Good morning, ladies and gentlemen. My name is Patricia McKenzie, and I am your Chair. Welcome to AGL's 2022 annual general meeting, my first meeting as Chair of AGL. It's a pleasure for the AGL board to be present in Melbourne for today's meeting. I would like to start the meeting by acknowledging the traditional owners of the land on which we meet today, the Wurundjeri people of the Kulin Nation, and pay my respects to their elders, past and present. Shareholders attending via our online platform may be doing so from other ancestral lands, and I also pay my respects to the traditional owners of those lands and their elders, past and present. May I ask you to make sure that your mobile phones are switched to silent while the meeting is in progress. Filming of the meeting is not permitted.
I also ask that you note where your nearest exit is in the unlikely event it becomes necessary to evacuate the building. In the event of an emergency, please follow the instructions of the venue staff. The notice convening this meeting has been made available to all the registered shareholders, and the necessary quorum is present here today. Today's meeting is being conducted as a hybrid meeting, and our shareholders have been given the opportunity to attend the meeting in person or via the online platform. For the purposes of the online meeting, this meeting is being filmed for webcasting purposes. Shareholders have also been given the opportunity to lodge a proxy or direct vote and ask questions in advance of the meeting. Shareholders and proxies attending using the online platform can submit written questions at any time.
To ask a question, select the Q&A icon and type your question in the text box. Once you have finished typing, please hit the Send button. Although you can submit your questions from now on, I will not address them until the relevant time in the meeting. Please also note that your questions may be moderated or, if we receive multiple questions on one topic, amalgamated together. We will give all shareholders a reasonable opportunity to ask questions, but it is possible that not all questions will be answered today. To ask a verbal question, please follow the instructions set out on the virtual meeting platform. If you are attending online and are eligible to vote, once voting opens, press the Vote icon and all resolutions will be activated with voting options. To cast your vote, simply select one of the options.
There is no need to hit a Submit or Enter button as the vote is automatically r ecorded. You will receive a vote confirmation notification on your screen. You can change your vote up until the time I declare voting closed. For those attending the meeting here in person, once we come to question time, you can ask a question by raising your hand and a microphone attendant will come to you. Please show your attendance card and provide your name. To be eligible to speak today, you must hold a yellow or blue attendance card. If you are eligible to vote, you can scan the QR code on your attendance card with your mobile device at any time after I open the voting. This will take you to an online voting page. To cast your vote, simply select one of the options.
There is no need to hit a Submit or Enter button as the vote is automatically recorded. You will receive a vote confirmation notification on your screen. If you do not have a mobile device, you may complete the voting items on the reverse side of the attendance card, and Computershare staff will collect the cards at the conclusion of the meeting. You can change your vote up until the time I declare voting closed. I now declare voting open on all items of business. I will now explain the running order for today's meeting. In a moment, I will make a few remarks about AGL's new strategic direction and the board and management renewal process. Damien Nicks, AGL's Interim CEO, will speak to the financial results and strategic plan. We will attend to the formal business of the meeting.
I would now like to introduce my fellow directors. Since the last AGM, the composition of the AGL board has changed significantly. We have welcomed three new directors to the Board, Graham Cockroft, Vanessa Sullivan, and Miles George, who all have significant and relevant experience in renewables, the energy transition, and transforming companies. Mark Bloom has been on the board since July 2020 and is chair of the Audit & Risk Management Committee. I woul d like to take this opportunity to thank all directors and the executive team for their dedication, hard work, and commitment in steering this company forward in what has been a challenging year. I would also like to recognize Jacqueline Hey, Diane Smith-Gander, and Peter Botten, who retired as non-executive directors during the year.
On behalf of the board, I thank them for their significant contribution and service to the board and AGL. I would also like to recognize and thank Graeme Hun t on behalf of the board, who stepped down as Managing Director and CEO on the 30th of September this year, for his significant contribution as a Non-Executive Director, Chair, and Managing Director and CEO over a 10-year period. His leadership and dedication to AGL have been greatly appreciated. Also attending this meeting today is our interim CEO, Damien Nicks, Company Secretary, Melinda Hunter, and Interim Chief Financial Officer, Gary Brown, as well as other members of the executive team. AGL's external auditors, Deloitte, are also attending this meeting.
The Senior Audit Partner, Jason Thorne, is available to answer any relevant questions in relation to the audit that you may wish to ask later in the meeting, and I thank him for attending today. Let me start my address by expressing my excitement for the future of AGL. AGL now has a renewed board and management team and a set of new strategic directions, one that shapes a stronger, more sustainable future for AGL by embarking on one of Australia's most significant decarbonization initiatives. This new strategy was overseen by a board subcommittee, co-chaired by Vanessa Sullivan and Graham Cockroft, and including Mark Bloom. Gary Brown, our interim CFO, led the review internally. The resulting key priorities for AGL moving forward include the targeted closure of the Loy Yang Power Station by the end of FY 2035, up to 10 years earlier than previously announced.
An ambition to add up to 12 GW of new renewable and firming capacity by 2036, which will require a total investment of up to AUD 20 billion. An interim target to have up to 5 GW of new renewables and firming in place by 2030. AGL currently has a 3.2 GW pipeline of high-quality energy projects and access to a 3.5 GW high-quality renewables development pipeline via its investment in Tilt Renewables. An unwavering focus on our customers as a continued major retailer of essential services, supplying affordable energy, supporting electrification and their transition to a low carbon future. An unchanged commitment to rejuvenate our operating sites into low carbon energy hubs.
We believe this new strategy is in the best interest of the company and enhances long-term shareholder value in a way that maintains the reliability and affordability of the NEM and also addresses the need for decarbonization. Having listened to our stakeholders, in particular our shareholders, we also know it's also what our community expects of us, and above all, it's the right thing to do. We have received strong support following the announcement of the outcomes of the review of strategic direction from a wide range of stakeholders, and the management team and our people are excited to take the company forward on this basis.
As Australia's largest carbon emitter and Australia's leading private investor in renewable energy and the operator of the largest portfolio of renewable and battery assets of any ASX-listed company, AGL can make a material difference in reducing the nation's carbon footprint by taking the steps outlined in our new strategic direction. Importantly, the outcomes of the review of strategic direction and this accelerated plan for decarbonization supports the transition to a lower carbon world, aligned with the Paris Agreement goal of limiting warming to below 2 degrees compared to pre-industrial levels. AGL plans to be net zero for operated Scope 1 and Scope 2 emissions following the closure of all AGL's coal-fired power stations. AGL also has the ambition of being net zero for Scope 3 emissions by 2050.
More detail about our decarbonization approach can be found in our inaugural Climate Transition Action Plan, issued as part of the outcomes of the review of strategic direction, which shareholders will vote on today. Based on the proxies lodged ahead of the meeting, it has been strongly supported by our shareholders. AGL will report on its progress against the Climate Transition Action Plan annually, and we will continue to communicate transparently with shareholders about our approach to decarbonization. I also want to emphasize that AGL continues to reliably supply more than 4.2 million services per annum. We take our responsibility to our customers seriously, and that's why our strategy includes a number of customer-focused programs to support our customers in their decarbonization journeys.
These programs include Australia's largest virtual power plant, behind-the-meter solutions for electrification and decentralized energy generation, and significant investments in digital and data to deliver value to our customers. This energy transition is an industry-wide transformation that will involve significant changes, and it will have widespread impacts. As we navigate our industry's transition, we are firmly committed to supporting our customers and communities with a just transition. Just as we are doing in preparation for the closure of the Liddell coal-fired power station, we will work with our broad stakeholder group to deliver these outcomes. In particular, we are committed to working with employees, their representatives, and government to help develop the skills and capabilities required for new and existing industries to ensure the transitioning energy sector is supported by a skilled workforce.
The outcomes of the review of strategic direction lay a clear path which is deliverable and responsible, and our focus now is to implement this ambitious plan. I would now like to take a few moments to discuss a few board matters. Graham Cockroft, Vanessa Sullivan, and Miles George were appointed as non-executive directors since the last AGM. As required by our constitution and the ASX listing rules, will each retire and stand for election at today's meeting. I will also retire by rotation and I'm standing for a re-election at today's meeting. For the reasons set out in the notice of meeting, the board recommends that shareholders vote in favor of each of these director appointments. I will now speak about the candidates that were nominated for election by entities associated with Grok Ventures. These are items five A to five D in the notice of meeting.
The board respects the right of shareholders to put forward candidates for election as directors, and it carefully considered the candidates in the context of the board skills matrix of the renewed board. The board determined that Mark Twidell, who brings customer-facing experience as well as more than 30 years of experience in the international energy sector, most recently as Director, Energy Programs at Tesla, would provide a valuable addition to the board, and the board recommended that shareholders vote in favor of his election. After careful consideration, the board determines that although the other candidates nominated by entities associated with Grok Ventures are respected directors in their own right, their skill set was either already present on the board or not aligned to the priority skills that were being sought through the existing board renewal process.
Based on the proxies lodged ahead of the meeting, the election of Mark Twidell, Dr. Kerry Schott, Christine Holman, and John Pollaers as directors has been supported by our shareholders. The board welcomes these new directors to the board and will work constructively with them in the best interests of shareholders. I also confirm that the process for appointing a new CEO is continuing as planned, and there is currently a short list of Australian and global candidates. We expect to announce the permanent CEO in the coming months. Finally, I wish to make some comments on the second item on today's agenda, the remuneration report. The chair of the board's People & Performance Committee, Graham Cockroft, will speak to the remuneration report in more detail shortly.
Based on the proxies lodged ahead of the meeting, AGL is likely to receive a first strike on the remuneration report due to a couple of large shareholders voting against it. This is a disappointing result, given that all major proxy advisors recommended that shareholders vote in favor of the report and no material concerns were identified. However, we will take this outcome into account when we review our remuneration structure during FY 2023 to consider opportunities to further align the structure with company performance and long-term shareholder value. In summary, it has been a difficult year for AGL amid significant external challenges, but our FY 2022 results show the underlying resilience of our business.
Your board is confident that we can now move forward with the right strategy, supported by our shareholders and delivered by a strong management team to deliver reliability and affordability of the NEM, value to shareholders, and an accelerated decarbonization pathway. It is now my pleasure to invite Damien Nicks, your Interim CEO, to address you. Following Damien's address, we will move to the formal business of the meeting.
