First off, though not noticeable in this picture, the phaser is actually painted a pale blue. It looks grey in the photo, but I assure you, it's pale blue. Explanation shortly.
Second, this piece was acquired prior to the airing of "Encounter at Farpoint", the Next Gen pilot.
Third, this piece was acquired from one of the artisans who worked for the prop company that made the props for the pilot. It was not screen used, but came from the same molds, was made by the same artists using the same techniques etc as the real props.
So why is it blue?
When the original owner got ahold of the prop, and was told that they were from an upcoming Star Trek TV show, he was unimpressed by the grey paint scheme. He felt that it wasn't very "Trek". So he stripped off the paint, and gave it a coat of something that looked more "trek". Funny, no?
Where the green LED bar is supposed to go, there is a strip of reflective material. Not clear to me if this is what the used for background phasers on the show or not, but that's how it is here. Also, the firing button appears non-canon. I'm not sure if this was a result of the repaint, or if this is how it was originally shipped. Who knows, perhaps the design was changed after the phaser showed up on set.
The emitter is solid black, and the buttons are non moving.