EnergyAustralia posts earnings of $26m, down from $363m

tallawarra A (energyaustralia earnings)
Tallawarra Power Station

Leading energy retailer EnergyAustralia has reported earnings before interest, tax, depreciation and amortisation, and fair value adjustments for the six-month period to June 30, 2022, of just $26 million—compared to $363 million last year.

“Against the backdrop of the global energy crisis, unexpectedly lower generation output coupled with high spot price purchases to cover retail customers, had a significant bearing on the company’s financial performance,” the retailer said in a statement.

“The negative impact from accounting revaluations of sold energy (fair value movements) was $2,031 million before tax for the first six months of 2022.”

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EnergyAustralia chief financial officer Alastair McKeown said, “Amid this energy crunch, we have continued to provide power into the system to support the millions of households and businesses who rely on us.

“High wholesale prices are challenging. We know household and businesses are feeling it. Our priorities are to maintain supply into the system, support customers experiencing financial difficulty, while increasing investment in energy transition projects to improve our future.

“During the first half of the year, the significant increases in the cost of energy were largely driven by adverse weather and geological issues which slowed domestic coal supply, along with untimely generator outages. Abroad, sanctions against Russia and the war in Ukraine, drove higher prices for Australia’s coal and gas. The culmination of these conditions found us in unchartered territory.

“Our generation output at Mount Piper and Yallourn Power Stations was unexpectedly lower, due to planned and unforeseen maintenance outages.

“We also faced fuel constraints at Mount Piper, which arose from lower-than-expected coal deliveries from our primary supplier. This led to a shortfall in contracted generation and the requirement to settle positions not covered by our generation at high spot market prices.

“Despite these challenges, our team worked hard to make our generators available to provide good supply into the system and help soften the impact of Australia’s energy supply crunch. Our gas assets ran up to seven times the volume compared with the same period last year.

“We remain committed to supporting our customers during this challenging economic climate. We have various support initiatives available to households and businesses experiencing financial difficulty and strongly encourage customers to come forward if they are worried about their bills—help is available.

“These short-term challenges have not impeded our progress to help advance Australia’s clean energy future and deliver on our long-term strategy.

“This includes the introduction of Solar Home Bundle—a new product which puts a solar and battery system within reach, for $0 upfront over a seven-year contract.

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“Critically, ahead of major coal retirements, we have progressed construction of Tallawarra B Power Station, the country’s first net-zero emission, hydrogen-ready, fast start, gas power plant.

“Progress was also made on the Kidston pumped hydro storage project in Queensland and two new battery storage projects in New South Wales developed with partner Edify Energy for a combined 90MW, scheduled for completion in 2024.

“Planning for the Wooreen Battery is underway and we will shortly commence geotechnical analysis as part of our planning for a pumped hydro project at Lake Lyell, near our Mount Piper power station site.”

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