Brookfield buys AGL stake as Australia’s coal closures accelerate

Brookfield Asset Management built a stake in AGL Energy four months after moving away from trying to take over the Australian power company alongside software billionaire and climate activist Mike Cannon-Brooks.

AGL said in a regulatory submission that a Brookfield subsidiary bought 2.56% of the company’s shares but no new offer was made for the business. It was not clear when Brookfield Purchase the shares.

The acquisition of AGL shares by Brookfield has sparked speculation that the company is once again planning to do so Unite forces with Cannon-Brooks, Which owns 11% of the company’s shares through its family firm Grok Ventures, for another takeover bid. Both sides declined to comment.

If that happens, it will likely accelerate the closure of coal plants as well as investment in renewable energy in Australia. Under the previous proposal, the Brookfield-Grock consortium said it would close AGL’s three major coal plants at least a decade earlier than planned and invest $ 20 billion ($ 14 billion) in renewable energy.

Last month, Cannon-Brookes successfully blocked AGL’s plan to turn its coal production business around and operate its coal plants into the 2040s, causing the CEO and Chairman to resign.

Australia’s central grid is controlled by coal power, which supplies about 60% of Eastern countries’ electricity, according to government data analyzed by OpenNEM, a platform for national electricity market data. But the transition to renewable energy sources was rapid, driven mostly by households installing solar panels on their roofs. This undermined the profitability of coal-fired power plants, prompting some power companies to bring forward closing dates.

The Australian energy market operator warned on Thursday that Australia’s coal – dependent electricity grid would lose 60% of its aging coal plants over the next eight years, requiring urgent investment in renewable energy, batteries and transmission.

AEMO CEO Daniel Westerman said that for Australia to be able to ensure reliable electricity by 2050, investment is needed for a “nine-fold increase in wind and solar capacity on a grid scale” and “a nearly five-fold increase in distributed solar.”

The lack of a national energy policy under the previous Liberal-National Coalition government has deterred investment in renewable energy to replace those closures, said Johanna Boyer, an energy analyst at the Institute of Energy Economics and Financial Analysis.

“Coal ports are going to happen fast so we need to have a clearer and safer plan around this,” she said.

God The new Labor governmentElected in May, she promised in her election campaign to invest $ 20 billion in transmission and wants 82% of the country’s electricity to be generated by renewable energy by 2030.

Simon Corbel, CEO of the Clean Energy Investors Group, said pension funds and sovereign wealth funds, including power companies AGLSpanish renewable energy expert Iberdrola, oil companies like Shell and BP and the investment bank Macquarie Group have been among the largest investors in renewable energy in Australia.

He said these and similar organizations have the money to fund a rapid transition to renewable energy, but Australia has been a more risky market than many other OECD countries, thanks in part to its lack of transfer and slow approval processes.

“Without the right project approval regulations, there will still be significant risks,” he said.

Brookfield buys AGL stake as Australia’s coal closures accelerate Source link Brookfield buys AGL stake as Australia’s coal closures accelerate

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