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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549




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FORM 10-Q

|      |  |                                                                                         
|----- |  | ----------------------------------------------------------------------------------------
|[X]   |  | Quarterly report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 
|      |  |                                                                                         
|[   ] |  | Transition report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934

|                                          |  |                              
|----------------------------------------- |  | -----------------------------
|For the Quarter Ended: September 30, 2002 |  | Commission File No. 333-42638

NRG Northeast Generating LLC

(Exact name of Registrant as specified in its charter)


|                                                                                                 |  |                                                
|------------------------------------------------------------------------------------------------ |  | -----------------------------------------------
|Delaware
(State or other jurisdiction
of incorporation or organization)                          |  | 41-1937472
(I.R.S. Employer
Identification No.)
|                                                                                                 |  |                                                
|901 Marquette Avenue, Suite 2300
Minneapolis, Minnesota
(Address of principal executive offices) |  | 55402
(Zip Code)                               

(612) 373-5300
(Registrants telephone number, including area code)

None
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports 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.

Yes  [X]      No  [   ]

Indicate by check mark whether the Registrant is an
accelerated filer (as defined in Rule 12b-2 of the Exchange Act)

Yes  [  ]     No  [X]





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TABLE OF CONTENTS



|                                 |                                                                                               |                                            |  |  |  |  |  | 
|-------------------------------- | --------------------------------------------------------------------------------------------- | ------------------------------------------ |  |  |  |  |  | 
|                                 |                                                                                               | CONSOLIDATED STATEMENTS OF OPERATIONS     
|                                 |                                                                                               | CONSOLIDATED BALANCE SHEETS               
|                                 |                                                                                               | CONSOLIDATED STATEMENTS OF MEMBERS EQUITY
|                                 |                                                                                               | CONSOLIDATED STATEMENTS OF CASH FLOWS     
|                                 |                                                                                               | NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|                                 | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                 | Item 3. Quantitative and Qualitative Disclosures About Market Risk                           
|                                 | Item 4. Controls and Procedures                                                              
|Part II  OTHER INFORMATION     
|                                 | Item 1. Legal Proceedings                                                                    
|                                 | Item 3. Defaults Upon Senior Securities                                                      
|                                 | Item 6. Exhibits and Reports on Form 8-K                                                     
|SIGNATURES                      
|EX-99.1  Officers' Certification



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TABLE OF CONTENTS

INDEX

|              |                                                                                       |    |          |   | 
|------------- | ------------------------------------------------------------------------------------- | -- | -------- | - | 
|              |                                                                                       |    | Page No.
|              |                                                                                       |    |         
|Part I        |                                                                                       |    |          |  
|Item 1        | Consolidated Financial Statements and Notes                                           |    |          |  
|              | Consolidated Statements of Operations                                                 |    |          | 3 | 
|              | Consolidated Balance Sheets                                                           |    |          | 4 | 
|              | Consolidated Statements of Members Equity                                            |    |          | 5 | 
|              | Consolidated Statements of Cash Flows                                                 |    |          | 6 | 
|              | Notes to Consolidated Financial Statements                                            |    |          | 7 | 
|Item 2        | Managements Discussion and Analysis of Financial Condition and Results of Operations |    | 11      
|Item 3        | Quantitative and Qualitative Disclosures About Market Risk                            |    | 17      
|Item 4        | Controls and Procedures                                                               |    | 17      
|Part II       |                                                                                       |    |          |  
|Item 1        | Legal Proceedings                                                                     |    | 18      
|Item 3        | Defaults on Senior Securities                                                         |    | 19      
|Item 6        | Exhibits, Financial Statement Schedules, and Reports on Form 8-K                      |    | 19      
|              | Cautionary Statement Regarding Forward Looking Information                            |    | 20      
|SIGNATURES    |                                                                                       | 21
|CERTIFICATION |                                                                                       | 22

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NRG NORTHEAST GENERATING LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

|                             |                                     |      |                    |         |                   |      |         |         |   |   |         |         |   |   |         |         |  
|---------------------------- | ----------------------------------- | ---- | ------------------ | ------- | ----------------- | ---- | ------- | ------- | - | - | ------- | ------- | - | - | ------- | ------- | -
|                             |                                     |      | Three Months Ended |         | Nine Months Ended
|                             |                                     |      | September 30,      |         | September 30,    
|                             |                                     |      |                    |         |                  
|(Thousands of Dollars)       |                                     | 2002 |                    | 2001    |                   | 2002 |         | 2001   
|                             |                                     |      |                    |         |                   |      |         |        
|Operating revenues           |                                     |      |                    |         |                   |      |         |         |   |   |         |         |   |   |         |        
|                             | Revenues                            |      | $                  | 233,604 |                   |      | $       | 352,158 |   |   | $       | 550,252 |   |   | $       | 898,709 |  
|Operating costs and expenses |                                     |      |                    |         |                   |      |         |         |   |   |         |         |   |   |         |        
|                             | Operating costs                     |      |                    | 182,104 |                   |      |         | 204,908 |   |   |         | 390,657 |   |   |         | 621,828 |  
|                             | Depreciation                        |      |                    | 13,639  |                   |      |         | 12,238  |   |   |         | 39,790  |   |   |         | 36,553  |  
|                             | General and administrative expenses |      |                    | 5,330   |                   |      |         | 5,545   |   |   |         | 16,671  |   |   |         | 14,653  |  
|                             |                                     |      |                    |         |                   |      |         |         |   |   |         |         |   |   |         |        
|Operating income             |                                     |      | 32,531             |         |                   |      | 129,467 |         |   |   | 103,134 |         |   |   | 225,675 |        
|Other income (expense)       |                                     |      |                    |         |                   |      |         |         |   |   |         |         |   |   |         |        
|                             | Other income, net                   |      |                    | 133     |                   |      |         | 563     |   |   |         | 5,167   |   |   |         | 1,854   |  
|                             | Interest expense                    |      |                    | (12,877 | )                 |      |         | (15,226 | ) |   |         | (39,621 | ) |   |         | (45,562 | )
|                             |                                     |      |                    |         |                   |      |         |         |   |   |         |         |   |   |         |        
|Net income                   |                                     | $    | 19,787             |         |                   | $    | 114,804 |         |   | $ | 68,680  |         |   | $ | 181,967 |        
|                             |                                     |      |                    |         |                   |      |         |         |   |   |         |         |   |   |         |        

See accompanying notes to consolidated financial statements.

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NRG NORTHEAST GENERATING LLC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

|                                                                                        |                                                                          |                                       |           |               |           |              |           |         |           | 
|--------------------------------------------------------------------------------------- | ------------------------------------------------------------------------ | ------------------------------------- | --------- | ------------- | --------- | ------------ | --------- | ------- | --------- | 
|                                                                                        |                                                                          |                                       |           | September 30, |           | December 31,
|(Thousands of Dollars)                                                                  |                                                                          | 2002                                  |           | 2001         
|                                                                                        |                                                                          |                                       |           |               |          
|Assets                                                                                  |                                                                          |                                       |           |               |           |              |           |        
|Current Assets:                                                                         |                                                                          |                                       |           |               |           |              |           |        
|                                                                                        | Cash and cash equivalents                                                |                                       | $         | 318           |           |              | $         | 370     |          
|                                                                                        | Restricted cash                                                          |                                       |           | 310           |           |              |           |        |          
|                                                                                        | Accounts
receivable, net of allowance for doubtful accounts of $0 and $0 |                                       |           | 99,413        |           |              |           | 56,025  |          
|                                                                                        | Accounts receivable  affiliate                                          |                                       |           | 70,752        |           |              |           |        |          
|                                                                                        | Inventory                                                                |                                       |           | 114,797       |           |              |           | 172,215 |          
|                                                                                        | Prepaid expenses                                                         |                                       |           | 35,215        |           |              |           | 20,116  |          
|                                                                                        |                                                                          |                                       |           |               |           |              |           |         |          
|                                                                                        |                                                                          | Total current assets                  |           |               | 320,805   |              |           |         | 248,726   | 
|Property,
plant and equipment, net of accumulated depreciation of $151,018
and $113,688 |                                                                          |                                       | 1,385,316 |               |           |              | 1,403,318 |        
|Deferred finance costs, net of accumulated amortization of $1,060 and $750              |                                                                          |                                       | 9,096     |               |           |              | 9,406     |        
|Derivative instruments valuation  at market                                            |                                                                          |                                       | 184,779   |               |           |              | 109,017   |        
|Other
assets, net of accumulated amortization of $2,388 and $1,737                      |                                                                          |                                       | 23,612    |               |           |              | 24,263    |        
|                                                                                        |                                                                          |                                       |           |               |           |              |           |         |          
|                                                                                        |                                                                          | Total assets                          |           | $             | 1,923,608 |              |           | $       | 1,794,730 | 
|                                                                                        |                                                                          |                                       |           |               |           |              |           |         |          
|Liabilities and Members Equity                                                         |                                                                          |                                       |           |               |           |              |           |        
|Liabilities:                                                                            |                                                                          |                                       |           |               |           |              |           |        
|                                                                                        | Current portion of long-term debt                                        |                                       | $         | 556,500       |           |              | $         | 107,000 |          
|                                                                                        | Accounts payable                                                         |                                       |           | 1,140         |           |              |           | 2,550   |          
|                                                                                        | Accrued fuel and purchased power expense                                 |                                       |           | 7,168         |           |              |           | 27,049  |          
|                                                                                        | Accrued interest                                                         |                                       |           | 16,684        |           |              |           | 2,302   |          
|                                                                                        | Other accrued liabilities                                                |                                       |           | 49,025        |           |              |           | 41,086  |          
|                                                                                        | Derivative instruments valuation  at market                             |                                       |           | 38,066        |           |              |           | 32,504  |          
|                                                                                        |                                                                          |                                       |           |               |           |              |           |         |          
|                                                                                        |                                                                          | Total current liabilities             |           |               | 668,583   |              |           |         | 212,491   | 
|Long-term debt                                                                          |                                                                          |                                       |          |               |           |              | 503,000   |        
|Note payable  affiliate                                                                |                                                                          |                                       | 30,000    |               |           |              |          |        
|Derivative instruments valuation  at market                                            |                                                                          |                                       | 100,747   |               |           |              |          |        
|Other long-term liabilities                                                             |                                                                          |                                       | 22,948    |               |           |              | 24,655    |        
|                                                                                        |                                                                          |                                       |           |               |           |              |           |         |          
|                                                                                        |                                                                          | Total liabilities                     |           |               | 822,278   |              |           |         | 740,146   | 
|Commitments and contingencies                                                           |                                                                          |                                       |           |               |           |              |           |        
|Members equity                                                                         |                                                                          |                                       | 1,101,330 |               |           |              | 1,054,584 |        
|                                                                                        |                                                                          |                                       |           |               |           |              |           |         |          
|                                                                                        |                                                                          | Total liabilities and members equity |           | $             | 1,923,608 |              |           | $       | 1,794,730 | 
|                                                                                        |                                                                          |                                       |           |               |           |              |           |         |          

See accompanying notes to consolidated financial statements.

