redman was / is - in my eyes - the worst thing that has happened for AGL shareholders. Cannot say one of his decisions was right
Renewables were actually great for AGL... it was the bundling into PowAR co - and then buying the output back on PPA where things went wrong - massively failed in their prediction of where spot prices would go... and used a pricing mechanism that was overly generous to the buyer (PowAR co)
We have just seen a 700m write back occur on the "onerous PPAs"... but forecast that there will be write downs next report... part of this is new accounting standards bringing the value of contracts to the balance sheet in a more timely manner than historically has occurred, the other part is how new generation being added vs old generation being retired is impacting the NEM.
IMO - the Australian market is not currently being driven by demand, rather by supply constraint.
AGL Price at posting:
$7.18 Sentiment: Hold Disclosure: Held
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