In an astounding turn of events, Atlassian Founder Mike Cannon-Brookes has teamed up with Canadian asset manager Brookfield to put in a bid for Australia’s most polluting power company. It was a case of “if you can’t beat them, buy them.” Green capital is trying to push out the old legacy coal barons.
Predictably, the bid was rejected even though it was at current market value. Just as predictably, Australia’s fossil fuel loving prime minister, Scott Morrison, and Minister for Carbon Emissions Increases Angus Taylor both reacted in horror that anyone would want to buy and close down a coal power station. “We need to ensure that our coal-fired generation of electricity runs to its life, because if it doesn’t, electricity prices go up, they don’t go down,” Morrison said this week — pushing the same old FUD that has been disproved time after time.
AGL is Australia’s biggest coal generator and biggest emitter. The company is at the beginning of a complex demerger process — creating Accel Energy to operate its fossil fuel assets and retaining the company’s renewable energy assets and retail services under a rebranded AGL Australia. It’s a plan labelled by Cannon-Brookes as not good for the environment or for the plant’s shareholders.
Cannon-Brookes believes that buyouts by environmentally concerned entities could become a model for how the green energy transition can be achieved more quickly, at lower cost, and with less risk. It could be a way to get cheaper, greener power to customers fast. And the demand is there — from everyone from individual homeowners to aluminum smelters.
AGL recently announced the planned closure of two coal-fired power plants — Bayswater in 2035 and Loy Yang A in 2045. Not fast enough for Cannon-Brookes and Brookfield. Not good enough for the environment (Loy Yang burns highly polluting brown coal). And probably not good enough for shareholders — renewables are increasing rapidly and pushing coal out of the energy business. “If there’s one thing we’ve seen over the last 10 years, if we create that stability, and create that low cost of capital, we will be blown away by how much renewable capacity will come online in that period of time,” Cannon-Brookes told Energy Insiders.
Australian households could lead the world in decarbonization by doing it themselves, according to research supported by Cannon-Brookes, published last year by Dr. Saul Griffith and Rewiring Australia. Rooftop solar in Australia is the cheapest in the world, at a couple of cents per kilowatt-hour. Batteries allow rooftop solar to soak up excess energy during the day and use it at night. If households also replace their cars with electric vehicles and replace gas appliances with electric ones, it’s possible to reach zero emissions and do it this decade.
“Out with the dinosaurs and climate luddites on the AGL board, in with strategic forward thinkers driving decarbonization and energy transition!” said Tim Buckley, from Climate Energy Finance, on LinkedIn.
If you can’t beat them, buy them.