<PAGE>
                                    
                              UNITED STATES
                   SECURITIES AND EXCHANGE COMMISSION
                                    
                         Washington, D.C. 20549
                                    
                                FORM 10-Q
                               ___________
                                    
                               (Mark one)
   
    X   QUARTERLY  REPORT  PURSUANT TO SECTION 13  OR  15(d)  OF  THE
        SECURITIES  EXCHANGE  ACT OF 1934 FOR  THE  QUARTERLY  PERIOD
        ENDED MARCH 31, 1998
   
                                   OR
                                    
    _   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 1-9208
   
                       NRG GENERATING (U.S.) INC.
           (Exact name of Registrant as Specified in Charter)
                                    
             Delaware                          59-2076187
   (State or other jurisdiction             (I.R.S. Employer
         of incorporation)                 Identification No.)
                               ___________
                                    
                      1221 Nicollet Mall, Suite 610
                    Minneapolis, Minnesota 55403-2445
           (Address of principal executive offices) (Zip Code)
                                    
   Registrant's telephone number, including area code: (612) 373-8834
                                    
     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.     X    Yes                No
   
      APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                    DURING THE PRECEDING FIVE YEARS:
                                    
     Indicate  by  check mark whether the registrant  has  filed  all
   documents and reports required to be filed by Sections 12,  13  or
   15(d)  of  the Securities Exchange Act of 1934 subsequent  to  the
   distribution  of  securities under a plan confirmed  by  a  court.
       X    Yes                 No
   
                  APPLICABLE ONLY TO CORPORATE ISSUERS:
                                    
     Indicate  the  number  of  shares outstanding  of  each  of  the
   issuer's  classes  of  common stock as of the  latest  practicable
   date:  6,836,769  shares  of Common Stock,  $0.01  par  value  per
   share, as of May 11, 1998.
   
<PAGE>                                    
                                    
                       NRG GENERATING (U.S.) INC.
                                FORM 10-Q
                             March 31, 1998
                                    
                                  INDEX
                                    
                                    
                                                                   Page
Part I - Financial Information:

     Item  1.  Financial Statements                                  3

          Consolidated Balance Sheets -
            March 31, 1998 and December 31, 1997                     3
          Consolidated Statements of Operations -
            Three months ended March 31, 1998 and March 31, 1997     4
          Consolidated Statements of Cash Flows -
            Three months ended March 31, 1998 and March 31, 1997     5
          Notes to Consolidated Financial Statements                 6

     Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations                    8


Part II - Other Information

     Item 1.  Legal Proceedings                                     15

     Item 3.  Defaults Upon Senior Securities                       16

     Item 6.  Exhibits and Reports on Form 8-K                      17

     Signature                                                      18

     Index to Exhibits                                              19

                                   2

<PAGE>

                                 PART 1

                          FINANCIAL INFORMATION

Item 1.  FINANCIAL STATEMENTS

                       NRG GENERATING (U.S.) INC.
                       CONSOLIDATED BALANCE SHEETS
                         (Dollars in thousands)

<TABLE>
<CAPTION>
                                 ASSETS
                                                                   March 31,    December 31,
                                                                      1998          1997
                                                                   (Unaudited)
<S>                                                              <C>          <C>
Current assets:
  Cash and cash equivalents....................................  $     4,979  $    3,444
  Restricted cash and cash equivalents.........................        8,634       8,527
  Accounts receivable, net.....................................       11,401      11,099
  Receivables from related parties.............................           65          87
  Notes receivable, current....................................            1          27
  Inventories..................................................        2,131       2,134
  Other current assets.........................................          696       1,022
                                                                                        
    Total current assets.......................................       27,907      26,340
                                                                                        
Property, plant and equipment, net.............................      125,908     127,574
Property under construction....................................       71,274      46,247
Project development costs......................................          129         129
Investments in equity affiliates...............................       14,394      13,381
Deferred financing costs, net..................................        5,518       5,643
Deferred tax assets, net.......................................        7,996       7,996
Other assets...................................................          557         584
                                                                                        
    Total assets...............................................  $   253,683  $  227,894
</TABLE>

<TABLE>
<CAPTION>
                  LIABILITIES AND STOCKHOLDERS' EQUITY
<S>                                                              <C>          <C>    
Current liabilities:                                                                    
  Current portion of loans and payables due NRG Energy, Inc....  $     1,966  $    2,864
  Current portion of nonrecourse long-term debt................        8,796       8,525
  Current portion of recourse long-term debt...................          455         495
  Short-term borrowings........................................        1,793       1,313
  Accounts payable.............................................       23,270      20,582
  Prepetition liabilities......................................          780         775
  Other current liabilities....................................        2,678       3,083
                                                                                        
    Total current liabilities..................................       39,738      37,637
                                                                                        
Loans due NRG Energy, Inc......................................        4,439       4,439
Nonrecourse long-term debt.....................................      186,000     165,020
Recourse long-term debt........................................       25,000      25,000

    Total liabilities..........................................      255,177     232,096
                                                                                        
Stockholders' equity (deficit):                                                         
  Preferred stock, par value $.01, 20,000,000 shares                                    
    authorized; none issued or outstanding.....................            -           -
  New common stock, par value $.01, 50,000,000 shares                                   
    authorized, 6,871,069 shares issued,                                                
    6,836,769 shares outstanding as of                                                  
    March 31, 1998 and December 31, 1997, respectively.........           68          68
  Additional paid-in capital...................................       65,715      65,715
  Accumulated deficit..........................................      (66,919)    (69,592)
  Accumulated other comprehensive income (loss)................         (358)       (393)
                                                                                        
    Total stockholders' equity (deficit).......................       (1,494)     (4,202)
                                                                                        
    Total liabilities and stockholders' equity (deficit).......  $   253,683  $  227,894
</TABLE>

The accompanying notes are an integral part of these consolidated
financial statements.

