AGL Energy says repairs at a damaged unit of the Loy Yang A brown coal-fired power station in Victoria could take more than six weeks longer than first thought, keeping the 535MW unit offline until late September.
The announcement came as AGL reveals chief customer officer, Christine Corbett, who was to head the AGL Australia unit, will also depart the company after the proposed demerger was pulled.
Corbett’s departure is the latest in an ongoing clear-out of AGL’s senior leadership following its failure to secure shareholder support for the controversial company split.
In a statement to the ASX on Friday, AGL Energy said global supply chain issues and the subsequent lack of available materials had hampered repairs to the Loy Yang A unit.
Loy Yang A’s ‘unit 2’ generator was taken offline in April, due to damage caused by an electrical fault – understood to be a failed generator rotor – the second such outage within the last three years.
It is one of a number of coal outages that has seen up to a third of coal capacity sidelined, just as the market – driven by soaring international prices – hit record highs in the past two months.
In the statement, AGL says it has completed a review of the latest incident, which concluded the unit would likely remain offline until at least late September.
“Based on this review AGL now expects this outage to extend until the second half of September. The outage extension is driven by global supply chain issues and the availability of specialised materials,” AGL’s statement says.
In May, AGL indicated that the outage would cost the company $73 million in lost income, due to the foregone revenue from the power station. AGL says it will not be able to recover the losses through insurance.
AGL said that it would provide an update on the expected losses in the new financial year and was not in a position to provide an earnings guidance while a strategic review of the company was underway.
The extended outage occurs during a volatile time for Australian energy markets, as well as a tricky time for AGL itself, which is grappling with the ongoing fall out of its failed demerger.
In a separate statement, AGL CEO Graeme Hunt – who will also leave the company in the coming months – said Corbett would step down on 24 June.
“Christine has made a significant contribution to AGL. Her drive, energy and focus has been transformative for the business and our customers,” Hunt said.
“I’d like to thank Christine for her hard work and dedication and wish her the very best for the next stage of her career.”
Corbett had been lined up to become CEO of AGL Australia – the side of the proposed AGL split that would have retained the company’s energy retail and renewable energy assets.
“I was very excited to be appointed as Managing Director and CEO elect of AGL Australia to create and lead a new company centred around the customer and poised to capitalise on the growth opportunities arising in the renewable energy space,” Corbett said.
AGL chair Peter Botten, as well as two other members of the AGL board, Jacqueline Hey and Diane Smith-Gander, will also step down.
AGL’s current general manager for product and portfolio, Jo Egan, will replace Corbett as chief customer officer.