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NRG NORTHEAST GENERATING LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF MEMBERS EQUITY
(UNAUDITED)

For the three months ended September 30, 2002 and
2001

|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  
|--------------------------------------------------------------- |  | -------------- | ------- | ----------- |  | ------------- | -------- | -------- |  | ----------- | ------- | - |  | - | --------- | -
|                                                                |  |                |         |             |  |               |          |          |  | Accumulated |         |   |  |  
|                                                                |  | Member         |         |             |  |               |          | Other    |  | Total      
|                                                                |  | Contributions/ |         | Accumulated |  | Comprehensive |          | Members
|(Thousands of Dollars)                                          |  | Distributions  |         | Net Income  |  | Income        |          | Equity  
|                                                                |  |                |         |             |  |               |          |         
|Balances at June 30, 2001                                       |  | $              | 719,478 |             |  | $             |         |          |  | $           | 121,737 |   |  | $ | 841,215   |  
|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  
|Net income                                                      |  |                |        |             |  |               | 114,804  |          |  |             |        |   |  |   | 114,804   |  
|Impact of SFAS No. 133 for the quarter
ended September 30, 2001 |  |                |        |             |  |               |         |          |  |             | (31,309 | ) |  |   | (31,309   | )
|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  
|Comprehensive income                                            |  |                |        |             |  |               | 114,804  |          |  |             | (31,309 | ) |  |   | 83,495    |  
|Distributions to member, net                                    |  |                | (94,143 | )           |  |               | (114,804 | )        |  |             |        |   |  |   | (208,947  | )
|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  
|Balances at September 30, 2001                                  |  | $              | 625,335 |             |  | $             |         |          |  | $           | 90,428  |   |  | $ | 715,763   |  
|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  
|Balances at June 30, 2002                                       |  | $              | 788,315 |             |  | $             | 207,421  |          |  | $           | 66,772  |   |  | $ | 1,062,508 |  
|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  
|Net income                                                      |  |                |        |             |  |               | 19,787   |          |  |             |        |   |  |   | 19,787    |  
|Impact of SFAS No. 133 for the quarter
ended September 30, 2002 |  |                |        |             |  |               |         |          |  |             | 19,035  |   |  |   | 19,035    |  
|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  
|Comprehensive income                                            |  |                |        |             |  |               | 19,787   |          |  |             | 19,035  |   |  |   | 38,822    |  
|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  
|Balances at September 30, 2002                                  |  | $              | 788,315 |             |  | $             | 227,208  |          |  | $           | 85,807  |   |  | $ | 1,101,330 |  
|                                                                |  |                |         |             |  |               |          |          |  |             |         |   |  |   |           |  

For the nine months ended September 30, 2002 and
2001

|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  
|--------------------------------------------------------- |  | -------------- | -------- | ----------- |  | ------------- | -------- | -------- |  | ----------- | ------- | - |  | - | --------- | -
|                                                          |  |                |          |             |  |               |          |          |  | Accumulated |         |   |  |  
|                                                          |  | Member         |          |             |  |               |          | Other    |  | Total      
|                                                          |  | Contributions/ |          | Accumulated |  | Comprehensive |          | Members
|(Thousands of Dollars)                                    |  | Distributions  |          | Net Income  |  | Income        |          | Equity  
|                                                          |  |                |          |             |  |               |          |         
|Balances at December 31, 2000                             |  | $              | 788,315  |             |  | $             |         |          |  | $           |        |   |  | $ | 788,315   |  
|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  
|Net income                                                |  |                |         |             |  |               | 181,967  |          |  |             |        |   |  |   | 181,967   |  
|Cumulative impact on adoption of SFAS
No. 133             |  |                |         |             |  |               |         |          |  |             | 14,100  |   |  |   | 14,100    |  
|Impact of SFAS No. 133 for the year
to September 30, 2001 |  |                |         |             |  |               |         |          |  |             | 76,328  |   |  |   | 76,328    |  
|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  
|Comprehensive income                                      |  |                |         |             |  |               | 181,967  |          |  |             | 90,428  |   |  |   | 272,395   |  
|Distributions to member, net                              |  |                | (162,980 | )           |  |               | (181,967 | )        |  |             |        |   |  |   | (344,947  | )
|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  
|Balances at September 30, 2001                            |  | $              | 625,335  |             |  | $             |         |          |  | $           | 90,428  |   |  | $ | 715,763   |  
|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  
|Balances at December 31, 2001                             |  | $              | 788,315  |             |  | $             | 158,528  |          |  | $           | 107,741 |   |  | $ | 1,054,584 |  
|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  
|Net income                                                |  |                |         |             |  |               | 68,680   |          |  |             |        |   |  |   | 68,680    |  
|Impact of SFAS No. 133 for the year to
September 30, 2002 |  |                |         |             |  |               |         |          |  |             | (21,934 | ) |  |   | (21,934   | )
|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  
|Comprehensive income                                      |  |                |         |             |  |               | 68,680   |          |  |             | (21,934 | ) |  |   | 46,746    |  
|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  
|Balances at September 30, 2002                            |  | $              | 788,315  |             |  | $             | 227,208  |          |  | $           | 85,807  |   |  | $ | 1,101,330 |  
|                                                          |  |                |          |             |  |               |          |          |  |             |         |   |  |   |           |  

See accompanying notes to consolidated financial statements.

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NRG NORTHEAST GENERATING LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |        |         |  
|---------------------------------------------------- | ------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ---------------------------------------- | ------- | -------------------------------------- | ------- | -------- | -------- | ------ | ------- | -
|                                                     |                                                                                                         |                                            |                                          |         | For the nine months endedSeptember 30,
|                                                     |                                                                                                         |                                            |                                          |         |                                       
|(Thousands
of Dollars)                               |                                                                                                         | 2002                                       |                                          | 2001   
|                                                     |                                                                                                         |                                            |                                          |        
|Cash flows from operating activities:                |                                                                                                         |                                            |                                          |         |                                        |         |          |         
|                                                     | Net income                                                                                              |                                            | $                                        | 68,680  |                                        |         | $        | 181,967  |       
|                                                     | Adjustments to reconcile net income to net cash provided by (used in)
operating activities
Depreciation |                                            |                                          | 37,990  |                                        |         |          | 36,553   |       
|                                                     |                                                                                                         | Amortization of other assets               |                                          |         | 651                                    |         |          |          | 651    |        
|                                                     |                                                                                                         | Loss on sale of property & equipment       |                                          |         | 1,800                                  |         |          |          |       |        
|                                                     |                                                                                                         | Unrealized
loss/(gain) on energy contracts |                                          |         | 8,614                                  |         |          |          | 55,100 |        
|                                                     |                                                                                                         | Amortization of deferred financing costs   |                                          |         | 310                                    |         |          |          | 309    |        
|                                                     |                                                                                                         | Changes in assets and liabilities:         |                                          |         |                                        |         |          |          |        |        
|                                                     |                                                                                                         |                                            | Accounts receivable                      |         |                                        | (43,388 | )        |          |        | 73,259  |  
|                                                     |                                                                                                         |                                            | Accounts receivable  affiliates         |         |                                        | (70,752 | )        |          |        |        |  
|                                                     |                                                                                                         |                                            | Inventories                              |         |                                        | 57,418  |          |          |        | (39,301 | )
|                                                     |                                                                                                         |                                            | Prepaid expenses                         |         |                                        | (15,099 | )        |          |        | (19,559 | )
|                                                     |                                                                                                         |                                            | Accounts payable                         |         |                                        | (1,410  | )        |          |        | (1,585  | )
|                                                     |                                                                                                         |                                            | Accounts payable  affiliates            |         |                                        |        |          |          |        | 201,306 |  
|                                                     |                                                                                                         |                                            | Accrued interest                         |         |                                        | 14,382  |          |          |        | 28,344  |  
|                                                     |                                                                                                         |                                            | Accrued fuel and purchased power expense |         |                                        | (19,881 | )        |          |        | (15,004 | )
|                                                     |                                                                                                         |                                            | Other accrued liabilities                |         |                                        | 7,939   |          |          |        | (78,312 | )
|                                                     |                                                                                                         |                                            | Other liabilities                        |         |                                        | (1,708  | )        |          |        | (494    | )
|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |       
|Net cash provided by operating activities            |                                                                                                         |                                            | 45,546                                   |         |                                        |         | 423,234  |         
|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |       
|Cash flows from investing activities:                |                                                                                                         |                                            |                                          |         |                                        |         |          |         
|                                                     | Capital expenditures                                                                                    |                                            |                                          | (21,788 | )                                      |         |          | (15,496  | )     
|                                                     | Investment in restricted funds                                                                          |                                            |                                          | (310    | )                                      |         |          |         |       
|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |       
|Net cash used in investing activities                |                                                                                                         |                                            | (22,098                                  | )       |                                        |         | (15,496  | )       
|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |       
|Cash flows from financing activities:                |                                                                                                         |                                            |                                          |         |                                        |         |          |         
|                                                     | Principal payments on long-term debt                                                                    |                                            |                                          | (53,500 | )                                      |         |          | (45,000  | )     
|                                                     | Proceeds from note payable  affiliate                                                                  |                                            |                                          | 30,000  |                                        |         |          |         |       
|                                                     | Distribution to member                                                                                  |                                            |                                          |        |                                        |         |          | (344,947 | )     
|                                                     | Deferred financing costs                                                                                |                                            |                                          |        |                                        |         |          | (199     | )     
|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |       
|Net cash used in financing activities                |                                                                                                         |                                            | (23,500                                  | )       |                                        |         | (390,146 | )       
|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |       
|Net increase/(decrease) in cash and cash equivalents |                                                                                                         |                                            | (52                                      | )       |                                        |         | 17,592   |         
|Cash and cash equivalents at beginning of period     |                                                                                                         |                                            | 370                                      |         |                                        |         | 2,444    |         
|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |       
|Cash and cash equivalents at end of period           |                                                                                                         | $                                          | 318                                      |         |                                        | $       | 20,036   |         
|                                                     |                                                                                                         |                                            |                                          |         |                                        |         |          |          |       

See accompanying notes to consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NRG Northeast Generating LLC (the Company or NRG Northeast), a
wholly-owned indirect subsidiary of NRG Energy, Inc. (NRG Energy), owns electric power
generation plants in the northeastern region of the United States. The Company
was formed for the purpose of financing, acquiring, owning, operating and
maintaining, through its subsidiaries and affiliates; facilities owned by
Arthur Kill Power LLC, Astoria Gas Turbine Power LLC, Connecticut Jet Power
LLC, Devon Power LLC, Dunkirk Power LLC, Huntley Power LLC, Middletown Power
LLC, Montville Power LLC, Norwalk Harbor Power LLC, Oswego Harbor Power LLC and
Somerset Power LLC.

The accompanying unaudited consolidated financial statements have been
prepared in accordance with the Securities and Exchange Commission (SEC)
regulations for interim financial information and with the instructions to Form
10-Q. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. The accounting policies followed by the Company are set forth in
Item 8  Note 2 to the Companys financial statements in its annual report on
Form 10-K for the year ended December 31, 2001 (Form 10-K). The following notes
should be read in conjunction with such policies and other disclosures in the
Form 10-K. Interim results are not necessarily indicative of results for a full
year.

In the opinion of management, the accompanying unaudited interim consolidated financial
statements contain all material adjustments necessary to present fairly the
consolidated financial position of the Company as of September 30, 2002 and
December 31, 2001, the results of its operations and
members equity for the three and nine months
ended September 30, 2002 and 2001, and its cash flows for
the nine months ended September 30, 2002 and 2001.

Certain prior year amounts have been reclassified for comparative
purposes. These reclassifications had no effect on net income or total members
equity as previously reported.

1. RECENT DEVELOPMENTS

In
December 2001, Moodys Investor Service (Moodys) placed NRG Energys long-term senior unsecured
debt rating on review for possible downgrade. In response to this threat to
NRG Energys investment grade rating, on February 17, 2002, Xcel Energy
announced a financial improvement plan for NRG Energy, which included an
initial step of acquiring 100% of NRG Energy through a tender offer to exchange all of
the outstanding shares of NRG Energy common stock for Xcel Energy common
shares. In addition, the plan included financial support to NRG Energy from
Xcel Energy; marketing certain NRG Energy generating assets for possible sale;
canceling and deferring capital spending for NRG Energy projects; and combining
certain of NRG Energys functions with Xcel Energys system and organization.
On June 3, 2002, Xcel Energy completed its exchange offer for the 26% of NRG
Energys shares that had been previously publicly held. Xcel Energy offered NRG
Energy shareholders 0.50 shares of Xcel Energy common stock for each
outstanding share of NRG Energy common stock, representing a $650 million
purchase price. During 2002, Xcel Energy provided NRG Energy with $500 million
of cash infusions. Throughout this period of time, Xcel Energy was in
discussions with credit agencies and believed that its actions would be
sufficient to avoid a downgrade of NRG Energys credit rating.

