AGL power play moves Australia ‘beyond the quarry’
The clean energy power play by a tech billionaire for AGL heralds a major shift in the tempo of Australia’s transition from fossil fuels, a leading infrastructure manager says.
Photo: Tony Lewis/InDaily
“As for AGL, it is now in play irrespective of the outcome of this particular takeover bid,” David Scaysbrook, co-founder and managing partner of Quinbrook Infrastructure Partners, told AAP.
Together with the accelerated closure of Origin’s Eraring, Australia’s biggest coal-fired generator, the nation now has an opportunity to move “beyond the quarry” into value-add industries, he said.
AGL Energy on Monday rejected an opening bid by Brookfield and Grok Ventures, the private investment company of Mike and Annie Cannon-Brookes, who want to fast-track Australia’s exit from coal-fired power.
But the consortium says it “remains optimistic” that an agreement can be reached with the AGL board.
Swinburne University of Technology engineer Geoffrey Brooks said Australia’s third-richest person made his money from IT with Atlassian but clearly has a passion for renewable energy.
“This new twist to the interplay between green activism and the corporate world has some way to go,” Professor Brooks said.
“This bid raises many interesting issues about corporate governance and how Australia will manage this transition from a coal dominated power system to renewable energy.”
Scaysbrook says the potential future investment opportunity is staggering.
Electricity generation is Australia’s largest emitting industry, currently accounting for almost half of emissions.
Amid calls for a national plan to deal with a rapid market-led transition to renewables, Prime Minister Scott Morrison said it was important that coal-fired generation of electricity ran full term.
“Because if it doesn’t, electricity prices go up, they don’t go down,” he said in Relbia, Tasmania.
Snowy 2.0 hydropower, the Tallawarra B gas generator and Port Kembla gas project near Wollongong, and Snowy Hydro’s controversial gas-fired Kurri Kurri generator in the Hunter Valley are also part of the government’s plan.
The consortium bidding for AGL intends to spend A$20 billion to transform AGL’s generation fleet, consistent with a target to limit global warming to 1.5 degrees, and reach net zero by 2035.
“Cannon-Brookes is certainly not short on ambition and new ideas as to how to maximise that hugely valuable opportunity,” Scaysbrook said.
“Just like Andrew Forest at Fortescue, they are both dreaming way bigger than our political leaders.”
– AAP
