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Origin boss warns investment needed to plug power gaps as coal exits

Origin Energy is one of Australia’s largest energy companies, with operations spanning coal and gas-fired power generation, renewable energy, retailing and liquefied natural gas (LNG) production.

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Rival power companies AGL and EnergyAustralia have delayed plans to develop gas plants in NSW amid uncertainty surrounding the impact of the state government’s renewable energy “road map” announced last year.

Federal Energy Minister Angus Taylor has told power companies the Commonwealth expected them to “step up” and deliver enough dispatchable generation to “keep the lights on and prices low” once Victoria’s Yallourn shuts. Victorian Energy Minister Lily D’Ambrosio said she was confident Victoria had sufficient power to meet the state’s needs, and an influx of renewable energy into the grid by 2028 would keep prices down.

The accelerating clean energy transition and market upheaval have driven the nation’s biggest utility, AGL, to pursue plans to break up its business. The company last month told investors it would divide into two companies: “New AGL”, which would include electricity, gas and telecommunications retailing along with some energy assets, and “PrimeCo”, which would own AGL’s largest thermal power stations and some wind farms.

AGL’s break-up proposal has revived speculation among investors and analysts that Origin might also choose to divide its assets. Mr Calabria reiterated the company’s position that it continually reviewed its portfolio.

“Clearly, if there is a case for value to be released through a different structural holding, then we would continue to explore that,” he said.

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