However, even with NRG Energys efforts to avoid a downgrade, unexpectedly
on July 26, 2002, Standard & Poors (S&P) downgraded NRG Energys senior
unsecured bonds below investment grade, and three days later Moodys also downgraded NRG Energys senior unsecured debt rating below
investment grade. Over the next few months NRG senior unsecured debt, as well
as the secured NRG Northeast Generating LLC bonds and the secured NRG South
Central Generating LLC bonds, were downgraded multiple times. After
NRG Energy failed
to make the payment obligations due under certain unsecured bond obligations on
September 16, 2002, both Moodys and S&P lowered their ratings on NRG Energys
unsecured bonds once again. Currently, unsecured bond obligations of
NRG Energy carry a
rating of between CCC and D, depending on both the specific debt issue and the
rating agency rating system. NRG Northeast Generating LLC bonds
currently carry a rating of Ca with S&P and Caa1 with
Moodys.

Many of the corporate guarantees and commitments of NRG Energy and its
subsidiaries require that they be supported or
replaced with letters of credit or cash collateral within 5 to 30 days of
a ratings downgrade below Baa3 or BBB- by Moodys or Standard & Poors,
respectively. As a result of the downgrades on July 26 and July 29, NRG Energy
estimated that it would be required to post collateral ranging from $1.1
billion to $1.3 billion. Although the credit rating downgrades were not
expected to occur, NRG Energy believed that it could meet the collateral
requirements that would result from such an occurrence with available cash,
operating cash flows, equity contributions from Xcel Energy, proceeds from
asset sales and the issuance of bonds into the capital markets or as a private
placement.

On August 19, 2002, NRG Energy executed a Collateral Call Extension Letter
(CCEL) with various secured project lender groups in which the banks agreed to
extend until September 13, 2002, the deadline by which NRG Energy was to post
its approximately $1.0 billion of cash collateral in connection with certain
bank loan agreements.

Subsequently, and effective as of September 13, 2002, NRG Energy and these
various secured project lenders entered into a Second Collateral Call Extension
Letter (Second CCEL) that extended until November 15, 2002, the deadline for
NRG Energy to post such collateral. Under the Second CCEL, NRG Energy agreed
to submit to the lenders a comprehensive restructuring plan. NRG Energy
submitted this plan on November 4, 2002 and is working with the lenders on an
overall restructuring of its debt (see further discussion below). The
extension agreements did not, however, waive other events of default, including
failure to make principal and/or interest payments when due or failure to
comply with financial covenants. Nor did the extension agreements waive the
rights of the bank groups or bondholders to pursue any rights and remedies in
respect of such other defaults. The November 15, 2002, deadline of the second
CCEL has passed and NRG Energy has not posted the required collateral. Because
NRG Energy has failed to make principal and interest payments when due, and is
in breach of other covenants in various financing agreements, NRG Energy is in
default of various debt instruments. By reason of these defaults, the lenders
are able, if they so choose, to seek to enforce their remedies, which would
likely lead to a bankruptcy filing by NRG Energy.

Starting in August 2002, NRG Energy engaged in the preparation of a
comprehensive business plan and forecast. The business plan detailed the
strategic merits and financial value of NRG Energys projects and operations.
It also anticipates that NRG Energy will function independently from Xcel
Energy and thus all plans and efforts to combine certain functions of the
companies were terminated. NRG Energy utilized independent electric revenue
forecasts from an outside energy markets consulting firm to develop forecasted
cash flow information included in the business plan. Management concluded that
the forecasted free cash flow available to NRG Energy after servicing
project-level obligations will be insufficient to service recourse debt
obligations. Based on this information and in consultation with Xcel Energy and
its financial advisor, NRG Energy prepared and submitted a restructuring plan
on November 4, 2002 to various lenders, bondholders and other creditor groups
(collectively, NRG Energys Creditors) of NRG Energy and its subsidiaries. The
restructuring plan is expected to serve as a basis for negotiations with NRG
Energys Creditors in a financially-restructured NRG Energy and, among other
things, proposes (i) holders of secured (project-level) debt would either (a)
have their debt reinstated with agreed modifications or (b) receive the
collateral securing such debt and a claim or claims to the extent such debt is
under-secured; (ii) holders of unsecured debt, holders of secured recourse
claims against NRG Energy, and holders of other general unsecured claims
against NRG Energy would receive a pro rata share of (a) an aggregate of $500
million of junior secured debt of reorganized NRG Energy and (b) 95% of the
common equity of reorganized NRG Energy; and (iii) holders of project-level
general unsecured claims that are non-recourse to NRG Energy would receive a
pro rata share of the remaining 5% of the common equity of a reorganized NRG
Energy.

On November 6, 2002, lenders to NRG Energy accelerated approximately $1.1
billion of NRG Energys debt under a construction revolver financing facility,
rendering the debt immediately due and payable. This action terminated the
Second CCEL in effect between NRG Energy and its major lenders. The extension
letter was previously scheduled to expire November 15, 2002. Based on
discussions with the construction revolver lenders it is NRG Energys
understanding that the administrative agent, Credit Suisse First Boston, issued
the acceleration notice to preserve certain rights under the construction
revolver financing agreements. NRG Energy believes that the administrative
agent intends to forbear in the immediate exercise of any rights and remedies
against the Company.

The restructuring plan also includes a proposal by Xcel Energy that in
return for a release of any and all claims against Xcel Energy, upon
consummation of the restructuring, Xcel Energy would pay $300 million to NRG
Energy and surrender its equity ownership of NRG Energy.

If an agreement were reached with NRG Energys Creditors on a
restructuring plan, it would most likely lead to NRG Energy commencing a
Chapter 11 bankruptcy case and immediately seeking approval of a prenegotiated
plan of reorganization. The absence of an agreement will increase the
possibility of NRG Energy seeking protection under the bankruptcy laws.

Throughout the restructuring process, NRG Energy seeks to operate the
business in a manner that management believes will offer to creditors similar
protection as would be offered by a bankruptcy court. NRG Energy attempts to
preserve the enterprise value of the business and to treat creditors within
each creditor class without preference, unless otherwise agreed to by advisors
to all potentially affected creditors. By operating the Company within
this framework, NRG Energy desires to mitigate the risk that creditors will
pursue involuntary bankruptcy proceedings against NRG Energy or its material
subsidiaries, including NRG Northeast Generating LLC and its
subsidiaries.

The bonds and working capital facility agreements of the Company generally
restrict its ability to pay dividends, make distributions or otherwise transfer
funds to NRG Energy under certain circumstances. As of September 30, 2002, the
Company did not meet the required minimum debt service coverage ratios, and
therefore is restricted from making payments to NRG Energy.

Prior to the NRG Energy downgrades, the debt service reserve account of the
Company was funded with a letter of guarantee from the parent company.
Following the downgrade, the Company received notice from the trustee on
September 9 requesting the cash funding of the debt service reserve account
within 30 days. On October 9 NRG Energy failed to fund the debt service
reserve account, which created an event of default that, if not cured within 60
days, gives the bond holders rights of acceleration. The project is precluded
from making payments to NRG Energy. As a result of this impending default, the
long-term portion of the debt has been reclassified to a current liability, as
it is potentially callable within the next twelve months.

The credit rating downgrades, defaults under certain agreements, increased
collateral requirements, creditors
actions and reduced liquidity that have occurred during the quarter ended
September 30, 2002 have created substantial doubt as to NRG
Energys and NRG Northeast Generating LLC ability to
continue as a going concern. The absence of a restructuring agreement will
increase the possibility of NRG Energy and certain of its
subsidiaries, including the Company, seeking protection under the bankruptcy
laws. Such action would have a material affect on the Company and its
subsidiaries.

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2. LONG-TERM DEBT AND NOTE PAYABLE
 AFFILIATE

On February 22, 2000, the Company issued $750 million of senior secured
bonds to refinance short-term project borrowings and for certain other
purposes. The bond offering included three tranches: $320 million with an
interest rate of 8.065% due in 2004; $130 million with an interest rate of
8.842% due in 2015; and $300 million with an interest rate of 9.292% due in
2024. Principal payments are made semi-annually. The bonds are
jointly and severally guaranteed by each of the Company's existing and future subsidiaries. The bonds are secured by a
security interest in the Company's membership or other ownership interests in
the guarantors and its rights under all intercompany notes between
the Company and the guarantors. At September 30, 2002, $556.5 million of bonds
remain outstanding and are classified as current. On October 9, 2002,
NRG Energy failed to fund the debt service reserve account which
created an event of default that, if not cured within 60 days, gives
the Bondholders rights of acceleration. See Footnote 1 for more
information.

On June 15,
2002, NRG Energy loaned the Company $30 million to fund capital
expenditures. The debt bears interest at the 3 month London Interbank Offered
Rate plus 0.5%. The debt is subordinate to the other long-term debt of the
Company and is subject to the terms and conditions of the senior secured bonds
indenture. The Company has recorded this loan as a long-term affiliated note
payable.

3. INVENTORY

Inventory consists of spare parts, coal, fuel oil and kerosene and is
stated at the lower of weighted average cost or market value:

|                       |       |                    |        |                   |  |   |        |         | 
|---------------------- | ----- | ------------------ | ------ | ----------------- |  | - | ------ | ------- | 
|(Thousands of Dollars) |       | September 30, 2002 |        | December 31, 2001
|                       |       |                    |        |                  
|Fuel oil               |       | $                  | 44,282 |                   |  | $ | 83,857 |        
|Spare parts            |       |                    | 59,155 |                   |  |   | 57,901 |        
|Coal                   |       |                    | 10,435 |                   |  |   | 29,179 |        
|Kerosene               |       |                    | 712    |                   |  |   | 1,268  |        
|Other                  |       |                    | 213    |                   |  |   | 10     |        
|                       |       |                    |        |                   |  |   |        |        
|                       | Total |                    | $      | 114,797           |  |   | $      | 172,215 | 
|                       |       |                    |        |                   |  |   |        |        

4. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are stated at cost. Depreciation is computed on a
straight-line basis over the following estimated useful lives:

|                                    |  |               
|----------------------------------- |  | --------------
|Facilities, machinery and equipment |  | 25 to 30 years
|Office furnishings and equipment    |  | 3 to 10 years 

Property, plant and equipment consisted of:

|                                    |                                    |                    |           |                   |  |   |           |           | 
|----------------------------------- | ---------------------------------- | ------------------ | --------- | ----------------- |  | - | --------- | --------- | 
|(Thousands of Dollars)              |                                    | September 30, 2002 |           | December 31, 2001
|                                    |                                    |                    |           |                  
|Facilities, machinery and equipment |                                    | $                  | 1,459,410 |                   |  | $ | 1,441,428 |          
|Land                                |                                    |                    | 51,920    |                   |  |   | 51,920    |          
|Construction in progress            |                                    |                    | 23,474    |                   |  |   | 22,206    |          
|Office furnishings and equipment    |                                    |                    | 1,530     |                   |  |   | 1,452     |          
|Accumulated depreciation            |                                    |                    | (151,018  | )                 |  |   | (113,688  | )        
|                                    |                                    |                    |           |                   |  |   |           |          
|                                    | Property, plant and equipment, net |                    | $         | 1,385,316         |  |   | $         | 1,403,318 | 
|                                    |                                    |                    |           |                   |  |   |           |          

5. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITY

On January 1, 2001, the Company adopted Statement of Financial Accounting
Standards No. 133, Accounting for Derivative Instruments and Hedging Activities
(SFAS No. 133), as amended by SFAS No. 137 and SFAS No. 138. SFAS No. 133
requires the Company to record all derivatives on the balance sheet at fair
value. Changes in the fair value of non-hedge derivatives are immediately
recognized in earnings. Derivatives that have been designated as hedges of
assets, liabilities or firm commitments, are

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accounted for using the fair value method. Changes in the fair value of
these instruments are recognized in earnings as offsets to the changes in the
fair value of the related hedged assets, liabilities and firm commitments.
Derivatives that have been designated as hedges of forecasted transactions are
accounted for using the cash flow method. Changes in the fair value of these
instruments are deferred and recorded as a component of accumulated other
comprehensive income (OCI) until the hedged transactions occur and are
recognized in earnings. Reclassifications of the deferred gains and losses are
included on the same line of the statement of operations in which the hedged
item is recorded. The ineffective portion of the change in fair value of a
derivative instrument designated as a cash flow hedge is immediately recognized
in earnings. The Company formally assesses both at inception and at least
quarterly thereafter, whether the derivatives used in hedging transactions are
highly effective in offsetting the changes in either the fair value or cash
flows of the hedged item. This assessment includes all components of each
derivatives gain or loss unless otherwise noted. When it is determined that a
derivative ceases to be a highly effective hedge, hedge accounting is
discontinued.

