~Level~~generating 3facility. The agreement, which amends our Project Schedule and Agreement, dated July 2008 with the City of Alexandria, provides for the ~~fair~~retirement ~~value~~of ~~hierarchy;~~the Potomac River generating facility on October 1, 2012, subject to the receipt of all necessary consents and approvals. PJM has determined that the retirement of the facility will not affect reliability. We must now receive consent from PEPCO.

• for those fair value measurements categorized within Level 3 of the fair value hierarchy, both the valuation processes used and the sensitivity of the fair value measurement to changes in unobservable inputs and the interrelationships between those unobservable inputs, if any; and10

•Table ~~the categorization by level~~ of ~~the fair value hierarchy for items that are not measured at fair value in the statement of financial position but for which the fair value is required to be disclosed.~~Contents

We will ~~present~~reverse $31 million of the ~~additional~~previously ~~disclosures~~recorded asobligation ~~required~~under the 2008 agreement with the City of Alexandria upon the receipt of consent from PEPCO and we will recognize a reduction in ~~our~~ ~~Form~~operations ~~10-Q~~and ~~for~~maintenance expense. If the ~~quarter~~PEPCO ~~ended~~consent ~~March~~has not been received by July 313, 2012, the Potomac River generating facility will be retired within 90 days after the receipt thereof. Upon retirement of the Potomac River generating facility, all funds in the escrow account ($32 million) established under the July 2008 agreement shall be distributed to us, provided, that, if the retirement of the facility is after January 1, 2014, $750,000 of such funds shall be paid to the City of Alexandria.

2.Contra ~~Impairment~~Costa ofGenerating ~~Long-Lived Assets and Emissions Allowances~~ Facility

WeA ~~evaluate~~subsidiary ~~long-lived~~of ~~assets,~~GenOn ~~such~~Americas asGeneration ~~property,~~entered ~~plant~~into ~~and~~an ~~equipment~~agreement ~~and~~with ~~purchased~~PG&E ~~intangible~~in ~~assets~~September 2009 ~~subject to amortization,~~ for ~~impairment~~674 ~~whenever~~MW ~~events~~at orContra ~~changes~~Costa infor ~~circumstances indicate that~~ the ~~carrying~~period ~~amount~~from ofNovember 2011 ~~the~~through ~~asset may not be recoverable~~April 2013. At ~~Such evaluations are performed in accordance with~~ the ~~accounting~~end ~~guidance related to evaluating long-lived assets for impairment. Recoverability~~ of ~~assets~~the toagreement, ~~be held~~ and ~~used~~subject ~~is measured by a comparison of the carrying amount of an asset~~ to ~~the~~any ~~estimated~~necessary ~~undiscounted~~regulatory ~~future~~approvals, ~~cash~~we ~~flows~~have ~~expected~~agreed to beretire ~~generated by~~ the ~~asset.~~Contra IfCosta ~~the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized as the amount by which the carrying amount of the asset exceeds its fair value~~facility.

~~Granted~~Expenses ~~Emissions~~Related ~~Credits~~to Retirements

In ~~August~~connection ~~2011,~~with ~~the EPA~~our ~~finalized~~decision ~~the regulations~~ to ~~replace~~retire the ~~CAIR with the CSAPR starting in 2012. The CSAPR addresses interstate transport of emissions of NOx and SO2. The CSAPR establishes limitations on NOx and/or SO2 emissions from electric~~ generating ~~units~~facilities, ~~that~~we are ~~(i) greater~~evaluating ~~than~~our ~~25 megawatts~~materials and ~~(ii) located~~supplies ~~in 27 states~~inventory ~~(in~~and ~~the~~have ~~eastern~~determined ~~half of the United States)~~ that ~~the~~we ~~EPA~~have ~~determined~~excess ~~contribute significantly to nonattainment in other states, or to interfere with maintenance in other states, of one or more of three NAAQS: (a) the annual NAAQS for fine particulate matter (PM2~~inventory.5) promulgated in 1997; (b) the “24-hour” NAAQS for PM2.5 promulgated in 2006 and (c) the ozone NAAQS promulgated in 1997. The CSAPR creates “emission budgets” for each of the covered states and allocates emissions allowances (denominated in tons of emissions) to each of the 27 states regulated under the CSAPR. Under the EPA federal implementation plan, for 2012, GenOn Americas Generation ~~was allocated 9,642, 4,311,~~ and ~~19,285 allowances under the CSAPR for annual NOx, ozone-season NOx, and SO2, respectively. For 2012,~~ GenOn Mid-Atlantic ~~was~~established ~~allocated~~a ~~9,476,~~reserve ~~4,194,~~of ~~and~~$6 ~~18,925~~million ~~allowances~~and ~~under~~$4 ~~the CSAPR for annual NOx~~million, ~~ozone-season NOx~~respectively, ~~and~~recorded ~~SO2,~~to ~~respectively.~~operations ~~The~~and ~~federal~~maintenance ~~implementation~~expense ~~plan~~during ~~has also outlined EPA-determined allocations in~~ the ~~same~~three ~~amounts~~months ~~for~~ended ~~2013~~March 31, ~~although~~ ~~the CSAPR contemplates that states after~~ 2012 ~~may~~relating ~~allocate~~to ~~allowances~~excess ~~in a different manner than allocated initially under the CSAPR~~inventory. At ~~In October 2011~~March 31, ~~the EPA proposed revisions to the final CSAPR that~~2012, ~~if finalized, would provide GenOn Americas Generation with a small allowance increase in each compliance year. As a result,~~ the ~~expected~~aggregate ~~CSAPR~~carrying ~~allowances~~value ~~for~~of ~~GenOn Americas Generation would be 9~~property,~~683,~~ ~~4,345~~plant and ~~19,339~~equipment ~~in 2012~~ and ~~2013,~~materials ~~for annual NOx, ozone-season NOx~~ and ~~SO2,~~supplies ~~respectively.~~inventory ~~The~~for ~~CSAPR~~the ~~limits each electric~~ generating ~~unit’s NOx~~facilities ~~and SO2 emissions~~ to ~~amounts covered by the number of allowances held by that source in allowance accounts under the program (which may~~ be ~~purchased~~retired orwas ~~otherwise~~$6 ~~acquired~~million ~~from other sources, subject to certain limitations in the rule). The NOx allowances from the CAIR program will not be used in the CSAPR program~~ and ~~accordingly~~$1 ~~will have no value after 2011. The SO2 allowances used for compliance in the CAIR program are the acid rain program allowances~~million, ~~which will have negligible value after 2011. As a result of the CSAPR~~respectively, for GenOn Americas Generation ~~recorded impairment losses of $128 million for (a) the write-off of excess NOx~~ and ~~SO2 emissions allowances included in intangible assets (~~$700 ~~million)~~ and ~~(b) the write-off of excess NOx and SO2 emissions allowances previously included in property, plant and equipment (~~$581 million~~) during the three months ended September 30~~, ~~2011. As a result of the CSAPR~~respectively, for GenOn Mid-Atlantic recorded impairment losses of $94 million for (a) the write-off of excess NOx and SO2 emissions allowances included in intangible assets ($56 million) and (b) the write-off of excess NOx and SO2 emissions allowances previously included in property, plant and equipment ($38 million) during the three months ended September 30, 2011. In ~~The emissions allowances within property~~addition, ~~plant~~we ~~and~~expect ~~equipment~~to ~~and~~incur ~~intangible~~other ~~assets~~costs ~~had~~in ~~previously~~connection ~~been included~~ with ~~a generating facility asset group for purposes of impairment testing. As (a) there will be no future use of~~ the ~~NOx emissions allowances and (b) the SO2 emission allowances will have negligible value after 2011 under the CSAPR and their price has fallen sharply~~retirements, wesuch ~~evaluated,~~as inseverance ~~conjunction with preparing these interim financial statements, these emissions allowances for impairment separately from the generating facility asset group~~ and ~~determined~~shutdown ~~that impairments existed~~costs.

113. Financial Instruments

~~Table~~Derivatives ofand ~~Contents~~Hedging Activities

AtIn ~~GenOn~~connection ~~Americas~~with ~~Generation~~the business of generating electricity, ~~CAIR~~we ~~NOx~~are exposed to energy commodity price risk associated with the acquisition of fuel and emissions allowances ofneeded ~~$43~~to ~~million~~generate ~~will~~electricity, ~~have~~the noprice ~~value~~of ~~after~~electricity ~~2011~~produced and sold, and ~~were~~ ~~therefore~~the ~~fully~~fair ~~impaired~~value of fuel inventories. Through ~~The~~our ~~excess~~asset ~~acid~~management ~~rain~~activities, ~~program SO2~~we ~~emissions~~enter ~~allowances~~into a variety of ~~$86~~exchange-traded ~~million~~and ~~will~~OTC ~~have~~energy ~~negligible value~~and ~~after~~energy-related ~~2011~~derivative financial instruments, such as forward contracts, futures contracts, option contracts and ~~were~~financial ~~impaired~~swap agreements to ~~their~~manage ~~estimated~~exposure ~~fair~~to ~~value~~commodity ofprice $1risks. These ~~million~~contracts ~~based~~have onvarying ~~their~~terms ~~current~~and ~~market~~durations, ~~prices~~which ~~obtained~~range from ~~brokers~~a few days to years, depending on the instrument. GenOn ~~The~~Americas ~~excess~~Generation’s ~~acid~~proprietary ~~rain~~trading ~~program~~activities ~~SO2~~also ~~emissions~~utilize ~~allowances~~similar ~~were~~derivative ~~categorized~~contracts in ~~Level~~markets 3where init has a physical presence to attempt to generate incremental gross margin. GenOn Americas Generation’s fuel oil management activities use derivative financial instruments to hedge economically the fair value ~~hierarchy~~of physical fuel oil inventories, optimize the approximately two million barrels of storage capacity that it owns, and attempt to profit from market opportunities related to timing and/or differences in the pricing of various products. The open positions in GenOn Americas Generation’s trading activities comprising proprietary trading and fuel oil management activities expose it to risks associated with changes in energy commodity prices.

