Angry workers and consumers can blame Coalition for using climate change challenge as a political weapon

Years earlier, AGL had given notice of its intention to decommission the ageing plant in 2022, around the time Liddell would turn 50. With other local leaders, I accepted the inevitability of the closure and urged AGL to invest in new electricity generation in the region including gas, hydro, wind, hydrogen, and solar projects, backed with battery storage. We also worked with AGL and the unions to ensure Liddell's workforce was taken care of with well-funded voluntary redundancies and the right to transfer to Bayswater Power Station.

The Coalition government had always accepted Liddell's closure but in the heat of the climate change debate, and in an attempt to give cover to for its policy failures, in 2017 it decided to weaponise the issue by attempting to bully AGL into keeping Liddell open well beyond its physical life.

In the end, the stunt achieved nothing to protect us from higher electricity prices and blackouts. But it's likely that it won the government a few extra votes at the 2019 election, as it had hoped.

My concern back then was that the Turnbull government's political games would run interference on AGL's plans for new generation, particularly its plan for a gas peaking station in Tomago. On that matter, I was vindicated.

Now, just as the heat appeared to be coming out of the unhelpful climate wars, a new threat to investment plans has emerged from the corporate world. Don't believe for a moment the Brookfield raid on AGL is about our natural environment. Rather, it's about money, not that there's anything wrong with that, so long as they are honest about it

The partnership with entrepreneur and climate change campaigner Mike Cannon-Brookes, I suggest, is a clever play that delivers the bid significant green credentials. Brookfield and Cannon-Brookes claim they can buy AGL, close its coal-fired generator assets earlier, still make money, all the while keeping power prices down and avoiding blackouts. I doubt they can, and most energy experts agree.

Meanwhile AGL says if left alone, it will deliver around 2000 Megawatts (MW) of renewable generation by 2024 through wind and pumped hydro projects across three states. Battery projects with a combined capacity of 450 MW will provide storage and firming capacity. For perspective, between them AGL's three existing coal-fired generators are capable of delivering about 6000 MW of reliable base-load power.

Another power company, Origin, proposes shutting Eraring power station as soon as 2025, cutting another 2800MW from the grid. In a statement, Brookfield and Cannon-Brookes said they plan to build 8000 MW of capacity in less time. I doubt that very much. Regulatory approval challenges alone tell us that is far too aspirational.

AGL is off-loading its coal generation assets into a new ASX listed entity known as Accel Energy. The demerger is about meeting the climate change demands of its AGL shareholder activists, particularly its big ESG investment fund shareholders. These investment funds are increasingly dumping company stocks that don't meet their environmental expectations. This is an exercise in green washing as the coal generators will continue to emit the same amount of carbon in the hands of the new entity.

Brookfield as owners, will have an investment advantage over AGL. It doesn't have to worry about pesky ESG fund managers and generally it will have a lower funding costs. In other words, it no doubt believes it can make greater returns running the coal generation assets than AGL has been able to do.

This is not primarily about the environment, it's an exercise in economic engineering.

What does this all mean for power station workers, electricity prices and electricity reliability? Sadly, I suggest the answer is, nothing good. There is certainly no good news for Hunter power station workers, many of whom thought they had up to 15 more years of work and in any case, found comfort in AGL's workforce transition plan.

Only the most ardent climate ideologues could believe electricity prices will be lower or energy security more assured if Brookfield and Cannon-Brooks are successful in their bid to buy AGL.

If angry workers and consumers are looking for someone to blame for this debacle, they should look to the political class that has spent the past 20 years weaponising our very real climate change challenge.

In doing so, they've destroyed every prospect of securing a sensible policy response.

As a result, the energy market is looking like the wild west and power station workers and consumers, including big industrial consumers, are caught in the crossfire.

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