SFAS No. 133 applies to the Companys long-term power sales contracts,
long-term gas purchase contracts and other energy related commodities financial
instruments used to mitigate variability in earnings due to fluctuations in
spot market prices, hedge fuel requirements at generation facilities and
protect investments in fuel inventories. At September 30, 2002, the Company had
derivative contracts extending through December 2006.

Accumulated Other Comprehensive Income

The following table summarizes the effects of SFAS No. 133 on the
Companys OCI balance:

|                                                                 |                                               |                    |        |                   |      |   |         |         |      |   |         |         |   |   |        |        | 
|---------------------------------------------------------------- | --------------------------------------------- | ------------------ | ------ | ----------------- | ---- | - | ------- | ------- | ---- | - | ------- | ------- | - | - | ------ | ------ | 
|Gains/(Losses)                                                   |                                               | Three Months Ended |        | Nine Months Ended
|(Thousands of Dollars)                                           |                                               | September 30,      |        | September 30,    
|                                                                 |                                               |                    |        |                  
|                                                                 |                                               |                    | 2002   |                   | 2001 |   | 2002    |         | 2001
|                                                                 |                                               |                    |        |                   |      |   |         |         |     
|Beginning Balance                                                |                                               | $                  | 66,772 |                   |      | $ | 121,737 |         |      | $ | 107,741 |         |   | $ |       |       
|                                                                 | Cumulative impact on adoption of SFAS No. 133 |                    |        |                  |      |   |         |        |      |   |         |        |   |   |        | 14,100 | 
|                                                                 | Previously deferred amounts unwound from OCI  |                    |        | (2,854            | )    |   |         |        |      |   |         | (6,779  | ) |   |        |       | 
|                                                                 | Mark to market to hedge contracts             |                    |        | 21,889            |      |   |         | (31,309 | )    |   |         | (15,155 | ) |   |        | 76,328 | 
|                                                                 |                                               |                    |        |                   |      |   |         |         |      |   |         |         |   |   |        |       
|Ending Balance                                                   |                                               | $                  | 85,807 |                   |      | $ | 90,428  |         |      | $ | 85,807  |         |   | $ | 90,428 |       
|                                                                 |                                               |                    |        |                   |      |   |         |         |      |   |         |         |   |   |        |       
|Gains/(Losses) expected to unwind from OCI during next 12
months |                                               | $                  | 85,807 |                   |      |   |         |         |      | $ | 85,807  |         |   |   |        |       

During the three and nine months ended September 30, 2002, the Company
recorded a gain of approximately $19 million and a loss of approximately $22
million in OCI respectively, related to changes in the fair values of
derivatives accounted for as hedges. The net balance in OCI relating to SFAS
No. 133 as of September 30, 2002 was a gain of approximately $85.8 million. The
Company expects $85.8 million of the deferred net gains on derivative
instruments accumulated in OCI to be recognized as earnings during the next
twelve months.

Statement of Operations

The following table summarizes the effects of SFAS No. 133 on the
Companys statement of operations:

|                       |                                      |               |                    |               |                   |      |         |         |   |   |        |        |   |   |         |         |  
|---------------------- | ------------------------------------ | ------------- | ------------------ | ------------- | ----------------- | ---- | ------- | ------- | - | - | ------ | ------ | - | - | ------- | ------- | -
|                       |                                      |               | Three Months Ended |               | Nine Months Ended
|Gains/(Losses)         |                                      | September 30, |                    | September 30,
|(Thousands of Dollars) |                                      | 2002          |                    | 2001          |                   | 2002 |         | 2001   
|                       |                                      |               |                    |               |                   |      |         |        
|Revenues               |                                      | $             | (35,344            | )             |                   | $    |        |         |   | $ | (771   | )      |   | $ |        |        
|Operating costs        |                                      |               | (17,427            | )             |                   |      | (17,400 | )       |   |   | (7,843 | )      |   |   | (55,100 | )      
|                       |                                      |               |                    |               |                   |      |         |         |   |   |        |        |   |   |         |        
|                       | Total statement of operations impact |               | $                  | (52,771       | )                 |      | $       | (17,400 | ) |   | $      | (8,614 | ) |   | $       | (55,100 | )
|                       |                                      |               |                    |               |                   |      |         |         |   |   |        |        |   |   |         |        

During the three and nine months ended September 30, 2002 and 2001, the
Company recognized no gain or loss due to ineffectiveness of commodity cash
flow hedges.

The Companys earnings for the three months ended September 30, 2002 and
2001 were decreased by unrealized losses of $52.8 million and $17.4 million,
respectively. For the nine months ended September 30, 2002 and 2001 the
Companys earnings were decreased by unrealized losses of $8.6 million and
$55.1 million, respectively, associated with changes in the fair value of
energy related derivative instruments not accounted for as hedges in accordance
with SFAS No. 133.

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6. REGULATORY ISSUES

New England

On April 26, 2001 the Federal Energy Regulatory Commission (FERC)
approved, with a July 2001 implementation date, a change in the energy market
bidding structure in New England from a one part bidding structure with hourly
uplift compensation to a three part bidding system with Net Commitment Period
Compensation (NCPC). Under this three part bidding system, a supplier submits
separate bids for energy, start up costs and no load. Also under this revised
bidding structure, a supplier is guaranteed of receiving an amount at least
equal to the combination of its start up, no load and accepted energy bids over
the course of the day when it is dispatched to run in the energy market. The
impact of this change is that payments for operations dispatched out-of-merit,
or from operations required to relieve transmission congestion are evaluated
over a twenty four hour period and compensation is paid if the monies received
from the energy market are insufficient to cover the as-bid offer. Previously,
payments for out-of-merit energy was awarded on an hourly basis and therefore
payments received for out-of-merit energy under three part bidding with NCPC
are expected to be lower than under previously single part bid market.

On August 28, 2001, the FERC ruled that a capacity deficiency of $4.87 per
kilowatt (KW) per month was appropriate. The deficiency charge acts as a price
cap for the Installed Capacity (ICAP) market because load-serving entities
(LSE) that do not satisfy their ICAP purchase obligation must pay the
deficiency charge. Previous to this ruling, a temporary deficiency charge of
$0.17 per KW per month existed. In the same order, the FERC rejected ISO-NEs
proposed after-the-fact cure period for LSEs ICAP purchase obligation.

Effective May 1, 2002 certain rule changes went into effect which reflect
in part the recommendations made by ISO-NEs market advisor. Rule changes that
are intended to improve the efficiency of the price signal for energy during
high load periods include amending eligibility requirements for resources
eligible to set the clearing prices, changes to reserve markets including the
inclusion of Replacement Reserves in the Thirty Minute Operating Reserve
Markets and rules on transaction across the tie lines to New York.

New York

On October 31, 2001, the extension of the New York City mitigation
measures to the real time market and out-of-merit dispatches expired.
Consolidated Edison Company of New York (ConEd) has requested an extension of
the expanded mitigation measures. On November 27, 2001, the FERC denied this
request and directed the NYISO to address the concerns of ConEd in a
comprehensive mitigation filing, which is referenced below. On March 20, 2002,
the NYISO filed its comprehensive mitigation proposal with the FERC. Under the
proposal, the Day-Ahead energy market (DAM) bids of New York City suppliers
would continue to be mitigated under the existing ConEd mitigation rules with
the following changes. Specifically, the DAM bid for each hour would be
compared to the energy price at the Indian Point 2 bus and if the In-City bid
exceeded the Indian Point 2 price by more than 107%, all of the DAM energy bids
of the supplier would be mitigated to a reference price. The reference price
represents either an average of accepted energy bids in the DAM over the last
thirty days or a level negotiated with the NYISO. Regarding the real-time
energy market (RTM), the NYISO proposal for New York City restricts the ability
of a facility to bid above its reference price according to the level of
congestion In-City. If congestion prohibits energy from being imported into the
City and is also present within the New York City load pockets, the NYISO
proposal would restrict the ability to bid above the reference price by
approximately 2%. If there is no congestion found in New York City, the
facilities can bid approximately one hundred dollars above its referenced
price. Currently, the New York City mitigation measures only apply in the
day-ahead market. The effect of the expiration of part of these mitigation
measures means that in the real time market and out-of-merit dispatches, the
Companys generating assets in New York City are subject only to the NYISOs
New York state mitigation measures.

On April 30, 2002, the automatic mitigation measure for the entire New York
State DAM expired. On May 1, 2002, the FERC approved a NYISO request for
extension of the automatic mitigation procedures until May 31, 2002. The
extension was granted to permit the FERC to consider the NYISOs comprehensive
mitigation proposal noted above. The automatic mitigation measures evaluate a
suppliers bids to determine if (1) the bid exceeds the suppliers historically
accepted bids (over the past 90 days) by more than $100 and (2) that there is
an impact on the state-wide or a portion of the states energy price by more
than $100. If both of these occur, the suppliers energy bid is reduced to the
facilitys historically accepted bids. The impact of the expiration of the
automatic mitigation measures means that the Company and other market
participants have greater flexibility in submitting bids in the DAM.

The New York energy markets are subject to a price cap of $1,000 per
megawatt hour (MWh). This cap will continue indefinitely.

On September 4, 2001, the FERC approved the request of the NYISO to revise
the ICAP market to one based on unforced capacity

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similar to the capacity market in the Pennsylvania New Jersey Maryland
Interconnection. The change from a capacity market that is based on ICAP to one
based on unforced capacity requires that certain New York City Capacity
requirements be revised to reflect the change. Under ICAP methodology, ICAP
sold by the Company and other New York City generators was capped at $105 per
KW year. In the September 4th order, the FERC increased the price cap to
approximately $112 per KW year. Also in the order the FERC reduced the amount
of In-City Capacity an LSE must purchase by 8.6%. The amount of New York City
capacity that can be sold as unforced capacity is dependent on the availability
of the generating assets to NYISO dispatch instructions. Initially, the FERC
reduced the amount of capacity available from New York City generation by
approximately 7.1%. The effect of these changes is that the capacity price cap
is higher while the amount of capacity an LSE must purchase from New York City
generation and the amount of available New York City generating capacity is
reduced.

7. COMMITMENTS AND CONTINGENCIES

Contractual Commitments

During 1999, the Company acquired the Huntley and Dunkirk generating
facilities from Niagara Mohawk Power Corporation (NiMo). In connection with
this acquisition, the Company entered into a four-year agreement with NiMo that
requires the Company to provide to NiMo, pursuant to a predetermined schedule,
fixed quantities of energy and capacity at a fixed price.

During 1999, the Company acquired certain generating facilities from
Connecticut Light and Power Corporation (CL&P). The Company also entered into a
four-year standard offer agreement that requires the Company to provide to CL&P
a portion of its load requirements through the year 2003 at a substantially
fixed rate.

