AGL shareholders will have their say this week – and the Australian energy market will be listening | AGL

AGL Energy’s annual general meeting is underway at the Melbourne Recital Center this Tuesday – and the remaining executives running Australia’s biggest electricity producer are hoping the shareholder meeting provides an exciting finale to a torrid year.

That opening act February’s unsolicited takeover bid by Mike Cannon-Brookes.

Rebuffed, the technology billionaire back in May to snap up 11% of AGL’s shares then next stymie company plans to split. His encore in September led to demands via his family firm Grok Ventures to add four “independent” faces to the five-member board.

AGM will determine if the board takes leave. Also on the line will be AGL’s Climate Transition Action Plan, which management believes is the latest best way to wean our nation’s largest greenhouse gas polluter from fossil fuels. Grok insists too slowly.

The event could also be the last major demonstration of shareholder activism in the Australian power generation space.

although last week’s takeover bid by Origin Energy by two groups of successful investors, all but AGL among the large power producers will be held either by private companies or state and federal governments. AGL has not ended up in Grok or other private hands.

Ructions for AGL from Tuesday’s vote can also reverberate throughout the national electricity market that functions in eastern Australia, and the electricity bill that goes with it.

An AGL insider told Guardian Australia that the public is only realizing “it all has to be right” if the transition to renewables and storage is to succeed without more crises or worse. from the past. At least $12.7bn will need to be spent on key transmission lines alone to connect new solar arrays and windfarms to the grid by 2050, The Australian Energy Market Operator said in June.

AGL anticipates at least three of the four board members nominated by Grok will be elected onto the board, an insider told Guardian Australia. This includes Mark Twidell, a solar industry expert, who already has AGL’s support.

Kerry Schott, former chairman of the Energy Security Council, and CSR board member Christine Holman should also secure the election.

Swinburne University professor John Pollears also managed to grab just enough votes. If he does, the four could potentially join existing director Miles George, a wind energy veteran, to balance the expanded nine-member board in favor of Grok’s plan.

According to Grok, AGL’s proposal falls shy of a track consistent with the Paris climate goal of limiting global warming to 1.5C above pre-industrial levels. The result will be the same as the 1.8C path (ie other firms and nations are chasing such a pace).

“AGL needs to accelerate its decarbonisation ambitions to secure and maintain its market-leading position as Australia’s largest, greenest, most trusted energy retailer, in turn delivering high shareholder returns,” said Grok.

Meanwhile, AGL welcomed the support of four proxy advisors who recommended the shareholders again the proposed plan.

In September, AGL announced it will be brought forward data closure Loy Yang A brown coal power plant in Victoria decade to 2035 while leaving the Bayswater power plant burning black-coal in NSW to run until between 2030 and 2033. AGL’s Liddell plant, also in NSW, shuts next April.

“We share the ambition of many of our shareholders to accelerate the pace of decarbonisation,” said Patricia McKenzie, chairman of AGL.

An AGL spokesman added “positive conversations” suggested the majority of shareholders would support the plan, which includes spending $20 billion over 12 years on clean energy and storage plants.

The company also believes that the new director will be careful once on board. “This is more complicated than it seems from the outside,” said a company insider.

To bring AGL to 1.5C degree-compliant route will mean shutting down Bayswater as soon as 2028 and Loy Yang A a year later. “There’s no way” the government will let companies get out of coal that early, the person said, adding that enough alternative generation capacity won’t be ready now.

Also on the ballot will be the remuneration report for AGL executives, something else Grok opposes.

Brynn O’Brien, executive director of the Australasian Center for Corporate Responsibility, said McKenzie’s role in the company can hinge on the vote of the AGM.

“Given that one of the key roles of the chair is to unify and guide the board, his adversarial approach to shareholder-nominated directors, some of whom will now be sitting at the board table, seems very foolish,” O’Brien said. in a statement.

That performance is likely to get applause from Grok.

Having cheered out her predecessor, Peter Botten, and then-CEO, Graeme Hunt, Grok said eight weeks ago it had “reservations” about McKenzie appointing her as chair given her involvement in the foiled demerger plan.

Another final curtain call may be in the wings.

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