AtDerivative ~~GenOn~~financial ~~Mid-Atlantic,~~instruments ~~CAIR~~are ~~NOx~~recorded ~~emissions~~in ~~allowances~~the ofconsolidated ~~$43~~balance ~~million~~sheets ~~will~~at ~~have~~fair no value, ~~after~~except ~~2011,~~for derivative contracts that qualify for and ~~were~~for ~~therefore~~which ~~fully~~we ~~impaired.~~have ~~The~~elected ~~excess~~the ~~acid~~normal ~~rain program~~purchase ~~SO2~~or ~~emissions~~normal ~~allowances~~sale ofexceptions, ~~$52~~which ~~million~~are ~~will~~not ~~have negligible~~reflected ~~value~~in ~~after~~the ~~2011~~consolidated ~~and~~balance ~~were~~sheet ~~impaired~~or toresults ~~their~~of ~~estimated~~operations ~~fair~~prior ~~value~~to accrual of $1the ~~million~~settlement. We ~~based~~present onour ~~their~~derivative ~~current~~contract ~~market~~assets ~~prices~~and ~~obtained~~liabilities ~~from~~on ~~brokers.~~a ~~The~~gross ~~excess~~basis ~~acid~~(regardless ~~rain~~of ~~program~~master ~~SO2~~netting ~~emissions~~arrangements ~~allowances~~with ~~were~~the ~~categorized~~same incounterparty). Cash ~~Level~~collateral 3amounts inare ~~the~~also ~~fair~~presented ~~value~~on ~~hierarchy.~~a gross basis.

~~Potomac~~If ~~River~~certain ~~Retirement~~criteria are met, a derivative financial instrument may be designated as a fair value hedge or cash flow hedge. We did not have any derivative financial instruments designated as fair value or cash flow hedges for accounting purposes during the three months ended March 31, 2012 or 2011.

In the fourth quarter of 2010, GenOn Mid-Atlantic recorded impairment losses of $42 million to reduce the carrying value of the Potomac River generating facility to its estimated fair value of approximately $1 million. In addition, as a result of the impairment of the Potomac River generating facility, GenOn Mid-Atlantic recorded $32 million in operations and maintenance expense and corresponding liabilities associated with our commitment to reduce particulate emissions as part of the agreement with the City of Alexandria, Virginia. This $32 million is held in an escrow account. The planned capital investment would not be recovered in future periods based on the current projected cash flows of the Potomac River generating facility. See note 3(d) to our consolidated financial statements in our 2010 Annual Report on Form 10-K for further discussion. 11

InTable ~~August 2011, GenOn Mid-Atlantic entered into an agreement with the City~~ of Alexandria, Virginia to remove permanently from service its Potomac River generating facility. The agreement, which amends GenOn Mid-Atlantic’s Project Schedule and Agreement, dated July 17, 2008 with the City of Alexandria, provides for the retirement of the Potomac River generating facility on October 1, 2012, subject to the receipt of all necessary consents and approvals. PJM has determined that the retirement of the facility will not affect reliability. GenOn Mid-Atlantic must now receive consent from PEPCO. GenOn Mid-Atlantic will reverse the previously recorded obligation upon the receipt of consent from PEPCO and will recognize a reduction in operations and maintenance expense. If the PEPCO consent has not been received by July 3, 2012, the Potomac River generating facility will be retired within 90 days after the receipt thereof. Upon retirement of the Potomac River generating facility, all funds in the escrow account ($32 million) established under the July 17, 2008 agreement shall be distributed to GenOn Mid-Atlantic, provided, that, if the retirement of the facility is after January 1, 2014, $750,000 of such funds shall be paid to the City of Alexandria. Contents

3For our derivative financial instruments, changes in such instruments’ fair values are recognized currently in earnings. Our ~~Financial~~derivative ~~Instruments~~financial instruments are categorized based on the business objective the instrument is expected to achieve: asset management or trading, which includes GenOn Americas Generation’s proprietary trading and fuel oil management. For asset management activities, changes in fair value and settlement of derivative financial instruments used to hedge electricity economically are reflected in operating revenue and changes in fair value and settlement of derivative financial instruments used to hedge fuel economically are reflected in cost of fuel, electricity and other products in the consolidated statements of operations. Changes in the fair value and settlements of derivative financial instruments for GenOn Americas Generation’s proprietary trading and fuel oil management activities are recorded on a net basis as operating revenue in the consolidated statements of operations.

~~Derivatives~~We also consider risks associated with interest rates, counterparty credit and ~~Hedging~~our ~~Activities~~own non-performance risk when valuing derivative financial instruments. The nominal value of the derivative contract assets and liabilities is discounted to account for time value using a LIBOR forward interest rate curve based on the tenor of the transactions being valued.

In connection with the business of generating electricity, we are exposed to energy commodity price risk associated with the acquisition of fuel and emissions allowances needed to generate electricity, the price of electricity produced and sold, and the fair value of fuel inventories. Through our asset management activities, we enter into a variety of exchange-traded and OTC energy and energy-related derivative financial instruments, such as forward contracts, futures contracts, option contracts and financial swap agreements to manage exposure to commodity price risks. These contracts have varying terms and durations, which range from a few days to years, depending on the instrument. GenOn Americas Generation’s proprietary trading activities also utilize similar derivative contracts in markets where it has a physical presence to attempt to generate incremental gross margin. GenOn Americas Generation’s fuel oil management activities use derivative financial instruments to hedge economically the fair value of physical fuel oil inventories, optimize the approximately three million barrels of storage capacity that it owns or leases, and attempt to profit from market opportunities related to timing and/or differences in the pricing of various products. The open positions in GenOn Americas Generation’s trading activities comprising proprietary trading and fuel oil management activities expose it to risks associated with changes in energy commodity prices.

12The following table presents the fair value of GenOn Americas Generation’s derivative financial instruments (including amounts with affiliates):

											Net Derivative
	Derivative Contract Assets				Derivative Contract Liabilities						Contract
	Current		Long-Term		Current			Long-Term			Assets (Liabilities)
	(in millions)

March 31, 2012
Commodity Contracts:
Asset management	$	762	$	856	$	(487	)	$	(257	)	$	874
Trading activities	534		10		(544		)	(10		)	(10		)
Total derivatives	$	1,296	$	866	$	(1,031	)	$	(267	)	$	864

December 31, 2011
Commodity Contracts:
Asset management	$	562	$	757	$	(314	)	$	(186	)	$	819
Trading activities	459		3		(462		)	(3		)	(3		)
Total derivatives	$	1,021	$	760	$	(776	)	$	(189	)	$	816

Derivative financial instruments are recorded in the consolidated balance sheets at fair value, except for derivative contracts that qualify for and for which we have elected the normal purchase or normal sale exceptions, which are not reflected in the consolidated balance sheet or results of operations prior to accrual of the settlement. We present our derivative contract assets and liabilities on a gross basis (regardless of master netting arrangements with the same counterparty). Cash collateral amounts are also presented on a gross basis. 12

~~For~~Table our derivative financial instruments, changes in such instruments’ fair values are recognized currently in earnings. Our derivative financial instruments are categorized based on the business objective the instrument is expected to achieve: asset management or trading, which includes GenOn Americas Generation’s proprietary trading and fuel oil management. For asset management activities, changes in fair value and settlement of derivative financial instruments used to hedge electricity economically are reflected in operating revenue and changes in fair value and settlement of derivative financial instruments used to hedge fuel economically are reflected in cost of fuel, electricity and other products in the consolidated statements of operations. Changes in the fair value and settlements of derivative financial instruments for GenOn Americas Generation’s proprietary trading and fuel oil management activities are recorded on a net basis as operating revenue in the consolidated statements of operations. Contents

WeThe ~~also~~following ~~consider~~table ~~risks~~presents ~~associated~~the ~~with~~net ~~interest~~gains ~~rates,~~(losses) ~~counterparty~~for ~~credit and our own non-performance risk when valuing~~ derivative financial instruments. ~~The~~(including ~~nominal~~amounts ~~value~~with ofaffiliates) ~~the~~recognized ~~derivative~~in ~~contract assets~~income ~~and~~in ~~liabilities is discounted to account for time value using a LIBOR forward interest rate curve based on~~ the ~~tenor~~consolidated statements of ~~the transactions being valued.~~ operations:

GenOn Americas Generation

	Three Months Ended March 31,
	2012						2011
Derivatives Not Designated as Hedging Instruments	Operating Revenues			Cost of Fuel, Electricity and Other Products			Operating Revenues			Cost of Fuel, Electricity and Other Products
	(in millions)

Asset Management Commodity Contracts:
Unrealized	$	82		$	(26	)	$	(62	)	$	14
Realized(1)(2)	143			(16		)	68			(11		)
Total asset management	$	225		$	(42	)	$	6		$	3

Trading Commodity Contracts:
Unrealized	$	(7	)	$	—		$	(23	)	$	—
Realized(1)(2)	(5		)	—			6			—
Total trading	$	(12	)	$	—		$	(17	)	$	—

Total derivatives	$	213		$	(42	)	$	(11	)	$	3

~~The~~(1) Represents ~~following~~the ~~table~~total ~~presents~~cash ~~the~~settlements ~~fair~~of ~~value~~derivative financial instruments during each reporting period (composed of ~~GenOn~~ ~~Americas~~the ~~Generation’s~~sum ~~derivative~~of ~~financial~~the ~~instruments:~~quarterly settlements) that existed at the beginning of each respective period.

