Documents show AGL Energy’s split business units are close to breaching global climate targets, critics say.
Australia’s largest energy company on Friday released the split book required by regulators for the council’s plan to create an energy retailer – AGL Australia – and a coal-fired power generator – Accel Energy.
“This split is shit rolled up in glitter, but the marketing brilliance doesn’t fool anyone,” said Glenn Walker, campaign manager for Greenpeace Australia Pacific.
Dan Gocher, director of the Australasian Center for Corporate Responsibility, said alignment with the Paris climate accord in the two split entities was a fundamental demand of the majority of AGL shareholders less than a year ago. ‘a year.
“We don’t expect AGL’s major shareholders to agree to be ignored,” he said.
According to the International Energy Agency and UN climate bodies, aligning with the Paris Agreement would mean closing coal-fired power plants in OECD countries by 2030.
Grant Samuel, the independent expert commissioned by the board of directors, concluded that the split is in the best interests of shareholders, according to the document submitted to the ASX.
Justifying the split, the rapid shift in the national electricity market towards renewable energy generation has impacted AGL’s structure as a gentailer – producer and retailer of energy – the company said.
“The split is the next step in AGL Energy’s history as a leader of change in the energy society.”
A “strong future” for both parts of the business and long-term shareholder value will be created, he said.
The booklet reiterates that AGL Australia will aim for net zero emissions by 2040 and Accel Energy by 2047, which is too slow for biggest billionaire shareholder Mike Cannon-Brookes.
His investment vehicle Grok Ventures remains vehemently opposed to the split.
A spokesperson for Grok told AAP that AGL shareholders need only see that the risks and disadvantages section of the spin-off booklet far outweighs the benefits the company put forward.
“The booklet does not change our view that the plan to split promotes a terrible outcome for shareholders, communities and the climate,” the spokesperson said.
The brochure says it would be better to split up than to have the two arms of the business competing for investors at the same time.
But Accel Energy could be denied access to capital and insurance due to environmental, social and governance (ESG) concerns about its coal-fired power plants, according to Greenpeace.
Mr Cannon-Brookes has accumulated a stake of more than 11% and is campaigning for shareholders to join him and block the split.
He failed in his bid earlier this year to buy the company, privatize it and quickly replace its coal assets with renewables this decade, in line with global momentum.
AGL shares closed 7 cents lower at $8.35, above the tech mogul’s watered-down March offer of $8.25 per share that the board rejected as under -assessing the company.
AGL’s board expects to implement the split by June 30, following the June 15 shareholder vote.
There is a long-term plan for Accel to transform fossil fuel generation assets into low-emissions industrial hubs.
AGL Australia will develop, operate and manage a portfolio of gas, electricity and battery storage assets.
Australian Associated Press