                                   3

<PAGE>

                       NRG GENERATING (U.S.) INC.
            CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
            (Dollars in thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                            Three Months Ended
                                                          March 31,    March 31,
                                                            1998         1997
<S>                                                     <C>          <C>
REVENUES:                                                                       
 Energy revenues................................        $    11,283  $    12,391
 Equipment sales and services...................              5,471        4,606
 Rental revenues................................                875          460
                                                                                
                                                             17,629       17,457
                                                                                
COST OF REVENUES:                                                               
 Cost of energy revenues........................              3,513        3,160
 Cost of equipment sales and services...........              4,739        3,899
 Cost of rental revenues........................                650          383
                                                                                
                                                              8,902        7,442
                                                                                
   Gross profit.................................              8,727       10,015
                                                                                
Selling, general and                                                            
 administrative expenses........................              2,107        2,253
                                                                                
   Income from operations.......................              6,620        7,762
                                                                                
Interest and other income.......................                218          162
Equity in earnings of affiliates................              1,007           39
Interest and debt expense.......................             (3,553)      (3,537)
                                                                                
   Income before income taxes...................              4,292        4,426
                                                                                
Provision for income taxes......................              1,619          339
                                                                                
   Net income...................................        $     2,673  $     4,087
                                                                                
Basic earnings per share........................        $      0.39  $      0.63
                                                                                
Diluted earnings per share......................        $      0.38  $      0.62
                                                                                
Weighted average shares outstanding (Basic).....              6,837        6,441
                                                                                
Weighted average shares outstanding (Diluted)...              7,010        6,624
</TABLE>


The accompanying notes are an integral part of these consolidated
financial statements.

                                   4

<PAGE>

                       NRG GENERATING (U.S.) INC.
            CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
                         (Dollars in thousands)

<TABLE>
<CAPTION>                                    
                                                                   Three Months Ended
                                                                  March 31,   March 31,
                                                                    1998         1997
<S>                                                             <C>         <C>
Cash Flows from Operating Activities:                                                  
 Net income...................................................  $     2,673 $     4,087
 Adjustments to reconcile net income to net                                            
   cash provided by operating activities:                                              
      Depreciation and amortization............................       2,106       1,973
      Equity in earnings of affiliates.........................      (1,007)        (39)
      Gain on disposition of property and equipment............         (67)          -
      Other, net...............................................          29         594
     Changes in operating assets and liabilities:                                      
        Accounts receivable, net...............................        (302)       (560)
        Inventories............................................           3         178
        Receivables from related parties.......................          22          86
        Other assets...........................................         325         626
        Accounts payable and other current liabilities.........      (1,303)         37
                                                                                       
          Net cash provided by operating activities............       2,479       6,982
                                                                                       
Cash Flows from Investing Activities:                                                  
  Capital expenditures.........................................     (25,314)       (291)
  Proceeds from disposition of property and equipment..........          71         175
  Project development costs....................................           -         (15)
  Collections on notes receivable..............................          26         277
  Deposits into restricted cash accounts, net..................        (102)     (2,065)
                                                                                       
          Net cash used in investing activities................     (25,319)     (1,919)
                                                                                       
Cash Flows from Financing Activities:                                                  
  Proceeds from long-term debt.................................      23,387           -
  Repayments of long-term debt.................................      (2,176)     (2,715)
  Net proceeds (repayments) of short-term borrowings...........       3,168        (266)
  Payments of prepetition liabilities..........................           -        (408)
  Deferred financing costs.....................................          (4)          -
                                                                                       
          Net cash provided by (used) in financing activities..      24,375      (3,389)
                                                                                       
 Net increase in cash and cash equivalents.....................       1,535       1,674
 Cash and cash equivalents, beginning of period................       3,444       3,187
 Cash and cash equivalents, end of period......................  $    4,979 $     4,861


Supplemental disclosure of cash flow information:
  Interest paid..............................................    $    3,327 $     3,537
  Income taxes paid..........................................           347         389
</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.

                                   5

<PAGE>

                       NRG GENERATING (U.S.) INC.
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                             MARCH 31, 1998
                         (Dollars in thousands)
                                    
1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      NRG  Generating  (U.S.) Inc. (the "Company") and  its  subsidiaries
develop  and  own  cogeneration projects which  produce  electricity  and
thermal  energy  for sale to industrial and commercial users  and  public
utilities.  In addition, the Company, through its subsidiaries, sells and
rents  power generation, cogeneration and standby/peak shaving  equipment
and services.

      Basis of Presentation

      The  consolidated financial statements include the accounts of  all
majority-owned subsidiaries and all significant intercompany accounts and
transactions   have   been   eliminated.    Investments   in   companies,
partnerships and projects that are more than 20% but less than  majority-
owned are accounted for by the equity method.

      The  accompanying unaudited consolidated financial  statements  and
notes should be read in conjunction with the Company's Report on Form 10-
K  for  the  year ended December 31, 1997.  In the opinion of management,
the  consolidated financial statements reflect all adjustments  necessary
for  a  fair  presentation of the interim periods presented.  Results  of
operations  for  an  interim period may not give  a  true  indication  of
results for the year.

      Reclassifications

      Certain  reclassifications have been made to conform  prior  year's
data  to the current presentation.  These reclassifications had no impact
on previously reported net income or stockholders' deficit.

      Net Earnings Per Share

      Basic  earnings per share includes no dilution and is  computed  by
dividing  net  income available to common stockholders  by  the  weighted
average  shares outstanding.  Diluted earnings per share is  computed  by
dividing  net income by the weighted average shares of common  stock  and
dilutive  common  stock equivalents outstanding.  The Company's  dilutive
common stock equivalents result from stock options and are computed using
the treasury stock method.