		September 30,		September 30,		September 30,			September 30,			September 30,
	Derivative Contract Assets				Derivative Contract Liabilities						Net DerivativeContract
	Current		Long-Term		Current			Long- Term			Assets (Liabilities)
	(in millions)
September 30, 2011
Commodity Contracts:
Asset management	$	338	$	540	$	(184	)	$	(80	)	$	614
Trading activities		344		19		(348	)		(17	)		(2	)
Total derivatives	$	682	$	559	$	(532	)	$	(97	)	$	612
December 31, 2010
Commodity Contracts:
Asset management	$	442	$	623	$	(279	)	$	(102	)	$	684
Trading activities		851		69		(854	)		(71	)		(5	)
Total derivatives	$	1,293	$	692	$	(1,133	)	$	(173	)	$	679

(2) Excludes settlement value of fuel contracts classified as inventory.

13The following tables present the notional quantity on long (short) positions for derivative financial instruments:

	Notional Volumes at March 31, 2012
Derivative Instruments	Derivative Contract Assets		Derivative Contract Liabilities	Net Derivative Contracts
	(in millions)

Commodity Contracts (in equivalent MWh):
Power(1)	(92	)	56	(36	)
Natural gas	(8	)	9	1
Coal	1		8	9

The following table presents the net gains (losses) for derivative financial instruments recognized in income in the unaudited condensed consolidated statements of operations:

	Notional Volumes at December 31, 2011
Derivative Instruments	Derivative Contract Assets		Derivative Contract Liabilities	Net Derivative Contracts
	(in millions)

Commodity Contracts (in equivalent MWh):
Power(1)	(97	)	61	(36	)
Natural gas	(9	)	10	1
Coal	3		8	11

		September 30,			September 30,			September 30,			September 30,
	Three Months Ended September 30,
	2011						2010
Derivatives Not Designated as Hedging Instruments	OperatingRevenues			Cost of Fuel,Electricity andOther Products			OperatingRevenues			Cost of Fuel,Electricity andOther Products
	(in millions)
Asset Management Commodity Contracts:
Unrealized	$	(1	)	$	(10	)	$	164		$	13
Realized(1)(2)		57			(15	)		54			(69	)
Total asset management	$	56		$	(25	)	$	218		$	(56	)
Trading Commodity Contracts:
Unrealized	$	11		$	—		$	(10	)	$	—
Realized(1)(2)		(13	)		—			—			—
Total trading	$	(2	)	$	—		$	(10	)	$	—
Total derivatives	$	54		$	(25	)	$	208		$	(56	)

(1) Includes MWh equivalent of natural gas transactions used to hedge power economically.

~~(1) Represents the total cash settlements of derivative financial instruments during each quarterly reporting period that existed at the beginning of each respective period.~~13

~~(2)~~Table ~~Effective January 1, 2011, excludes settlement value~~ of ~~fuel contracts classified as inventory.~~Contents

		September 30,			September 30,			September 30,			September 30,
	Nine Months Ended September 30,
	2011						2010
Derivatives Not Designated as Hedging Instruments	OperatingRevenues			Cost of Fuel,Electricity andOther Products			OperatingRevenues			Cost of Fuel,Electricity andOther Products
	(in millions)
Asset Management Commodity Contracts:
Unrealized	$	(88	)	$	19		$	299		$	(107	)
Realized(1)(2)		188			(39	)		230			(95	)
Total asset management	$	100		$	(20	)	$	529		$	(202	)
Trading Commodity Contracts:
Unrealized	$	(1	)	$	—		$	(13	)	$	—
Realized(1)(2)		(8	)		—			(2	)		—
Total trading	$	(9	)	$	—		$	(15	)	$	—
Total derivatives	$	91		$	(20	)	$	514		$	(202	)

GenOn Mid-Atlantic

~~(1)~~The ~~Represents~~following ~~the~~table ~~total~~presents ~~cash~~the ~~settlements~~fair ofvalue ~~derivative financial instruments during each reporting period (composed~~ of ~~the~~GenOn ~~sum~~Mid-Atlantic’s ofderivative ~~the~~financial ~~quarterly settlements) that existed at the beginning of each respective period.~~instruments:

(2) Effective January 1, 2011, excludes settlement value of fuel contracts classified as inventory.

											Net Derivative
											Contract
	Derivative Contract Assets				Derivative Contract Liabilities						Assets
	Current		Long-Term		Current			Long-Term			(Liabilities)
	(in millions)

March 31, 2012
Commodity Contracts:
Asset management	$	253	$	537	$	—		$	—		$	790
Asset management—affiliate	195		140		(203		)	(88		)	44
Total derivatives	$	448	$	677	$	(203	)	$	(88	)	$	834

December 31, 2011
Commodity Contracts:
Asset management	$	208	$	526	$	—		$	—		$	734
Asset management—affiliate	191		105		(168		)	(68		)	60
Total derivatives	$	399	$	631	$	(168	)	$	(68	)	$	794

14The following table presents the net gains (losses) for derivative financial instruments recognized in income in the consolidated statements of operations:

	Three Months Ended March 31,
	2012					2011
Derivatives Not Designated as Hedging Instruments	Operating Revenues		Cost of Fuel, Electricity and Other Products			Operating Revenues			Cost of Fuel, Electricity and Other Products
	(in millions)

Asset Management Commodity Contracts:
Unrealized	$	67	$	(25	)	$	(51	)	$	12
Realized(1)(2)	138		(1		)	61			—
Total asset management	$	205	$	(26	)	$	10		$	12

~~The~~(1) Represents ~~following~~the ~~tables~~total ~~present~~cash ~~the~~settlements ~~notional~~of ~~quantity~~derivative onfinancial ~~long~~instruments during each reporting period (~~short~~composed of the sum of the quarterly settlements) ~~positions~~that ~~for~~existed ~~derivative financial~~at ~~instruments:~~the beginning of each respective period.

		September 30,			September 30,		September 30,
	Notional Volumes at September 30, 2011
Derivative Instruments	DerivativeContractAssets			DerivativeContractLiabilities		NetDerivativeContracts
	(in millions)
Commodity Contracts (in equivalent MWh):
Power(1)		(56	)		21		(35	)
Natural gas		(18	)		19		1
Fuel oil		(1	)		1		—
Coal		4			9		13

(2) Excludes settlement value of fuel contracts classified as inventory.

		September 30,			September 30,			September 30,
	Notional Volumes at December 31, 2010
Derivative Instruments	DerivativeContractAssets			DerivativeContractLiabilities			NetDerivativeContracts
	(in millions)
Commodity Contracts (in equivalent MWh):
Power(1)		(23	)		(15	)		(38	)
Natural gas		(28	)		29			1
Fuel oil		2			(3	)		(1	)
Coal		9			7			16

~~(1)~~Table ~~Includes MWh equivalent~~ of ~~natural gas transactions used to hedge power economically.~~Contents

~~GenOn~~The ~~Mid-Atlantic~~following tables present the notional quantity on long (short) positions for derivative financial instruments:

The following table presents the fair value of GenOn Mid-Atlantic’s derivative financial instruments:

	Notional Volumes at March 31, 2012
Derivative Instruments	Derivative Contract Assets		Derivative Contract Liabilities	Net Derivative Contracts
	(in millions)

Commodity Contracts (in equivalent MWh):
Power(1)	(48	)	12	(36	)
Coal	1		8	9

		September 30,			September 30,		September 30,			September 30,			September 30,
	Notional Volumes at December 31, 2011
	Derivative Contract Assets					Derivative Contract Liabilities						Net Derivative Contract Assets
Derivative Instruments	Derivative Contract Assets		Derivative Contract Liabilities	Net Derivative Contracts
	Current			Long-Term		Current			Long-Term			(Liabilities)
	(in millions)
	(in millions)
Commodity Contracts (in equivalent MWh):
September 30, 2011
Power(1)	(56	)	19	(37	)
Commodity Contracts:
Coal	3		8	11
Asset management	$	170		$	452	$	(4	)	$	—		$	618
Asset management – affiliate		113			38		(123	)		(33	)		(5	)
Total derivatives	$	283		$	490	$	(127	)	$	(33	)	$	613
December 31, 2010
Commodity Contracts:
Asset management	$	162		$	516	$	(18	)	$	—		$	660
Asset management – affiliate		245			97		(231	)		(94	)		17
Total derivatives	$	407		$	613	$	(249	)	$	(94	)	$	677

15(1) Includes MWh equivalent of natural gas transactions used to hedge power economically.

~~Table~~Fair ofValue ~~Contents~~Measurements

~~The~~Fair ~~following~~Value ~~table~~Hierarchy ~~presents~~and ~~the~~Valuation ~~net~~Techniques. We ~~gains~~apply ~~(losses)~~recurring ~~for~~fair ~~derivative~~value measurements to our financial ~~instruments recognized~~assets and liabilities. In estimating fair value, we generally use a market approach and incorporate assumptions that market participants would use in ~~income~~pricing the asset or liability, including assumptions about risk and/or the risks inherent in the ~~unaudited~~inputs ~~condensed~~to ~~consolidated~~the ~~statements~~valuation techniques. The fair value measurement inputs we use vary from readily observable prices for exchange-traded instruments to price curves that cannot be validated through external pricing sources. Based on the observability of ~~operations:~~the inputs used in the valuation techniques, the financial assets and liabilities carried at fair value in the financial statements are classified as follows:

		September 30,			September 30,			September 30,		September 30,
	Three Months Ended September 30,
	2011						2010
Derivatives Not Designated as Hedging Instruments	OperatingRevenues			Cost of Fuel,Electricity andOther Products			OperatingRevenues		Cost of Fuel,Electricity andOther Products
	(in millions)
Asset Management Commodity Contracts:
Unrealized	$	(3	)	$	(9	)	$	156	$	23
Realized(1)(2)		54			—			54		(58	)
Total asset management	$	51		$	(9	)	$	210	$	(35	)

Level 1: Represents unadjusted quoted market prices in active markets for identical assets or liabilities that are accessible at the measurement date. This category primarily includes natural gas and crude oil futures traded on the NYMEX and swaps cleared against NYMEX prices. Interest bearing funds are also valued using Level 1 inputs.

