Economic Strategy of AGL (Australia)

Essay by romurroyUniversity, Master'sB, October 2011

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AGL Energy Pyt. Ltd.




Table of Content:


Introduction 3

Company profile 4

Internal environment in AGL as an organisation

Board Strategies 7

Delegation of Authorities 9

SWOT Analysis 13

AGLs relation with their customers 15

Code of Conduct 15

Financial Analysis of AGL 18

AGL on ASX list 22

AGL in Sustainability 24

Future of AGL 26

Conclusion 26




The purpose of this report is to give detailed information about AGL energy private limited. This report is a case study of AGL organisation. While choosing the topic for my report I look through number of different organisations in Australia as well as overseas but AGL attracted my attention. I thought it is worth exploring and going in details about this company. So, I have tried to cope up all the minor details about AGL and hope you get all the desired information in this report.


Australian Gas Light Company (AGL) was formed in 1837 (AGL Energy 2010). History of AGL can be summarised in the following tabular form:

Table 1: History of AGL private limited. (AGL Energy 2010)

Sr. No.





First gas street light in Sydney.



Gas lit lights became famous and were installed in departmental store which enabled late night shopping



AGL imported first gas cooked stove for £4 & was installed in Darling Harbour store.



AGL started marketing their gas cooked stove through cookery books and people could buy or rent it.



The very first AGL display store was setup in Haymarket. It was the first AGL official showroom & it showcased cooking, lighting & heating options and many more.



59,000 housewives took gas cooking classes and which was organised by AGL.



AGL introduced first natural gas to Sydney and it involved the longest pipeline in the country which stretched from South Australia to Sydney.



The first Australian Company ever listed in Chicago Climate Exchange



AGL made Australia's first carbon trade.



Largest organisation in production of Sustainable energy and can lit over 500,000 homes by renewable energy

So, from the table 1 we can see that AGL brought a revolution in field of gas and electricity and stretched its hands over the years by serving people by all means.

Company Profile:

AGL is the largest Australian gas & electricity retailer & a leading company in field of renewable energy. AGL is the largest private owner, operator & developer of sustainable energy. AGL has over 3 million customers all over Australia. AGL deals in field of gas and electricity and now it has largely developed in field of renewable energy like wind, solar, hydro power generation. AGL is listed on the Australian Securities Exchange (ASX code: AGK) it is also an S&P/ASX 50 company.

AGL Energy Limited:

Type of Organisation


Area of Operation

Energy (Retail Energy, Merchant Energy and Upstream gas)

Region of Operation

South Australia, Victoria, New South Wales, Queensland




North Sydney, Sydney, Australia

Key person

Mr. Michael Fraser (CEO)


New Developments

Growing market for renewable energy

Areas served

Residential and commercial

Fig. 1 shows the different operating areas of AGL. AGL deals in three main areas i.e. Gas, Sustainable energy (Merchant Energy), Electricity generation and distribution. From the fig.1 we can clearly view how AGL generates, transmits and distribute energy in market. This is the standard flow chart of AGL working method.

Table 2 shows AGL Energy Pyt. Ltd. key persons: (ASX 2010)

Sr. No.


Name of the person


Company Secretary

Mr. Paul McWilliams


Chairman (CEO)

Mr. Michael Fraser


Non Executive Director

Mr. Leslie Hosking


Non Executive Director

Mr. Jerry Maycock



Mr. Stephen Mikkelsen


Investor Relations

Mr. John Hobson.

Principal of AGL:

The company secretary Mr. Paul McWilliams share his company's success with ASX and unwinds the secret by stating that 4 Corners strategy is the key for their success.

Projects by AGL:

Table 3 shows Electricity generation projects: (AGL Energy 2010)



Loy yang A (32.5% equity)




Pinjarra 1 & 2 (33% equity)


Victoria Hydro


NSW Hydro

52.5 MW

Torrens Island Power Station


Dalton Power Project


Table 4 shows Gas projects: (AGL Energy 2010)



Camden Gas Project

This project is being in operation since 2001. The project is a joint venture between AGL & Sydney Gas Limited. The Camden Gas Project is located 50 km south west of Sydney and from February 2006 it is solely operated by AGL.

