AGL to create two leading energy businesses
AGL announced its plans to create two leading energy businesses focused on executing distinct strategies, via a structural separation :
“New AGL” - Australia’s largest multi-product energy retailer, leading the transition to a low carbon future; and
“PrimeCo” - Australia’s largest electricity generator, supporting the economy as the energy market evolves.
The company cited the accelerating market forces of customer, community and technology driving the imperative to create a new path to separate AGL into two distinct organisations. The proposed structure would give each business the freedom and focus to execute their own respective strategies and growth agendas, in order to play different roles in Australia’s energy transition.
New AGL would be Australia’s largest multi-product energy retailer by the number of services to customers, delivering electricity, gas, internet and mobile services to more than 30% of Australian households. It would also be carbon neutral for scope one and two emissions on day one, with a clear pathway to full carbon neutrality.
Generating approximately 20% of the total electricity demand across the National Electricity Market, PrimeCo would be Australia’s largest electricity generator supplying major wholesale, industrial and retail electricity users. PrimeCo’s focus would be the safe and reliable running of its generation portfolio. While its strong base generation position brings with it a capacity to invest in development options including the transformation of existing generation sites into the energy hubs of the future, as well as the development of its 1,600 MW wind development pipeline.
AGL will immediately commence a process of engaging with shareholders, regulators, government and workforce stakeholders with a view to confirming the timing and nature of the proposed structural separation by end of FY21. The proposed separation is subject to this consultation process and to ongoing internal AGL analysis.