Good morning. I'm Damien Nicks, AGL's Interim CEO. I'm honored and excited to be leading AGL as at this crucial time as we reset our strategy in line with shareholder and community expectations. I'd also like to welcome those joining us online and for shareholders in Melbourne, it is great to be here together on the land of the Wurundjeri people of our annual general meeting. I've been with AGL for the past nine years, most recently as its Chief Financial Officer. The management team and I are working hard to get on with the job of delivering AGL's new strategy. As Patricia said, this strategy is one of the most significant decarbonization initiatives in Australia and includes bringing forward our targeted exit from coal by up to a decade.
I'll talk more about the strategy shortly, but first, I'd like to take some time to reflect on the year, on our safety performance, the extraordinary industry and market conditions we've been operating in, and the financial and operational performance of the business in FY 2022. First, starting with safety. Our priority is to conduct our business in a way that cares for our people, our customers, and the communities in which we operate. I'm pleased to share, because of our continuous improvement and focus on health and safety, our total injury frequency rate, or TIFR, for FY 2022 was 2.1 per million hours worked for employees and contractors, which was a reduction from 2.3 in FY 2021. This continues the material improvement we saw in FY 2021 on the previous two financial years.
It is also important to note that a high volume of critical work was undertaken throughout the year without any significant injuries. While we know there's always more to do, these are positive results and are testaments to the team continued vigilance and commitment to a strong and healthy health and safety culture. Turning now to the developments in the industry and the extraordinary context we've been operating in. FY 2022 was a challenging time for the energy industry and its customers. Geopolitical instability on the back of the Russia, Ukraine conflict and international supply constraints drove global commodity pricing significantly higher. In June, the confluence of these higher prices, as well as a series of planned and unplanned thermal generator outages, led to an elevated wholesale electricity pricing environment within the national electricity market.
This unprecedented market volatility culminated in the suspension of the market by Australia's energy market regulator, AEMO. At the same time, we saw a series of electricity and gas Retailer of Last Resort or RoLR events, as well as selected retailers immediately withdrawing their discounted market offers and defaulting to regulated pricing. These conditions are widely recognized and regarded as some of the most difficult and complex in the 20+ year history of the national electricity market. While conditions have settled to some extent, we continue to see high wholesale prices and elevated volatility. These increases in wholesale energy prices, driven largely by fuel input costs, are now flowing through to customers. New federal budget forecasts point to more than a 50% increase in retail electricity prices across the market over the next two years, and a significant spike in gas prices.
We understand the additional pressure this puts on households and businesses alongside broader cost of living pressures, and we're working closely with our customers to help them manage their energy bills. It is also clear the pace of energy transition is accelerating, supported by recent state and federal government announcements, including a AUD 25 billion federal commitment to clean energy spending. The increased focus and broad alignment on decarbonization and transition is welcome, and we support sensible policies aimed at accelerating the transition. Indeed, we have been pleased by the clear investment signals provided by the new federal government, including the legislated 43% reduction in carbon emissions by 2030. This provides greater certainty to businesses like ours to get on with building the renewables and firming capacities that will be required as coal-fired power stations close.
We believe effective collaboration across and between industry and all governments will be integral to ensuring customers and communities are supported as the transition accelerates and investment is not impeded. Let's now turn to AGL's financial and operational performance. AGL's underlying EBITDA was down 27% to AUD 1.218 billion, and underlying profit after tax was AUD 225 million, down 58% from FY 2021, albeit within guidance. This was driven predominantly by historically low wholesale prices. Our lower FY 2022 result was disappointing, but reflective of very difficult and complex energy industry and market conditions. However, against this backdrop, the results demonstrate the underlying strength of AGL's business, our low-cost base load generation, supported by our long-term owned and contracted fuel supply, our large and our loyal customer base, and our effective portfolio management.
We've also continued our ongoing focus on cost discipline. In FY 2022, we delivered AUD 150 million of targeted operating cost reductions, and in FY 2023 are on target to deliver more than AUD 100 million of sustaining CapEx reduction, noting that this is against the FY 2021 baseline. Our cash conversion has also remained strong, driven by solid working capital outcomes. In late September, we provided guidance for our FY 2023 underlying earnings, which I'm pleased to confirm today has remained unchanged and is as follows. Underlying EBITDA of between AUD 1.25 billion and AUD 1.45 billion and underlying profit after tax of between AUD 200 million and AUD 320 million. These ranges reflect the resilience of AGL's earnings on the back of its largely hedged position for FY 2023 and continued market volatility.
AGL is well-positioned from FY 2024 to benefit from sustained higher wholesale electricity pricing as historical hedge positions progressively roll off. The final unfranked dividend of AUD 0.10 per share was paid on the 27th of September, 2022. When added to the interim dividend of AUD 0.16 per share, the total dividend for FY 2022 was AUD 0.26 per share. Now turning to how the different parts of the business performed in FY 2022. Firstly, to our customers. As always, we have kept the customer at the center of what we do. We've continued to achieve positive customer advocacy scores and maintain customer service amidst significant market volatility. We've also continued to reduce operating costs through digitization and automation, enhancing customer experience, and extending our product offering through growth in behind-the-meter and other energy solutions.
Total services to customers remain stable at 4.2 million, a solid result given the market conditions. Our Net Promoter Score, a measure of customer advocacy, remains at a historical year-end high at +6. Disciplined margin management delivered improved consumer gross margin in the second half, and this demonstrates our ability to support customers, but also carefully manage value during times of heightened volatility. We continue to invest in rapidly enhancing behind-the-meter energy solutions, enabling us to capture value through increased demand from electrification. Our offer for customers continues to evolve through microgrids and expansion into biogas energy systems through the acquisition of Energy 360. Our virtual power plant of decentralized assets under orchestration has grown 65% in the last year, underpinned by our innovative NEO platform and we remain market leader in commercial solar.
This growing part of our business helps us to establish long-term relationships with customers and create a platform for future growth as customers expand current capacity, they replace older systems, and add storage and charging solutions. In E-mobility, AGL was the first Australian company to join the EV100, committing to full fleet electrification by 2030, and we're now getting on with the job of helping our customers electrify. We offer commercial and home charging solutions to customers of any size, and our EV subscription for business is allowing companies to flexibly test their fleet transition pathway. We're also leading Australia's development of smart charging capa bility with our ARENA trial, the SA Smart Charging trial, and Kaluza flex trial, which are all focused on enabling EV drivers getting the cleanest, fastest, and most reliable charge possible.
Going forward, our large, diverse, and loyal customer base, coupled with prudent margin management and our investment in rapidly expanding behind-the-meter energy solutions, positions us well for future customer growth. We'll now turn to our generation and trading performance. Despite the good start to the year, our generation volume remained broadly flat in FY 2022, and our thermal fleet's commercial availability was down 2 percentage points year-on-year. This was largely due to a confluence of both planned and unplanned outages in the fourth quarter. Loy Yang Unit Two was the most extended of these outages, and the unit has recently returned to service. While these unplanned outages were disappointing, we continue to invest around AUD 1 billion per annum in capital and operational costs to maintain and run these key assets, including actions to improve safety and availability.
Over the next 12 years, these assets will continue to be an important part of the national electricity market, supporting system stability and energy affordability. The strong performance of the AGL trading team in FY 2022 was crucial to managing the organization's risk position and in mitigating downside in an extremely volatile market. This year, we also made solid progress in advancing our high-quality 3.2 GW pipeline of renewables and storage projects. Last month, I had the opportunity to tour our 250 MW Torrens Island Battery in South Australia, which is now at its commissioning stage. The battery will be fully operational by 2023 and will play a vital role in unlocking the value of South Australia's investment in renewables. Our Torrens Island site represents the transition in action, with the older generation being replaced by fast start and battery firming.
Early this month, we also started construction on our Broken Hill battery. We've also got state government planning approval for our grid-scale batteries at our Liddell and our Loy Yang sites and are continuing to advance our energy hubs at each of the major sites. Our new strategy outlined in the Climate Transition Action Plan sets us up to be an integrated, low carbon energy leader and will ensure that AGL remains a strong and sustainable company for many years to come. We've brought forward our targeted exit from coal to 2035, up to a decade earlier than previously announced. Our ambition to supply future customer demand with approximately 12 GW of new renewable and firming assets by 2036. We already have 3.2 GW pipeline of projects, which includes the Torrens Island and Broken Hill batteries I mentioned earlier.
We are also committed to redeveloping our thermal sites in the Hunter, Torrens Island, and the Latrobe Valley to be industrial energy hubs of the future, bringing economic diversification and new jobs to these communities. Delivering on AGL's growth ambition will require significant capital investment, which we estimate will be approximately AUD 20 billion over a 12-year period. We have a number of channels to source this volume of energy, be it through our existing, future project pipeline via partnerships like Tilt Renewables or others, through offtaking from decentralized energy sources or even in traded energy markets. When making decisions we're insourcing, we'll look to the option that drives the best economic outcome for AGL shareholders as we deliver on a faster decarbonization for our business and for Australia.
The value that will be created as Australia transitions to a low-carbon future is widely recognized. AGL's strategic asset base, renewable development capability, our large customer portfolio uniquely position AGL to generate strong shareholder returns from the transition. The cost of capital on carbon-intensive industries is well understood, and we expect that our commitment to an accelerated transition will result in a lower cost of capital and a valuation premium. As I've said, there is a significant opportunity ahead of us as we accelerate AGL's transition to renewables and storage and support our customers on their decarbonization journey. Finally, I'd like to thank our employees for everything they've done over the past year to support our business and customers, including those who keep the lights on for the millions of households and businesses that depend on us. Thank you very much.
Thank you, Damien. It's now time to address the formal business of the meeting. The notice of meeting sets out five items of business. A poll will be conducted on each resolution. Conducting the formal voting by poll will ensure that the views of all shareholders who wish to vote are represented, including those who have lodged valid proxies and direct votes in advance of today's meeting. We will display details of the direct and proxy voting for each item of business after the discussion on that item. Votes will be counted immediately following the meeting, and the results will be notified to the ASX before the end of today and posted on the company's website. Turning now to the first item of business, the financial report, director's report and auditor's report for FY 2022.
AGL published its 2022 annual report in August, which contains full information about the company's financial and operating performance during the year. Under the company's constitution and the Corporations Act, there is no requirement to ask shareholders to vote to adopt the accounts. However, you may ask questions or make comments on the 2022 annual report and the management and performance of AGL. As I mentioned earlier, Jason Thorne from Deloitte is available to answer questions relevant to the audit. I would now like to invite questions on the 2022 annual report and the management and performance of AGL. I will first take questions from the floor of the meeting, then written questions from the online platform and verbal questions from online. It will help in keeping a record of the proceedings if the speaker will announce their name and, if relevant, the name of the organization they represent.