During 1999, the Company acquired the Oswego generating facilities from
NiMo and entered into a 4 year transition power sales contract with NiMo in
order to hedge NiMos transition to market rates. Under the agreement, NiMo
will pay to Oswego Power a fixed monthly price plus start up fees for the right
to claim, at a specified delivery point(s), the installed capacity of unit 5
and for the right to exercise an option for an additional 350 MW of installed
capacity.

NRG Power Marketing,
Inc. (NRG Power Marketing), an affiliate of the Company, has entered into a wholesale standard offer service
agreement with Blackstone Valley Electric Company, Eastern Edison Company and
Newport Electric Corporation (collectively the EUA Companies). Under the
agreement, NRG Power Marketing is obligated to provide each of the EUA
Companies with firm all-requirements electric service, including capacity,
energy, reserves, line losses and related services necessary to serve the
aggregate load attributable to retail customers taking standard offer service.
The price the EUA Companies pay to NRG Power Marketing for each unit of
electricity is a fixed price plus a fuel cost adjustment factor.

Conectiv Agreement Termination

On November 8, 2002
Conectiv provided NRG Energy with a Notice of Termination of
Transaction under the Master Power Purchase and Sale Agreement
(Master PPA) dated June 21, 2001. Under the Master PPA, which was
assumed by NRG Energy in its acquisition of various assets from
Conectiv, NRG Energy had been required to deliver 500 MW of
electrical energy around the clock at a specified price through 2005.
In connection with the Conectiv acquisition, NRG Energy recorded as
an out-of-market contract obligation for this contract. As a result
of the cancellation, NRG Energy will lose approximately $402 million
in future contracted revenues. Also, in conjunction with the terms of
the Master PPA, NRG Energy will receive from Conectiv a termination
payment in the amount of $955,000. At September 30, 2002, the balance
of the contract obligation was approximately $54 million. Management
is currently evaluating the impact of the Notice of Termination of
the Master PPA.

NYISO Claims

In November 2002, the
NYISO notified NRG Energy of claims related to New York City
mitigation adjustments, general NYISO billing adjustments and other
miscellaneous charges related to sales between November 2000 and
October 2002. NRG Energy strenuously disagrees with both the validity
and calculation of the claims and is currently negotiating with the
NYISO over the ultimate disposition. Due to the uncertainty of the
final adjustment, an estimate of the final amount has not been
recorded in the results for the quarter ended September 30, 2002.

Guarantees

The Company is directly liable for the obligations of certain of its
subsidiaries pursuant to guarantees relating to certain of their operating
obligations. In addition, in connection with the purchase and sale of fuel,
emission credits and power generation products to and from third parties with
respect to the operation of some of the Companys generation facilities in the
United States, the Company may be required to guarantee a portion of the
obligations of certain of its subsidiaries. As of September 30, 2002, the
Companys obligations pursuant to its guarantees of the performance of its
subsidiaries totaled approximately $184.8 million.




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

NRG Northeast was formed for the purpose of financing, acquiring, owning,
operating and maintaining, through its subsidiaries and affiliates, competitive
electric generating facilities in the northeastern region of the United States.

RESULTS OF OPERATIONS

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2002 COMPARED TO THE THREE MONTHS ENDED SEPTEMBER 30, 2001

Net income for the
three months ended September 30, 2002 was $19.8 million,
a decrease of $95.0 million compared to the same period in 2001. This change
represents a decrease of 82.8%. This change was due to the factors
described below.

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Operating Revenues

For the three months ended September 30, 2002, the Company had total
revenues of $233.6 million, compared to $352.2 million for the same period in
2001, a decrease of $118.6 million or 33.7%. The decrease in revenues
is due to
a combination of lower capacity revenues and a 3% decline in megawatt hour generation compared with the same period in
2001. This decline in generation is attributable to reduced demand for electricity,
together with new regulation which reduced price volatility,
particularly in New York City, where the Companys plants sell
into the merchant energy market. Additionally, unrealized losses associated with
changes in the fair value of non-hedge energy related derivative
instruments recorded in revenues were $35.3 million and $0 for
the three months ended September 30, 2002 and 2001, respectively.

Operating Costs

Operating costs were $182.1 million for the three months ended September
30, 2002 compared to $204.9 million for the same period in 2001, a decrease of
$22.8 million, or 11.2%. Operating costs primarily consist of expenses for fuel,
plant operations and maintenance and unrealized gains or losses associated with
changes in the fair value of energy related derivative instruments not
accounted for as hedges in accordance with SFAS No. 133. The decrease in
operating costs is primarily due to a reduction in fuel cost due to a decline
in power generation, a general decline in the price of fuel, and lower
expenditures on plant maintenance and operations.

Fuel expense for the three months ended September 30, 2002 was $119.5
million compared to $136.6 million for the same period in 2001, a decrease of
$17.1 million or 12.5%. This decrease is due to a decline in
power generation and a general decline in the price of fuel. Fuel expense for the three months ended September 30,
2002 represented 51.2% of revenues compared to 38.8% for the same
period in 2001. This increase is the result of a sharper decline in electricity
prices than the rate of decline in fuel prices during the three months
ended September 30, 2002 as compared to the same period in 2001. Fuel
expense included $31.8 million of coal, $51.3 million
of natural gas, and $36.4 million of fuel oil, diesel and other related costs. For the three months
ended September 30, 2001, fuel expense included $28.7 million of coal, $61.7
million of natural gas, and $46.2 million of fuel oil, diesel and other related
costs.

Plant operations and maintenance expense for the three months ended
September 30, 2002 was $45.2 million compared to $50.9 million for the same
period in 2001, a decrease of $5.7 million or 11.2%. Plant operations and
maintenance expense for the three months ended September 30, 2002 represented
19.3% of revenue, and included labor and benefits under operating service
agreements of $16.8 million, maintenance parts, supplies and services of $14.6
million and property taxes and other expense of $13.8 million. Plant operations
and maintenance expense for the three months ended September 30, 2001
represented 14.5% of revenue, and included labor and benefits under operating
service agreements of $11.5 million, maintenance parts, supplies and services
of $22.2 million and property taxes and other expenses of $17.2 million.

Unrealized losses associated with changes in fair value of non-hedge
energy related derivative instruments recorded in operating costs
were $17.4 million for each of the three month periods
ended September 30, 2002 and 2001.

Depreciation

Depreciation costs were $13.6 million for the three months ended September
30, 2002, which is an increase of $1.4 million, or 11.5% from the same period in
2001. Depreciation expense was primarily related to the acquisition costs of
the facilities, which are being depreciated over twenty-five to thirty years.
The increase in depreciation expense is attributable to higher
depreciable costs resulting from routine capital additions.

General and Administrative Expenses

General and administrative expenses were $5.3 million for the three months
ended September 30, 2002, compared to $5.5 million for the same period in 2001,
a decrease of $0.2 million or 3.6%. General and administrative expenses include
costs for outside legal and other contract services, payments to NRG Energy for
corporate services, expenses related to office administration, as well as costs
for certain employee benefits incurred under operating service agreements.

Interest Expense

Interest expense for the three months ended September 30, 2002 was $12.9
million compared to $15.2 million for the three months ended September 30,
2001, a decrease of $2.3 million or 15.1%. Interest expense primarily relates to
the amortization of deferred finance costs and interest on the senior secured
bonds issued on February 22, 2000 and the affiliated note payable issued on
June 15, 2002. The decrease in interest expense is attributable to a decline
in the average principle amounts outstanding on the senior secured
indebtedness.

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Other Income

Other income for the three months ended September 30, 2002 was $0.1
million compared to $0.6 million for the same period in 2001, a decrease of
$0.5 million or 83.3%.

FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 2002 COMPARED TO THE NINE MONTHS ENDEDSEPTEMBER 30, 2001

Net income for the
nine months ended September 30, 2002 was $68.7 million,
a decrease of $113.3 million compared to the same period in 2001. This change
represents a decrease of 62.3%. This change was due to the factors
described below.

Operating Revenues

For the nine months ended September 30, 2002, the Company had total
revenues of $550.3 million, compared to $898.7 million for the same period in
2001, a decrease of $348.4 million or 38.8%. The decrease in revenues for the
nine months ended September 30, 2002 versus the same period in 2001 is due to a
combination of lower capacity revenues realized of approximately
$27.8 million
and a 26% decline in megawatt hour generation compared with the same period in
2001. This decline in generation is attributable to an unseasonably warm
winter and cooler spring which reduced demand for electricity, together with new regulation which reduced price
volatility, particularly in New York City, where the Companys plants sell into
the merchant energy market.

Operating Costs

For the nine months ended September 30, 2002, operating costs were $390.7
million compared to $621.8 million for the same period in 2001, a decrease of
$231.1 million or 37.2%. Operating costs, as a percentage of operating revenues
were 71.0% for the nine months ended September 30, 2002 compared
to 69.2% for the
same period in 2001. Operating costs primarily consist of expenses for fuel,
plant operations and maintenance and unrealized gains or losses associated with
changes in the fair value of energy related derivative instruments not
accounted for as hedges in accordance with SFAS No. 133. The decrease in
operating costs is primarily due to a reduction in fuel cost due to a decline
in power generation, a general decline in the price of fuel, lower expenditures
on plant maintenance and operations and a $47.3 million favorable swing in
unrealized losses associated with changes in the fair value of energy related
derivative instruments not accounted for as hedges in accordance with SFAS No.
133.

Fuel expense for the nine months ended September 30, 2002 was $234.5
million compared to $393.5 million for same period in 2001, a decrease of
$159.0 or 40.4%. Fuel expense for the nine months ended
September 30, 2002, was 42.6% of revenues compared to 43.6% for
the same period in 2001. Fuel expense included $79.7 million of
coal, $92.4 million of natural gas, and $62.4 million of fuel oil, diesel and
other related costs, for the nine months ended September 30, 2002. For the nine
months ended September 30, 2001, fuel expense included $93.5 million of coal
$135.6 million of natural gas, and $164.4 million of fuel oil, diesel and other
related costs.

Plant operations and maintenance expense for the nine months ended
September 30, 2002 was $148.4 million compared to $173.2 million for the same
period in 2001, a decrease of $24.8 million or 14.3%. Plant operations and
maintenance expense for the nine months ended September 30, 2002 represented
27.0% of revenue, and included labor and benefits under operating service
agreements of $49.4 million, maintenance parts, supplies and services of $54.9
million and property taxes and other expenses of $44.1 million. Plant
operations and maintenance expense for the nine months ended September 30, 2001
represented 19.3% of revenue, and included labor and benefits under operating
service agreements of $47.3 million, maintenance parts, supplies and services
of $73.6 million and property taxes and other expenses of $52.3 million.

Unrealized losses associated with changes in fair value of non-hedge
energy related derivative instruments recorded in operating costs were $7.8 million for the nine months
ended September 30, 2002 compared to $55.1 million for the same period in 2001.

Depreciation

Depreciation costs were $39.8 million for the nine months ended September
30, 2002, which is an increase of $3.2 million, or 9% from the same period in
2001. Depreciation expense was primarily related to the acquisition costs of
the facilities, which are being depreciated over twenty-five to thirty years.
The increase in depreciation expense is attributable to higher
depreciable costs resulting from routine capital additions.

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General and Administrative Expenses

General and administrative expenses were $16.7 million for the nine months
ended September 30, 2002, compared to $14.7 million for the same period in
2001, an increase of $2.0 million or 14%. General and administrative expenses
include costs for outside legal and other contract services, payments to NRG
Energy for corporate services, expenses related to office administration, as
well as costs for certain employee benefits incurred under operating service
agreements.

