New NRG Energy CEO leans into growth with ‘bring your own power’ for the AI boom and affordability with ‘virtual power plants’

Robert Gaudette took over as the new CEO of power and electricity giant NRG Energy at the end of April ready to ride the AI wave and build the “bespoke desires and needs” of hyperscalers nationwide. But NRG isn’t only in the business of rapidly building new power plants—primarily gas-fired facilities—to satiate the hunger of data centers. NRG also is leaning into the burgeoning business of turning the United States’ dumb power grid smart with better technology and efficiency. That’s where demand-response programs and so-called “virtual power plants” come into play, convincing both industrial users and residential customers to turn their thermostats over to AI at times of peak demand—and returning excess renewable energy back to the grid if available—to save energy and keep energy prices lower, essentially acting as a de facto power plant. NRG (No. 153 on the Fortune 500) represents a tale of two strategies—rapid power growth to satisfy demand and smarter grid efficiency to help solve the rising utility bill woes that are triggering AI backlashes nationwide. “We’ve barely started the first inning from a VPP-virtual power plant perspective,” Gaudette told Fortune in a sit-down interview. “Where we are today is now we have an affordability issue. Now we have a need. You have the combination of technology, willingness, and the economic desire to find a way to mobilize the power of the consumer to make a difference.” Scaling up quickly Early this year, NRG closed the roughly $10 billion acquisition of 18 natural gas-fired power plants from LS Power, nearly doubling NRG’s power generation nationwide. NRG also recently partnered with GE Vernova and Kiewit for 5.4 gigawatts—enough to power 4 million homes—of gas-fired turbines to power data center campuses. Gaudette is leaning into those two acronyms, VPP and BYOP—bring your own power—paid for by hyperscalers and built by NRG. “NRG is uniquely positioned with two attacks on how we solve the challenges,” he said. NRG is push