<TABLE>
<CAPTION>

                               Three Months Ended                   Three Months Ended
                                 March 31, 1998                       March 31, 1997
                         Income         Shares               Income        Shares
                      (Numerator)   (Denominator)   EPS    (Numerator)  (Denominator)   EPS
<S>                   <C>           <C>           <C>      <C>          <C>           <C>
Net income:                                                                               
 Basic EPS            $     2,673          6,837  $ 0.39   $     4,087         6,441  $ 0.63
 Effect of dilutive                                                                         
   stock options                -            173                     -           183       
                                                                                            
 Diluted EPS          $     2,673          7,010  $ 0.38   $     4,087         6,624  $ 0.62
</TABLE>

                                   6

<PAGE>

2.    LOANS DUE NRG ENERGY, INC.

      Of the  March 31, 1998  loan balance of $4,439 due  to NRG  Energy,
Inc. ("NRG  Energy"), $2,539 has a maturity  date  of April 30, 2001  and
$1,900 has a maturity date of July 1, 2005.

3.    COMPREHENSIVE INCOME

      During the three  months ended March 31, 1998, the Company  adopted
the  provisions of Statement of Financial Accounting Standards  No.  130,
"Reporting  Comprehensive Income."  Total comprehensive  income  for  the
quarter   ended  March  31,  1998  and  1997  was  $2,315   and   $4,016,
respectively.  The difference between total comprehensive income and  net
income  for  the  above  periods was due to foreign currency  translation
adjustments.

4.    LITIGATION

      The Company's  wholly-owned subsidiary through which it owns a one-
third  interest in the Grays Ferry Cogeneration Partnership  (the  "Grays
Ferry Partnership"), filed suit as one of three Plaintiffs (including the
Grays Ferry Partnership) in an action brought against PECO Energy Company
("PECO")  on March 9, 1998, in the United States District Court  for  the
Eastern  District  of  Pennsylvania,  for  PECO's  refusal  to  pay   the
partnership  the  electricity  rates set  forth  in  the  power  purchase
agreements.  On March 19, 1998, the federal district court dismissed  the
federal  lawsuit for lack of subject matter jurisdiction.  On  March  27,
1998, the Plaintiffs filed a motion for reconsideration and leave to file
an amended complaint.  On April 13, 1998 the federal district court judge
denied  the  Plaintiffs' motion.  The Plaintiffs thereafter filed  a  new
lawsuit  in  state court in Pennsylvania seeking, among other things,  to
enjoin  PECO  from  terminating its power purchase  agreements  with  the
partnership and to compel PECO to pay the electricity rates set forth  in
the  agreements.  On May 5, 1998, the Grays Ferry Partnership obtained  a
preliminary injunction enjoining PECO from terminating the power purchase
agreements  and  ordering PECO to comply with  the  terms  of  the  power
purchase  agreements pending the outcome of the litigation.  The Court of
Common Pleas  in  Philadelphia also ordered  PECO  to abide by all of the
terms and conditions of  the  power purchase agreements and pay the rates
set forth in the agreements.   The Plaintiffs  were  required  to  post a
bond in the amount of $50  in connection with the preliminary injunction.
On May 8, 1998, PECO filed a notice  of  appeal and a  motion to stay the
preliminary injunction order.  On  May 13, 1998, the Grays Ferry Partner-
ship filed an emergency petition for  contempt to compel PECO  to pay the
amounts due and owing  under  the power  purchase  agreements.  The Grays
Ferry Partnership  is  vigorously pursuing  the  litigation  and  expects
to  achieve a favorable result.  No provision for loss has been recorded.

      For additional  information see "Part I - Financial  Information  -
Item  2. Management's Discussion and Analysis of Financial Condition  and
Results  of  Operations - Liquidity and Capital Resources;"  "Part  II  -
Other  Information - Item 1. Legal Proceedings;" and  "Part  II  -  Other
Information - Item 3. Defaults Upon Senior Securities."

                                   7

<PAGE>

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND
         RESULTS OF OPERATIONS

      The  information contained  in this  Item 2 updates, and  should be
read in conjunction  with, the  information set forth in Part II, Item 7,
of  the Company's  Report on  Form 10-K for  the year  ended December 31,
1997.  Capitalized terms used in this Item 2 which are not defined herein
have the meaning ascribed to such terms in the  Notes  to  the  Company's
financial  statements  included in Part I,  Item 1 of this Report on Form
10-Q.  All dollar amounts (except per share amounts) set  forth  in  this
Report are in thousands.

      Except for the historical information contained in this Report, the
matters  reflected  or  discussed in this  Report  which  relate  to  the
Company's beliefs, expectations, plans, future estimates and the like are
forward-looking  statements within the meaning  of  Section  27A  of  the
Securities  Act  of 1933, as amended, and Section 21E of  the  Securities
Exchange  Act  of 1934, as amended.  Such forward-looking statements  are
not   guarantees  of  future  performance  and  are  subject  to   risks,
uncertainties  and  other  factors that may  cause  the  actual  results,
performance  or  achievements of the Company to  differ  materially  from
historical  results  or from any results expressed  or  implied  by  such
forward-looking  statements.  Such factors include,  without  limitation,
uncertainties inherent in predicting the outcome of litigation and  other
factors  discussed in this report and the Company's Report on  Form  10-K
for  the year ended December 31, 1997 entitled "Item 1.  Business -  Risk
Factors."   Many  of  such factors are beyond the  Company's  ability  to
control  or predict, and readers are cautioned not to put undue  reliance
on such forward-looking statements.  The Company disclaims any obligation
to  update  or  review any forward-looking statements contained  in  this
Report  or in any statement referencing this Report, whether as a  result
of new information, future events or otherwise.