Hunter Gas Project

This is a very important project as AGL is exploring the area of Hunter for natural gas which will be used for power generation. From many years AGL import natural gas from interstates and if this project works successfully then it will led AGL to new heights. It covers an area of 10,000 sq. Km in the Hunter region.

Gloucester Coal Seam Gas Project

This is a long-term project in the area of Gloucester to develop coal seam gas resources and will be transported to different regions through high-pressure pipeline.

Table 5 shows Renewable power generation Projects:


Project Description

AGL Oaklands Hill Wind Farm

32 wind turbines will operate at a capacity of 63MW and the estimated project completion date is in late 2011.

AGL Hallet Wind Farm

Provide 132.3 MW of renewable wind energy for domestic, commercial & industrial purpose. The project is located 10km south-east of Jamestown in the Mid North of South Australia.

Internal Environment of AGL as an organisation:

This is an insight about what the duties of different persons at different positions are and how actual the management of AGL works and the environment inside AGL company between their employees. The AGL management has their dedicated strategies which I will be covering in this section.

Board Strategies: (AGL Energy Board Charter 2009)

A Board committee comprise of several members including CEO, Company Secretary and many more. An overall Board has the following responsibilities:

The overall development of an organisation is solely dependent on the board members as How they manage their employees and have control on their financial and managerial activity.

The Board has to oversee the development of AGL's corporate strategy through experts and taking a poll on a particular decision to be made.

The board has to plan, organise and implement new constructive strategies as per changing time depending on the current market situation so that the external market (environment) does not affect their business.

Monitoring implementation of plans to give effect to AGL's strategy.

Role of Management (Board members):

To appoint or remove the Chief Executive Officer (CEO)

Approving plans for development of organisation

Arranging annual board meetings with managerial persons, stakeholders, etc.

Preparing an annual report about the key points mentioned in the end of the meeting and distribute to all the stakeholders and committee members.

Appointing or removing of the Chief Financial Officer & the Company Secretary.

To implement environmental safety as well as employees safety policies.

Taking feedbacks from the lower level managers about the output their team achieved as per the target given by board members and if not what are the limitation s? And where actually their efforts went less and giving solution to improve their performance and giving new target.

Providing advice and counsel to management.

To resolve major disputes in the organisation this cannot be handled by lower managerial personals.


The board is responsible for communicating and informing their each and every board member about the annual meetings and happenings in the organisation.

Look in to the different legal matters about shareholders and see to it that the shareholder gets his desired rights in the organisation.

Informing shareholders about new managerial policies, new laws and Corporation Acts.

Oversight of financial management:

This is the most important task board members have to do. It's a critical task but most essential.

Reviewing and approving annual financial reports prepared by accounts department.

Overseeing the annually or quarterly financial audit and depending on the report of audit necessary steps to be taken.

Monitoring financial results and keeping a track record of all deals and investments made.

Decision making on financial issues if any.

Monitoring stock price of AGL in stock market.

Approval of major projects with high initial capital cost and studying whether it is worth investing in this project in terms of payback period and different evaluating criterion.

Role of Chairperson:

A chairperson is an independent and non-executive Director appointed by the Board and he is the one who has control over the company.

He is the main person leading the board and taking the final decision.

Attending board meetings and shareholders meetings.

A chairperson must be very energetic and should have leadership qualities because he is the one who drives the whole organisation and he should motivate his employees for performing well and giving their best at work place.

Attending private managerial meetings to know internal situation in the organisation.

Overseeing of implementation of policies that are discussed and approved in the board meeting.

Making deals as per requirement it includes take-over of new company, signing new deals, approval of projects, etc.

Role of Company Secretary:

Organising board meetings and shareholders meetings.

Preparing minutes of meetings and circulating it to each and every board member & approve it from the Chairperson.

Preparation of annual company report and sending it to every committee member and shareholder.