If anyone holding a yellow or blue card has a question, please raise your hand and a microphone will be brought to you. For shareholders asking questions via the online platform, please submit your questions now if you have not already done so, or please follow the instructions to join the queue to ask a verbal question. If anyone holding a yellow or blue card, please raise your hand.
Good morning. Helen Manning here from the Australian Shareholders' Association. Thank you for answering the question on the strategic review, which we put to you before the meeting. It's now clear that you've got the four additional directors on the board. So what we're asking here is that while the strategic review emphasized the decarbonization process, which is of itself a herculean task, do you see other matters for strategy coming up? Do you think you will be continuing the strategic review?
Thank you for your question, Ms. Manning. The strategic review had multiple matters under consideration. We certainly considered the decarbonization task. We also considered the reshaping of the energy portfolio, and we considered the multiple strategies which have been developed for the demerged entities relating to consumers and other items and other areas. We've determined that most of those strategies are appropriate for the integrated entity, and we will continue to implement them moving forward.
Hi, my name is Theo Villars. I'm a shareholder. I don't want to go in detail of your reports. Congratulations that under the COVID situation you managed to get more money, and I don't know how, apart from picking up the price. Anyway, what I try to say is this, we have a lot of directors. I go to various company meetings, becomes a sport. Directors and politician may not need always to be qualified. They can jump from one company to another. I am not judging them. What I'm saying, if you ring AGL to try to get from other company to them, takes days, not hours, to talk to somebody, and then you talk to an answering machine.
If you succeed to get through, my last answer from one of the officer in charge they call consultants ask me how much do I pay now. That is not a fair question in my view. What I'm saying without going in the bush, the director responsible for communication to be nice, to stand up and to tell us or whoever is interested, how can you talk to somebody, not to a robot? When we have this landline, you could talk to somebody. What's the benefit of having high tech if you cannot talk to anybody? My view is the companies tend to raise the income of the higher level and very little on the low level, which basically brings you customers. If you don't have communication, how can you get customers? Anyway, that is my questions.
Yeah, thank you for your question, sir. We certainly put a lot of time and effort into our customer experience, and I'm disappointed that you have not received the communication that you had sought. We do have today customer experience officers available, and would be very happy for you to speak to them after the meeting. You can find them in the foyer, and to deal with any particular issues that you have. We will take into account your comments, and we will continue to focus on our communication with our customers. As to the question regarding what you're paying at the time, it is our practice to try to ensure that our customers are on the best possible payment plan for them, and that's the purpose of that question.
Hello.
I'm not trying to be Mr. Smart, but unfortunately, why the director to tell us, to me at least, what qualifies and what plans he have? Because the low-level employee is responsible for 20% of his, statistically, his performance. The rest belongs to the company for training them. If you cannot talk to somebody, how can you get customers? I don't want to. Please don't kill the question because or the answer. Thank you very much.
Thank you.
Hello. My name's Yaron Flicker. I'm both a shareholder and a customer. My question relates really to the next two years of AGL rather than the next five to 10 years that you've spoken about. My comments and questions relate to comments in the shareholder update and in the annual report, which have been repeated here, and just like some comments about that. While you talk about the unwavering support towards customers and to supply them affordable energy, that's on page two of the notice to shareholder, and also later on in the annual report, we talk about the underpinned by the strength of the low-cost base load position of AGL.
In financial year 2024, where AGL talks about having reduced its hedges, therefore, it's going to have a de-linking of cost and price to customers, and therefore, it effectively is announcing that it's going to gouge its customers by charging a much higher electricity price. Those two comments are, I find, incompatible, and it seems to be that I'm not surprised, for example, that the remuneration report because there's a de-linking between cost efficiencies and price returns. Also, the situation in gas is quite similar, where AGL is a small producer of gas.
Essentially, we're deafened by the silence of all the retailers towards both the public and to the government about the high, high cost of particularly of gas, but also electricity, where it seems that AGL have joined the other retailers in allowing the cartel-like behavior of the producers to essentially use this situation to grow margin at the expense of its customers. It seems that in the next two years, the unwavering commitment to customers will allow really the domestic, commercial, and industrial customers, some of which will be thrown onto the scrap heap of bankruptcy and continuing closures, as we have seen already due to the high gas prices. Despite what the interim CEO has said, this is not a new situation related to the U.K.rainian war, which has, to be frank, exaggerated it.
This was written about in 2017 when all the hedge positions were done and every gas producer was running out its supplies to the domestic market. Essentially all, I think other than Origin, have reduced their supplies to the domestic market. This is not a new situation, but the hyper windfall profits of the producers is really exaggerated by the Ukraine war. My question to AGL is, do you have an unwavering support to customers? Are you gonna take advantage of your low-cost energy production to offer low-cost cost prices to the customers and lead? Or you gonna just we gonna continue just ripping off the market and ripping off our customers?
Well, thank you for your question, Mr. Flicker. The pricing, particularly for domestic customers, from AGL, is in line with the regulated prices that are in place in respect to the Default Market Offer and Victorian Default Offer. We do offer discounts to those prices where appropriate, as do other retailers. We have in place plans to assist any customers who are in a difficult position and unable to make their payments. We have the Staying Connected program, which in addition to offering smoothing of payments or payment plans, provides assistance in energy consumption and also in relation to obtaining government assistance where possible. We negotiate contracts with the larger customers, as appropriate from time to time. We consider that the pricing plans that we offer are consistent with others in the market and are appropriate at this time.
The question is AGL going to lead in terms of pricing? You talk about in page, I think it's three of the annual report that AGL is the low cost producer of electricity. At the same time announcing that you will take advantage of the loss of the hedge positions in 2024 to increase the AGL margin. That is not compatible with being a leader in providing affordable energy to your unwavering customers. That's really not an answer. I'm sorry.
Well, we do expect that as we move into FY 2024, that the traditional hedging positions will roll off, and we will be in a position to take advantage of whatever the wholesale pricing is at that time. We will always look to balance returns to shareholders with the cost and affordability and reliability of supply to our customers. Next, any other questions?
Michelle Lanera here. I'm not quite sure how to phrase this question, but we have a state government election coming up, and Daniel Andrews is suggesting that we may go back to a state, not necessarily all run electricity. My question, I suppose is: How does that affect AGL, if does take place?
Yes, thank you for the question. AGL will work with all governments including the Victorian Government to continue to provide incentives for investment in the state so that we can move forward with the transition as quickly as possible. We believe that we'll be able to work with the Victorian Government to continue to progress the decarbonization path.
I also have another question, if I may. On the feed-in rebate, is there any flexibility on AGL's offering more, I suppose? I mean, at this point in time, it's overall AUD 0.11. I went into the market with solar panels at AUD 0.33, and there seems to be no conversation to bring it on an environmental, you know, where we can have solar panels and be affecting and being positive towards climate change.
Yeah. Absolutely, the feed-in rates have changed over time, but I might ask Damien to speak to the actual dollar figures.
Thank you, Chair, and thank you for the question. I can't see where it's coming from, unfortunately, but can we get my speaker on, please?
Could we please turn on Damien's speaker?
Thank you for the question. I can't see exactly where it's coming from, but I think the question is in relation to feed-in tariffs for those customers who have solar. We are always reviewing what those feed-in tariffs are in line with market practice. We'll continue to review those feed-in tariffs for our customers, you know, based on where the market is at in any point in time. 'Cause clearly, as you say, getting more solar onto more roofs helps with the overall decarbonization of Australia. We'll continue to do that as part of our pricing reviews.
Good morning. John McKenzie. No relation to Patricia. I'm a shareholder and customer. There's a lot of science and technology involved in the business of AGL, and I'm just wondering, where does the board and management receive its scientific technology and technology advice from and at what cost? I was also wondering, what funding is the AGL providing to perhaps universities, per haps the CSIRO, for research into the science and technology areas involving the business of AGL?
Thank you for your question, Mr. McKenzie. Dr. McKenzie, my apologies. We have many experts within AGL who are very focused on technology, particularly in relation to renewables and firming and the technology which we will see accelerate the decarbonization programs moving forward behind the meters, electrification. All of those technologies are areas where we have departments and experts focused and report regularly to the board. The research in respect to those areas is something which we do review from time to time, and I think. Are we disclosing that in the annual report or not? But we do review it from time to time, and we do ensure that we assist various companies and universities in their projects.
Hello. Kazum from Sydney. What I'd lik e to know, you've just added four more directors, and what I'd like to know is. Is the current remuneration pool going to be shared amongst the new directors? Where is the extra money coming from? Will it be more money out of the shareholder pockets, or is Mr. Cannon-Brookes going to take something out of his pocket?
Thank you for the question. The additional directors' fees will be paid by the company, as is usual, and we have ensured that we have a sufficient cap on directors' fees approved by shareholders to allow us to pay directors' fees to all of the directors who will be joining the board and currently on the board.
Pool. Hello? Oh, sorry. Are you gonna enlarge the rem pool, and where is the extra money coming from? Is Mr. Cannon-Brookes going to put some out of his pocket, or is it coming out of the pockets of the shareholders to pay for the four extra directors that are now joining the board?
It is never the case that specific shareholders provide funds to the company for any particular reason, and it will not be the case here. The funds will come from AGL's income.
No, no, you still haven't answered the question. I mean, at the end of the day, it's the shareholders who are paying for all the AGL's operations. Now, if you're going to have four extra directors, which means that more money is required to pay for those new directors, and surely it's coming out of the pockets of the shareholders. To say, "Okay, look, you've got four extra directors, they're making a contribution," which is fine, but the money, extra money is, at the end of the day, basically coming out of the shareholders' pockets. That's what I want to know.
All directors will be paid from the income of the company, and therefore, I think that you could say that ultimately shareholders pay for those fees, but that is appropriate and usual across all companies in the ASX.
No, no. Well, what I'd like to know.
I think I've answered that question.
No, no.
Thank you. Can we have another question, please?
Yes. Hello. My name is Agnes Chi. I'm one of the shareholders, and I'm also a sole director of my own superannuation fund. I have a question related to the election of one of your four directors, Mr. John Pollaers. Can Mr. Pollaers please list each one of the 16 major transformation companies he has performed at?
Thank you for your question, Ms. Chi. We will be moving to the election of directors a little later in the program, and each director has prepared a presentation for shareholders, and I think that your questions will be answered during that presentation.
Good afternoon. Morning. My name's Colin Walker. There's been a lot said about percentages to do with climate change, but all of them mean absolutely nothing without the grid to come to fruition. Where does the board stand as far as creating or existing with the grid in order to reach zero emissions?
