OPINION: Higher power prices have helped AGL shares surge 44 per cent this year. But higher prices will come with a tricky side effect for chief executive Damien Nicks.
What a difference 12 months makes. Just a year after AGL chief executive Damien Nicks delivered a full-year profit result under the shadow of a corporate governance war between the board and major shareholder Mike Cannon-Brookes, the 2023 result brought more good news about the electricity giant’s outlook.
Macquarie analysts had suggested the 2025 curve was pointing to a reduction in prices of between 10 per cent and 12 per cent. But Nicks’ comments should help investors keep the faith, and are another step along theIndeed, Nicks’ real achievement over the past 12 months is that he has reset the way the market views the company.
AGL’s ability to exploit higher prices is also important, and Nicks’ strategy is to run its coal-fired power plants at Bayswater in NSW and Loy Yang in Victoria smarter and harder.He revealed on Thursday that the Bayswater plant can be flexed down by as much as 70 per cent, and Loy Yang by 45 per cent, as power prices rise and fall each day as renewable generation pushes wholesale spot prices down and even into the negative.
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