~~(1)~~Level 2: Represents ~~the~~quoted ~~total~~market ~~cash~~prices ~~settlements~~for ofsimilar ~~derivative~~assets ~~financial~~or ~~instruments~~liabilities ~~during~~in ~~each~~active ~~quarterly~~markets, ~~reporting~~quoted ~~period~~market prices in markets that ~~existed~~are atnot ~~the~~active ~~beginning~~or ofother ~~each~~inputs ~~respective~~that ~~period~~are observable or can be corroborated by observable market data. This category primarily includes non-exchange-traded derivatives such as OTC forwards, swaps and options, and certain energy derivative instruments that are cleared and settled through exchanges.

Level 3: Represents commodity derivative instruments whose fair value is estimated based on internally developed models and methodologies utilizing significant inputs that are generally less readily observable from market sources (2such as implied volatilities and correlations). The ~~Effective~~OTC, ~~January~~complex 1or structured derivative instruments that are transacted in less liquid markets with limited pricing information are included in Level 3. Examples are coal contracts, ~~2011~~power transmission congestion products, ~~excludes~~less ~~settlement~~liquid ~~value~~power ofand ~~fuel~~natural gas contracts, ~~classified~~and asoptions ~~inventory~~valued using internally developed inputs.

		September 30,			September 30,		September 30,		September 30,
	Nine Months Ended September 30,
	2011					2010
Derivatives Not Designated as Hedging Instruments	OperatingRevenues			Cost of Fuel,Electricity andOther Products		OperatingRevenues		Cost of Fuel,Electricity andOther Products
	(in millions)
Asset Management Commodity Contracts:
Unrealized	$	(81	)	$	18	$	289	$	(81	)
Realized(1)(2)		176			—		215		(62	)
Total asset management	$	95		$	18	$	504	$	(143	)

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls must be determined based on the lowest level input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and consideration of factors specific to the asset or liability.

(1) Represents the total cash settlements of derivative financial instruments during each reporting period (composed of the sum of the quarterly settlements) that existed at the beginning of each respective period.15

~~(2)~~Table ~~Effective January 1, 2011, excludes settlement value~~ of ~~fuel contracts classified as inventory.~~Contents

~~The~~A ~~following~~significant ~~tables~~amount ~~present~~of the ~~notional~~fair ~~quantity~~value of our derivative contract assets and liabilities is based on ~~long~~observable quoted prices from exchanges and indicative quoted prices from independent brokers in active markets that regularly facilitate our transactions. An active market is considered to have transactions with sufficient frequency and volume to provide pricing information on an ongoing basis. We think that these prices represent the best available information for valuation purposes. In determining the fair value of derivative contract assets and liabilities, we use third-party market pricing where available. For transactions classified in Level 1 of the fair value hierarchy, we use the unadjusted published settled prices on the valuation date. For transactions classified in Level 2 of the fair value hierarchy, we value these transactions using indicative quoted prices from independent brokers or other widely-accepted valuation methodologies. Transactions are classified in Level 2 if substantially all (~~short~~greater than 90%) ~~positions~~of ~~for~~the fair value can be corroborated using observable market inputs such as transactable broker quotes. In accordance with the exit price objective under the fair value measurements accounting guidance, the fair value of our derivative ~~financial~~contract ~~instruments:~~assets and liabilities is determined based on the net underlying position of the recorded derivative contract assets and liabilities using bid prices for assets and ask prices for liabilities. The quotes we obtain from brokers are non-binding in nature, but are from brokers that typically transact in the market being quoted and are based on their knowledge of market transactions on the valuation date. We typically obtain multiple broker quotes as of the valuation date that extend for the tenor of the underlying contracts for each delivery location. The number of quotes that we can obtain depends on the relative liquidity of the delivery location on the valuation date. If multiple broker quotes are received for a contract, we use an average of the quoted bid or ask prices. If only one broker quote is received for a delivery location and it cannot be validated through other external sources, we will assign the quote to a lower level within the fair value hierarchy. In some instances, we may combine broker quotes for a liquid delivery hub with broker quotes for the price spread between the liquid delivery hub and the delivery location under the contract. We also may apply interpolation techniques to value monthly strips if broker quotes are only available on a seasonal or annual basis. We perform validation procedures on the broker quotes at least monthly. The validation procedures include reviewing the quotes for accuracy and comparing them to our internal price curves. In certain instances, we may exclude from consideration a broker quote if it is a clear outlier and other quotes are obtained. At March 31, 2012, we obtained broker quotes for 100% of our delivery locations classified in Level 2 of the fair value hierarchy.

		September 30,			September 30,		September 30,
	Notional Volumes at September 30, 2011
Derivative Instruments	Derivative ContractAssets			Derivative ContractLiabilities		Net DerivativeContracts
	(in millions)
Commodity Contracts (in equivalent MWh):
Power(1)		(40	)		6		(34	)
Coal		4			9		13

Inactive markets are considered to be those markets with few transactions, noncurrent pricing or prices that vary over time or among market makers. Our transactions in Level 3 of the fair value hierarchy may involve transactions whereby observable market data, such as broker quotes, are not available for substantially all of the tenor of the contract or we are only able to obtain indicative broker quotes that cannot be corroborated by observable market data. In such cases, we may apply valuation techniques such as extrapolation and other quantitative methods to determine fair value. Our techniques for fair value estimation include assumptions for market prices, including market price volatility and the volatility of the spread between multiple market prices. Proprietary models may also be used to estimate the fair value of derivative contract assets and liabilities that may be structured or otherwise tailored. The degree of estimation increases for longer duration contracts, contracts with multiple pricing features, option contracts and off-hub delivery points. At March 31, 2012, GenOn Americas Generation’s assets and liabilities classified as Level 3 in the fair value hierarchy represented 5% of its total derivative contract assets and 11% of its total derivative contract liabilities. At March 31, 2012, GenOn Mid-Atlantic’s assets and liabilities classified as Level 3 in the fair value hierarchy represented less than 1% of its total derivative contract assets and 32% of its total derivative contract liabilities.

		September 30,			September 30,		September 30,
	Notional Volumes at December 31, 2010
Derivative Instruments	Derivative ContractAssets			Derivative ContractLiabilities		Net DerivativeContracts
	(in millions)
Commodity Contracts (in equivalent MWh):
Power(1)		(40	)		4		(36	)
Coal		6			10		16

The fair value of our derivative contract assets and liabilities is also affected by assumptions as to time value, credit risk and non-performance risk. The nominal value of derivatives is discounted to account for time value using a LIBOR forward interest rate curve based on the tenor of the transaction. Derivative contract assets are reduced to reflect the estimated default risk of counterparties on their contractual obligations. The counterparty default risk for our overall net position is measured based on published spreads on credit default swaps for counterparties, where available, or proxies based upon published spreads, applied to our current exposure and potential loss exposure from the financial commitments in our risk management portfolio. The fair value of derivative contract liabilities is reduced to reflect the estimated risk of default on contractual obligations to counterparties and is measured based on published default rates of our debt, where available, or proxies based upon published spreads. Credit risk and non-performance risk are calculated with consideration of our master netting agreements with counterparties and our exposure is reduced by cash collateral posted to us against these obligations.

~~(1) Includes MWh equivalent of natural gas transactions used to hedge power economically.~~16

16Table of Contents

~~Table~~Information about Sensitivity to Changes in Significant Unobservable Inputs. The significant unobservable inputs used in the fair value measure of ~~Contents~~our commodity instruments categorized within Level 3 of the fair value hierarchy are estimates of future market volatility, estimates of forward congestion power price spreads and estimates of counterparty credit risk and our own non-performance risk. These assumptions are generally independent of each other. Volatility curves and power prices spreads are generally based on observable markets where available, or derived from historical prices and forward market prices from similar observable markets when not available. Increases in the price or volatility of the spread on a long/short position in isolation would result in a higher/lower fair value measurement. A change in the assumption used for the probability of default is accompanied by a directionally similar change in the adjustment to reflect the estimated default risk of counterparties on their contractual obligations, or the estimated risk of default on our own contractual obligations to counterparties.

~~Fair~~Risk ~~Value~~Management. The ~~Measurements~~Risk and Finance Oversight Committee of GenOn’s Board of Directors is responsible for oversight of the risk management of our commercial activities and enterprise risk management. In order to ensure proper daily oversight of our commercial risk controls, the Risk and Finance Oversight Committee has established the ROC with membership determined by GenOn’s Chief Executive Officer. The ROC is responsible for ensuring that the necessary policies, procedures and systems are in place to measure, monitor and report on the risks associated with our commercial activities. The ROC is also responsible for safeguarding proprietary models against the negative impact of inadequate model control by providing oversight and control to model development, back-testing and verification, automation, security and revision control. The ROC must approve new valuation models or fundamental modifications to existing models. Model forecasts are back-tested annually and the results reviewed with the ROC.

