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AGL Solar – Company quits rooftop solar business.

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AGL solar – the company announced on Tuesday that they will record a $47m loss from their residential rooftop solar installation business. 

AGL solar installation business to shut down.

AGL Solar Installations
AGL Solar Installations (source: aglsolar.com.au)

AGL bought the Rezeko brand around seven years ago and used its systems to install “proprietary residential solar”. They’ve now put out a press release advising that they will write down the company’s residential solar arm. 

With the imminent (2022) closure of their Liddell coal generator, it makes sense that the company are trying to diversify with regards to methods of energy generation. It’s a shame that this hasn’t worked out, and we’ll be interested to see how it affects AGL’s vision of renewable energy moving forwards. 

“We decided to withdraw from the direct installation of residential solar hardware after completing a comprehensive review of the business,” AGL Chief Customer Officer Melissa Reynolds was quoted as saying in an email to Renew Economy. 

“The review determined that the interests of our customers would be better served by moving to a different business model. Under this model we forward enquiries for residential solar hardware installation to our third-party partners which are experts in the installation of PV solar.

“AGL will continue to provide advice to customers on solar energy and energy plans.”

AGL was one of the country’s top 10 residential solar installers, and in the top five of commercial solar installers. It remains to be seen what the ramifications of this writedown are, but we’ll keep you updated with how things are going. What we do know is that their commercial solar installation arm will remain unchanged as it’s presumably much more profitable than the ‘race to the bottom’ we’re seeing domestic solar installers engaged in.

The company says its plans for virtual power plants in Adelaide and elsewhere will not be affected. 

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Two bidders for Liddell power station.

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Delta Electricity have entered the contest with Alinta Energy to buy the Liddell power station – a coal-fired, ageing plant that still pumps out 1680MW and is owned by AGL, who have advised that they’ll close it by 2022.

Liddell Power Station

Liddell Power Station
Liddell Power Station (source: wikipedia.org)

Following the shutdown of the 1600MW Hazelwood coal-fired power plant last year, customers saw power shortages and a spike in power bills. The government is concerned that the same thing will happen if the Liddell power station is shut by 2022 – with PM Malcolm Turnbull directly telephoning AGL chairman Graeme Hunt this week to talk about the sale.

AGL haven’t allowed Alinta Energy or Delta Electricity to do any due diligence on the plant – with Delta MD Greg Everett telling the Sydney Morning Herald is was a major hindrance for the company who have been shut out from performing any in the past, as AGL advised they weren’t willing to sell:

“Would we be interested? If it was for sale we would definitely be interested in doing due diligence on it,” Mr Everett said.

“So we’d be in the same position as Alinta.”

Everett and Delta already operate the Vales Point coal-fired generator in NSW and the company was previously owned by the NSW government. Everett has been quoted as saying there is a ‘reasonable’ chance of extending the life of the program past 2022.

Alinta chief executive Jeff Dimery made a statement this morning confirming that their company are interested in Liddell, and if they sign a deal they aren’t going to apply for any government subsidies. Dimery advised that Alinta are willing to invest ~$1 billion AUD to buy the plant and extend its life by five to seven years. This would see the plant shutting down around 2027-2029 instead of 2022. 

AGL are keeping fairly taciturn about the situation:

“AGL is relying on Liddell to generate power for our customers until 2022 and we will require its infrastructure for our replacement plans into the future,” an AGL spokesman told Fairfax Media.

“AGL received an approach from Alinta last night expressing an interest in entering negotiations to acquire the Liddell Power Station. No formal offer has been received.

“Should a formal offer for Liddell be received, it would be given consideration in order to meet our obligations to customers and shareholders.”

There’s no doubt that Australia are moving towards renewable, clean energy and this is a good thing. The transition, however, needs to be done in an intelligent way – it’s be great to be totally renewably powered as soon as possible but it’s going to be a patience game as the technology increases and we work on reliable baseload power while we invest as much in renewable energy generation as we can. Where will we be in 2022, RET wise? It’s hard to say. We’ll keep you updated with any news about the plant’s potential sale. 

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Liddell Power Station To Close in 2022 – AGL Energy

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AGL Energy will be closing the Liddell coal-fired power station in 2022, resulting in a 1000MW shortfall of energy. AGL has an exciting plan to cover this missing amount by using a mix of solar power, wind power, pumped hydro, battery storage, and gas peaking plants over a three-stage period leading up to 2022. 

The Closure of Liddell and its implications

The Turnbull government had asked AGL Energy to consider extending the life of the Liddell power station or selling it to someone else, but it doesn’t seem like that plan is on AGL’s radar. According to the SBS, Energy Minister Josh Frydenberg has asked the AEMO (Australian Energy Market Operator) have a look at AGL’s idea, advising that it is best to “leave the judgement of (the plan’s) merits to the experts”. 

AGL’s plan for solar/wind/pumped hydro/storage and gas peaking plants will cost $1.3b and is expected to provide electricity at $83/MWh for up to 30 years, in contrast to the much higher cost for Liddell. By keeping it open for just an extra five years the cost would be $920 million and it would cost $106/MWh, according to figures stated on the SBS. 

“Obviously it’s a significant proposal, there is a host of new technologies and new investments as part of it,” Mr Frydenberg was quoted in Melbourne on Sunday.

“You need all forms of energy in Australia’s future energy mix, there’s a role for coal there’s a role for gas, there is increasingly a role for wind and solar and for battery storage,” he added.

Liddell Power Station - AGL Energy to close it in 2022
Liddell Power Station – AGL Energy to close it in 2022 (source: wikipedia.org)

This news comes hot on the heels of the closing of the Hazelwood coal-fired power station in Victoria in March this year. Numerous other coal-fired power stations across New South Wales and Victoria are nearing the end of their 50 year lifespans – with two of Victoria’s three coal-fired plants having outages during last February’s hot weather. 

Federal opposition energy spokesman Mark Butler was complimentary of the plan – whether 

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