AGL dishes out cash to upgrade coal plants through summer

AUSTRALIA’s largest electricity generator AGL Energy has spent nearly A$200 million on renovations and upgrades aimed at ensuring domestic security of supply and reliability from its Loy Yang A power station in Victoria, and its Bayswater power station in New South Wales.
AGL dishes out cash to upgrade coal plants through summer AGL dishes out cash to upgrade coal plants through summer AGL dishes out cash to upgrade coal plants through summer AGL dishes out cash to upgrade coal plants through summer AGL dishes out cash to upgrade coal plants through summer

AGL's Loy Yang coal-fired power station

 
Meanwhile its LNG import plans hit another milestone late last year when it announced it had signed on for a floating storage and regasification unit for its Crib Point terminal in Victoria. 
 
The agreement, a long-term charter from Hoegh LNG, is conditional on a final investment decision and regulatory approvals, including environmental approvals required by the state government. 
 
In mid-June AGL announced it had signed agreements with pipeliner APA Group to develop the Crib Point Pakenham pipeline and transport gas from the proposed jetty via a 20-year gas transportation agreement. 
 
The agreement with AGL is Hoegh's second contract win in Australia, having signed a similar agreement with Australian Industrial Energy in August year for the supply of an FSRU at AIE's proposed Port Kembla LNG Terminal. 
 
The two are currently the most likely of up to five proposed LNG import terminals for the tight east coast gas market. 
 
Meanwhile despite its ongoing promise to shutter coal-fired Liddel plant by 2025 to the intense irritation of the government - and threats to forcibly nationalise it by the so-called far right Monash Group - AGL is spending on maintaining its current coal-fired plants. 
 
The company spent $190 million across the two major assets, citing its commitment to reliability and the need for the two stations to remain fully operational over the summer period.
 
AGL's upgrades follow warnings from the Australian Energy Market Operator which released its summer readiness report last November revealing that extreme heatwaves would cause generator failures and limit output potentially causing blackouts and major disruptions throughout the east coast market. 
 
The Loy Yang power station in Victoria is one of AGL's largest assets and generates approximately 30% of Victoria's power requirements each year. 
 
Upgrades included $90 million worth of refurbishments to the fourth unit at the station and an additional $30 million of work on the electrical systems and the dredger. 
 
 "The purpose of these projects is to ensure AGL Loy Yang remains a safe, reliable and competitive supplier to the National Energy Market over the remaining 30 years of its life," Yoy Yang general manager Nigel Browne said. 
 
AGL spent $70 million on the initial improvements to the coal fired power plant in the Hunter Valley of New South Wales, and expects to continue to invest in the plant with repairs planned for two of its units in the future to enable them to operate at full capacity over summer. 
 
AGL was trading up nearly 2% at $20.69 per share today.  

 

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