~~Fair~~Comprehensive, ~~Value~~accurate ~~Hierarchy~~ and ~~Valuation~~timely ~~Techniques.~~reporting Weand ~~apply~~monitoring ~~recurring~~is ~~fair~~essential ~~value measurements~~ to ~~our~~effectively ~~financial~~manage ~~assets and liabilities. In estimating fair value~~market, wecredit ~~generally~~and ~~use~~operational arisks ~~market approach~~ and ~~incorporate~~to ~~assumptions~~protect ~~that~~against ~~market~~large ~~participants~~unanticipated ~~would~~losses. A ~~use~~strong, ineffective ~~pricing~~reporting ~~the~~and ~~asset~~monitoring ~~or liability~~function, ~~including~~which ~~assumptions~~includes ~~about~~daily ~~risk~~ and~~/or~~ ~~the~~weekly ~~risks~~reporting, ~~inherent~~keeps in the ~~inputs~~ROC toand ~~the~~GenOn’s ~~valuation techniques.~~Chief ~~The~~Risk ~~fair~~Officer ~~value~~informed ~~measurement~~of ~~inputs~~our ~~we use vary from readily observable prices for exchange-traded instruments to price curves that cannot be validated through external pricing sources~~activities. The ~~Based~~chair ~~on the observability~~ of the ~~inputs~~ROC ~~used in~~reports ~~the~~to ~~valuation techniques,~~ the ~~financial~~Risk ~~assets~~ and ~~liabilities~~Finance ~~carried~~Oversight atCommittee ~~fair~~on ~~value~~a inquarterly ~~the~~basis, ~~financial~~or ~~statements~~more ~~are~~frequently, ~~classified~~if asevents ~~follows:~~and circumstances dictate.

Level 1: Represents unadjusted quoted market prices in active markets for identical assets or liabilities that are accessible at the measurement date. This category primarily includes natural gas and crude oil futures traded on the NYMEX and swaps cleared against NYMEX prices. The interest bearing funds are also valued using Level 1 inputs.17

~~Level~~Table 2:of Represents quoted market prices for similar assets or liabilities in active markets, quoted market prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data. This category primarily includes non-exchange-traded derivatives such as OTC forwards, swaps and options, and certain energy derivative instruments that are cleared and settled through exchanges.Contents

~~Level~~GenOn 3:Americas This category includes the commodity derivative instruments whose fair value is estimated based on internally developed models and methodologies utilizing significant inputs that are generally less readily observable from market sources (such as implied volatilities and correlations). The OTC, complex or structured derivative instruments that are transacted in less liquid markets with limited pricing information are included in Level 3. Examples are coal contracts, power transmission congestion products, power and natural gas contracts, and options valued using internally developed inputs.Generation

InFair ~~certain~~Value ~~cases,~~of ~~the~~Derivative ~~inputs~~Instruments ~~used~~and toCertain ~~measure~~Other ~~fair value may fall into different levels of the fair value hierarchy~~Assets. The ~~In such cases, the level in the~~ fair value ~~hierarchy~~measurements ~~within which the fair value measurement in its entirety falls must be determined based on the lowest level input that is significant to the fair value measurement. Our assessment~~ of ~~the~~GenOn ~~significance~~Americas ofGeneration’s afinancial ~~particular input~~assets ~~to the fair value measurement in its entirety requires judgment~~ and ~~consideration~~liabilities of(including ~~factors~~amounts ~~specific~~with toaffiliates) ~~the~~by ~~asset~~class orare ~~liability.~~as follows:

Most of the fair value of our derivative contract assets and liabilities is based on observable quoted prices from exchanges and indicative quoted prices from independent brokers in active markets that regularly facilitate our transactions. An active market is considered to have transactions with sufficient frequency and volume to provide pricing information on an ongoing basis. We think that these prices represent the best available information for valuation purposes. In determining the fair value of derivative contract assets and liabilities, we use third-party market pricing where available. For transactions classified in Level 1 of the fair value hierarchy, we use the unadjusted published settled prices on the valuation date. For transactions classified in Level 2 of the fair value hierarchy, we value these transactions using indicative quoted prices from independent brokers or other widely-accepted valuation methodologies. Transactions are classified in Level 2 if substantially all (greater than 90%) of the fair value can be corroborated using observable market inputs such as transactable broker quotes. In accordance with the exit price objective under the fair value measurements accounting guidance, the fair value of our derivative contract assets and liabilities is determined based on the net underlying position of the recorded derivative contract assets and liabilities using bid prices for assets and ask prices for liabilities. The quotes that we obtain from brokers are non-binding in nature, but are from brokers that typically transact in the market being quoted and are based on their knowledge of market transactions on the valuation date. We typically obtain multiple broker quotes as of the valuation date that extend for the tenor of the underlying contracts for each delivery location. The number of quotes that we can obtain depends on the relative liquidity of the delivery location on the valuation date. If multiple broker quotes are received for a contract, we use an average of the quoted bid or ask prices. If only one broker quote is received for a delivery location and it cannot be validated through other external sources, we will assign the quote to a lower level within the fair value hierarchy. In some instances, we may combine broker quotes for a liquid delivery hub with broker quotes for the price spread between the liquid delivery hub and the delivery location under the contract. We also may apply interpolation techniques to value monthly strips if broker quotes are only available on a seasonal or annual basis. We perform validation procedures on the broker quotes at least monthly. The validation procedures include reviewing the quotes for accuracy and comparing them to our internal price curves. In certain instances, we may exclude from consideration a broker quote if it is a clear outlier and other quotes are obtained. At September 30, 2011, we obtained broker quotes for 100% of our delivery locations classified in Level 2 of the fair value hierarchy.

	March 31, 2012
	Level 1(1)		Level 2(1) (2)		Level 3		Total Fair Value
	(in millions)
Derivative contract assets:
Commodity Contracts
Asset Management:
Power	$	170	$	1,398	$	31	$	1,599
Fuel	1		1		17		19
Total Asset Management	171		1,399		48		1,618
Trading Activities	90		388		66		544
Total derivative contract assets	$	261	$	1,787	$	114	$	2,162

Derivative contract liabilities:
Commodity Contracts
Asset Management:
Power	$	153	$	451	$	15	$	619
Fuel	16		2		107		125
Total Asset Management	169		453		122		744
Trading Activities	110		422		22		554
Total derivative contract liabilities	$	279	$	875	$	144	$	1,298

Interest-bearing funds(3)	$	571	$	—	$	—	$	571

17(1) Transfers between Level 1 and Level 2 are recognized as of the end of the reporting period. There were no transfers during the three months ended March 31, 2012.

~~Table~~(2) Option contracts comprised 1% of ~~Contents~~GenOn Americas Generation’s net derivative contract assets.

~~Inactive~~(3) Represents ~~markets~~investments ~~are considered to be those markets with few transactions, noncurrent pricing or prices that vary over time or among market makers. Our transactions~~ in ~~Level~~money ~~3 of the fair value hierarchy may involve transactions whereby observable~~ market ~~data,~~funds ~~such~~and asis ~~broker~~included ~~quotes,~~in ~~are~~cash ~~not~~and ~~available~~cash ~~for substantially all of the tenor of the contract or we are only able to obtain indicative broker quotes that cannot be corroborated by observable market data. In such cases~~equivalents, wefunds ~~may~~on ~~apply~~deposit ~~valuation techniques such as extrapolation~~ and other ~~quantitative~~noncurrent ~~methods~~assets toin ~~determine fair value. Proprietary models may also be used to estimate~~ the ~~fair~~consolidated ~~value~~balance ~~of derivative contract assets and liabilities that may be structured or otherwise tailored~~sheet. Our techniques for fair value estimation include assumptions for market prices, correlation and volatility. The degree of estimation increases for longer duration contracts, contracts with multiple pricing features, option contracts and off-hub delivery points. At September 30, 2011, GenOn Americas Generation’s ~~assets and~~had ~~liabilities~~$368 ~~classified~~million ~~as Level 3 in the fair value hierarchy represented approximately 3%~~ of ~~its~~interest-bearing ~~total~~funds ~~derivative~~included ~~contract~~in ~~assets~~cash and ~~13%~~cash ~~of its total derivative contract liabilities. At September 30~~equivalents, ~~2011, GenOn Mid-Atlantic’s assets and liabilities classified as Level~~$197 3million included in ~~the~~funds ~~fair~~on ~~value~~deposit ~~hierarchy represented approximately 2% of its total derivative contract assets~~ and ~~42%~~$6 million ofincluded ~~its~~in ~~total~~other ~~derivative~~noncurrent ~~contract liabilities~~assets.

The fair value of our derivative contract assets and liabilities is also affected by assumptions as to time value, credit risk and non-performance risk. The nominal value of derivatives is discounted to account for time value using a LIBOR forward interest rate curve based on the tenor of the transaction. Derivative contract assets are reduced to reflect the estimated default risk of counterparties on their contractual obligations to us. The counterparty default risk for our overall net position is measured based on published spreads on credit default swaps for counterparties, where available, or proxies based upon published spreads, applied to our current exposure and potential loss exposure from the financial commitments in our risk management portfolio. The fair value of derivative contract liabilities is reduced to reflect the estimated risk of default on contractual obligations to counterparties and is measured based on published default rates of our debt, where available, or proxies based upon published spreads. Credit risk and non-performance risk are calculated with consideration of our master netting agreements with counterparties and our exposure is reduced by cash collateral posted to us against these obligations. 18

18Table of Contents

	December 31, 2011
								Total
	Level 1(1)		Level 2(1) (2)			Level 3		Fair Value
	(in millions)
Derivative contract assets:
Commodity Contracts
Asset Management:
Power	$	118	$	1,169		$	17	$	1,304
Fuel	2		—			13		15
Total Asset Management	120		1,169			30		1,319
Trading Activities	124		302			36		462
Total derivative contract assets	$	244	$	1,471		$	66	$	1,781

Derivative contract liabilities:
Commodity Contracts
Asset Management:
Power	$	108	$	298		$	9	$	415
Fuel	19		(9		)	75		85
Total Asset Management	127		289			84		500
Trading Activities	142		309			14		465
Total derivative contract liabilities	$	269	$	598		$	98	$	965

Interest-bearing funds(3)	$	421	$	—		$	—	$	421

~~GenOn~~(1) Transfers ~~Americas~~between ~~Generation~~Level 1 and Level 2 are recognized as of the end of the reporting period. There were no significant transfers during 2011.