Yes, thank you for your question, Mr. Walker. In determining the strategic plan and the determination to exit coal-fired generation by 2036, AGL did consider the reliability of the grid, and the plan that we have put forward to shareholders, and which has been supported, takes into account reliability and affordability and balances that with the need for returns to shareholders and the need for decarbonization. We believe that this is the correct and best plan to move forward in order to achieve those outcomes. Any other questions? All right.
My name is Donald Walker, and I' m a shareholder. I bought the shares for about AUD 18, and now they're AUD 7.60. A big, big drop. If I sell out now, I lose a lot of money. I don't wanna lose that, so I'm keeping it with AGL. I want a guarantee from the board that there'll be more revenue coming in, more profits and not losses. Please get the shares back. Why have they dropped down? Why? Is it because of performance? I know. I own my own business, and I know what I'm talking about. If I make a loss, I go out of business. I want you people to work hard and to make sure the shares go back again, please. That's all I'm saying. Thank you.
Yeah, thank you for the question. We certainly acknowledge the loss in shareholder value which has occurred over recent years. It is attributable to many factors, including what has been an extraordinary reduction in the wholesale price, somewhat unprecedented.
We've had some amazing and unique conditions, volatility in the market and we've also had some issues in relation to performance of our assets as they are growing older and we need to continue to work with those assets moving forward. We do believe that there is shareholder value to be gained in the transition, and we will work to implement the strategic plan which we have put forward to shareholders, which all of the directors endorse, and which we believe will bring value back to shareholders as we move forward. Any other questions? All right. James, could you please let me know if there are any questions relevant to this item online or by phone?
Yes, Chair. We have four questions online and currently no one on the phone. The first question online comes from Steven Johnston. He asks, "How much has AGL spent on the global search for board members and executives that were already employed within the company and or on the board?
AGL entered into a search for directors within Australia and a search for the managing director, which is an international search. We employed external search firms to assist us in that, and we have paid them at market rates.
The next question comes from Mr. Mamoon Raza. "As a shareholder of two years, I'm disappointed by AGL's performance. In a surging energy price market, as a customer, I'm paying more, but as a shareholder, I'm seeing poor returns. How can I trust the current board to turn things around?
The current board has responded to the current conditions in the market with the new strategic plan, and we believe that is the best way forward for AGL, and we are strongly of the view that this will deliver value to our shareholders as we implement it.
Next question comes from Mark Willis. "Total assets increased from AUD 14.45 billion to AUD 19.27 billion. Can some transparency around this increase be provided?
I think for the detail on that, I might hand over to Damien Nicks. Can we have the microphone on, please?
Thank you for the question. Look, the simple answer on this one is because of the volatility in the wholesale markets. What we saw is significant increase in wholesale prices, which drove up the financial value of the financial assets. Also corresponding, we had the same increase in financial liability. That's just a short, simple way of explaining it. Wholesale markets drove both the assets up and the liabilities up.
Thanks, Damien.
The next question comes from Michael Cockburn of Masirah Proprietary Limited. "Your EBITDA, despite current high wholesale prices, seems restricted by hedging arrangements in place. Why does it take so long for these hedges to run out, and we get the benefit of the higher prices? Why, if we are producing electricity and selling it ourselves, we cannot get today's prices? Some further understanding of how all this works would be helpful.
Yes, thank you for that question. The hedging is a prudent approach by AGL to ensure that we can, to some extent, protect our income from the volatility in the market. It is also a response to some regulatory requirements in respect to hedging for the domestic market. We will find that over FY 2023, the hedging will start to run off, and we will be well-positioned to see returns increasing in FY 20 24. Thank you. I think we may move on now. The second item of business concerns the adoption of the remuneration report of the company for the year ended the 30th of June 2022. The People & Performance Committee assists the board with oversight of AGL's remuneration policies. Graham Cockroft is the chair of that committee.
Before inviting questions on the remuneration report, I would like to invite Graham to speak to you about AGL's remuneration policy during FY 2022.
Good morning, ladies and gentlemen, and thank you for joining us today. My name is Graham Cockroft, and I am Chair of the People & Performance Committee at AGL. I would like to start by acknowledging the significant contribution made by Diane Smith-Gander as Chair of AGL's People & Performance Committee during FY 2022, and for more than four years prior to that. Diane resigned as a director in September 2022, and I've taken over the role of Chair of the committee, having been a member of the committee since being appointed director of AGL in January 2022. AGL's remuneration report commences on page 59 of the annual report. It sets out AGL's policy in respect of remuneration paid to the board and senior executives and describes the link between company performance and executive remuneration outcomes for the 2022 financial year.
I will now summarize the key remuneration outcomes for AGL's executive team for FY 2022. In terms of fixed remuneration, the only executive to receive an increase in FY 2022 was Damien Nicks, who was the Chief Financial Officer at that time, and he received an increase of 9.5% in September 2021. This increase was reflective of Mr. Nicks's experience and the inclusion of technology leadership in his role and aligned Mr. Nicks's fixed remuneration with external market benchmarks. This was the first increase that Mr. Nicks had received since commencing as CFO in May 2019.
The incoming Chief Customer Officer, Jo Egan, was appointed to the position with a fixed remuneration reflective of her developing experience in that role. Executive short-term incentive, or STI outcomes, continue to be measured against scorecards containing group and individual objectives, which are established at the commencement of the financial year and comprise financial and non-financial measures. In FY 2021, the board took a holistic view of the scorecard outcomes for company and individual performance and exercised discretion to adjust STI awards to zero for all executives as financial thresholds were not met that year. In FY 2022, the board again took a holistic view of the scorecard and the company's overall performance and determined that no discretion should be applied to FY 2022 STI outcomes.
STI awards for the financial year were in the range of 42.9%-51.7% of maximum opportunity, with the former Managing Director and CEO, Mr. Graeme Hunt, being awarded 42.9% of his maximum opportunity. The board considers these awards to be reflective of the company's performance and individual performance and provide a commensurate level of reward to executives who have navigated extreme uncertainty and market volatility in FY 2022. I'll now move to AGL's long-term incentive, or LTI plan, which is designed to align executive reward with long-term AGL performance and shareholder experience. The performance conditions for the FY 2020 LTI bridging grant, which was implemented to bridge the extension of vesting periods from three to four years, were tested in FY 2022.
The relative total shareholder return and return on equity hurdles were not met, and accordingly, there was no vesting. This aligns with the shareholder experience over the period of the grant. The LTI metrics were changed for FY 2022, with the return on equity metric removed, the relative total shareholder return metric increased to 75%, and carbon transition metrics set to 25%. Relative total shareholder return, which compares the performance of a shareholding in AGL with other companies in the ASX 100, provides a clear link between rewards and shareholder experience and remains the most commonly used performance metric in LTI plans for ASX-listed companies. The carbon transition metrics are included in the LTI plan to ensure AGL progresses the carbon transition responsibly.
In May 2022, it was announced that Managing Director and CEO, Graeme Hunt, would step down from his role, which occurred on the 30th of September 2022. The performance period for the FY 2023 LTI plan is four years, ending on the 30th of June 2026, when testing against targets will be undertaken. Given Mr. Hunt only led AGL for a limited proportion of the performance period, the board determined that he would not participate in the FY 2023 LTI offer. I'd now like to discuss the retention awards that were paid to key executives during the financial year. In FY 2022, the board prioritized continuity and leadership during preparation for the proposed demerger.
With the uncertainty and instability created by the proposed demerger, limited variable rewards from previous years and closed borders resulting in high demand for talented Australian-based executives, the board considered it was necessary to provide retention awards to key executives who were critical to delivering both the demerger and ongoing operations. These rewards were paid either in cash or as a combination of cash and equity. In summary, Damien Nicks, in his role as CFO, was provided a retention award of AUD 600,000 in August 2021. 33% of this award was paid in cash in January 2022, and the remaining 67% was delivered as 50% cash and 50% equity in August 2022.
Markus Brokhof, our Chief Operating Officer, was provided a retention award of AUD 450 thousand in August 2021, which was delivered as 50% cash and 50% equity in August 2022. Jo Egan, now our Chief Customer Officer, was provided a cash retention award of AUD 154 thousand in Ma y 2021 in her prior role as General Manager of Product and Portfolio. All three of these executives remain at AGL and have important roles to play in delivering AGL's strategy, including implementing the reviews of the strategic review.
In addition to these retention awards, Christine Corbett, who had been the AGL Australia Managing Director and CEO-elect, was paid a monthly allowance of AUD 35,714 from December 2021, capped at AUD 250,000, which ceased at the time the demerger was withdrawn in May. This allowance was to recognize the duties undertaken by Ms. Corbett in relation to the establishment of AGL Australia, in addition to her role as Chief Customer Officer. Finally, non-executive director fees were not increased during FY 2022. The last fee change was in January 2020. As Patricia mentioned earlier, based on the proxies lodged ahead of the meeting, AGL is likely to receive a first strike on the remuneration report due to a couple of large shareholders voting against it.
This is disappointing given that all major proxy advisors recommended that shareholders vote in favor of the report and no material concerns were identified. The board, assisted by the People & Performance Committee, reviews the remuneration framework on an annual basis. We will take this outcome into account when we review our remuneration structure during FY 2023 and consider opportunities to align further opportunities to align remuneration structures with company performance and long-term shareholder value, including to ensure that AGL's incentive plans align with the delivery of the outcomes of the strategic review. The board recommends that shareholders vote in favor of this resolution. Thank you.
Now let's turn to questions on the 2022 remuneration report, and we will start with questions from shareholders and proxies in the room today. If anyone holding a yellow or blue card has a question, please raise your hand and a microphone will be brought to you.
Thank you. Thank you, Madam Chair. Sorry, Helen Manning from the Australian Shareholders' Association. We are, of course, across all the outcomes for the remuneration report. I guess most people in the room, average people, wouldn't understand most of this stuff. It's quite hard to follow. You've told us that two of your major shareholders have voted against it with no material reasons. Can you give us a better idea of why they voted against it? I mean, we voted against it as well, but we just thought it's basically meaningless now, you know, because of all the changes. Can you give us a... I guess what you'll do. Will you be talking to the major shareholders or it's just a bit of color. Thanks.
Thank you for your question. I cannot speak for the shareholders and their votes, but I can tell you that clearly we will engage with certainly these two large shareholders on their concerns about the remuneration report and factor that into the design that we have for the FY 2024 remuneration structure. Clearly, you know, we're disappointed in that vote, as I said, but we will try and address the concerns that they have as efficiently as possible.
