AGL Share Price On Heavy Watch

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Energy giant AGL Energy Limited’s (ASX: AGL) share price increased in the days following its drop before the end of September. 

On September 29, the energy company’s share went up by 3% to $6.80 as opposed to the ASX 200 index, which was down 1.1% on the same day.

AGL share price was up by 12% in the last 12 months, to which brokers responded positively, causing investors to buy AGL shares. This, and the recent announcement of the company’s intention to reduce its carbon footprint, contributed to the share price increase.

Australia’s largest electricity generator announced its plan to close down all its coal-powered generations by the end of the fiscal year 2035, targeting net-zero annual greenhouse gas emissions.

AGL Chair Patricia McKenzie shares that the company would be net-zero from operations when the Liddell and Bayswater power plants in NSW and the Loy Yang power station close.

“Our decarbonisation and energy investment strategy set a clear pathway for the company’s future and its leading role in Australia’s energy transition,” McKenzie adds. Their plan to transition from coal energy generation to renewable energy resulting from their review of the company’s strategic direction and incorporating the opinions of shareholders, government, and energy regulatory authorities.

The company also announced that it would recognise the $700 million non-cash impairment charge to fast-track the Loy Yang closure by a decade, reviewing dividend payouts.

McKenzie also noted that for the plan to work, AGL would appoint more directors with critical functions in their 2035 target, including recommending nominees from billionaire shareholder Mike Cannon-Brookes’ Grok Ventures list of independents he wants on the board.

AGL ends its announcement by reaffirming its stakeholders, “Overall, AGL believes FY23 earnings will remain resilient amidst the current challenging energy industry and market conditions and is well positioned from FY24 to benefit from sustained higher wholesale electricity pricing as historical hedge positions progressively roll off.”

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