~~Fair~~(2) Option ~~Value~~contracts ofcomprised ~~Derivative~~1% ~~Instruments and Certain Other Assets. The fair value measurements~~ of GenOn Americas Generation’s ~~financial~~net ~~assets~~derivative ~~and~~contract ~~liabilities by class are as follows:~~ assets.

		September 30,		September 30,		September 30,		September 30,
	September 30, 2011
	Level 1(1)		Level 2(1) (2)		Level 3		TotalFair Value
	(in millions)
Derivative contract assets:
Commodity Contracts
Asset Management:
Power	$	31	$	810	$	8	$	849
Fuel		4		3		22		29
Total Asset Management		35		813		30		878
Trading Activities		202		148		13		363
Total derivative contract assets	$	237	$	961	$	43	$	1,241
Derivative contract liabilities:
Commodity Contracts
Asset Management:
Power	$	44	$	124	$	7	$	175
Fuel		19		2		68		89
Total Asset Management		63		126		75		264
Trading Activities		213		145		7		365
Total derivative contract liabilities	$	276	$	271	$	82	$	629
Interest-bearing funds(3)	$	391	$	—	$	—	$	391

(3) Represents investments in money market funds and is included in cash and cash equivalents, funds on deposit and other noncurrent assets in the consolidated balance sheet. GenOn Americas Generation had $249 million of interest-bearing funds included in cash and cash equivalents, $166 million included in funds on deposit and $6 million included in other noncurrent assets.

~~(1) Transfers between Level 1 and Level 2 are recognized as of the end of the reporting period. There were no significant transfers during the nine months ended September 30, 2011.~~19

~~(2)~~Table ~~Option contracts comprised less than 1%~~ of ~~GenOn Americas Generation’s net derivative contract assets.~~Contents

~~(3)~~The ~~Represents~~following ~~investments in money market funds and~~ is ~~included~~a inreconciliation ~~cash~~of ~~and~~changes ~~cash~~(comprised ~~equivalents,~~of ~~funds~~the onsum ~~deposit~~of ~~and~~the ~~other~~quarterly ~~noncurrent~~changes) ~~assets~~ in ~~the~~fair ~~consolidated~~value ~~balance sheet. GenOn Americas Generation had $187 million~~ of ~~interest-bearing~~net ~~funds~~commodity ~~included~~derivative incontract ~~cash~~assets and ~~cash~~liabilities ~~equivalents,~~(including ~~$166~~amounts ~~million~~with ~~included~~affiliates) inclassified ~~funds~~as onLevel 3 ~~deposit~~during ~~and~~the ~~$38~~three ~~million~~months ~~included~~ended inMarch ~~other~~31, ~~noncurrent~~2012 ~~assets.~~and 2011:

	Net Derivatives Contracts (Level 3)
	Asset Management			Trading Activities			Total
	(in millions)

Balance, January 1, 2012 (net asset (liability))	$	(54	)	$	22		$	(32	)
Total gains (losses) realized/unrealized:
Included in earnings(1)	(35		)	29			(6		)
Purchases(2)	—			—			—
Issuances(2)	—			—			—
Settlements (3)	15			(7		)	8
Transfers into Level 3(4)	—			—			—
Transfers out of Level 3(4)	—			—			—
Balance, March 31, 2012 (net asset (liability))	$	(74	)	$	44		$	(30	)

Balance, January 1, 2011 (net asset (liability))	$	(68	)	$	2		$	(66	)
Total gains (losses) realized/unrealized:
Included in earnings(1)	15			2			17
Purchases(2)	—			—			—
Issuances(2)	—			—			—
Settlements(3)	(2		)	—			(2		)
Transfers into Level 3(4)	—			—			—
Transfers out of Level 3(4)	—			—			—
Balance, March 31, 2011 (net asset (liability))	$	(55	)	$	4		$	(51	)

~~Table~~(1) Represents the fair value, as of ~~Contents~~the end of each reporting period, of Level 3 contracts entered into during each reporting period and the gains and losses attributable to Level 3 contracts that existed as of the beginning of each reporting period and were still held at the end of each reporting period.

		September 30,		September 30,		September 30,		September 30,
	December 31, 2010
	Level 1(1)		Level 2(1) (2)		Level 3		TotalFair Value
	(in millions)
Derivative contract assets:
Commodity Contracts
Asset Management:
Power	$	1	$	1,022	$	2	$	1,025
Fuel		4		3		33		40
Total Asset Management		5		1,025		35		1,065
Trading Activities		530		385		5		920
Total derivative contract assets	$	535	$	1,410	$	40	$	1,985
Derivative contract liabilities:
Commodity Contracts
Asset Management:
Power	$	12	$	248	$	4	$	264
Fuel		18		—		99		117
Total Asset Management		30		248		103		381
Trading Activities		533		389		3		925
Total derivative contract liabilities	$	563	$	637	$	106	$	1,306
Interest-bearing funds(3)	$	547	$	—	$	—	$	547

(2) Contracts entered into during each reporting period are reported with other changes in fair value.

(13) Represents ~~Transfers~~the ~~between~~reversal ~~Level~~of 1previously ~~and~~recognized ~~Level~~unrealized 2gains ~~are~~and ~~recognized~~losses asfrom settlement of ~~the~~contracts ~~end~~during ofeach ~~the~~ reporting period. ~~There were no significant transfers during 2010.~~

(24) Denotes ~~Option~~the total contracts ~~comprised~~that ~~approximately~~existed 1%at the beginning of ~~GenOn~~each ~~Americas~~reporting ~~Generation’s~~period ~~net~~and ~~derivative~~were ~~contract~~still held at the end of each reporting period that were either previously categorized as a higher level for which the inputs to the model became unobservable or assets and liabilities that were previously classified as Level 3 for which the lowest significant input became observable during each reporting period. Amounts reflect fair value as of the end of each reporting period.

~~(3)~~The ~~Represents~~following ~~investments~~table inpresents ~~money~~the ~~market~~amounts ~~funds and is~~ included in ~~cash~~income ~~and~~related ~~cash~~to ~~equivalents,~~derivative ~~funds~~contract ~~on deposit and other noncurrent~~ assets ~~in the consolidated balance sheet. GenOn Americas Generation had $508 million of interest-bearing funds included in cash~~ and ~~cash~~liabilities ~~equivalents,~~(including $2amounts ~~million~~with ~~included~~affiliates) inclassified ~~funds~~as ~~on deposit and $37 million included in other noncurrent assets.~~Level 3:

	Three Months Ended March 31,
	2012							2011
	Operating Revenues		Cost of Fuel, Electricity and Other Products			Total		Operating Revenues		Cost of Fuel, Electricity and Other Products		Total
	(in millions)

Gains (losses) included in income	$	29	$	(27	)	$	2	$	3	$	12	$	15
Gains (losses) included in income (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at March 31	$	28	$	(27	)	$	1	$	3	$	13	$	16

~~Table of Contents~~20

~~The~~Table ~~following is a reconciliation~~ of changes (composed of the sum of the quarterly changes) in fair value of net commodity derivative contract assets and liabilities classified as Level 3 during the nine months ended September 30, 2011 and 2010, respectively: Contents

		September 30,			September 30,			September 30,
	Net Derivatives Contracts (Level 3)
	AssetManagement			Trading Activities			Total
	(in millions)
Balance, January 1, 2011 (net asset (liability))	$	(68	)	$	2		$	(66	)
Total gains (losses) realized/unrealized:
Included in earnings(1)		—			9			9
Purchases(2)		—			—			—
Issuances(2)		—			—			—
Settlements (3)		11			(5	)		6
Transfers into Level 3(4)		—			—			—
Transfers out of Level 3(4)		12			—			12
Balance, September 30, 2011 (net asset (liability))	$	(45	)	$	6		$	(39	)
Balance, January 1, 2010 (net asset (liability))	$	19		$	13		$	32
Total gains (losses) realized/unrealized:
Included in earnings(1)		(45	)		(22	)		(67	)
Purchases(2)		—			—			—
Issuances(2)		—			—			—
Settlements(5)		(80	)		28			(52	)
Transfers in and out of Level 3(4)		38			(1	)		37
Balance, September 30, 2010 (net asset (liability))	$	(68	)	$	18		$	(50	)

Information about Sensitivity to Changes in Significant Unobservable Inputs. The following table presents the range of sensitivity of unobservable inputs used in fair value measurements categorized within Level 3 of the fair value hierarchy:

(1) Represents the fair value, as of the end of each reporting period, of Level 3 contracts entered into during each reporting period and the gains and losses attributable to Level 3 contracts that existed as of the beginning of each reporting period and were still held at the end of each reporting period.