Any other questions from the floor? If not, James, could you please let me know if there are any questions relevant to this item online or by phone?
There are none.
Thank you. We'll move on.
Hello.
Oh.
I think the strike speaks for itself, but what I need to know is we've got directors, four more directors, which are forced on the board at the moment, despite the fact that you claim to have the expertise already on the board. Four more directors, which means four more directors to pay for. Now, are you likely to reexamine the pool to add to the money, or are you going to share the pool that's already there among the directors?
The director fee pool, which was approved in 2016, is AUD 2.75 million. In the last two years or so, the director fees have come out at around AUD 2 million. Within the fee pool, there is headroom to accommodate new directors without coming back to shareholders for another approval.
You haven't asked.
Sorry, I can't hear you.
You haven't asked Mr. Cannon-Brookes to put a few breadcrumbs into that pool.
I think.
I'm seeing that he wants his ideas.
I think Patricia addressed that question earlier.
Yeah. Okay.
It's not. You know, the directors are independent and they're paid by the company, not by shareholders.
No, no, I mean, he might throw some breadcrumbs into the pool. I'm just wondering.
Yeah.
Okay.
Okay.
Thank you.
Thank you.
Are there any further questions from the floor on this issue? Sorry, it's a bit hard to see up here. All right. Thank you very much, Graham.
Thanks, Patricia.
I think we'll move on now. Details of the proxy and direct votes that have been cast on this item are as shown on the screen. As you will see from the proxies, the vote against our remuneration report is more than 25%, which means that AGL is likely to receive a first strike, as we've mentioned. Please place your vote for this item if you have not done so already. I now turn to the third item of business, which is the advisory resolution on the Climate Transition Action Plan. AGL's inaugural Climate Transition Action Plan demonstrates our commitment to communicating transparently with our stakeholders about our approach to decarbonization. I'll now invite questions on this item.
Let's start with questions from shareholders and proxies in the room, and anyone holding a yellow or blue card, please raise it and raise your hand and a microphone will be brought to you.
Thank you. Margot Kunic, I'm a general practitioner from Sydney. Both the direct effects of climate change on the stability of society and the rapid technological changes in energy markets estimated by the NEM and AEMO and IEA are strategic risks for AGL that need to be better prepared for. As it stands, the current Climate Transition Action Plan needs to be redesigned if AGL is being sincere to shareholders, consumers, and the market more generally in our need for surety around climate risk. Will AGL commit to revising the plan in the next 12 months before the 2023 AGM, so it specifically addresses Paris-aligned 1.5-degree targets rather than your below 2 degrees by, for example, closing all coal-fired power stations by 2030 rather than 2036?
Thank you for your question. In determining the strategic review, AGL modeled four different scenarios in relation to closure of the coal-fired power plants. Two of those related to AEMO scenarios. One, the below two degrees scenario, where AEMO has chosen a 1.8 degrees reduction and the 1.5 scenario. We considered the implications of those two scenarios, both for AGL and for the NEM generally. In relation to a 1.5 degrees reduction, the modeling from ACIL Allen, which is set out in our Climate Transition Action Plan, shows that in order for the NEM to transition to a 1.5 degree scenario, and in respect to AGL, we would need to close all of our coal-fired power stations by 2029 and all of the coal-fired power stations in the NEM by the early 2030s.
This would require an additional 98 GW of electricity at a cost of around AUD 90 billion. That equates to about 10 GW per annum compared to the average 2.2 GW per annum, which has been delivered in the last five years. We do not consider that there is a feasible deliverable plan that can deliver the reduction at 1.5 degrees in the NEM in that timeframe. Simply stated, the major build-out of renewables firming and transmission is highly unlikely to be delivered in that timeframe. Accordingly, AGL has delivered what it considers to be a responsible and appropriate plan to deliver against the Paris Agreement commitment of substantially less than 2 degrees, consistent with the AEMO and consistent with other players in the energy industry.
Should the transition occur more quickly, and should there be opportunity for us to move more quickly within AGL to exit coal-fired generation, we will certainly consider that, taking into account the need to ensure affordability and reliability in the grid, returns to shareholders and as fast a decarbonization as we can responsibly deliver. Next question.
Helen Manning from the Australian Shareholders' Association. I guess just following on from that, will you commit to putting the resolution to a vote next year as y ou had already, you know, allowed for?
Yes, thank you for the question, Ms. Manning. The board has resolved to put the Climate Transition Action Plan to a vote for shareholders every three years. We've done this because this is a long-term plan, and we need to be able to account for changes in technology and progress along the way. We will certainly report against progress each year, and should there be any significant change to our plan, we will bring it back for a shareholder resolution. Any other questions? No. James, could you let me know if there are any questions relevant to the resolution on the 2020 CTAP online or by phone?
Yes, Chair. We have six questions online and no one on the phone. The first question comes from Mr. Tarek Hafez and Ms. Hania Masood. Is the board s atisfied that this plan and the AUD 20 billion of extra funds required will maximize shareholder value? If how and over what period?
Yes, thanks for that question. The board is clearly of the view that the transition in the energy industry will bring many opportunities to increase value to shareholders. We believe that the plan that we have developed, our new strategic plan, is the right way forward, and we will be looking forward to implementing that and to delivering that value through to our shareholders.
The next question comes from Mr. Ian McCallum and Mrs. Lynette McCallum. Why is AGL following the climate and renewables agenda of Grok Ventures rather than providing support to the existing coal and baseload assets that it controls? There are another 89% of shareholders that AGL management are not listening to.
Thank you, Mr. and Mrs. McCallum. AGL accepts the science of climate change, and we agree that we need to transition the energy market as quickly as possible, providing we are doing so responsibly and delivering appropriately in relation to that plan. We believe that this strategic plan does deliver a responsible and appropriate transition.
The next question comes from Ms. Hillary Kuhn. Is AGL considering use of biological capture of carbon dioxide by using microalgae to recycle CO2 emissions from combustion of coal at Liddell, Bayswater, and Loy Yang A power stations?
Thank you for the question. We are considering for each of those power stations, energy hubs. In relation to those energy hubs, we are looking at various opportunities for new technology. We will determine which is the best technology to introduce into those hubs as we move forward and which can deliver best value for shareholders.
The next question comes from Mrs. Margaret McArthur. Is the company aware that E.U. nations are withdrawing from the Energy Charter, France, Netherlands, Sweden and Germany?
Thank you for that question. Certainly there have been major changes internationally in relation to energy industry. Particularly this year, we've seen the position in the Ukraine, which has definitely impacted on gas supplies. We've also seen wind droughts. There are considerations that need to be taken into account when considering the transition. That's why we need to ensure that our transition is responsible and targeted to the situation in Australia.
The next question comes from Ms. Yi Wen. The media is showing AGL as the biggest carbon emitter. At the same time, AGL is also the biggest renewable energy generator in the country. I'd like to know what the board is going to do to change this public view of AGL.
Thank you, Ms. Yi Wen, for that question. We believe that the strategic plan that we have put forward allows AGL to play a major role in transitioning to net zero in Australia, and that the perception of AGL as the largest emitter also allows us to be one of the largest players in that transition journey. We are definitely looking to introduce, as we have said, an ambition of up to 12 GW of renewable firming and renewable energy over the next 12 years, and we will be a leader in the transition, and we expect that our leadership role will position us well in relation to our customers and our stakeholders.
The next question comes from Mr. Jonathan Hancock. My question relates to the environmental damage which is being done with the switch to renewables. In the building of solar and wind farms, new transmission lines, and mining for battery metals, as well as limited life of new technologies requiring massive recycling solutions, how is AGL viewing and measuring their investments in the Climate Transition Action Plan in terms of all these costs relating to renewables?
Well, thank you for the question, Mr. Jonathan Hancock. We do believe that there is substantial value for our shareholders in the transition to renewables, and we do ensure that we comply with all applicable environmental controls in relation to any infrastructure which we build and adopt moving forward.
The next question comes from Jamie Harris. Beyond building batteries in your existing energy hubs, what else will AGL do to aid the communities in these regions?
Thank you for your question, Mr. Harris. We have a 12-year plan for exiting coal-fired generation in the regions. In order to deliver on that plan, we will be working closely with the local communities, with our employees and their representatives, and with the government to ensure that there is a just transition, that communities and our employees are treated fairly and appropriately, that we can assist in ensuring that the new energy industry has the skills and training necessary to deliver. We will continue to work as we have done in Liddell with all of those people to deliver those outcomes.
The next question comes from Mr. Jonathan Hancock. Coal-fired power still has a place for the next decade in Australia, as indicated by the 2035 shutdown plans. What is AGL doing to ensure that, one, they retain the necessary expertise to manage and operate the remaining coal-fired power stations until closure, two, pursue expertise and research to advance the technology in coal-fired power, which may make the generation of this form of power more efficient and less environmentally damaging?
Thank you for the question, Mr. Hancock. We are continuing to work with our employees at all of our coal-fired generators to ensure that we maintain and retain the necessary expertise to operate those coal-fired generators through to the closure dates. At this point, we believe we have in place the appropriate processes to ensure that that will occur. In relation to new technologies that might assist us in the efficiency, we keep an open mind. We keep across all of those new technologies, and we implement them wherever that will make a significant difference to our operation of our plants.
The next question comes from Mark Willis. In 2017, I believed AGL declared investment replacement capacity equal or near to Liddell prior to closure via various renewables and energy firming projects. How many of these megawatts have been constructed as planned? Thus, is the 5 GW now documented any more feasible for AGL?
Thank you for your question, Mr. Willis. AGL is the largest owner of renewables in the ASX, and privately owned, and we will continue to work on the ambition of the 12 GW by 2036, 5 GW by 2030. We have in place 3.2 GW of firming and renewable capacity that are currently either under construction or in the planning stages. We have access to a further 3.5 GW through our partnership or our position in Tilt Renewables. This is a deliverable plan that will ensure that AGL is able to continue to meet the demands of its customers moving forward.
The last online question from Mr. Mamoon Reza, "Does AGL have any plans to leverage households with solar as a source of clean energy? If so, what are the targets?
Thank you, Mr. Mamoon Reza. AGL already operates one of the largest virtual power plants in Australia, where we orchestrate the energy from solar to deliver back into the grid. We certainly have plans to extend those virtual power plants, and we have additional plans in relation to distributed energy, electrification, and the many new technologies which will come with the transition to renewables. We'll continue to evolve those and explain them to our shareholders and to our customers as we move forward.
Hello?
Yes.