General

      The  Company  is engaged primarily in the business  of  developing,
owning and operating cogeneration projects which produce electricity  and
thermal  energy  for sale under long-term contracts with  industrial  and
commercial  users  and  public utilities.   In  addition  to  its  energy
business,  the Company sells and rents power generation and  cogeneration
equipment  through  subsidiaries located in the  United  States  and  the
United Kingdom.

      In  its  role  as a  developer and  owner  of energy projects,  the
Company has developed the following projects in which it currently has an
ownership interest:

          (a)   The  52  megawatt  ("MW") Newark  Boxboard  Project  (the
          "Newark  Project"),  located  in  Newark,  New  Jersey,   began
          operations  in  November 1990, and is owned  by  the  Company's
          wholly-owned  subsidiary NRG Generating  (Newark)  Cogeneration
          Inc. ("Newark");

          (b)   The  122  MW E.I. du Pont de Nemours Parlin Project  (the
          "Parlin  Project"),  located  in  Parlin,  New  Jersey,   began
          operations in June 1991, and is owned by the Company's  wholly-
          owned  subsidiary  NRG  Generating (Parlin)  Cogeneration  Inc.
          ("Parlin");

                                   8

<PAGE>

          (c)    The   22  MW  Philadelphia  Cogeneration  Project   (the
          "Philadelphia   PWD   Project"),   located   in   Philadelphia,
          Pennsylvania, began operations in May 1993, and is owned by  an
          83%-owned subsidiary of the Company; and

          (d)   The  150 MW Grays Ferry Project, located in Philadelphia,
          Pennsylvania,  began operations in January 1998.   The  Company
          owns a one-third interest in the Grays Ferry Partnership, which
          owns the Grays Ferry Project.

      In  December 1997, the Company acquired from NRG Energy  a  117  MW
steam  and  electricity cogeneration project located in Morris,  Illinois
(the   "Morris   Project").   The  Morris  Project  is  currently   under
construction with commercial operation currently expected to occur during
the fourth quarter of 1998.

      The Company's  power purchase  agreements  ("PPAs") with  utilities
have typically contained, and may in the future contain, price provisions
which   in   part  are  linked  to  the  utilities'  cost  of  generating
electricity.  In addition, the Company's fuel supply prices, with respect
to  future  projects,  may be fixed in some cases or  may  be  linked  to
fluctuations  in energy prices.  These circumstances can result  in  high
volatility in gross margins and reduced operating income, either of which
could  have a material adverse effect on the Company's financial position
or  results  of  operations.   Effective  April  30,  1996,  the  Company
renegotiated  its  PPAs  with  Jersey Central  Power  and  Light  Company
("JCP&L"),  the primary electricity purchaser from its Newark and  Parlin
Projects.   Under the new PPAs, JCP&L is responsible for all natural  gas
supply and delivery.  Management believes that this change in these  PPAs
has  reduced its historical volatility in gross margins on revenues  from
such  projects  by eliminating the Company's exposure to fluctuations  in
the  price  of  natural gas that must be paid by its  Newark  and  Parlin
Projects.

      Both  the  Newark and Parlin Projects were previously certified  as
qualifying facilities ("QFs") by the Federal Energy Regulatory Commission
("FERC")  under  the  Public  Utility Regulatory  Policies  Act  of  1978
("PURPA").   The effect of QF status is generally to exempt  a  project's
owners  from  relevant provisions of the Federal Power  Act,  the  Public
Utility  Holding  Company Act of 1935 ("PUHCA"), and  state  utility-type
regulation.   However, as permitted under the terms of  its  renegotiated
PPAs, Parlin has chosen to file rates with FERC as a public utility under
the  Federal Power Act.  The effect of this filing was to relinquish  the
Parlin  Project's claim to QF status.  The FERC approved  Parlin's  rates
effective  April  30,  1996 and has determined Parlin  to  be  an  exempt
wholesale generator ("EWG").  As an EWG, Parlin is exempt from PUHCA, and
the  ownership of Parlin by the Company does not subject the  Company  to
regulation  under  PUHCA.  Finally, as a seller of power  exclusively  at
wholesale,  Parlin is not generally subject to state regulation  and,  in
any  case,  management believes that Parlin complies with all  applicable
requirements of state utility law.

      In  addition  to the energy business, the Company sells  and  rents
power   generation  and  cogeneration  equipment  and  provides   related
services.  The Company operates its equipment sales, rentals and services
business principally through two subsidiaries.  In the United States, the
equipment sales, rentals and services business operates under the name of
O'Brien  Energy  Services  Company ("OES").  NRG  Generating  Limited,  a
wholly-owned  United  Kingdom subsidiary, is the holding  company  for  a
number of subsidiaries

                                   9

<PAGE>

that  operate  in  the  United Kingdom under  the  common  name  of  Puma
("Puma").  The Company has determined that OES and Puma are not a part of
its  strategic plan for the future, and the Company is currently pursuing
several avenues for the disposition of these businesses.  The disposition
of  these  businesses is not expected to have a material  impact  on  the
Company's financial position.

Net Income and Earnings Per Share

      Pre-tax earnings for the 1998 first quarter were $4,292 compared to
$4,426 in  the  prior year  comparable quarter.  Net income  for the 1998
first  quarter  was  $2,673, or diluted  earnings  per  share  of  $0.38,
compared to first quarter  1997 net income of $4,087, or diluted earnings
per share of $0.62.  The decrease in net income is primarily due to lower
income tax expense in  1997 as a result of  recognition of net  operating
loss carryforwards.  During the 1997 fourth quarter, the Company  reduced
the valuation allowance established for net  operating loss carryforwards
and other deferred tax assets,  resulting  in recognition in earnings  of
most remaining net operating loss carryforwards.  Consequently, beginning
with the 1998  first quarter, income taxes are generally  charged against
pre-tax   earnings  without  any   reduction   for  net   operating  loss
carryforwards that continue to be used  to reduce  income taxes currently
payable.   Prior  to  the  1997   fourth  quarter,  net   operating  loss
carryforwards were recognized as a reduction of income tax  expense based
on pre-tax  earnings  reported for the  period.  The decrease  in diluted
earnings per share is due to the higher effective income tax rate  and an
increase in the  weighted  average shares outstanding.  Weighted  average
shares  outstanding  increased  primarily  due  to  the conversion by NRG
Energy  in  October  1997 of  $3,000 of  borrowings  to the Company  into
396,255 shares of the Company's common stock.

