‘World is waking up’: ex-energy boss Kerry Schott says AGL bid a sign of big changes ahead
The $8bn dollar takeover bid for AGL Energy is a sign the “world is waking up” to the rapid shifts in electricity generation and demand with the surprise only in its timing, Kerry Schott, the former chair of Australia’s Energy Security Board, has said.
The 185-year-old energy firm on Monday rejected the unsolicited bid by Australian technology billionaire Mike Cannon-Brookes and Canadian asset manager Brookfield as it “materially undervalues the company”.
The bidders say they would shut AGL’s coal-fired power plants by 2035. AGL, which plans to close its Liddell plant by April 2023, said earlier this month it would expedite the demise of its Bayswater plant to no later than 2033 and Loy Yang A by 2045.
Schott, who headed the national coordinating energy group until last October, said the bidders’ plans merely aligned the timetable to the current trajectory seen as most likely by the Australian energy market operator.
“The world’s waking up to the disruption that’s been going on in electricity for a while now,” Schott said. “It gets down to how fast can we get the renewables in and keep the transmission system stable as we go.”
Origin Energy last week said it had no choice but to bring forward the closure of its Eraring coal-fired plant – Australia’s largest power station – by seven years to 2025.
Schott said Eraring had often been running on fewer than all of its four units already, as had AGL’s Bayswater, because of their inability to compete with the near-zero fuel costs of wind and solar. Both are in New South Wales and burn black coal.
“For the orderly transition, we do need to make sure we’ve got a backup of either pumped hydro or gas, frankly, and there will be the need to keep some coal … while those [new generation and
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