Sorry, I was a bit slow getting my hand up earlier. Harriet Kater from the Australasian Centre for Corporate Responsibility. In the era of escalating focus on greenwashing, how confident are you that the CTAP can be described as a Paris-aligned plan? The Paris Agreement states we need to limit warming to well below two degrees, and based on modeled probabilities, a 1.8-degree pathway could quite easily lead to warming that is above two degrees. There is an emerging acceptance in the scientific community that well below two degrees is actually sort of closer to 1.6 degrees of warming. Could you provide comment on that?
Yes. Thank you for your question. Yes, we are certainly very well aware of our obligations in respect to greenwashing, and for that reason, we have many thousands of pages of analysis in relation to the plan which we have put forward to our shareholders. The 1.8-degree scenario was adopted by AEMO, and we have adopted that plan in our modeling to ensure that we have a deliverable and responsible plan in relation to our decarbonization path. We have checked this through with multiple external experts. We had McKinsey, EY, Deloitte and others advising the organization to ensure that what we put before our stakeholders is, in fact, something which we can deliver. What we've put forward is a plan which allows a lower carbon future, which is aligned with the Paris Agreement ambitions.
As I've said, we have adopted the AEMO climate transition packages in order to ensure that it is appropriate within the Australian energy market.
Hello. It's Michelle Lanera here again. Part of what I wa s going to ask, I think, was asked online in the last three questions, but I don't think it actually. Those questions didn't actually address when your power plants are wound down and what is the cleanup situation, timeframe, money, and also health effects on any of the people that live in the close region to the power plants. Thank you.
Thank you for the question. We have an ambition to provide 12 GW by 2036, with 5 GW by 2030. We estimate the cost of that will be around AUD 20 billion. But as Damien Nicks pointed out in his speech, that's not AUD 20 billion which needs to be provided directly by AGL. We will use the power of our book to underwrite renewables by others. We will partner with others, as we have, for example, in the Tilt Renewables organization. We will use our own balance sheet to deliver where appropriate returns can be made for our shareholders. The renewable ambition that AGL has espoused will, we believe, ensure that we have sufficient renewable power available to meet the demands of our customers moving forward.
As I've already said, we do ensure that we meet all health and environmental regulations in relation to all of that renewable and firming build out. We will work with our employees and the communities in relation to any health impacts of the withdrawal from coal-fired generation. Are there any other questions? Yes. Thank you.
Excuse me. I think I keep hearing we're strategic. I've been a shareholder, AGL shareholder and a customer for a very long time. There's anything but strategic. There's been a lot of intellectual inertia on AGL's part, and this may have something to do with the government policies. In this case, I welcome the director, new director, Miles George, who was on the board of Infigen, and its progress was stultified by government policies. I hope he's able to add a bit more intellectual rigor in the discussions and contribute more positively and aggressively to this transition plan, as I expect the new directors also to provide more backbone and some strength, intellectual strength towards moving towards the transitional plan. Thank you. Welcome, Miles George.
Thank you very much. We also welcome Miles to the board, and we see he certainly brings very useful expertise to assist us in our renewable pathway moving forward. If there are no other questions? Actually, can I see a hand up there? Yeah. Could someone take a microphone, please?
Hi, my name is Ed Ka sekis. I'm a shareholder. When you sell your coal power stations and all of the coal mines that go along with it, are we actually losing assets that you as a company do not get any remuneration for? Have they just basically gone like I buy a new car tomorrow for AUD 60,000, three days later, I just get rid of it, I get nothing for it?
Yes, thank you for the question. Of course, we depreciate and amortize the assets over time, and we will be looking to replace those assets with a refreshed and new energy asset base for AGL moving forward. Thank you. I think we can now move on. Details of the proxy and direct votes that have been cast on this item are as shown on the screen. Please place your vote for this item if you have not already done so. I now turn to the fourth item of business, which is the election and re-election of directors nominated by the board. Given the number of candidates we have seeking election to the board today, for item four, I will be taking questions on all candidates other than myself together. I will do the same for item five when we get to that item.
Given my personal interest, I will ask Mark Bloom to address the meeting in respect of my own re-election. The board has invested a lot of time and thought into the mix of skills and experience it needs to guide AGL through this transformational period and deliver the strategic direction outcomes, while recognizing that AGL is a complex and highly regulated business with customer, technology, and heavy industry operations. The composition of the board has changed significantly over the past 12 months, with three new non-executive directors being appointed, Graham Cockroft, Vanessa Sullivan, and Miles George, all of whom are seeking election by shareholders today. Each of Graham, Vanessa, and Miles brings deep energy experience in the energy sector, as well as a range of other complementary skills and experience.
The board has considered the performance and contribution that each of these directors make and is supportive of their election to the board. Each of Graeme, Vanessa, and Miles is considered an Independent Director. A short video will now play where Graeme, Vanessa, and Miles will outline why they are seeking your approval to continue as a director of your company.
Good morning, ladies and gentlemen, and fellow shareholders. Thank you very much for joining us today, and thank you for giving me the opportunity to present some relevant details of my background and career. I started my journey in the energy sector over 30 years ago when I joined a company called British Gas in London. I'd grown up in New Zealand and studied economics and marketing before heading to the U.K., where I completed a master's in finance at the London Business School. I've since spent nearly all of my working life in the industry, in a variety of roles and countries, most recently as group chief financial officer in a Singapore-listed company called Sembcorp Industries. Prior to that, I served as chief operating officer and then chief financial officer at Contact Energy in New Zealand, a company listed on the NZX and the ASX.
I joined Contact Energy after nearly 20 years with British Gas in the U.K. and South America. During this time, I gained a lot of leadership experience in company transformations in the energy sector, as each one of these companies sought to adapt its business to the world's requirement for cleaner fuels. Whether it was British Gas producing natural gas to replace high sulfur fuel oil in South America, Contact Energy investing in geothermal power and closing large gas-fired power stations, or Sembcorp developing solar and wind farms in India, floating solar in Singapore, and grid-scale batteries in the U.K., was with the goal of meeting our stakeholders' expectations and required innovative leadership. I believe these experiences have given me the ability to see the energy industry from many different angles and help us address the challenges we face today.
Earlier this year, I was appointed as an independent director to the board of Meridian Energy, New Zealand's largest energy company, listed on the NZX and ASX, with a market capitalization of over AUD 12 billion. The need to decarbonize our economy to reduce our impact on the environment is the primary driver for the energy transition. There are many opportunities for our company in this transition, and your board and the management team are pursuing these so that you as shareholders will benefit from this future. We need to do this in a well-considered and balanced way so that Australians have reliable and affordable energy and that our communities are supported. I believe my international experience and perspectives can help us navigate this transition. Ladies and gentlemen, I would be honored to continue to serve this board and company and accordingly offer myself for re-election.
Thank you for your consideration.
Hi, everyone. My name is Vanessa Sullivan. Thank you for this opportunity to briefly outline to you some of my experience as you consider appointing me to the AGL board. Firstly, I have worked for many years in the energy sector. I'm also very experienced across ESG. These important environmental, social, and governance principles must underpin the significant changes we are seeing in the energy market today. I have a diverse work background, so I've seen projects and business from different angles. I worked in senior roles in government, in energy and water reform, creating energy businesses and preparing them for market. While leading EY's sustainability and utilities teams in Queensland, I was responsible for helping large businesses reduce their emissions within a commercial framework. I also have experience in grassroots development of renewable energy projects, including the first-ever grid-connected solar battery project in the NEM.
My current board roles include being the independent energy and water expert on the Queensland Hydrogen Taskforce. This is advising on developing a sustainable green hydrogen industry. I'm also on the board of EcoMarkets Australia. It provides a framework for commercial projects to reduce runoff and protects the Great Barrier Reef. I also hold a pro bono role on the Board of Centacare, which is a large provider of disability and family support services. Since joining the AGL board in March this year, I am proud to say I co-chaired the review of strategic direction. This led to one of the largest decarbonization initiatives in the Australian market. I also chair AGL's Safety & Sustainability Committee. As you know, AGL has a very proud history in the Australian energy market and a significant job ahead of it.
As shareholders, we need to stand together to deliver energy transition within a very strong ESG framework. We must do this in a way that drives strong environmental and social outcomes that leads to optimal conditions for our people and the communities in which we operate and supports our customers. Importantly, I think this allows all shareholders to benefit in the future. I'd be honored to continue to contribute to this future, and so offer myself for election to the AGL board. Thank you for your time today.
Good morning, ladies and gentlemen. I'd like to thank you for considering my candidacy to continue to serve on your board. By way of background, I'm an engineer by training and have spent the last 20 years working in the rapidly growing renewable energy sector. During that time, I've worked on renewable energy project development, investment, financing, and operations in Australia, the U.S., Europe, China, and New Zealand. During my career, I served for 10 years as chief executive of Infigen Energy, Australia's first large renewable energy business to be listed on the Australian Securities Exchange. More recently, I served as the inaugural Chief Executive of the Queensland government-owned energy business known as CleanCo Queensland. During my career, I've also served on various regulatory and industry bodies, including as chair of Australia's Clean Energy Council and as a member of the Australian Energy Market Commission Reliability Panel.
Until recently, I served on the board of Spark Infrastructure. Spark was listed on the Australian Securities Exchange and owns electricity transmission and distribution assets in New South Wales, Victoria, and South Australia. Prior to joining AGL, I also served on the board of Collgar Renewables, which owns renewable energy assets in Western Australia. I believe that my background, experience, and passion to make a strong contribution to your board will benefit shareholders. AGL is proposing a major transformation in a rapidly changing environment for electricity market participants. I'm excited by the opportunity that this presents to secure long-term value creation for AGL shareholders. I believe long-term value creation can be achieved through an ambitious plan to decarbonize AGL's generation fleet, improve service for AGL's customers, and create positive outcomes for AGL's people and the communities in which we operate.
I look forward to continuing to work for the benefit of the company and shareholders as we move towards a clean energy future. Ladies and gentlemen, thanks again for considering my candidacy to continue to serve on your board. I offer myself for election at this meeting.
I will now take questions on the election of Graham Cockroft, Vanessa Sullivan, and Miles George. Let's start with questions from shareholders and proxies in the room today, and then anyone holding a yellow or blue card, please raise your hand.
Personally, I don't think the video did any justice to three of the directors are seeking re-election. I would much rather have seen them stand there on the podium and say, "This is who I am." I think particularly Miles George, it was doing great injustice just looking at it from a distance. I'm disappointed that they didn't take this opportunity to come and speak to us directly on the podium, rather than having a video, which didn't really do any justice. Anyway, I don't have much more to say on that. I would much rather have seen them speak on the podium and with some passion, rather than that video that we just watched. Thank you.
