SMH: AGL has stuck to its decision to close the Liddell coal-fired power station, despite government pressure.
Speaking at its annual general meeting today, chairman Jerry Maycock and chief executive Andy Vesey outlined the company's rapid turnaround in finance and ongoing commitment to the closure of the Liddell coal-fired plant.
Chairman Graeme Hunt says green and renewable energy will be a major focus for AGL at the Liddell facility.
Green and renewable energy was also a major focus, as Mr Vesey outlined the investments and developments AGL is making in gas and wind technology.
Mr Maycock also took the opportunity to remind the federal government that Liddell's previous owner - the New South Wales government - originally set the Liddell closure date.
"When considering the future of Liddell, it is important to acknowledge that it is a plant that is approximately 45-years old and that, at the time that AGL acquired it, the intention of the NSW Government, its previous owner, was to close the plant in 2022," Mr Maycock said.
He said that since the announcement of the closure - in 2015 - management has been working on a number of options to mitigate Liddell's shutdown, which includes new generation and re-purposing of the site.
Mr Maycock said while it would be "technically possible" to extend the ageing power plant's life beyond 2022, "the costs of doing so in a way that ensures that the plant is even moderately reliable are certain to be substantial", and finding a buyer to willing to do the same would be "challenging".
The company is considering a mix of different energy sources to replace the lost 1000 MW, which includes gas-fired power, wind, solar, and battery storage.
This could also be achieved by upgrading Liddell's neighbouring Bayswater power plant.
Mr Maycock also rejected the potential of AGL building a 'clean coal' power station, stating that as a purely economic decision as these power stations are not competitive financially.
"It would not be a wise use of shareholder funds to [build a clean power station], and we can mitigate the closure of coal fired plants through the mix of [renewable] assets."
AGL has recorded a massive turnaround in operations, registering a statutory profit after tax of $539 million, compared to a loss of statutory $408 million in the previous financial year.
It achieved an underlying profit of $802 million after tax, up 14 per cent year on year, and above earlier guidance levels.
According to Maycock, this strong result was driven predominately by the company's thermal - coal and gas - assets and its renewable generation assets.
The company also announced the completion of $1 billion in asset sales.
"We're very focused on investing in technology," Vesey said.
AGL is looking at a capacity of more than $2 billion in FY18 to continue to invest in achieving its strategic growth objectives.
Director Graeme Hunt also officially stepped into the role of chairman, replacing Maycock
The energy retailer said its estimates remain on track to achieve underlying profit after tax of between $940 million and $1.04 billion for 2017-18.
"That guidance is unchanged, although we do note that the scrutiny of the energy sector by federal and state governments and regulatory bodies continues to increase," Mr Maycock said.
AGL's share price has fallen more than one per cent since markets opened this morning.