According to the company’s website Review of Strategic Direction Outcomes & FY23 Guidance media release on September 29, 2022, AGL targets to complete its exit from coal-fired generation by the end of FY35 and accelerates its transition to an integrated low carbon energy leader.
- AGL targets an accelerated exit from all coal fired generation, announcing today a targeted earlier closure date of Loy Yang A Power Station – up to 10 years earlier than previously announced
- AGL’s annual greenhouse gas emissions1 are expected to reduce from 40 million tonnes to Net Zero on achieving targeted closure, supporting the transition to a lower carbon world aligned with the Paris Agreement goals2 and achieving net zero for operated Scope 1 and 2 emissions after coal closures
- AGL aims to progressively decarbonise its asset portfolio with new renewable and firming capacity, with an ambition to supply its customer demand with up to 12 GW of new generation and firming capacity, requiring a total investment of up to $20 billion3, in place before 2036, funded from a combination of assets on AGL’s balance sheet, offtakes and via partnerships. This includes an interim target to have up to 5 GW of new renewables and firming in place by 2030
- Unwavering focus on its customers as a continued major retailer of essential services, supplying affordable energy, supporting electrification and their transition to a low carbon future
- Unchanged commitment to rejuvenate its operating sites into low-carbon Energy Hubs
- Continuing consultation with its employees to understand their needs as AGL explores opportunities for career transition and re-skilling
- Inaugural Climate Transition Action Plan, opens in a new window published today
Financial implications of targeted FY35 coal closure
Following AGL’s decision to bring forward the targeted closure date of Loy Yang A (by the end of FY35), it intends to recognise a non-cash impairment charge of approximately $700m million (after tax).
The impairment charge will be recognised against the carrying value of the property, plant and equipment of AGL’s thermal generation assets and reflects the impact of the shortened operating life of Loy Yang A power station and additional ESG costs identified in the review of strategic direction.
The estimated impairment charge is subject to finalisation and audit of AGL’s financial statements and will be recognised as a Significant Item against Statutory Profit.
AGL anticipates the new targeted closure date will not have a material impact on Underlying Profit after tax (which excludes Significant Items) in the financial year ending 30 June 2023 (FY23).
As previously announced on September 12, 2022, which was released to the Australian Securities Exchange Ltd (ASX), AGL advised that during testing in the final assembly of the generator rotor at Loy Yang A Unit 2, a defect in a part was identified that requires the Original Equipment Manufacturer GE to manufacture in Switzerland. The outage is now expected to extend until the second half of October 2022 and AGL will make further changes to the outage profile of other units to accommodate this change.
About AGL Energy
Proudly Australian for 185 years, AGL supplies around 4.2 million energy and telecommunications customer services. We’re committed to becoming a leading multi-product retailer, making energy and other essential services simple, fair and transparent. AGL operates Australia’s largest private electricity generation portfolio within the National Electricity Market, comprising coal and gas-fired generation, renewable energy sources such as wind, hydro and solar, batteries and other firming technology, and gas production and storage assets. We are building on our history as Australia’s leading private investor in renewable energy to now lead the business of transition to a low emissions, affordable and smart energy future in line with the goals of our Climate Statement. We have a passionate belief in progress and a relentless determination to make things better for our communities, customers, the Australian economy and our planet. For more information visit agl.com.au.
James Thompson
Head of Investor Relations
+61 3 8623 8498
+61 403 183 563
JThompson5@agl.com.au
Brett Cox
Head of Media Relations
+61 498 074 613
BCox@agl.com.au
