D26 Electricity Supply

Cannon-Brookes bid doesn’t add up, says AGL chief

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 1 & 16 : 23-Feb-22

AGL Energy’s CEO Graeme Hunt says a $5bn takeover offer "extremely undervalues" the electricity generator and retailer. He says Brookfield Asset Management and Atlassian co-founder Mike Cannon-Brookes are seeking to buy AGL at a "ridiculously low premium". Hunt has also questioned the bidders’ proposal to fast-track the closure of AGL’s coal-fired power stations, and their claims that this would have no appreciable impact on electricity prices. Meanwhile, former Energy Security Board chair Kerry Schott contends that there would be insufficient grounds for the federal government to intervene and block the deal.

CORPORATES
AGL ENERGY LIMITED – ASX AGL, BROOKFIELD ASSET MANAGEMENT INCORPORATED, ATLASSIAN CORPORATION PLC, ENERGY SECURITY BOARD

Forrest’s green vows hit $200bn

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Original article by Nick Evans
The Australian – Page: 13 & 16 : 8-Nov-21

Media analysis reveals that Fortescue Future Industries has ‘inked’ agreements for hydrogen and renewable energy projects in over 20 countries over the last 18 months, with FFI being the green energy unit of Fortescue Metals Group. It has been estimated that FMG would need to find $US195 billion to pay for all the projects that its chairman Andrew Forrest has committed FFI to, while it is likely to cost even more than that to achieve FMG’s goal of producing 15 million tonnes of hydrogen a year by 2030.

CORPORATES
FORTESCUE FUTURE INDUSTRIES PTY LTD, FORTESCUE METALS GROUP LIMITED – ASX FMG

WA could not offer site for FMG plant, Govt reveals

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Original article by Stuart McKinnon
The West Australian – Page: Online : 13-Oct-21

The Western Australian government has revealed that Fortescue Metals Group chose to build a $1bn electrolyser plant in Queensland because there was no suitable site for the green hydrogen project in WA. Liberal Party leader David Honey says the fact that Fortescue founder Andrew Forrest selected Queensland for the site of the project rather than his home state demonstrates Labor’s "complete failure" to put in place the necessary infrastructure and incentives to develop green hydrogen export jobs. He has called for State Development Minister Roger Cook and Hydrogen Industry Minister Alannah MacTiernan to be removed from their portfolios.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, LIBERAL PARTY OF WESTERN AUSTRALIA, AUSTRALIAN LABOR PARTY

Lessons to learn from UK’s electricity failures

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Original article by Robert Gottliebsen
The Australian – Page: 20 : 6-Oct-21

Electricity retailing has traditionally been a stable business, with good long-term returns. However, it is rapidly becoming a low-margin and high-risk industry in Australia and abroad. The recent collapse of nine smaller power distribution companies in the UK has implications for Australia. A sharp rise in the price of gas triggered the collapse of these companies, but the underlying problem of electricity retailers in both the UK and Australia is the use of forward hedge contracts with major power generators, which can leave smaller retailers extremely vulnerable in the event of a price shock.

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Spark’s $5.2b takeover tactics are well received

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Original article by Elouise Fowler
The Australian Financial Review – Page: 12 & 18 : 24-Aug-21

Shares in Spark Infrastructure rose by two per cent on 23 August after it was revealed its board had agreed to a $5.2 billion takeover offer from a consortium led by private equity firm Kohlberg Kravis Roberts and the Ontario teachers’ pension fund. Dougal Maple-Brown from Maple-Brown Abbott, which owns a stake in Spark, said that the Spark board had done a good job in getting the consortium to increase its original offer, while the transaction will be undertaken by means of a scheme of arrangement

CORPORATES
SPARK INFRASTRUCTURE GROUP – ASX SKI, KOHLBERG KRAVIS ROBERTS AND COMPANY, ONTARIO TEACHERS’ PENSION PLAN, MAPLE-BROWN ABBOTT LIMITED

AGL Energy savaged after demerger given green light

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Original article by Perry Williams
The Australian – Page: 13 & 16 : 1-Jul-21

AGL Energy has incurred the biggest one-day fall in its share price since 2007 after revealing details of its proposed restructuring and demerger. AGL will be rebranded as Accel Energy and retain its coal-fired power plants, while the group’s gas and electricity retailing business will be spun off into a listed company to be called AGL Australia. Acting CEO Graeme Hunt believes that AGL’s shares were sold down in response to changes to its dividend policy and revised earnings guidance, rather than the demerger proposal. Hunt will become CEO of Accel, while chief customer officer Christine Corbett will be CEO of the new AGL. The demerger is subject to shareholder approval.

CORPORATES
AGL ENERGY LIMITED – ASX AGL

Price of electricity the lowest since 2012

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Original article by Perry Williams
The Australian – Page: 7 : 28-Apr-21

Data from the Australian Energy Market Operator shows that wholesale electricity prices fell to the lowest level since 2012 during the first three months of 2021. The wholesale price in New South Wales averaged $38 per megawatt hour, compared with $86MWh for the March 2020 quarter; the wholesale price in Victoria averaged $25MWh, down from $79MWh previously. Demand for electricity fell during the quarter due to factors such as the increase in solar power generation and the lowest average temperatures for the period since 2012.

CORPORATES
AUSTRALIAN ENERGY MARKET OPERATOR LIMITED

Coalition rebuffed over need for coal-fired power stations

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Original article by Greg Brown
The Australian – Page: 4 : 12-Apr-21

A report from the Grattan Institute has concluded that gas will play a key as Australia transitions to a net-zero emissions electricity grid. The report also cautions against shifting to complete reliance on renewables; it contends that the electricity grid can shift to 70-90 per cent renewables in the 2040s with no major impact on the affordability or reliability of the electricity system. Grattan Institute director Tony Wood adds that there is no need to build new coal-fired power stations or to refurbish existing ones to extend their operational life.

CORPORATES
GRATTAN INSTITUTE

Energy regulator probe a challenge for Victorian electricity grid expansion

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Original article by Perry Williams
The Australian – Page: Online : 8-Jan-21

The Moorabool Central Highlands Power Alliance has alleged that the Australian Energy Market Operator breached three national electricity rules. The Alliance claims the breaches took place during AEMO’s regulatory test for the $370 million Western Victorian Transmission Network Project, which is aimed at easing renewable energy bottlenecks and includes a new terminal station north of Ballarat. The Alliance represents 110 community groups whose members reside near the proposed powerline expansion, and it has raised its concerns with the Australian Energy Regulator.

CORPORATES
AUSTRALIAN ENERGY MARKET OPERATOR LIMITED, AUSTRALIAN ENERGY REGULATOR

Renewables cutting power bills

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Original article by Patrick Commins
The Australian – Page: 2 : 21-Dec-20

The Australian Energy Market Commission has predicted Australian households will pay around nine per cent less for electricity in 2023 than they are at the moment, with the Commission’s forecast based on a combination of cheaper renewable power and falling gas prices. Looking at individual states, Victorian households can expect to pay 15 per cent less by 2022-23, but New South Wales households can only expect to pay two per cent less, due to the closure of the Liddell coal-fired power plan

CORPORATES
AUSTRALIAN ENERGY MARKET COMMISSION