      On a pro forma basis, 1997 first quarter net income would have been
$2,662,  or  diluted  earnings  per  share  of  $0.40, assuming  the same
effective tax rate as in the 1998 first quarter.

Revenues

      Energy  revenues for  the first  quarter 1998  of $11,283 decreased
from first quarter 1997 revenues of $12,391.  Energy  revenues  primarily
reflect  billings associated with the Newark and Parlin Projects and  the
Company's Philadelphia PWD Project.  The decrease in energy revenues  was
primarily  attributable to seasonal capacity revenues recognized  in  the
first quarter 1997.

      Revenues recognized at Parlin and Newark were $5,386 and $4,845 for
the  first quarter 1998 and $6,289 and $5,094 for the first quarter 1997,
respectively.  The decreases were primarily due to a milder winter in the
first  quarter 1998 as compared to the comparable period in 1997  and  to
seasonal capacity revenues recognized in the first quarter 1997.

      Energy revenues from the Company's Philadelphia PWD Project for the
first  quarter 1998 of $1,052 increased slightly from first quarter  1997
revenues of $1,008.

      Equipment sales and services revenues for the first quarter 1998 of
$5,471 increased from first quarter 1997 revenues of $4,606.  The revenue
increase is primarily attributable to higher sales volume.

                                   10

<PAGE>

      OES equipment  sales  and services  revenues for the  first quarter
1998 of $2,248 increased from first quarter 1997 revenues of $1,288.  The
increase  is primarily due to higher sales volume.  Puma equipment  sales
and services revenues for the first quarter 1998 of $3,223 decreased from
first quarter 1997 revenues of $3,318.  The decrease was primarily due to
the  unfavorable impact of foreign currency rates in some of Puma's Asian
markets.

      Rental  revenues for the first quarter 1998 of $875 increased  from
first  quarter 1997 revenues of $460.  The increase was due primarily  to
higher  sales  volume  due to the ice storms in the  northeastern  United
States and Canada.

Costs and Expenses

      Cost  of  energy  revenues for the first  quarter  1998  of  $3,513
increased  from  first quarter 1997 costs of $3,160.   The  increase  was
primarily the  result of  depreciation costs  associated  with  equipment
capitalized at the  Newark  and  Parlin facilities  in periods subsequent
to the first quarter of 1997.

      Cost of equipment sales and services for the first quarter 1998  of
$4,739  increased from first quarter 1997 costs of $3,899.  The  increase
was  primarily due to increased costs associated with higher sales volume
at OES.

      Cost  of  rental  revenues  for  the first  quarter  1998  of  $650
increased from first quarter  1997 costs of $383.  The increase was  pri-
marily due to increased  sales volume due to the ice storms in the north-
eastern  United States and Canada.

      The  Company's  gross profit for the first quarter 1998  of  $8,727
(49.5%  of  sales) decreased from the first quarter 1997 gross profit  of
$10,015  (57.4%  of  sales).   The gross  profit  decrease  is  primarily
attributable  to energy segment seasonal capacity revenues recognized  in
the  first quarter of 1997 and to lower gross margin equipment  sales  in
the first quarter 1998.

Selling, General and Administrative Expenses

      Selling, general and administrative expenses ("SG&A") for the first
quarter 1998 of $2,107 decreased from first quarter 1997 SG&A expenses of
$2,253.   The  reduction is primarily due to lower bad  debts  and  lower
insurance costs, offset in part by increased legal expenses.

Interest and Other Income

      Interest  and  other  income for the first  quarter  1998  of  $218
increased from first quarter 1997 interest and other income of $162.  The
increase  was  primarily  attributable to  a  gain  on  the  disposal  of
equipment in the quarter ended March 31, 1998.

                                   11

<PAGE>

Equity in Earnings of Affiliates

      Equity  in  earnings of affiliates for the first  quarter  1998  of
$1,007 increased from first quarter 1997 equity in earnings of affiliates
of  $39.   The  increase was primarily due to the earnings of  the  Grays
Ferry  Project  which commenced operations in January 1998 and  accounted
for  approximately $986 of the Company's equity in earnings of affiliates
for  the  first quarter of 1998.  The earnings of the Grays Ferry Project
reflect  the contract price of electricity under the terms of  the  power
purchase  agreements.  The electric power purchaser from the Grays  Ferry
Project  has  asserted  that  such  power  purchase  agreements  are  not
effective and that the power purchaser is not obligated to pay the  rates
set  forth  in  the  agreements, and the  Company  and  the  Grays  Ferry
Partnership  are in litigation with the power purchaser over that  issue.
The  Grays  Ferry Partnership is vigorously pursuing this litigation  and
expects  to  achieve a favorable result.  For additional information  see
"Part  I  -  Financial Information - Item 2. Management's Discussion  and
Analysis of Financial Condition and Results of Operations - Liquidity and
Capital  Resources" and "Part II - Other Information  -  Item  1.   Legal
Proceedings."

Interest and Debt Expense

      Interest  and  debt expense for the first quarter  1998  of  $3,553
increased from first quarter 1997 interest and debt expense of $3,537.