Interest Expense

Interest expense for the nine months ended September 30, 2002 was $39.6
million compared to $45.6 million for the same period in 2001, a decrease of
$6.0 million or 13%. Interest expense primarily relates to the amortization of
deferred finance costs and interest on the senior secured bonds issued on
February 22, 2000 and the affiliated note payable issued on June 15, 2002. The
decrease in interest expense is attributable to a decline in the average
principle amounts outstanding on the senior secured indebtedness.

Other Income

Other income for the nine months ended September 30, 2002 was $5.2 million
compared to $1.9 million for the same period in 2001, an increase of $3.3
million or 174%. The increase in other income is primarily attributable to of
an insurance settlement for $1.5 million and a refund of transfer tax of $2.9
million related to the acquisition of the Companys Connecticut
assets, offset in part by other expenses of $1.1 million.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company managements discussion and analysis of its financial
condition and results of operations are based upon the Companys consolidated
financial statements, which have been prepared in accordance with accounting
principles generally accepted in the United States of America. The preparation
of these financial statements and related disclosures in compliance with
generally accepted accounting principles requires the application of
appropriate technical accounting rules and guidance as well as the use of
estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses. These judgments, in and of themselves,
could materially impact the financial statements and disclosures based on
varying assumptions, which may be appropriate to use. In addition, the
financial and operating environment also may have a significant effect, not
only on the operation of the business, but on the results reported through the
application of accounting measures used in preparing the financial statements
and related disclosures, even if the nature of the accounting policies have not
changed.

On an ongoing basis, the Company evaluates its estimates utilizing
historic experience, consultation with experts and other methods the Company
considers reasonable. In any case, actual results may differ significantly from
the Companys estimates. Any effects on the Companys business, financial
position or results of operations resulting from revisions to these estimates
are recorded in the period in which the facts that give rise to the revision
become known.

Refer to Item 8
Note 2 of the consolidated financial statements of the Companys Form 10-K for the year ended December 31, 2001 for
additional discussion regarding the Companys accounting policies and
estimates.

LIQUIDITY AND CAPITAL RESOURCES

The Company and its majority-owned subsidiaries have historically obtained cash
from operations, issuance of debt securities, and borrowings under credit
facilities or affiliated loans. The Company has used these funds to finance
operations, service debt obligations, fund the acquisition, development, and
construction of generation facilities, finance capital expenditures and meet
other cash and liquidity needs.

The bonds and working capital facility agreements of the Company generally
restrict its ability to pay dividends, make distributions or otherwise transfer
funds to NRG Energy under certain circumstances. As of September 30, 2002, the
Company did not meet the required minimum debt service coverage ratios, and
therefore is restricted from making payments to NRG Energy.

On February 22, 2000, the Company issued $750 million of senior secured
bonds to refinance short-term project borrowings and for certain other
purposes. The bond offering included three tranches: $320 million with an
interest rate of 8.065% due in 2004; $130 million with an interest rate of
8.842% due in 2015; and $300 million with an interest rate of 9.292% due in
2024. Principal payments are made semi-annually. The bonds are
jointly and severally guaranteed by each of the Company's existing and future subsidiaries. The bonds are secured by a
security interest in the Company's membership or other ownership interests in
the guarantors and its rights under all intercompany notes between
the Company and the guarantors. At September 30, 2002, $556.5 million of bonds
remain outstanding and are classified as current.

Prior to the NRG Energy downgrades, the debt service reserve account of the
Company was funded with a letter of guarantee from the parent company.
Following the downgrade, the Company received notice from the trustee on
September 9 requesting the cash funding of the debt service reserve account
within 30 days. On October 9 NRG Energy failed to fund the debt service
reserve account, which created an event of default that, if not cured within 60
days, gives the bond holders rights of acceleration. The project is precluded
from making payments to NRG Energy. As a result of this impending default, the
long-term portion of the debt has been reclassified to a current liability, as
it is potentially callable within the next twelve months.

As of October 31, 2002, the Company had cash and cash equivalents of
approximately $100 million.

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On August 19, 2002, NRG Energy executed a Collateral Call Extension Letter
(CCEL) with various secured project lender groups in which the banks agreed to
extend, until September 13, 2002, the deadline by which NRG Energy must post
its approximately $1.0 billion of cash collateral in connection with certain
bank loan agreements. Subsequently, NRG Energy and these various secured
project lenders entered into a Second Collateral Call Extension Letter (Second
CCEL) extending, until November 15, 2002, the deadline by which NRG Energy must
post such collateral.

On November 6, 2002, lenders to NRG Energy accelerated approximately $1.1
billion of NRG Energys debt under a construction revolver financing facility,
rendering the debt immediately due and payable. This action terminated the
Second CCEL in effect between NRG Energy and its major lenders. The extension
letter was previously scheduled to expire November 15, 2002. Based on
discussions with the construction revolver lenders it is NRG Energys
understanding that the administrative agent, Credit Suisse First Boston, issued
the acceleration notice to preserve certain rights under the construction
revolver financing agreements. NRG Energy believes that the administrative
agent intends to forbear in the immediate exercise of any rights and remedies
against the Company.

Starting in August 2002, NRG Energy engaged in the preparation of a
comprehensive business plan and forecast. The business plan detailed the
strategic merits and financial value of NRG Energys projects and operations.
It also anticipates that NRG Energy will function independently from Xcel
Energy and thus all plans and efforts to combine certain functions of the
companies were terminated. NRG Energy utilized independent electric revenue
forecasts from an outside energy markets consulting firm to develop forecasted
cash flow information included in the business plan. Management concluded that
the forecasted free cash flow available to NRG Energy after servicing
project-level obligations will be insufficient to service recourse debt
obligations. Based on this information and in consultation with Xcel Energy and
its financial advisor, NRG Energy prepared and submitted a restructuring plan
on November 4, 2002 to various lenders, bondholders and other creditor groups
(collectively, NRG Energys Creditors) of NRG Energy and its subsidiaries. The
restructuring plan is expected to serve as a basis for negotiations with NRG
Energys Creditors in a financially-restructured NRG Energy and, among other
things, proposes (i) holders of secured (project-level) debt would either (a)
have their debt reinstated with agreed modifications or (b) receive the
collateral securing such debt and a claim or claims to the extent such debt is
under-secured; (ii) holders of unsecured debt, holders of secured recourse
claims against NRG Energy, and holders of other general unsecured claims
against NRG Energy would receive a pro rata share of (a) an aggregate of $500
million of junior secured debt of reorganized NRG Energy and (b) 95% of the
common equity of reorganized NRG Energy; and (iii) holders of project-level
general unsecured claims that are non-recourse to NRG Energy would receive a
pro rata share of the remaining 5% of the common equity of a reorganized NRG
Energy.

The restructuring plan also includes a proposal by Xcel Energy that in
return for a release of any and all claims against Xcel Energy, upon
consummation of the restructuring, Xcel Energy would pay $300 million to NRG
Energy and surrender its equity ownership of NRG Energy.

If an agreement were reached with NRG Energys Creditors on a
restructuring plan, it would most likely lead to NRG Energy commencing a
Chapter 11 bankruptcy case and immediately seeking approval of a prenegotiated
plan of reorganization. The absence of an agreement will increase the
possibility of NRG Energy seeking protection under the bankruptcy laws.

If NRG Energy files under Chapter 11, it is likely that NRG Energy would also
file certain wholly-owned subsidiaries, which may include the Company.

Throughout the restructuring process, NRG Energy seeks to operate the
business in a manner that management believes will offer to creditors similar
protection as would be offered by a bankruptcy court. NRG Energy attempts to
preserve the enterprise value of the business and to treat creditors within
each creditor class without preference, unless otherwise agreed to by advisors
to all potentially affected creditors. By operating the Company within
this framework, NRG Energy desires to mitigate the risk that creditors will
pursue involuntary bankruptcy proceedings against NRG Energy or its material
subsidiaries.

The credit rating downgrades, defaults under certain agreements, increased
collateral requirements, creditors
actions and reduced liquidity that have occurred during the quarter ended
September 30, 2002 have created substantial doubt as to NRG Energys ability to
continue as a going concern. The absence of a restructuring agreement will
increase the possibility of NRG Energy and certain of its
subsidiaries, including the Company, seeking protection under the bankruptcy
laws.

Cash Flows

|                                          |  |                                         |        |      |  |   |         | 
|----------------------------------------- |  | --------------------------------------- | ------ | ---- |  | - | ------- | 
|                                          |  | For the nine months ended September 30,
|                                          |  |                                        
|(Thousands of Dollars)                    |  | 2002                                    |        | 2001
|                                          |  |                                         |        |     
|Net cash provided by operating activities |  | $                                       | 45,546 |      |  | $ | 423,234 | 

Net cash provided by operations decreased during the nine months ended
September 30, 2002 compared to the same period in 2001. The most significant
changes in working capital items related to the decrease in Inventory and the increases in Accounts Receivable and Accounts
Receivable  Affiliate during 2002.

|                                      |  |                                         |         |      |  |   |         |  
|------------------------------------- |  | --------------------------------------- | ------- | ---- |  | - | ------- | -
|                                      |  | For the nine months ended September 30,
|                                      |  |                                        
|(Thousands of Dollars)                |  | 2002                                    |         | 2001
|                                      |  |                                         |         |     
|Net cash used in investing activities |  | $                                       | (22,098 | )    |  | $ | (15,496 | )

Net cash used in investing activities for the nine months ended September
30, 2002 increased in comparison to the same period in 2001. The increase is
due to the increase in capital expenditures in the current period.

|                                      |  |                                         |         |      |  |   |          |  
|------------------------------------- |  | --------------------------------------- | ------- | ---- |  | - | -------- | -
|                                      |  | For the nine months ended September 30,
|                                      |  |                                        
|(Thousands of Dollars)                |  | 2002                                    |         | 2001
|                                      |  |                                         |         |     
|Net cash used in financing activities |  | $                                       | (23,500 | )    |  | $ | (390,146 | )

Net cash used in financing activities for the nine months ended September
30, 2002 decreased from the same period in 2001. The decrease is primarily due
to significant capital distributions in 2001 and no capital distributions in
2002.

The debt agreements
of NRG Energys subsidiaries and project affiliates generally
restrict their ability to pay dividends, make distributions or otherwise
transfer funds to NRG Energy. As of September 30, 2002, the Company is restricted
from making cash payments to NRG Energy. On October 31, 2002, the Company had
approximately $100 million of cash on hand.

Capital Commitments

Prospective Capital Requirements

The Company estimates $25 million and $35 million in capital spending for the
period from October 21 through December 31, 2002, and for calendar year 2003,
respectively. These amounts include the cost of capital improvements, minor
refurbishments, and expansions of projects in operation. The Company plans to
fund these liquidity needs with cash on hand and operating cash from generating
assets. Current financial plans estimate cash from operations of $125 million
to $150 million for 2003.

The Companys capital expenditure program is subject to continuing review and
modification. Actual expenditures may differ from these estimates.