Thank you for your comment. We have eight people standing for election to the board today, and in the interest of allowing you all to get out of here at a reasonable time, we believe that the efficient means of doing that would be to pre-record their speeches. Any other questions? If not, James, could you please tell me if there are any questions relevant to this item online or by phone?
Questions online or on the phone.
Thank you. I think we can then move on. Details of the proxy and direct votes that have been cast on items 4A to 4C are as shown on the screen. Please place your vote for this item if you've not already done so. In addition to the directors seeking election for the first time today, I am retiring by rotation and seeking re-election as a director of AGL. I will now ask Mark Bloom to address the meeting in respect of my re-election.
Thank you, Patricia. Patricia was appointed as a director in May 2019. She's considered by the board to be an independent director. The directors consider Patricia's skills and experience, in particular, her significant experience in the energy sector, are valuable and complement the board's existing skills and experience. Patricia also adds considerable strength and leadership as chair of the board. My fellow directors and I strongly support Patricia's re-election and recommend that shareholders vote in favor of her re-election. A short video will now play, where Patricia will outline why she is seeking your approval to continue as a director of your company.
Thank you, ladies and gentlemen, for this opportunity to present myself to you for re-election as Chair and Director of AGL Energy. When I first joined AGL over forty years ago, having completed a law degree, AGL was a monopoly gas supplier in New South Wales, and there was a great divide between the gas and electricity industries. Since that time, the market has seen major evolution through the creation of the national electricity market, to the introduction of competition between retailers, to the establishment of the Australian Energy Market Operator, AEMO, and the formation of a highly competitive, interdependent energy industry operating in one of the most complex markets in the world. It has been my privilege to participate in the design and implementation of many of these changes.
As the energy market faces another major transformation from thermal to renewable energy, it is this deep experience of market change and regulatory reform that I bring to AGL to help it navigate the opportunities and challenges ahead. My experience encompasses the breadth of the energy industry. As CEO of Gas Market Company, I managed the transition of the gas industry from a monopoly to a competitive retail market. Having been a key participant in COAG's national energy reform program establishing AEMO, I became a Director of that organization, the market operator for the combined gas and electricity markets. I was a director of ASX-listed APA Group, a leading Australian energy industry business, owning major gas pipelines and renewable assets.
I have been a Director of Macquarie Generation and transmission operator Transgrid prior to their privatization, and Chair of Essential Energy, distributing electricity to 95% of New South Wales. I am also a highly experienced company chair, currently chairing both NSW Ports and the Sydney Desalination Plant companies, having previously chaired Healthdirect Australia, Diabetes Australia, and as mentioned, Essential Energy. It has been my great honor to assume the role as Chair of AGL Energy, and should I receive your support today, I look forward to leading AGL into a successful and sustainable future. Thank you.
I will now take questions on the re-election of Patricia McKenzie.
Hello, Brynn O'Brien from the Australasian Centre for Corporate Responsibility. It's a question for Patricia. Today has been a momentous day in this company's history. Four new directors have been elected to the company's board, three of which you opposed their election. They've been roundly endorsed by shareholders. There's been a first strike against the remuneration plan. There's been over a 30% vote against the company's transition plan. The process of your elevation to chair involved, apparently, a worldwide search that you oversaw that resulted in, again, your elevation. Will you be reflecting on y our tenure as chair after this meeting? Do you think that it may be time for fresh thinking in that role?
Thank you for your question. Maybe before I get Patricia to answer, I'd like to say that, when you look at the numbers for Patricia's re-election, there has been overwhelming support from shareholders and the board of directors, as we have said, fully support Patricia. Maybe I can ask Patricia to add a few words.
Yeah. Thank you, Mark. Thank you for your question. I assumed the role of chair at the request of the board. I did not appoint myself. I think that significantly overstates my power. I bring over 40 years experience in the energy industry. I am a proven leader and chair, and I believe that I have received overwhelming support today from shareholders. I intend to continue as chair of AGL in order to provide continuity in what has been a turbulent time for the organization. I look forward to leading the company into a sustainable and successful future.
Are there any other questions?
Yes. Excuse me. Theo Villars, I am a shareholder. I want to ask a question, either of the three directors. I don't ask the chair. The chair is a special position, doesn't answer much. Every one of you said, "I have a lot of experience. I have a good background to tell if in a previous companies you did an innovation, implementing something, or we are more interested to see if any of you has a project to improve the AGL performance and AGL share prices. If it's any of you have, because it's nice to be an old engineers, but not necessarily a good one. Anyway, I want everyone to tell me, one of you, if you have any innovative in a previous or in a position you require with to be a Director in AGL. Thank you.
Thank you for your question. This is actually the time for questions about Patricia's re-election. I think we've passed the time when we were questioning the other directors. Are there any other questions?
Helen Manning from the Australian Shareholders' Association. Patricia, the Australian Shareholders' Association meets with the chair every year. In our pre-AGM meeting with Patricia, she said she would work with anyone who was appointed to the board, and we understood that to be a genuine statement from her. Would she like to elaborate on how she will go about creating cohesion here? Because that has been our major concern here, that we don't add to the dysfunction of the board.
Patricia.
Yes. Thank you very much for that question. The board consists of professional directors. We recognize the right of shareholders to nominate directors to the board, and we welcome the new directors who we expect will be appointed today. I believe that we will all work together collaboratively in the best interests of all shareholders. The new directors coming on board are also very professional businesspeople, and I do not anticipate that there will be any difficulty in the board forming a cohesive force to work for our shareholders.
Thank you. Any more questions?
I'm a little tired of all this talk about 40 years experience. I think it's time we took note of what some of the younger people are thinking. We need creative and innovative thinking. I think if there is a lesson to be learned, there is some suggestion that the election results in the United States, where the millennials and the Gen Z have provided a new direction. The older generation said, "We have the knowledge and experience," and look where they have taken us. I think it's something to be said for listening a little more closely to some of the newer and fresher ideas that will help transform us into a company that takes their interests, the interests of the future generations into account much more rather than saying, "I have 40 years or 50 years of experience." What?
I mean, you know, that's all very well in the past, but it doesn't give us much guidance for the future. I've been observing and studying and researching board performances. Westpac is another one where we've had the current CEO, who's been there 20 years, and yet what have we found? We found dead bodies coming out of the skeletons, coming out of the cupboards over and over again while he was out cruising. Why wasn't he taking note of some of those deficiencies and address them as he went along? All I'm saying is, I think it's about time that we had some sort of intellectual revolution that said, "Well, okay, this is it. All very well for the past. We now need to take some of the issues for the future in a much more vigorous manner." That's just my comment.
Thank you.
Thank you for your comments. Any further questions? James, are there any questions from the online forum?
There are no questions online or on the phone.
Thank you. We can now move on. Details of the proxy and direct votes that have been cast on the re-election of Patricia McKenzie are as shown on the screen. Please place your vote for this item if you have not already done so. I now invite Patricia McKenzie to resume chairmanship of the meeting. Thank you.
Thank you, Mark. I now turn to the fifth item of business, which is the election of four directors proposed by Galipea Partnership, which is an entity associated with Grok Ventures and Mike Cannon-Brookes. For the reasons I outlined earlier, I intend to vote on directed proxies I hold as chair in favor of the appointment of Mark Twidell as a Director and against the appointment of Dr. Kerry Schott, John Pollaers and Christine Holman. A short video will play in relation to each candidate, where they will each outline why they are seeking your approval to be elected as a Director of your company. I will then open the meeting to questions on the candidates.
My name is Mark Twidell, and I'd like to thank you for the opportunity to serve as an Independent Non-Executive Director on the AGL board. I came to Australia over 30 years ago as a graduate engineer to join an equally young renewable energy industry. I've been privileged to help the sector grow from 1 to now millions of homes generating their own power, and utility, solar and wind plants now being deployed at gigawatt scale. In my most recent role, leading Tesla's energy programs, battery storage rapidly became a key technology in enabling the energy transition from centralized thermal generation to distributed renewable. A key trend over my career has been customers moving from the end of the line to playing a central role in the energy system. With the advent of digital technology, customers and their assets will increasingly become important.
Addressing the challenges of rapid decarbonization, while also embracing the decentralization of the energy system enabled by digital technology, will bring new opportunities to serve customers and grow value for shareholders. If elected, I look forward to being part of AGL consolidating and extending a proud history of leadership in the Australian energy markets. My experience and skills can contribute to three key areas. Number one, the rapid rollout of solar and wind and storage capacity in a world where there's increasing competition and challenge around supply chains. This includes a laser-like focus on workforce safety and delivering opportunities for their communities as thermal power stations transition to green industrial hubs. Number two, providing AGL's millions of customers with a suite of offers and services that allow them to contribute and benefit from their behind-the-meter assets and smart technology.
Finally, number three, preparing for a world that is increasingly electrified. Electric vehicles, heating and cooling and industrial processes will all be growth opportunities for AGL. Thank you again, and if elected, I can assure you of my commitment to act independently and for the best interests of all shareholders.
Thanks for the opportunity to speak to you today. I'm asking your support in electing me as a Director to AGL. The reason that I've consented to put my name forward is that I think I can help the company over the next few years in a very challenging transition. I've got four years recent experience in energy and specifically in the transition towards more renewables, and I've been redesigning the electricity market for all the energy ministers in the NEM. There are a couple of big things left to do on the policy side, but the main task now is implementation. The other part of my background that's particularly relevant is 13 years as an investment banker at Deutsche Bank and Bankers Trust. During that time, I restructured and listed companies and have quite extensive experience at corporate change.
I've also been working with governments closely on and off for many, many years and will bring that relationships to AGL, which can be very helpful when you're going through policy changes. I think the challenges facing AGL are twofold. They need to try and cut their emissions as much as they can and as fast as they can, and they need to move into providing more services to their retail base. The value of AGL is in its retail base, both gas and electricity, and in its business with electricity corporate customers like Tomago.
All of these customers want to move to renewable energy and with retail customers, solar panels and batteries and the way that appliances in households can now be moderated together to bring efficiency and benefits to the household are services that AGL and companies like it can move to provide at scale for all its customer base, basically. On the business side, AGL needs to work very closely with its commercial customers as they try to move forward through their particular transitions. There's much work to be done. The appointment of the new CEO is critical. The other important thing is to get the board working together collaboratively. The last thing that a board needs is to be balkanized.
It's very important that the strategic work that AGL has started continues, that it's very clear to staff where it's going, and it's very clear to its shareholders, and the culture within the company needs to be improved. The morale has not been good, and it's been losing staff. Fixing these things is easier said than done, but I do think I can help, and I ask you to support my nomination. Thank you.