Income Taxes

      The  income tax provision for the quarter ended March 31,  1998  is
based  on  the effective tax rate expected to be applicable for the  full
year.   During the 1997 fourth quarter, the Company reduced the valuation
allowance established for tax benefits attributable to net operating loss
carryforwards and other deferred tax assets, resulting in recognition  of
most remaining operating loss  carryforwards in 1997 fourth quarter earn-
ings.  Consequently, beginning with the 1998 first quarter,  income taxes
are generally charged against pre-tax earnings without  any reduction for
operating  loss carryforwards that continue to be used to  reduce  income
taxes currently payable.  Prior to the 1997 fourth quarter, net operating
losses were recognized as a reduction of income tax expense based on pre-
tax income reported for the period.

Liquidity and Capital Resources

      In  May  1996, the Company's wholly-owned subsidiaries  Newark  and
Parlin  entered  into a Credit Agreement (the "Credit  Agreement")  which
established  provisions  for  a  $155,000  fifteen-year  loan  (of  which
$141,321  was outstanding at March 31, 1998) and a $5,000 five-year  debt
service  reserve  line of credit.  The interest rate on  the  outstanding
principal is variable based on, at the option of Newark and Parlin, LIBOR
plus  a  1.125% margin or a defined base rate plus a 0.375% margin,  with
nominal  margin  increases  in the sixth  and  eleventh  year.   For  any
quarterly  period where the debt service coverage ratio is in  excess  of
1.4:1,  both margins are reduced by 0.125%.  Concurrent with  the  Credit
Agreement, Newark and Parlin entered into an interest rate swap agreement
with  respect to 50% of the principal amount outstanding under the Credit
Agreement.  This interest rate swap agreement fixes the interest rate  on
such  principal  amount  ($70,661 at March 31, 1998)  at  6.9%  plus  the
margin.

                                   12

<PAGE>

      NRGG   Schuylkill  Cogeneration,  Inc.   ("NSC"),  a   wholly-owned
subsidiary of the Company, owns a one-third partnership interest  in  the
Grays  Ferry Project.  In March 1996, the Grays Ferry Partnership entered
into a credit agreement with The Chase Manhattan Bank N.A. to finance the
project.   The  credit  agreement obligated each of the  project's  three
partners  to make a $10,000 capital contribution prior to the  commercial
operation  of  the  facility.   The Company  made  its  required  capital
contribution in 1997.

      NRG  Energy  entered  into a loan commitment  to  provide  NSC  the
funding,  if needed, for the NSC capital contribution obligation  to  the
Grays  Ferry  Partnership.  Prior to March 31,  1998,  NSC  had  borrowed
$10,000  from  NRG  Energy  under this loan agreement,  of  which  $1,900
remained outstanding to NRG Energy at March 31, 1998, and contributed the
proceeds  to  the Grays Ferry Partnership as part of the above-referenced
capital  contribution.  In connection with this loan commitment  for  the
Grays  Ferry Project, the Company granted NRG Energy the right to convert
$3,000  of borrowings under the commitment into 396,255 shares of  common
stock  of  the  Company.   In  October 1997, NRG  Energy  exercised  such
conversion right in full.

      In  connection  with its acquisition of the Morris  Project,   NRGG
Funding  Inc. (a wholly-owned subsidiary of the Company) ("NRGG Funding")
assumed  all  of the obligations of NRG Energy to provide  future  equity
contributions to the project, which obligations are limited to the lesser
of  20%  of the total project cost or $22,000.  NRG Energy has guaranteed
to  the Morris Project's lenders that NRGG Funding will make these future
equity  contributions, and the Company has guaranteed to NRG  Energy  the
obligation  of  NRGG  Funding to make these future  equity  contributions
(which  guarantee is secured by a second priority lien on  the  Company's
interest  in  the  Morris  Project).   The  Company  intends  to  arrange
financing  for  either NRGG Funding or itself (the terms  and  manner  of
which  have  not  been determined by the Company) to  fund  the  required
future  equity contributions by NRGG Funding to the Morris  Project.   In
addition,  NRG  Energy  has  committed in a Supplemental  Loan  Agreement
between the Company, NRGG Funding and NRG Energy to loan NRGG Funding and
the Company (as co-borrower) the full amount of such equity contributions
by  NRGG  Funding,  subject  to  certain conditions  precedent,  at  NRGG
Funding's  option.   Any such loan will be secured by a  second  priority
lien  on  all  of  the membership interests of the project  and  will  be
recourse to NRGG Funding and the Company.

      On  December 17, 1997, the Company entered into a credit  agreement
providing  for a $30,000 reducing revolving credit facility  with  a  new
lender.   The  facility is secured by the assets and cash  flows  of  the
Philadelphia PWD Project as well as the distributable cash flows  of  the
Newark and Parlin Projects, and the Grays Ferry Partnership.  On December
19,  1997 the Company borrowed $25,000 under this facility.  The proceeds
were  used to repay $16,949 to NRG Energy, to repay $6,551 of obligations
of  the  Philadelphia  PWD  Project  and  $1,500  for  general  corporate
purposes.   The  remaining $5,000 of the facility will  become  available
once  security  interests in the Philadelphia PWD Project are  perfected.
As  a  consequence  of  the  pending Grays Ferry Partnership  litigation,
however,  the Company has agreed not to draw additional funds under  this
facility.   The  Company is unable to predict whether or when  additional
funds may become available under this facility.  The facility reduces  by
$2,500  on  the  first  and second anniversaries  of  the  agreement  and
repayment  of the outstanding balance is due on the third anniversary  of
the agreement.  Interest is based, at the Company's option, on LIBOR plus
a margin ranging from 1.50% to 1.875% or the prime rate plus a

                                   13

<PAGE>

margin  ranging  from 0.75% to 1.125%.  The interest rate  was  7.56%  at
March  31, 1998.  The facility provides for commitment fees of 0.375%  on
the unused facility.

