The Australasian Centre for Corporate Responsibility (ACCR) is commenting on AGL Energy’s announced Strategic Review and Climate Transition Action Plan (CTAP). This includes the announcement that closure of the Loy Yang A power station will be brought forward from 2045 to 2035.
Commenting on AGL’s announcement, Harriet Kater, Climate Lead (Australia) at the Australasian Centre for Corporate Responsibility (ACCR) said:
“The Board of AGL has finally listened to its shareholders and accepted that this ageing, polluting coal-fired power station is incompatible with the energy transition and a serious risk to company value.
“It is hard to determine what caused the penny to drop in the AGL boardroom. Was it the embarrassing defeat of the demerger, a new federal government, the rejection of a proposed chair or the final acceptance that shareholder value was at grave risk if Loy Yang stayed online into the 2040s?
“This announcement now means up to 200 Mt CO2-e will not be released into the atmosphere, and is evidence that active engagement strategies, pursued by major shareholders, can have material emissions outcomes in the real world. Those future-focused shareholders that have stayed the course and pushed for change have had a measurable impact on decarbonisation.
“Whilst the decision to close Loy Yang sooner is welcome, AGL is still not on a pathway that is aligned with limiting warming to 1.5C. Regardless, this is a positive development in the right direction.
“With constant maintenance challenges, it is quite possible that Loy Yang A will struggle to remain open as late as 2035. AGL would be wise to plan for this scenario considering the implications for its workforce and the Latrobe Valley Community more broadly.
“The early retirement of Loy Yang forms a significant pillar in AGL’s Climate Transition Action Plan, which will be put to an advisory vote at the company’s 15 November AGM. The company has also set an interim target to have 5GW of renewables and firming in place by 2030, surpassing Origin’s recent 2030 commitment of 4GW.
“This builds on what has already been a big year of major climate announcements for ASX-listed companies, with BHP and South32 abandoning the Mt Arthur and Dendrobium mine extensions and Origin bringing forward the closure of Eraring and exiting the Beetaloo Basin. These significant developments were born from years of community and shareholder pressure.
“ACCR encourages all shareholders in fossil fuel companies to use their power to push for decision-making compatible with the energy transition and a viable financial future for investors.”