Contractual obligations and commercial commitments

|                                   |  |                                                 |         |            |  |           |         |           |  |               |   |  |  |   |   |  |  |   |        | 
|---------------------------------- |  | ----------------------------------------------- | ------- | ---------- |  | --------- | ------- | --------- |  | ------------- | - |  |  | - | - |  |  | - | ------ | 
|                                   |  | Payments due by period as of September 30, 2002
|                                   |  |                                                
|(Thousands of Dollars)             |  | Total                                           |         | short term |  | 1-3 years |         | 4-5 years |  | after 5 years
|                                   |  |                                                 |         |            |  |           |         |           |  |              
|Long term debt                     |  | $                                               | 556,500 |            |  | $         | 556,500 |           |  | $             |  |  |  | $ |  |  |  | $ |       | 
|Note payable  affiliate           |  |                                                 | 30,000  |            |  |           |        |           |  |               |  |  |  |   |  |  |  |   | 30,000 | 
|                                   |  |                                                 |         |            |  |           |         |           |  |               |   |  |  |   |   |  |  |   |        | 
|Total contractual cash obligations |  | $                                               | 586,500 |            |  | $         | 556,500 |           |  | $             |  |  |  | $ |  |  |  | $ | 30,000 | 
|                                   |  |                                                 |         |            |  |           |         |           |  |               |   |  |  |   |   |  |  |   |        | 

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|                             |  |                                                                 |         |            |  |           |         |           |  |               |        |  |  |   |   |  |  |   |        | 
|---------------------------- |  | --------------------------------------------------------------- | ------- | ---------- |  | --------- | ------- | --------- |  | ------------- | ------ |  |  | - | - |  |  | - | ------ | 
|                             |  | Amount of commitment expiration period as of September 30, 2002
|                             |  |                                                                
|                             |  | Total amounts                                                   |         |            |  |           |         |           |  |               |        |  |  |   |   |  |  |  
|(Thousands of Dollars)       |  | committed                                                       |         | short term |  | 1-3 years |         | 4-5 years |  | after 5 years
|                             |  |                                                                 |         |            |  |           |         |           |  |              
|Guarantees                   |  | $                                                               | 184,839 |            |  | $         | 151,500 |           |  | $             | 15,000 |  |  | $ |  |  |  | $ | 18,339 | 
|                             |  |                                                                 |         |            |  |           |         |           |  |               |        |  |  |   |   |  |  |   |        | 
|Total commercial commitments |  | $                                                               | 184,839 |            |  | $         | 151,500 |           |  | $             | 15,000 |  |  | $ |  |  |  | $ | 18,339 | 
|                             |  |                                                                 |         |            |  |           |         |           |  |               |        |  |  |   |   |  |  |   |        | 

Other Contingencies

Contract Negotiation

In July 2002, NRG
Energy reached a tentative agreement with Connecticut Light &
Power (CL&P) that would result in increased compensation to NRG Energy, a supplier of
CL&Ps wholesale supply agreement. CL&P filed an emergency petition with the
Connecticut Department of Public Utility Control (DPUC) asking for approval of
a shift of wholesale supply agreement revenues, effective August 1, 2002,
through December 31, 2003, that would reallocate 0.7 cents per kilowatt-hour in
the wholesale price paid to existing suppliers. On July 26, 2002, the DPUC
denied the request of CL&P for an emergency letter ruling. On August 9, 2002,
NRG Energy announced that it had reached an agreement with ISO-New England to
keep three units at its Devon station in service. The agreement expires on
September 30, 2003.

Derivative Instruments

The tables below
disclose the Company's derivative activities that include
non-exchange traded contracts accounted for at fair value. Specifically, these
tables disaggregate realized and unrealized changes in fair value; identifies
changes in fair value attributable to changes in valuation techniques;
disaggregates estimated fair values at September 30, 2002 based on whether fair
values are determined by quoted market prices or more subjective means; and
indicates the maturities of contracts at September 30, 2002.

Derivative Activity

|                                                                       |  |       |         |  
|---------------------------------------------------------------------- |  | ----- | ------- | -
|Gains/(Losses)                                                         |  |       |         |  
|(Thousands of dollars)                                                 |  | Total
|                                                                       |  |      
|Fair Value of contracts outstanding at the beginning of the period     |  | $     | 115,943 |  
|Contracts realized or otherwise settled during the period              |  |       | 7,353   |  
|Fair value of new contract when entered into during the period         |  |       |        |  
|Changes in fair values attributable to changes in valuation techniques |  |       |        |  
|Other changes in fair values                                           |  |       | (59,646 | )
|                                                                       |  |       |         |  
|Fair value of contracts outstanding at the end of the period           |  | $     | 63,650  |  
|                                                                       |  |       |         |  

Sources of Fair Value Gains/(Losses)

|                                                 |  |                                       |        |           |  |           |         |                |  |       |     |          |  |       |       |  |  |   |        | 
|------------------------------------------------ |  | ------------------------------------- | ------ | --------- |  | --------- | ------- | -------------- |  | ----- | --- | -------- |  | ----- | ----- |  |  | - | ------ | 
|Maturity schedule                                |  | Fair Value of Contracts at Period End
|                                                 |  |                                      
|                                                 |  | Maturity                              |        |           |  |           |         |                |  |       |     |          |  |       |       |  |  |  
|                                                 |  |                                       |        |           |  |           |         |                |  |       |     | Maturity |  | Total
|                                                 |  | Less than 1                           |        | Maturity  |  | Maturity  |         | in excess of 5 |  | Fair 
|(Thousands of dollars)                           |  | Year                                  |        | 1-3 Years |  | 4-5 Years |         | Years          |  | Value
|                                                 |  |                                       |        |           |  |           |         |                |  |      
|Prices actively quoted                           |  | $                                     |       |           |  | $         |        |                |  | $     |    |          |  | $     |      |  |  | $ |       | 
|Prices provided by other external sources        |  |                                       |       |           |  |           |        |                |  |       |    |          |  |       |      |  |  |   |       | 
|Prices based on models & other valuation methods |  |                                       | 65,666 |           |  |           | (4,085) |                |  |       | 515 |          |  |       | 1,554 |  |  |   | 63,650 | 
|                                                 |  |                                       |        |           |  |           |         |                |  |       |     |          |  |       |       |  |  |   |        | 
|                                                 |  | $                                     | 65,666 |           |  | $         | (4,085) |                |  | $     | 515 |          |  | $     | 1,554 |  |  | $ | 63,650 | 
|                                                 |  |                                       |        |           |  |           |         |                |  |       |     |          |  |       |       |  |  |   |        | 

NEW ACCOUNTING PRONOUNCEMENTS

In June 2001, the Financial Accounting Standards Board (the FASB) issued
Statement of Financial Accounting Standards No. 142, Goodwill and Other
Intangible Assets(SFAS No. 142). SFAS No. 142 requires that goodwill and
intangible assets with indefinite useful lives no longer be amortized but
instead be tested for impairment in accordance with SFAS No. 121, Accounting
for the Impairment of Long-lived Assets and for Long-lived Assets to Be
Disposed Of(SFAS No. 121). Goodwill will no longer be amortized to comply with
the provisions of SFAS No. 142. Instead, goodwill and intangible assets that
will not be amortized should be tested for impairment annually and on an
interim basis if an event occurs or a circumstance changes between annual tests
that may reduce the fair value of a reporting unit below its carrying value. An
impairment test is required to be performed within nine months of the date of
adoption, and the first annual impairment test must be performed in the year
the statement is initially adopted. The Company and its
subsidiaries have adopted the provisions of SFAS No. 142 effective January 1,
2002. No impairments on assets were recorded upon adopting SFAS 142 on January
1, 2002.

16



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In June 2001, FASB issued SFAS No. 143, Accounting for Asset Retirement
Obligations(SFAS No. 143). This statement addresses financial accounting and
reporting for obligations associated with the retirement of tangible long-lived
assets and the associated asset retirement costs. SFAS No. 143 requires an
entity to recognize the fair value of a liability for an asset retirement
obligation in the period in which it is incurred. Upon initial recognition of a
liability for an asset retirement obligation, an entity shall capitalize an
asset retirement cost by increasing the carrying amount of the related
long-lived asset by the same amount as the liability. SFAS No. 143 is effective
for financial statements issued for fiscal years beginning after June 15, 2002.
The Company has not completed its analysis of SFAS No. 143.

In October 2001, the FASB issued SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets(SFAS No. 144). This statement
addresses financial accounting and reporting for the impairment or disposal of
long-lived assets. SFAS No. 144 retains and expands upon the fundamental
provisions of existing guidance related to the recognition and measurement of
the impairment of long-lived assets to be held and used and the measurement of
long-lived assets to be disposed of by sale. Generally, the provisions of SFAS
No. 144 are effective for financial statements issued for fiscal years
beginning after December 15, 2001. The Company and its
subsidiaries have adopted SFAS No. 144 effective January 1, 2002. No asset
impairments have been recognized as a result of adopting SFAS No. 144 through
the first three quarters of 2002.

In April 2002, FASB issued SFAS No. 145, Rescission of FASB Statements No.
4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections
(SFAS No. 145), that supercedes previous guidance for the reporting of gains
and losses from extinguishment of debt and accounting for leases, among other
things, SFAS No. 145 requires that only gains and losses from the
extinguishment of debt that meet the requirements for classification as
Extraordinary Items, as prescribed in Accounting Practices Board Opinion No.
30, should be disclosed as such in the financial statements. Previous guidance
required all gains and losses from the extinguishment of debt to be classified
as Extraordinary Items. This portion of SFAS No. 145 is effective for fiscal
years beginning after May 15, 2002, with restatement for prior periods
required. In addition, SFAS No. 145 amends SFAS No. 13, Accounting for Leases
(SFAS No. 13), as it relates to accounting by a lessee for certain lease
modifications. Under SFAS No. 13, if a capital lease is modified in such a way
that the change gives rise to a new agreement classified as an operating lease,
the assets and obligation are removed, a gain or loss is recognized and the new
lease is accounted for as an operating lease. Under SFAS No. 145, capital
leases that are modified so the resulting lease agreement is classified as an
operating lease are to be accounted for under the sale-leaseback provisions of
SFAS No. 98, Accounting for Leases.These provisions of SFAS No. 145 are
effective for transaction occurring after May 15, 2002. SFAS No. 145 will be
applied as required. Adoption of SFAS No. 145 is not expected to have a
material impact on the Company.

In June 2002, the FASB issued SFAS No. 146, Accounting for Costs
Associated with Exit or Disposal Activities. SFAS No. 146 addresses financial
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force Issue No. 94-3, Liability Recognition for Certain
Employee Termination Benefits and Other Costs to Exit an Activity (including
Certain Costs Incurred in a Restructuring). SFAS No. 146 applies to costs
associated with an exit activity that does not involve an entity newly acquired
in a business combination or with a disposal activity covered by SFAS No. 144,
Accounting for the Impairment or Disposal of Long-Lived Assets The provisions
of SFAS No. 146 are effective for exit or disposal activities that are initiated
after December 31, 2002, with early application encouraged. The
Company has
not completed its analysis of SFAS No. 146.




Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company is exposed to market risks, including changes in commodity
prices and interest rates, and credit risk as disclosed in Managements
Discussion and Analysis in its annual report on Form 10-K for the year ended
December 31, 2001. There have been no material changes as of September 30,
2002 to the market risk disclosures presented as of December 31, 2001.




Item 4. Controls and Procedures

NRGs Chief Operating Officer and Chief Financial Officer have evaluated
the effectiveness of the Company's disclosure controls and procedures (as
such term is defined in Rules 13a-14(c ) and 15d-14(c )) under the Securities
Exchange Act of 1934, as amended (Exchange Act) as of a date within 90 days
prior to the filing date of this quarterly report (Evaluation Date). Based on
such evaluation, such officers have concluded that, as of the Evaluation Date,
the Companys disclosure controls and procedures

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are effective in alerting
them on a timely basis to material information relating to the
Company including its consolidated subsidiaries) required to be included in the
Companys periodic filings under the Act.

Since the Evaluation Date, there have not been any significant changes in
the
Companys internal controls or in other factors that could significantly
affect such controls.




Part II  OTHER INFORMATION




Item 1. Legal Proceedings

Fortistar Capital v. NRG Energy

In July 1999, Fortistar Capital Inc., a Delaware corporation, filed a
complaint in District Court (Fourth Judicial District, Hennepin County) in
Minnesota against NRG Energy asserting claims for injunctive relief and for damages as
a result of NRG Energys alleged breach of a confidentiality letter agreement with
Fortistar relating to the Oswego facility in New York. NRG Energy disputed Fortistars
allegations and asserted numerous counterclaims. In October 1999, the
Company closed on the acquisition of the Oswego
facility. In April and December 2000, NRG Energy filed summary judgment motions to
dispose of the litigation. A hearing on these motions was held in February 2001
and certain of Fortistars claims were dismissed. On May 8, 2002 the parties
entered into a binding, conditional settlement of the litigation,
pending certain approvals and final agreement on the terms of the settlement.
The settlement also encompassed litigation between the parties with respect to
Minnesota Methane LLC. At the end of August, 2002, NRG Energy
asserted that conditions for consummation of the settlement had not
been met, while Fortistar moved the Court to enter judgement against
NRG Energy to enforce the settlement. At the Courts
encouragement, the parties are now engaged in further settlement
efforts to resolve all outstanding issues between them.

