February 27, 2023

EnergyAustralia confirmed its focus on improving asset reliability and performance in 2023 following today’s announcement of an underlying loss of $128 million EBITDAF for the 2022 financial year (underlying profit of A$486 million EBITDAF in 2021) reflecting volatile market conditions and lower generation output. 

EnergyAustralia’s financial results were announced in Hong Kong today as part of CLP’s earnings announcement for the year ending 31 December 2022.  This included the disclosure of the negative impact of EnergyAustralia’s accounting revaluations of sold energy (fair value movements) of $774 million before tax for the full year, an improvement on the negative impact of $2,031 million before tax reported for the first half reflecting an easing of forward energy prices and associated energy contract accounting valuation movement. 

EnergyAustralia Managing Director Mark Collette said: “Our financial performance in 2022 was driven by volatile market conditions, asset reliability and coal supply issues. This is not where we wanted to be, and we are progressing a plan to reset our performance over the next two years.

“The perfect storm of events we experienced in 2022 reinforced that we are now operating in a very different, more uncertain environment at the same time as Australia’s energy transformation is accelerating.

“Our plan for 2023 focuses on actions to improve energy supply reliability from our major generation assets at Yallourn and Mount Piper. Increasing reliable energy supply helps our customers by placing downward pressure on electricity price growth and supports an improvement in EnergyAustralia’s performance allowing us to unlock continued investment in the clean energy transformation.” 

Key Points - EnergyAustralia 2023 Reliability and Performance Plan 
•    Accelerating a program of maintenance at Yallourn to improve safety, reliability, and performance ahead of the power station’s planned closure mid-2028. The maintenance program includes major scheduled outages for each of Yallourn’s four generation units during 2023 and 2024 involving an investment of approximately $400 million.
•    New coal supply agreement for Mount Piper including multi-mine supply arrangements with Centennial to provide coal from Airly in addition to Springvale. This is one of a number of features of the new agreement that are expected will help improve coal reliability for Mt Piper and electricity supply for the New South Wales community. 
•    Implementing changes to improve working capital outcomes reflecting market conditions and generation performance at Yallourn.
•    Actively working with the government and gas and coal suppliers to meet the goals of recent interventions announced by the Commonwealth and State Governments.

Mr Collette added: “While we remain in a challenging environment, we are committed to working hard to provide affordable and reliable access to energy for our 1.6 million customers. We are doing this through actions that increase asset reliability and reduce pressure on electricity prices. We are also continuing to actively support our customers facing financial difficulty through payment plans, payment extensions, our staying-connected guarantee and access to cashflow assistance for small businesses.

“At the same time, improving our financial performance over 2023 and 2024, will support continued investment in projects that will enable us to grow over the longer-term and lead the clean energy transformation.  This includes the completion of the Tallawarra B gas/hydrogen power station later this year which, in peak periods, will deliver reliable power to an additional 150,000 New South Wales homes.”

EnergyAustralia Clean Energy Portfolio Highlights
•    Completion of the 316 MW Tallawarra B gas hydrogen carbon offset generation project this year to supporting peak summer demand in New South Wales with the scheduled retirement of the Liddell coal-fired power station. 
•    Progress toward the completion of Kidston pumped hydro project in Queensland in 2024 and planning for the Wooreen battery project in Victoria. 
•    Support for the Riverina and Darlington Point batteries in New South Wales.  
•    Completing feasibility studies and community consultation for a grid-scale battery at Mount Piper and the Lake Lyell pumped hydro project in New South Wales. 
•    Growing flexible capacity and behind the meter, including new initiatives to support retail and business customers to benefit from batteries if they have existing solar. 
•    Continuing to identify partners to support accelerated investments in flexible capacity.

In December 2022, Moody’s Investors Service assigned a Baa2 issuer rating to EnergyAustralia with a stable outlook.

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Jacinta Smith -