AGL demerger: Energy provider's reliance on coal exposed

AGL's Bayswater coal-fired power station in the Hunter Valley. Picture: Glen McCurtayne
AGL's Bayswater coal-fired power station in the Hunter Valley. Picture: Glen McCurtayne

Australia's largest energy provider, AGL, has announced plans to split into two businesses, after intense pressure about its poor environmental and financial performance.

One of these, a 'retail' business will be what most people will see day-to-day. This brand will carry the renewable energy and community-friendly image AGL likes to cultivate.

But AGL's demerger has a darker side. The company's coal assets include some of the nation's top climate polluters; Bayswater and Liddell in NSW's Hunter Valley, and Loy Yang A in Victoria's Latrobe Valley.

AGL plans to shunt these coal-burning power stations, which have seen it take the dubious title of Australia's worst emitter of greenhouse gases, into a separate entity.

This doesn't mean AGL is going to stop burning coal. Quite the opposite in fact.

AGL plans to run some of its coal-burning power stations until 2048, well beyond the timeline for coal closure needed to maintain a safe climate.

By hiding its polluting coal assets in a separate business, AGL is attempting to pull the wool over the eyes of its millions of customers. It's masquerading as a forward-facing, modern energy business while holding on to its coal power stations.

AGL knows that managing customer expectations is the number one rule of the game.

And what customers increasingly expect from businesses is meaningful action to reduce greenhouse gas emissions.

Just look at all the Australian businesses announcing shifts to 100 per cent renewable electricity. This year we've seen Coles, Coca-Cola Amatil and TPG Telecom make the renewable switch, following brands such as Woolworths, Bunnings and ALDI last year.

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These are big, complex companies that use lots of energy - and they have concrete plans to reduce emissions.

Now energy providers, like AGL, must do the same, rather than relying on complex corporate manoeuvres to keep their hands in polluting coal.

AGL has the reach and know-how to power Australia with renewable energy - and it would create thousands of jobs and thriving industries across the regions in doing so.

Even coal power station rehabilitation, one of the things AGL is seeking to dodge through its demerger, could create ongoing jobs following the closure of power stations.

There are also significant economic benefits for AGL in the transition, through pumped hydro and battery storage for renewables at the sites of its existing power stations.

With renewable energy already powering the country and growing every day, it's time for AGL to come clean and make the switch - or be left behind.

  • Glenn Walker is senior coal campaigner at Greenpeace Australia Pacific