      As  previously noted, the electric power purchaser from  the  Grays
Ferry  Project has asserted that such power purchase agreements  are  not
effective and that the power purchaser is not obligated to pay the  rates
set forth in the agreements.  The Company and the Grays Ferry Partnership
are  in  litigation  with the power purchaser over its obligations  under
such agreements.  After initially refusing to pay the rates set forth  in
the  power  purchase agreements, the power purchaser has been ordered  by
the  court  in  which  the litigation is pending  to  comply  with  power
purchase agreements pending the outcome of the litigation.  However,  the
power  purchaser  has filed a notice of appeal and  motion  to  stay  the
court's order, and there can be no assurance that such order will not  be
stayed  or reversed on appeal.  Moreover, the Grays Ferry Partnership  is
in  default of its principal credit agreement, and the lenders thereunder
have the ability to prevent the Grays Ferry Partnership from distributing
cash  held  or  generated by the Grays Ferry Project.   Such  rights,  if
exercised by such lenders, could prevent the Grays Ferry Partnership from
meeting  its  obligations to suppliers and others and  from  distributing
cash  to  its  partners during the pendency of the litigation.  Any  such
actions by the Grays Ferry Partnership's lenders could materially disrupt
the Grays Ferry Partnership's relations with its suppliers and could have
other  potentially  material  adverse  effects  on  its  operations   and
profitability  and  on  the Company.  On May 13, 1998,  the  Grays  Ferry
Partnership filed an emergency petition for contempt to compel the  power
purchaser  to  pay  the amounts due and owing under  the  power  purchase
agreements,  in accordance with a preliminary injunction entered  against
the power purchaser on May 5, 1998.  The Company believes the receipt  by
the  Grays Ferry Partnership of such payments would materially reduce the
likelihood that such lenders will cause such adverse effects to occur.

      The Company  believes  that the Grays Ferry Partnership  is  likely
either  to  prevail  in the pending litigation with  its  electric  power
purchaser or otherwise to achieve a favorable resolution of this dispute.
However,  the  Company  believes that if the power  purchaser's  position
ultimately were to be sustained, the Grays Ferry  Partnership would cease
to be  economically  viable as  currently  structured  and the  Company's
earnings  and financial position could be materially adversely  affected.
In addition, the Company could incur other material costs associated with
such  litigation  which would not be recovered and  could  suffer  cross-
defaults  under one or more of its credit agreements. While  the  Company
intends  to  continue to pursue a rapid and favorable resolution  of  the
litigation with the power purchaser, there can be no assurance that  such
an outcome will be obtained.

                                   14

<PAGE>

                                 PART II
                                    
                            OTHER INFORMATION
                                    

ITEM 1.  Legal Proceedings.

All dollar amounts are in thousands.

      Grays    Ferry     Cogeneration    Partnership,   Trigen-Schuylkill
Cogeneration,  Inc.,  NRGG  (Schuylkill) Cogeneration  Inc.  and  Trigen-
Philadelphia  Energy  Corp.  v. PECO Energy Company,  Adwin  (Schuylkill)
Cogeneration,  Inc. and the Pennsylvania Public Utility  Commission,  the
United  States  District Court for the Eastern District of  Pennsylvania,
Civil Action No. 98-CV-1243, filed March 9, 1998.  On March 19, 1998, the
federal district court dismissed this lawsuit for lack of subject  matter
jurisdiction.   On  March 27, 1998, the Plaintiffs  filed  a  motion  for
reconsideration  and leave to file an amended complaint.   On  April  13,
1998 the federal district court judge denied the Plaintiffs' motion.
     
      Grays    Ferry    Cogeneration    Partnership,    Trigen-Schuylkill
Cogeneration,  Inc.,  NRGG  (Schuylkill) Cogeneration  Inc.  and  Trigen-
Philadelphia  Energy  Corp.  v. PECO Energy Company,  Adwin  (Schuylkill)
Cogeneration, Inc. and the Pennsylvania Public Utility Commission,  Court
of  Common  Pleas Philadelphia County, April Term 1998,  No.  544,  filed
April  9,  1998. This action arose out of PECO Energy Company's  ("PECO")
notification  to  the  Grays Ferry Cogeneration Partnership  (the  "Grays
Ferry Partnership") that PECO believes its power purchase agreements with
the  Grays  Ferry  Partnership relating to the Grays  Ferry  Cogeneration
Project  (the "Grays Ferry Project") are no longer effective  and  PECO's
refusal to pay the electricity rates set forth in the agreement based  on
its  allegations  that  the Pennsylvania Public  Utility  Commission  has
denied cost recovery of the power purchase agreements in  retail electric
rates.   The  Grays  Ferry Partnership's complaint against  PECO  asserts
claims  which  include  breach  of contract,  fraud,  breach  of  implied
covenant  of  good  faith,  conversion, breach of  fiduciary  duties  and
tortious  interference  with contract.  The  Plaintiffs  are  seeking  to
enjoin  PECO from terminating the power purchase agreements and to compel
PECO to pay the rates set forth therein.  The Plaintiffs also are seeking
actual and punitive damages and attorneys' fees and costs.  On April  22,
1998,  the  court allowed the Grays Ferry Partnership to file an  amended
complaint to discontinue the suit against the Pennsylvania Public Utility
Commission   without  prejudice.   On  May  5,  1998,  the  Grays   Ferry
Partnership obtained a preliminary injunction pending the outcome of  the
litigation  enjoining PECO from terminating the power purchase agreements
and  ordering  PECO  to  comply  with the terms  of  the  power  purchase
agreements.  The Court of Common Pleas in Philadelphia also ordered  PECO
to  abide  by  all  of  the terms and conditions of  the  power  purchase
agreements and pay the rates set forth in the agreements.  The Plaintiffs
were required to post a bond in the amount of $50 in connection with  the
preliminary  injunction.  On May 8, 1998, PECO filed a notice  of  appeal
and  a  motion to stay the preliminary injunction order. On May 13, 1998,
the  Grays Ferry Partnership filed an emergency petition for contempt  to
compel  PECO  to  pay the amounts due and owing under the power  purchase
agreements.

