AGL Energy’s annual general meeting takes place this Tuesday at the Melbourne Recital Center – and the remaining executives of Australia’s biggest power producer are hoping the shareholder meeting will provide a rousing finale to what has been a tumultuous year .
The opening act was the February unsolicited takeover bid by Mike Cannon-Brookes.
Rebuffed, the tech billionaire returned in May to buy back 11% of AGL’s shares and then thwart the company’s proposed spin-off. His recall in September brought requests through his family business Grok Ventures to add four “independent” faces to the five-member board.
The AGM will determine if these board choices will stand. AGL’s climate transition action plan will also be at stake, which management says is the best way to wean the nation’s biggest greenhouse gas polluter from fossil fuels. Grok insists it’s too slow.
The show could also be the latest big show of shareholder activism in Australia’s power generation space.
If last week’s takeover of Origin Energy by two groups of investors is successful, all major power producers except AGL will be owned either by private companies or by state and federal governments. AGL could still end up in the hands of Grok or other private hands.
Ructions for AGL following Tuesday’s votes could also affect the national electricity market serving eastern Australia, and the electricity bills that go with it.
An AGL insider told Guardian Australia that the public is only dimly aware ‘everything has to be fine’ if the transition to renewables and storage is to succeed without more or worse crises than winter’s. last. At least $12.7 billion will be needed to be spent on key transmission lines alone to connect vast new arrays of solar and wind farms to the grid by 2050, the Australian power market operator said in June.
AGL anticipates that at least three of the four Grok-appointed board members will be elected to the board, an insider told Guardian Australia. These include solar industry stalwart Mark Twidell, who already has AGL endorsement.
Kerry Schott, the former chair of the Energy Security Board, and Christine Holman, a member of the CSR board of directors, are also expected to be elected.
John Pollears, a professor at Swinburne University, could also garner just enough votes. If he does, the four could potentially join current director Miles George, a wind power veteran, in tipping the scales of an expanded nine-member board to favor Grok’s plans.
According to Grok, AGL’s proposal falls far short of the Paris climate target of limiting global warming to 1.5°C above pre-industrial levels. The result would be akin to a 1.8°C trajectory (if other companies and nations continued at such a pace).
“AGL needs more accelerated decarbonisation ambitions to secure and maintain its market-leading position as Australia’s largest, greenest and most trusted energy retailer, in turn delivering higher returns. high for shareholders,” Grok said.
AGL, meanwhile, welcomed the support of the four proxy advisers recommending that shareholders back its proposed plans.
In September, AGL announced that it would present closure data for its Loy Yang A coal-fired power station in Victoria from a decade to 2035 while leaving its black coal-fired power station at Bayswater in New South Wales to operate until between 2030 and 2033. AGL’s Liddell plant, also in New South Wales, closes next April.
“We share the ambition of many of our shareholders to accelerate the pace of decarbonization,” said Patricia McKenzie, President of AGL.
An AGL spokesman added that ‘positive conversations’ indicated a majority of shareholders would support the plans, which include spending $20 billion over 12 years on new clean energy and storage plants. .
The company is also confident that new directors will exercise caution once on board. “It’s a lot more complex than it looks from the outside,” the company insider said.
Bringing AGL on a 1.5°C compliant trajectory would mean closing Bayswater as early as 2028 and Loy Yang A a year later. “There’s no way” governments are letting the company exit coal this early, the person said, adding enough alternative generation capacity won’t be ready by then.
The ballot will also feature AGL’s executive compensation report, something Grok objects to.
Brynn O’Brien, executive director of the Australasian Center for Corporate Responsibility, said McKenzie’s role in the company could depend on AGM votes.
“Given that one of the chairman’s key roles is to unite and guide a board, his contradictory approach to shareholder-appointed directors, some of whom are now likely to be seated around the board table , sounds extremely stupid,” O’Brien said. in a report.
It’s a view likely to win Grok’s applause.
After applauding her predecessor, Peter Botten, and then-CEO Graeme Hunt, Grok said eight weeks ago that she had ‘reservations’ about nominating McKenzie for president given his involvement in the foiled split plan.
Another final reminder may be behind the scenes.
#AGL #shareholders #speak #week #Australian #energy #market #listening