	Quantitative Information about Level 3 Fair Value Measurements
	Net Fair Value at March 31, 2012			Valuation Techniques	Unobservable Input	Range (Weighted Average)(1)
	(in millions)

Credit valuation adjustment	$	(1	)	Internal model	Counterparty credit risk	20% to (20)%	(2)
Credit valuation adjustment	$	4		Internal model	Own credit risk	20% to (20)%	(2)

(21) Excludes ~~Contracts~~immaterial ~~entered~~unobservable ~~into~~inputs ~~during~~related ~~each~~to ~~reporting~~power ~~period~~transmission ~~are~~congestion ~~reported~~products, ~~with~~power ~~other~~swaps ~~changes~~and inpremiums ~~fair~~on ~~value~~physical gas transactions.

(32) Represents ~~Effective~~the ~~January~~range 1,of ~~2011,~~the ~~represents~~credit ~~the~~default ~~reversal~~swap ofspread ~~previously~~curves ~~recognized~~used ~~unrealized~~in ~~gains~~the ~~and~~valuation ~~losses~~analysis ~~from~~that ~~settlement~~we ofthink ~~contracts~~market ~~during~~participants ~~each~~might ~~reporting~~use ~~period~~when pricing the contracts.

~~(4)~~At ~~Denotes~~March 31, ~~the~~2012, ~~total~~net ~~contracts~~fair ~~that~~value ~~existed~~of at$55 ~~the~~million ~~beginning~~ of ~~each~~power ~~reporting~~transactions ~~period~~ and ~~were~~$(90) ~~still~~million ~~held at the end~~ of ~~each~~fuel ~~reporting~~transactions ~~period~~classified ~~that were either previously categorized~~ as aLevel 3 ~~higher~~were ~~level~~priced ~~for~~based ~~which~~on ~~the~~unadjusted ~~inputs~~indicative tobroker ~~the~~quotes ~~model became unobservable or assets and liabilities~~ that ~~were~~cannot ~~previously~~be ~~classified~~corroborated asby ~~Level 3 for which the lowest significant input became~~ observable ~~during~~market ~~each~~data. Quantitative ~~reporting~~information ~~period.~~is ~~Amounts~~excluded ~~reflect~~for these fair value ~~as of the end of each reporting period~~measurements.

~~(5)~~GenOn ~~Represents the total cash settlements of contracts during each reporting period that existed at the beginning of each reporting period.~~Mid-Atlantic

21Fair Value of Derivative Instruments and Certain Other Assets. The fair value measurements of GenOn Mid-Atlantic’s financial assets and liabilities (including amounts with affiliates) by class are as follows:

	March 31, 2012
	Level 1(1)		Level 2(1) (2)		Level 3		Total Fair Value
	(in millions)
Derivative contract assets:
Commodity Contracts
Asset Management:
Power	$	58	$	1,061	$	—	$	1,119
Fuel	—		1		5		6
Total derivative contract assets	$	58	$	1,062	$	5	$	1,125

Derivative contract liabilities:
Commodity Contracts
Asset Management:
Power	$	42	$	152	$	—	$	194
Fuel	3		1		93		97
Total derivative contract liabilities	$	45	$	153	$	93	$	291

Interest-bearing funds(3)	$	312	$	—	$	—	$	312

~~The~~(1) Transfers ~~following~~between ~~table~~Level ~~presents~~1 and Level 2 are recognized as of the ~~amounts~~end ~~included~~of inthe ~~income~~reporting ~~related~~period. There towere ~~derivative~~no ~~contract assets~~transfers ~~and~~during ~~liabilities~~the ~~classified~~three asmonths ~~Level~~ended March 3:31, 2012.

		September 30,			September 30,			September 30,			September 30,			September 30,		September 30,
	Three Months Ended September 30,
	2011									2010
	OperatingRevenues			Cost of Fuel,Electricityand OtherProducts			Total			OperatingRevenues			Cost of Fuel,Electricityand OtherProducts		Total
	(in millions)
Gains (losses) included in income	$	(3	)	$	(7	)	$	(10	)	$	(1	)	$	24	$	23
Gains (losses) included in income (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at September 30	$	(2	)	$	(6	)	$	(8	)	$	(1	)	$	24	$	23

(2) Option contracts comprised less than 1% of GenOn Mid-Atlantic’s net derivative contract assets.

		September 30,		September 30,		September 30,		September 30,		September 30,			September 30,
	Nine Months Ended September 30,
	2011						2010
	OperatingRevenues		Cost of Fuel,Electricityand OtherProducts		Total		OperatingRevenues		Cost of Fuel,Electricityand OtherProducts			Total
	(in millions)
Gains (losses) included in income	$	7	$	20	$	27	$	1	$	(83	)	$	(82	)
Gains (losses) included in income (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at September 30	$	8	$	22	$	30	$	6	$	(83	)	$	(77	)

(3) Represents investments in money market funds and are included in cash and cash equivalents, funds on deposit and other noncurrent assets in the consolidated balance sheet. GenOn Mid-Atlantic had $115 million of interest-bearing funds included in cash and cash equivalents and $197 million included in funds on deposit.

22 21

Table of Contents

GenOn Mid-Atlantic

	December 31, 2011
	Level 1(1)		Level 2(1) (2)		Level 3		Total Fair Value
	(in millions)
Derivative contract assets:
Commodity Contracts
Asset Management:
Power	$	39	$	982	$	—	$	1,021
Fuel	—		—		9		9
Total derivative contract assets	$	39	$	982	$	9	$	1,030

Derivative contract liabilities:
Commodity Contracts
Asset Management:
Power	$	29	$	131	$	1	$	161
Fuel	3		—		72		75
Total derivative contract liabilities	$	32	$	131	$	73	$	236

Interest-bearing funds(3)	$	230	$	—	$	—	$	230

~~Fair~~(1) Transfers ~~Value~~between ofLevel 1 ~~Derivative Instruments~~ and ~~Certain~~Level 2 ~~Other~~are ~~Assets.~~recognized ~~The~~as ~~fair~~of ~~value~~the ~~measurements~~end of ~~GenOn~~the ~~Mid-Atlantic’s~~reporting ~~financial~~period. There ~~assets~~were ~~and~~no ~~liabilities~~significant bytransfers ~~class~~during ~~are as follows:~~ 2011.

		September 30,		September 30,		September 30,		September 30,
	September 30, 2011
	Level 1(1)		Level 2(1) (2)		Level 3		TotalFair Value
	(in millions)
Derivative contract assets:
Commodity Contracts
Asset Management:
Power	$	6	$	748	$	—	$	754
Fuel		—		1		18		19
Total derivative contract assets	$	6	$	749	$	18	$	773
Derivative contract liabilities:
Commodity Contracts
Asset Management:
Power	$	18	$	73	$	1	$	92
Fuel		2		—		66		68
Total derivative contract liabilities	$	20	$	73	$	67	$	160
Interest-bearing funds(3)	$	277	$	—	$	—	$	277

(2) Option contracts comprised less than 1% of GenOn Mid-Atlantic’s net derivative contract assets.

(13) Represents ~~Transfers~~investments ~~between~~in ~~Level~~money 1market funds and ~~Level~~are 2included ~~are~~in ~~recognized~~cash asand ofcash ~~the~~equivalents ~~end~~and offunds on deposit in the ~~reporting~~consolidated ~~period~~balance sheet. GenOn ~~There~~Mid-Atlantic ~~were~~had no$64 million ~~significant~~of ~~transfers~~interest-bearing ~~during~~funds ~~the~~included ~~nine~~in ~~months~~cash ~~ended~~and ~~September~~cash ~~30,~~equivalents ~~2011~~and $166 million included in funds on deposit.

~~(2) Option contracts comprised less than 1% of GenOn Mid-Atlantic’s net derivative contract assets.~~22

~~(3)~~Table Represents investments in money market funds and are included in cash and cash equivalents, funds on deposit and other noncurrent assets in the consolidated balance sheet. GenOn Mid-Atlantic had $79 million of ~~interest-bearing funds included in cash and cash equivalents, $166 million included in funds on deposit and $32 million included in other noncurrent assets.~~Contents

		September 30,		September 30,		September 30,		September 30,
	December 31, 2010
	Level 1(1)		Level 2(1) (2)		Level 3		TotalFair Value
	(in millions)
Derivative contract assets:
Commodity Contracts
Asset Management:
Power	$	1	$	986	$	—	$	987
Fuel		—		2		31		33
Total derivative contract assets	$	1	$	988	$	31	$	1,020
Derivative contract liabilities:
Commodity Contracts
Asset Management:
Power	$	12	$	231	$	1	$	244
Fuel		—		—		99		99
Total derivative contract liabilities	$	12	$	231	$	100	$	343
Interest-bearing funds(3)	$	234	$	—	$	—	$	234

The following is a reconciliation of changes (composed of the sum of the quarterly changes) in fair value of net commodity derivative contract assets and liabilities (including amounts with affiliates) classified as Level 3 during the three months ended March 31, 2012 and 2011:

(1) Transfers between Level 1 and Level 2 are recognized as of the end of the reporting period. There were no significant transfers during 2010.

	Asset Management
	(in millions)

Balance, January 1, 2012 (net asset (liability))	$	(64	)
Total gains (losses) realized/unrealized:
Included in earnings(1)	(43		)
Purchases(2)	—
Issuances(2)	—
Settlements(3)	19
Transfers into Level 3(4)	—
Transfers out of Level 3(4)	—
Balance, March 31, 2012 (net asset (liability))	$	(88	)

Balance, January 1, 2011 (net asset (liability))	$	(69	)
Total gains (losses) realized/unrealized:
Included in earnings(1)	14
Purchases(2)	—
Issuances(2)	—
Settlements(3)	(2		)
Transfers into Level 3(4)	—
Transfers out of Level 3(4)	—
Balance, March 31, 2011 (net asset (liability))	$	(57	)

(21) Represents ~~Option~~the fair value, as of the end of each reporting period, of Level 3 contracts ~~comprised~~entered ~~less~~into ~~than~~during 1%each reporting period and the gains and losses attributable to Level 3 contracts that existed as of ~~GenOn~~the ~~Mid-Atlantic’s~~beginning ~~net~~of ~~derivative~~each ~~contract~~reporting ~~assets~~period and were still held at the end of each reporting period.