      NRG Generating (U.S.) Inc. (the "Company") is subject from time  to
time to various other claims that arise in the normal course of business,
and management believes that

                                   15

<PAGE>

the  outcome  of these matters (either individually or in the  aggregate)
will  not  have  a material adverse effect on the business  or  financial
condition of the Company.

ITEM 3.  Defaults Upon Senior Securities.

All dollar amounts are in thousands.

Grays Ferry Cogeneration Partnership

      NRGG  Schuylkill Cogeneration, Inc., a wholly-owned  subsidiary  of
the Company, owns a one-third partnership interest  in  the  Grays  Ferry
Partnership  which  owns  the  Grays  Ferry  Project.   The  Grays  Ferry
Partnership  and The Chase Manhattan Bank N.A. ("Chase"), as  Agent  bank
for  the  Lenders (as defined therein), are parties to a Credit Agreement
dated  March  1,  1996  to finance the Grays Ferry  Project  (the  "Chase
Facility"),  of  which $113,000 was outstanding as  of  March  31,  1998.
Certain  actions  taken by PECO, the electric power purchaser  under  two
power  purchase agreements with the Grays Ferry Partnership, have  caused
certain  defaults to occur under the Chase Facility.  Such defaults  have
included defaults in the obligation to make interest payments thereon  of
$639 due on April 8, 1998 and $639 due on May 8, 1998, as well as certain
other defaults resulting directly or indirectly from the actions taken by
PECO.  As of the date of this Report, the aggregate interest arrearage on
the  Chase Facility is approximately $1,300.  In addition, as of the date
of this Report, the Grays Ferry Partnership is in default of an aggregate
of  approximately  $177  of  payments due  Chase  as  counterparty  under
interest rate swap arrangements entered into in connection with the Chase
Facility.  The Grays Ferry Partnership has sufficient funds to  pay  such
amounts;  however,  Chase has declined to permit disbursements  from  the
Grays Ferry Partnership's bank accounts due to the actions by PECO.   The
Grays Ferry Partnership believes that once PECO has paid the amounts owed
under  the power purchase agreements, Chase will release the funds needed
to  pay  such  obligations.  For additional information  see  "Part  I  -
Financial  Information - Item 2. Management's Discussion and Analysis  of
Financial  Condition  and Results of Operations - Liquidity  and  Capital
Resources" and "Part II - Other Information - Item 1. Legal Proceedings."

The Company

      The  Company, MeesPierson Capital Corp. ("MeesPierson") and certain
other  Lenders  (as  defined therein) are parties to a  Credit  Agreement
dated  as  of December 17, 1997 which provides for a $30,000,  three-year
reducing,   revolving   credit  facility  agreement   (the   "MeesPierson
Facility"),  of  which $25,000 was outstanding on March  31,  1998.   The
MeesPierson  Facility  includes  cross-default  provisions   that   cause
defaults  to  occur under the MeesPierson Facility in the  event  certain
defaults or other adverse events occur under certain other instruments or
agreements (including financing and other project documents) to which the
Company or one or more of its subsidiaries or other entities in which  it
owns  an  ownership interest is a party.  The actions taken by PECO  have
resulted in certain cross-defaults under the MeesPierson Facility.  As of
the  date  of  this Report, all such cross-defaults have been  waived  by
MeesPierson,  as  Agent under the MeesPierson Facility.   For  additional
information  see  "Part I - Financial  Information - Item 2. Management's
Discussion  and Analysis of Financial Condition and Results of Operations
- Liquidity and Capital Resources."

                                   16

<PAGE>

ITEM 6  Exhibits and Reports on Form 8-K.

      (a)  Exhibits

        The   "Index  to  Exhibits"  following  the  signature  page   is
        incorporated herein by reference.

      (b)  Reports on Form 8-K

        The  following  Reports on Form 8-K were filed by the  registrant
        during the fiscal quarter ended March 31, 1998:

           1.    Current  Report  on Form 8-K dated  December  30,  1997,
           reporting information under Items 2 and 7.

           2.     Current  Report  on  Form  8-K  dated  March  9,  1998,
           reporting information under Item 5.

                                   17

<PAGE>

                                SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf  by
the undersigned hereunto duly authorized.


                            NRG GENERATING (U.S.), INC.
                                     Registrant

Date:  May 15, 1998         By: /s/ Timothy P. Hunstad
                                    Timothy P. Hunstad
                     Vice President and Chief Financial Officer
                     (Principal Financial Officer and Duly Authorized Officer)

                                   18

<PAGE>

                            INDEX TO EXHIBITS

3.1  Amended  and  Restated Certificate of Incorporation of  the  Company
     filed  as  Exhibit  3.1 to Amendment No. 1 to the  Company's  Annual
     Report  on  Form 10-K for the fiscal year ended June  30,  1996  and
     incorporated herein by this reference.

3.2  Preferred Stock Certificate of Designation of the Company  filed  as
     Exhibit 3.3 to the Company's Current Report on Form 8-K dated  April
     30, 1996 and incorporated herein by this reference.

3.3  Restated Bylaws of the Company filed as Exhibit 3.3 to the Company's
     Annual  Report on Form 10-K for the fiscal year ended  December  31,
     1997 and incorporated herein by this reference.

27.1 Financial  Data Schedule for the quarter ended March 31,  1998  (for
     SEC filing purposes only).

27.2 Restated  Financial Data Schedule for the quarters ended  March  31,
     1997,  June 30, 1997 and September 30, 1997 (for SEC filing purposes
     only).

                                   19