Firstly, I'd like to thank Patricia McKenzie and the AGL board for allowing me to speak to the shareholders today. In the company's CTAP on page nine before you today, it refers to the need for board skills in energy markets, environment, entrepreneurship, commercial leadership, and growth. These last three have been a cornerstone of my time as a CEO, Director, and Chair. Leading corporate transformations across complex, multidimensional markets in Australia and around the world. I've experienced what it's like to have the ground shifting continuously. I've led corporate transformations through the 1992 recession in Europe, the Asian financial crisis, the SARS crisis, the global financial crisis, and the pandemic. I've led through the emergence of new technologies and fundamental consumer shifts, and I've led through industry transitions, most recently in advanced manufacturing.
I did my first corporate transformation in 1992 during the U.K. recession, and quickly generated a reputation for being able to identify the issues, build the team, and restore businesses to profitable growth. After all, that's what a transformation is to me. It's a fundamental change to an organization to unlock profitable growth to reach its potential. I bring 30 years of experience being a CEO and being on boards. I know how boards perform when they're at their best, and I know how to get the most out of the CEO and the leadership team. When things start to get shaky or difficult, as they inevitably will, I'm a steady hand because I've been there before. I've done it.
I've done the M&A, I've done the plant closures, I've done the consolidations, I've done the deep cost-cutting, and I've done all this while at the same time accelerating investment in people, in brands, and in technology. I'm bringing my experience forward because I believe that together this board has the potential to be a formidable board, one that can lead this business back to its full potential. If you look at each of the directors that are being proposed, existing and new, we do bring different skills. There is some overlap, but that's not a bad thing. In the area of corporate transformation and commercial leadership, I bring a depth of experience that isn't currently present on the board, and I believe that would add enormous value. After all, AGL is a provider of energy, but it's also consumer goods business and an advanced manufacturer.
It needs to work with pace and a deep understanding of consumers and customers, just as fast-moving consumer goods businesses do. It's also about the interdependence of the board and the board working as a team. We know that high levels of teamwork lead to better results because it leads to better decision-making. Being a team player is not just about what you bring, it's about your willingness to learn from each other, and I'm willing to learn. I know each of the directors here are willing to work together and build a strong team. I've got no doubt that we will gel as a board very quickly and turn our minds to the task ahead. I'm committed to working as a team with the chair and with the board to ensure a better outcome for shareholders, for employees, and for the community.
That's why I would be proud to serve you as a Director on the AGL board and return this company to its leadership position. Thank you.
Good morning. Thank you for giving me the opportunity to speak to you today, seeking your support to be elected as an Independent Director of AGL. I was first approached by representatives of Grok in mid-September to consider this appointment. My interactions with Grok have been confined to helping me connect with investors. These connections have been important as it has enabled me to speak to you directly about my experiences and my commitment to independence. Grok has never sought to influence my views or seek any agreements in relation to how AGL is to be governed in the future. The issue of over-boarding has been raised with me. If required, I will make the adjustments to my current commitments to ensure that I can devote the time to be an active, engaged, and focused Director at AGL. I expect this standard for myself and all my co-directors.
Some investors have engaged with me about a perceived conflict as a result of my current directorship on the CSR board. I will do what's right for both CSR and AGL and accept that choices will need to be made. What I do bring to AGL is the necessary experience in areas such as strategy development, digital and technology transformation, financial management, mergers and acquisitions, stakeholder management anchored in strong corporate governance and sustainability, all of which must be mobilized as part of AGL's future. However, most of all, I bring strong personal values, integrity, and an unquestioned commitment to always do the right thing without fear or favor, ensuring that mediocrity, self-interest, and a lack of accountability is not acceptable at any level, starting with me.
If we accept as a nation that fundamentally we need to make renewables work as one of the key pillars of how energy is delivered in the future, including a commitment to meet the higher ambition of limiting global warming to 1.5 degrees, then we also need to acknowledge that there are many complex issues to be considered to achieve that ambition. We must understand the unintended consequences considering all key stakeholders. As custodians of shareholder capital, we must always act in the best interest of AGL, and therefore, we need to agree on the trade-offs from an informed position of what that ambition means, always with a mindset of what can be done rather why it can't be done. Should I be elected today, it is important as a board that we draw a line in the sand, unite, and move ahead to rebuild AGL.
The staff deserve that. Stakeholders who have and continue to support AGL deserve that. I would like to thank all shareholders, proxy advisors, and institutional investors for giving me the opportunity to meet with you. Finally, I would like to publicly acknowledge all those involved in putting my name forward for this role, for what will no doubt have many, many challenges, but perhaps one of the most rewarding of my corporate life.
I will now take questions on items five A to D, the election of directors of the candidates proposed by Galipea Partnership. Let's start with questions from shareholders and proxies in the room today. If you are holding a yellow or blue card, please raise your hand.
Hi, I'm Agnes Chi. I'm a shareholder. This question is for Mr. John Pollaers. Mr. Pollaers, can you please list each and every one of the 16 company transformation which you have been involved in or you've had performed?
Can we turn that on, please?
Can I just see where the question was coming from? Great, thank you. Thank you for your question. Look, I'm not gonna go through listing all 16. However, if you do go and look at all of the materials that have been presented to shareholders and included on the Keepi t Together website, you'll see I lay out a very detailed resume. You'll see that I have led and had senior roles in more than 16 companies around the world, including multiple divisions. And I believe my record stands for itself. I think the thing that's most important though, and that goes to your question and to the comments of some of the previous questioners today, is this is not about the past.
This is about how we now bring our skills and our experience to bear on probably one of the most exciting and interesting and important corporate change programs that this country is gonna see and in returning this company to its brilliance. Again, I welcome you to have a look at that and very happy to go through that list with you personally in the bar if that's what you'd like to do afterwards. I think my experience stands for itself. Thank you for your question.
Thank you, John. Any further questions?
Thank you.
Sorry to waste your time again. Ed Kasekis, shareholder. I don't know what a Grok is. Does Grok run AGL? With these four new people that wanna go on the board, whose job is presently being done by these new people that they're gonna suddenly push you aside, as it were, to fit in?
Thank you for your question. Grok is an company associated with Mike Cannon-Brookes, a vehicle which he has used along with Galipea Partnership to purchase shares in AGL. It does not control AGL. The Grok holding is around 11.23% of AGL, and we obviously interact with all of our shareholders and will continue to interact with Grok as our largest shareholder moving forward. The constitution of AGL allows up to 10 people on its board, and so the addition of four directors today does not mean that any position is vacated. Those four directors will be additional to the existing directors on the board. The makeup of the board relates to a skills matrix.
We consider the skills on the board necessary to lead the company and oversee the company moving forward. We try to ensure that we have the right directors with the right skill sets that relate to that skills matrix moving forward.
Helen Manning from the Australian Shareholders' Association. Madam Chair, you've had three nominations approved to this board, which you explicitly went against. What will you do to try and bring the board together, in particular now?
We welcome the new directors to the board. The shareholders have made a determination as to the makeup of the board, and we accept that. I think it's great to have diversity of thought on the board, some new ideas coming in, and I have absolutely no doubt that, as everyone on this stage and joining the board are professional directors, we will work together in the best interest of all our shareholders.
Good morning. Patrick Bather, Shareholder. I'm interested to know if our four new directors own shares in AGL, or are they about to purchase them now that the share price has gone down?
Thank you for your question. I understand at this time that we'll be lodging notices later today that the directors do not own shares at this time. We do have a requirement at AGL that all directors are owners of shares and there is a period of time over which that shareholding can be accumulated. Let me also say that your existing board of directors, having delivered on the new strategic plan, all purchased additional shares. I think we've put our money where our mouth is in respect to that plan moving forward. James, could you please let me know if there are any questions relevant to item five online or by phone?
Yes, Chair. There are five questions online. There is no one on the phone. The first question comes from Mr. Tarek Hafez and Ms. Hania Masood: How does the election of four new directors representing a shareholder that only owns 11% of the company ensure that the interests and views of other shareholders are well represented?
Yes, thank you for the question. Each of the directors today have given to AGL a statement of independence, which we have accepted. They are not representing any particular shareholder, and they will all, I believe, act in the best interests of all shareholders.
The next question comes from Michael Cockburn of Masirah Pty Limited: In view of the board's recommendation to not support the election of three of the four new director candidates, can you give us an indication, if they are elected, as you indicated earlier, as to whether or not any of the existing directors might find this untenable and therefore resign from the board?
Thank you. None of the existing directors have any intention to resign. All have put themselves forward today for reelection other than Mark Bloom, and I know that Mark is excited about moving to implement the new strategic plan and will remain on the board.
The next question comes from Mr. Mamoon Reza: This is a question regarding all directors nominated by Grok Ventures. Considering the extra cost to AGL's bottom line, how will shareholders assess the value add by these four new directors? Are there any KPIs directly linked to the new directors that will be shared with the shareholders?
Thank you for that question. The means by which shareholders make comment in respect to directors is in relation to their election, which is required regularly and will continue to occur in accordance with our constitution. Shareholders will have opportunities to vote on the reelection of all directors, as required under that constitution.
The next question comes from Mr. Christopher Johnston: Do the proposed new directors support the Climate Transition Action Plan?
Thank you for your question, ma'am. I cannot speak on behalf of the new directors in relation to the Climate Transition Action Plan. I don't believe that it's p articularly useful at this point to ask each of them to speak to it. As a board, we will be looking to implement that plan moving forward, and I'm sure that our new directors will be enthusiastically a part of that.
The last question, which comes from James Star: How many companies does the new director candidate, John Pollaers, claim to have worked for? If it turns out that he has fabricated his experience, could he be removed from the board despite being elected?
Thank you, Mr. Starr. I think that question has already been answered. As I said previously, if shareholders have the opportunity, and as they do, to reelect Mr. Pollaers at a future time, then I'm sure that they will have, by that time, been able to consider his performance as a director of AGL, which will be the relevant factor. Okay. Any further questions? If not, thank you. I think we can now move on. Details of the proxy and direct votes that have been cast on item five are as shown on the screen. Please place your vote for this item if you've not already done so. Ladies and gentlemen, that concludes the formal items of business for today's meeting. The polls will remain open for another 10 minutes.
Results of the poll on each resolution put to th e meeting will be provided to the ASX as soon as possible today and posted on the company's website. On behalf of the board, thank you for attending and demonstrating your interest in AGL by taking part in this meeting. I now declare the meeting closed, subject to the conclusion of the poll. Thank you.