(32) Contracts ~~Represents~~entered ~~investments~~into induring ~~money~~each ~~market~~reporting ~~funds~~period ~~and~~ are ~~included~~reported inwith ~~cash and cash equivalents, funds on deposit and~~ other ~~noncurrent~~changes ~~assets~~ in ~~the~~fair ~~consolidated balance sheet~~value. ~~GenOn Mid-Atlantic had $202 million of interest-bearing funds included in cash and cash equivalents, $2 million included in funds on deposit and $30 million included in other noncurrent assets.~~

23(3) Represents the reversal of previously recognized unrealized gains and losses from settlement of contracts during each reporting period.

~~Table~~(4) Denotes the total contracts that existed at the beginning of ~~Contents~~each reporting period and were still held at the end of each reporting period that were either previously categorized as a higher level for which the inputs to the model became unobservable or assets and liabilities that were previously classified as Level 3 for which the lowest significant input became observable during each reporting period. Amounts reflect fair value as of the end of each reporting period.

The following istable apresents ~~reconciliation of changes (composed of~~ the ~~sum~~amounts ofincluded ~~the quarterly changes)~~ in ~~fair~~income ~~value~~related ofto ~~net commodity~~ derivative contract assets and liabilities ~~classified~~(including asamounts ~~Level 3~~with ~~during~~affiliates) ~~the~~classified ~~nine~~as ~~months ended September~~Level ~~30, 2011 and 2010, respectively~~3:

		September 30,
	Three Months Ended March 31,
	AssetManagement
	2012									2011
	(in millions)
	Operating Revenues			Cost of Fuel, Electricity and Other Products			Total			Operating Revenues		Cost of Fuel, Electricity and Other Products		Total
Balance, January 1, 2011 (net asset (liability))	$	(69	)
	(in millions)
Total gains (losses) realized/unrealized:
Gains (losses) included in income	$	1		$	(25	)	$	(24	)	$	—	$	12	$	12
Included in earnings(1)		(5	)
Gains (losses) included in income (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at March 31	$	—		$	(25	)	$	(25	)	$	—	$	12	$	12
Purchases(2)		—
Issuances(2)		—
Settlements(3)		13
Transfers into Level 3(4)		—
Transfers out of Level 3(4)		12
Balance, September 30, 2011 (net asset (liability))	$	(49	)
Balance, January 1, 2010 (net asset (liability))	$	13
Total gains (losses) realized/unrealized:
Included in earnings(1)		(64	)
Purchases(2)		—
Issuances(2)		—
Settlements(5)		(63	)
Transfers in and out of Level 3(4)		38
Balance, September 30, 2010 (net asset (liability))	$	(76	)

~~(2)~~Table ~~Contracts~~of ~~entered into during each reporting period are reported with other changes in fair value.~~Contents

~~(3)~~Information ~~Effective~~about ~~January~~Sensitivity 1,to ~~2011,~~Changes ~~represents~~in Significant Unobservable Inputs. The following table presents the ~~reversal~~range of ~~previously~~sensitivity ~~recognized~~of ~~unrealized~~unobservable ~~gains~~inputs ~~and~~used ~~losses~~in ~~from~~fair ~~settlement~~value ofmeasurements ~~contracts~~categorized ~~during~~within ~~each~~Level ~~reporting~~3 ~~period.~~of the fair value hierarchy:

(4) Denotes the total contracts that existed at the beginning of each reporting period and were still held at the end of each reporting period that were either previously categorized as a higher level for which the inputs to the model became unobservable or assets and liabilities that were previously classified as Level 3 for which the lowest significant input became observable during each reporting period. Amounts reflect fair value as of the end of each reporting period.

	Quantitative Information about Level 3 Fair Value Measurements
	Net Fair Value at March 31, 2012			Valuation Techniques	Unobservable Input	Range (Weighted Average)(1)
	(in millions)

Credit valuation adjustment	$	(1	)	Internal model	Counterparty credit risk	20% to (20)%	(2)
Credit valuation adjustment	$	3		Internal model	Own credit risk	20% to (20)%	(2)

(51) Excludes ~~Represents~~immaterial ~~the~~unobservable ~~total~~inputs ~~cash~~related ~~settlements~~to ofpower ~~contracts~~transmission ~~during~~congestion ~~each reporting period that existed at the beginning of each reporting period~~products.

24(2) Represents the range of the credit default swap spread curves used in the valuation analysis that we think market participants might use when pricing the contracts.

~~Table~~At March 31, 2012, net fair value of ~~Contents~~$(90) million of fuel transactions classified as Level 3 were priced based on unadjusted indicative broker quotes that cannot be corroborated by observable market data. Quantitative information is excluded for these fair value measurements.

~~The~~Counterparty ~~following~~Credit ~~table~~Concentration ~~presents the amounts included in income related to derivative contract assets and liabilities classified as Level 3:~~ Risk

		September 30,			September 30,			September 30,			September 30,			September 30,		September 30,
	Three Months Ended September 30,
	2011									2010
	OperatingRevenues			Cost of Fuel,Electricityand OtherProducts			Total			OperatingRevenues			Cost of Fuel,Electricityand OtherProducts		Total
	(in millions)
Gains (losses) included in income	$	(5	)	$	(7	)	$	(12	)	$	(1	)	$	24	$	23
Gains (losses) included in income (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at September 30	$	(7	)	$	(7	)	$	(14	)	$	(1	)	$	24	$	23

We are exposed to the default risk of the counterparties with which we transact. We manage our credit risk by entering into master netting agreements and requiring counterparties to post cash collateral or other credit enhancements based on the net exposure and the credit standing of the counterparty. We also have non-collateralized power hedges entered into by GenOn Mid-Atlantic. These transactions are senior unsecured obligations of GenOn Mid-Atlantic and the counterparties and do not require either party to post cash collateral for initial margin and, except as described in the next sentence, changes in power or natural gas prices. Beginning in April 2012, certain agreements entered into by GenOn Mid-Atlantic were amended to provide for the counterparty thereto to post collateral to secure credit exposure above the agreed threshold as a result of changes in power or natural gas prices. GenOn Americas Generation and GenOn Mid-Atlantic credit valuation adjustments on derivative contract assets were $23 million and $47 million at March 31, 2012 and December 31, 2011, respectively.

		September 30,			September 30,		September 30,		September 30,		September 30,		September 30,
	Nine Months Ended September 30,
	2011							2010
	OperatingRevenues			Cost of Fuel,Electricityand OtherProducts		Total		OperatingRevenues		Cost of Fuel,Electricityand OtherProducts		Total
	(in millions)
Gains (losses) included in income	$	—		$	20	$	20	$	2	$	2	$	4
Gains (losses) included in income (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at September 30	$	(2	)	$	21	$	19	$	2	$	2	$	4

At March 31, 2012 and December 31, 2011, $1 million and $4 million, respectively, of cash collateral posted to GenOn Americas Generation by counterparties under master netting agreements were included in accounts payable and accrued liabilities in GenOn Americas Generation’s consolidated balance sheets.

~~Counterparty~~We ~~Credit~~monitor ~~Concentration~~counterparty ~~Risk~~credit concentration risk on both an individual basis and a group counterparty basis. The following tables highlight the credit quality and the balance sheet settlement exposures related to these activities:

We are exposed to the default risk of the counterparties with which we transact. We manage our credit risk by entering into master netting agreements and requiring counterparties to post cash collateral or other credit enhancements based on the net exposure and the credit standing of the counterparty. We also have non-collateralized power hedges entered into by GenOn Mid-Atlantic. These transactions are senior unsecured obligations of GenOn Mid-Atlantic and the counterparties and do not require either party to post cash collateral for initial margin or for securing exposure as a result of changes in power or natural gas prices. GenOn Americas Generation and GenOn Mid-Atlantic credit valuation adjustments on derivative contract assets were $50 million and $19 million at September 30, 2011 and December 31, 2010, respectively. 24

AtTable ~~September 30, 2011 and December 31, 2010, $3 million~~ of cash collateral posted to GenOn Americas Generation by counterparties under master netting agreements was included in accounts payable and accrued liabilities on GenOn Americas Generation’s consolidated balance sheets. Contents

25GenOn Americas Generation

	March 31, 2012
Credit Rating Equivalent	Gross Exposure Before Collateral(1)		Net Exposure Before Collateral(2)		Collateral(3)		Exposure Net of Collateral		% of Net Exposure
	(dollars in millions)

Clearing and Exchange	$	891	$	292	$	292	$	—	—
Investment Grade:
Financial institutions	898		854		—		854		81	%
Energy companies	465		167		—		167		16	%
Non-investment Grade:
Energy companies	7		2		1		1		—
No External Ratings:
Internally-rated investment grade	22		21		—		21		2	%
Internally-rated non-investment grade	9		9		—		9		1	%
Total	$	2,292	$	1,345	$	293	$	1,052	100	%

We also monitor counterparty credit concentration risk on both an individual basis and a group counterparty basis. The following tables highlight the credit quality and the balance sheet settlement exposures related to these activities:

	December 31, 2011
Credit Rating Equivalent	Gross Exposure Before Collateral(1)		Net Exposure Before Collateral(2)		Collateral(3)		Exposure Net of Collateral		% of Net Exposure
	(dollars in millions)

Clearing and Exchange	$	710	$	217	$	217	$	—	—
Investment Grade:
Financial institutions	856		814		—		814

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