New York Environmental Litigation

In January 2002 the New York Attorney General and the New York Department
of Environmental Conservation filed suit in the United States
District Court, Western District of New York against, NRG Energy and
Niagara Mohawk Power Corporation (NiMo), the prior owner of the Huntley and Dunkirk
facilities in New York. The lawsuit relates to physical changes made at those
facilities prior to NRG Energys assumption of ownership. The complaint alleges that
these changes represent major modifications undertaken without the required
permits having been obtained and seeks a judgement requiring NRG
Energy and/or NiMo to install emissions control equipment to reduce
emissions of nitrogen oxides and sulfur dioxides. Although NRG Energy has a right to
indemnification by the previous owner for fines, penalties,
assessments and related losses resulting from the previous
owners failure to comply with environmental laws and
regulations, NRG Energy could be enjoined from operating the facilities if the
facilities are found not to comply with applicable permit
requirements and it could be required to bear the costs of installing
emissions controls. NRG Energy has filed a motion to dismiss the claims
against it which was heard in July 2002. The Courts ruling on
that motion is still pending.

In July 2001, NiMo filed a declaratory judgment action in the Supreme
Court for the State of New York, County of Onondaga, against NRG
Energy and its wholly-owned subsidiaries, Huntley Power LLC and
Dunkirk Power LLC. NiMo requests a declaration by the Court that,
pursuant to the terms of the Assets Sales Agreement under which NRG
Energy purchased the Huntley and Dunkirk generating facilities from
NiMo (the ASA), defendants have assumed liability for any costs
for the installation of emissions controls or other modifications to
or related to the Huntley or Dunkirk plants imposed as a result of
violations or alleged violations of environmental law. NiMo also
requests a declaration by the Court that, pursuant to the ASA,
defendants have assumed all liabilities, including liabilities for
natural resource damages, arising from emissions or releases of
pollutants from the Huntley and Dunkirk plants, without regard to
whether such emissions or releases occurred before, on or after the
closing date for the purchase of the Huntley and Dunkirk plants. NRG
Energy has counterclaimed against NiMo, and the parties have
exchanged materials.

NYDEC Opacity Notice of Violation

NRG Energy became part of an opacity consent order negotiation as a result of
acquiring its Huntley, Dunkirk and Oswego plants from NiMo. At the time of
financial close on these assets, a consent order was being negotiated between
NiMo and the NYDEC; it required NiMo to pay a stipulated penalty for each
opacity event at these facilities. On January 14, 2002, the
NYDEC issued NRG Energy Notices of Violations (NOV) for opacity events, which had occurred since the
time NRG Energy assumed ownership of the Huntley, Dunkirk and Oswego generating
stations. The NOVs allege that a total of 7,231 events had occurred where the
average opacity during a six-minute block of time had exceeded 20%. The NYDEC
proposed a penalty associated with the NOVs of $900,000. NRG Energy is
in negotiations with the NYDEC to settle the dispute.

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Constellation Power Source Inc. Agreement

On August 2, 2002, the Company received payment under a net settlement
agreement, of approximately $20 million from Constellation Power Source, Inc.,
through their affiliate, NRG Power Marketing. The agreement provides for
the termination of a long-term power purchase contract dated February 25, 2002
between Constellation and NRG Power Marketing on the Companys behalf.




Item 3. Defaults Upon Senior
Securities

NRG Northeast has
identified the following material defaults with respect to the
indebtedness of the Company and its significant subsidiaries:

$320 million of
8.065% Series A Senior Secured Bonds due 2004 by NRG Northeast
Generating LLC

| |  |  | Failure to fund debt service reserve account
|- |  |  | --------------------------------------------

$130 million of
8.824% Series B Senior Secured Bonds due 2015 by NRG Northeast
Generating LLC

| |  |  | Failure to fund debt service reserve account
|- |  |  | --------------------------------------------

$300 million of
9.29% Series C Senior Secured Bonds due 2024 by NRG Northeast
Generating LLC

| |  |  | Failure to
fund debt service reserve account
|- |  |  | --------------------------------------------




Item 6. Exhibits and Reports on Form 8-K



| | (A) |  | Exhibits                                                                                
| | --- |  | ----------------------------------------------------------------------------------------
|
| |     |  | 99.1 Officers
Certification                                                            
|
| | (B) |  | Reports on Form 8-K                                                                     
|
| |     |  | On October 24, 2002, the Company filed a Form 8-K reporting under Item 5  Other Events.



| |  |  | On October 18, 2002, NRG Energy announced that it had reached an agreement with
certain of its bank lenders to extend until November 15, the deadline by which it must
post approximately $1 billion of cash collateral in connection with certain bank loan
agreements. NRG Energy also announced the filing by The Shaw Group Inc. of an
involuntary petition for liquidation of LSP-Pike Energy, LLC under Chapter 7 of the
U.S. Bankruptcy Code. Shaw, the contractor for NRG Energys Pike power plant
construction project in Holmesville, Mississippi, also filed suit against NRG Energy
and Xcel Energy alleging claims connected with the Pike project.
| |  |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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Cautionary Statement Regarding Forward-Looking Statements

The information presented in this Form 10-Q includes forward-looking
statements in addition to historical information. These statements involve
known and unknown risks and relate to future events, or projected business
results. In some cases forward-looking statements may be identified by their
use of such words as may, expects, plans, anticipates, believes, and
similar terms. Forward-looking statements are only predications, and actual
results may differ materially from the expectations expressed in any
forward-looking statement. While the Company believes that the expectations
expressed in such forward-looking statements are reasonable, we can give no
assurances that these expectations will prove to have been correct. In addition
to any assumptions and other factors referred to specifically in connection
with such forward-looking statements, factors that could cause actual results
to differ materially from those contemplated in any forward-looking statements
include, among others, the following:



| |  |  | NRG Energys ability to reach agreements with its lenders and
creditors to restructure debt and delay the funding of collateral
required following NRG Energys, and the Companys, ratings
downgrades by Moodys and Standard & Poors;                                                                                                                                                                                      
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | NRG Energys ability to sell assets in the amounts and on the time table assumed;                                                                                                                                                                                                                                                                                                                                             
|
| |  |  | General economic conditions
including inflation rates and monetary exchange rate fluctuations; the
risk of a significant slowdown in growth in the U.S. economy or risk
of delay in growth recovery in the U.S. as a consequence of the
September 11, 2001 terrorist attacks and other factors;                                                                                                                               
|
| |  |  | Trade, monetary, fiscal, taxation, and environmental policies of
governments, agencies and similar organizations in geographic areas
where the Company has a financial interest;                                                                                                                                                                                                                                              
|
| |  |  | Customer business conditions including demand for their products or
services and supply of labor and materials used in creating their
products and services;                                                                                                                                                                                                                                                                  
|
| |  |  | Financial or regulatory accounting principles or policies imposed by
the Financial Accounting Standards Board, the Securities and Exchange
Commission, the Federal Energy Regulatory Commission and similar
entities with regulatory oversight;                                                                                                                                                                               
|
| |  |  | Factors affecting the availability or cost of capital such as changes
in: interest rates; market perceptions of the power generation industry,
the Company or any of its subsidiaries; or credit ratings;                                                                                                                                                                                                                     
|
| |  |  | Factors affecting power generation operations such as unusual weather
conditions; catastrophic weather-related damage; unscheduled generation
outages, maintenance or repairs; unanticipated changes to fossil fuel,
or gas supply costs or availability due to higher demand, shortages,
transportation problems or other developments; environmental incidents;
or electric transmission or gas pipeline system constraints;
|
| |  |  | Employee workforce factors including loss or retirement of key
executives, collective bargaining agreements with union employees, or
work stoppages;                                                                                                                                                                                                                                                                          
|
| |  |  | Volatility of energy prices in a deregulated market environment:                                                                                                                                                                                                                                                                                                                                                              
|
| |  |  | Increased competition in the power generation industry;                                                                                                                                                                                                                                                                                                                                                                       
|
| |  |  | Cost and other effects of legal and administrative proceedings, settlements, investigations and claims;                                                                                                                                                                                                                                                                                                                       
|
| |  |  | Technological developments that result in competitive disadvantages
and create the potential for impairment of existing assets;                                                                                                                                                                                                                                                                                               
|
| |  |  | Factors associated with various investments including competition,
operating risks, dependence on certain suppliers and customers, and
environmental and energy regulations;                                                                                                                                                                                                                                                  
|
| |  |  | Other business or investment considerations that may be disclosed
from time to time in the
Companys Securities and Exchange Commission filings or
in other publicly disseminated written documents including the
Companys Registration Statement No. 333-42638, as amended.                                                                                                                                                 

The Company undertakes no obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. The foregoing review of factors that could cause
the Companys actual results to differ materially from those contemplated in any
forward-looking statements included in this Form 10-Q should not be construed
as exhaustive.

20



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##### Table of Contents






SIGNATURES

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 thereunto duly authorized.

|                        |  |                                                       
|----------------------- |  | ------------------------------------------------------
|                        |  | NRG Northeast Generating LLC                          
|                        |  |                                                       
|                        |  | (Registrant)                                          
|                        |  |                                                       
|                        |  | /s/ RICHARD C. KELLY                                  
|                        |  |                                                       
|                        |  | Richard C. Kelly, President                           
|                        |  |                                                       
|                        |  | /s/ C. ADAM CARTE                                     
|                        |  |                                                       
|Date: November 19, 2002 |  | C. Adam Carte, Treasurer
(Principal Financial Officer)

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CERTIFICATIONS

I, Richard C. Kelly, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of NRG Northeast
Generating LLC;
|-- |  | -----------------------------------------------------------------------------------



|2. |  | Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|3. |  | Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|4. |  | The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | designed such disclosure controls and procedures to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b) |  | evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the Evaluation
Date); and
| | -- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | c) |  | presented in this quarterly report our conclusions about
the effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------



|5. |  | The registrants other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrants auditors and
the audit committee of the registrants board of directors (or persons
performing the equivalent function):
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | all significant deficiencies in the design or operation
of internal controls which could adversely affect the registrants
ability to record, process, summarize and report financial data
and have identified for the registrants auditors any material
weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | any fraud, whether or not material, that involves
management or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant deficiencies
and material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                | 
|----------------------------------------------- | 
|Dated: November 19, 2002                       
|                                               
|/s/ RICHARD C. KELLYRichard C. Kelly, President

22



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##### Table of Contents



CERTIFICATIONS

I, C. Adam Carte, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of NRG Northeast
Generating LLC;                                                                                                                                                                                                                                           
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;                   
|  
|4. |  | The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:                                                                                                     



| | d) |  | designed such disclosure controls and procedures to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | e) |  | evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the Evaluation
Date); and                                                                                                  
|
| | f) |  | presented in this quarterly report our conclusions about
the effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;                                                                                                                        



|5. |  | The registrants other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrants auditors and
the audit committee of the registrants board of directors (or persons
performing the equivalent function):
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | c) |  | all significant deficiencies in the design or operation
of internal controls which could adversely affect the registrants
ability to record, process, summarize and report financial data
and have identified for the registrants auditors any material
weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | d) |  | any fraud, whether or not material, that involves
management or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant deficiencies
and material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                          | 
|----------------------------------------- | 
|Dated: November 19, 2002                 
|                                         
|/s/ C. ADAM CARTEC. Adam Carte, Treasurer

23