Coordinating the completion & dispatch of the Board agenda & briefing materials.

How does Board work in AGL?

The Board meetings are held 8 times in a year and are conducted in accordance with AGL's Constitutional & Corporations Act. In emergency like an issue that needs to be resolved urgently then a meeting is organised in between the desired schedule.

After the completion of Board meeting some important members from the committee has a private meeting with CEO of AGL to discuss about managerial issues or matters of particularly sensitive nature.

Each and every Director in the meeting has rights to talk on the issue put forward and can give suggestions. If there is a dispute on any of the issue in Board meeting itself then the CEO calls for vote. Under AGL's Corporation Act each Director has only one vote.

If the votes are equal then as per ASX's Listing Rules & AGL's Constitution, the chairperson of Directors has a right to vote also know as casting vote in addition to his/her deliberative vote.

The Board meeting held is very confidential and no Director can leak the information or discussion took place inside the conference room.

The Board can conduct meetings by telephone or videoconferencing.

Directors have access to AGL's datasheet for any information they need before or after Board meeting such as operational reports, Financial reports, etc.

Delegation of Authority:

AGL Board has delegated to the CEO for handling of day-to-day affairs under AGL's Constitution. The Board also can delegate responsibilities to the community to handle a specific issue and then report back to and advise the Board. There are in total three standing committees in AGL:

The Audit & Risk Management Committee

The People & Performance Committee, and

The Safety, Sustainability & Corporate Responsibility Committee

Audit & Risk Management Committee: (ARMC)

Table 6 shows the brief information of the Committee. (Source: AGL Energy Risk Policy 2009)

Audit & Risk Management Committee (ARMC) comprises of 4 non-executive Directors. The Company Secretary is the secretary of the committee.

Members in Audit & Risk Management Committee (AGL Energy Risk Policy 2009)

Graham Reaney (Chairman)

Charles Allen (non-executive Director)

Carolyn Hewson (non-executive Director)

Jerry Maycock (non-executive Director)

Functions of AGLs Audit & Risk Management Policy:

To look after and monitor the financial data.

Arrange annual or quarterly audits.

Submitting the report of internal audit to the CEO

Reviewing AGL's internal operations.

Arranging meetings for CEO, CFO, General Manager Finance with the external auditor and discuss about the financial issues company is facing and take appropriate action.

Maintaining the internal operation as per the norms and regulations allotted by risk management policy.

Appointing external auditor and choosing a right person with appropriate qualification and experience which can handle account of such a vast firm perfectly.

To make available all the necessary data required for external audit to the auditor.

To study and discuss with the management the yearly and half-yearly audit report and take decision whether to publish this report or not.

Clarifying the doubts about the audit or any financial issues to the top management personals i.e. CEO, CFO, and General Manager.

Identifying the current financial position of company and determining the loaf holes to improve the financial strength in a particular field or department were the company is lacking.

Keeping the track record of shareholders account and share market price in ASX.

Fulfilling all the legislative and legal requirements of ASX.

Looking after the payments of clients and monthly salary of employees.

Internal Audit:

Carried by the AGL employee internal auditor.

Usually carried after every 3 months.

It gives the up to date financial position of company.

Internal Audit are very beneficial as they are carried every 3months and the audit is done by the AGL employee himself. So, this can help in taking actions on a particular issue and the financial data is updated after every 3 months which helps understanding the AGL's financial position.

Roles & Responsibilities of Risk Management Committee (RMC): (Wholesale risk management policy 2008)

Updating the policy as per changing time.

Avoiding economic risk by preparing methodologies and approving those methodologies.

Setting trader limits

Arranging meetings and discussing the current issues with the committee or problems associated with Wholesale Energy Economic Risk.

Approval of all derivative instruments that can be traded.

Submitting reports of the development in field of risk management to the CEO of AGL

Arranging meetings to solve the queries of CEO in regards to the committee or any individual personal in the committee.

Resolving personal issues of the members working as a whole in the committee.

Allocating task and duties to the right person with the correct knowledge of that field.

Approval of the methodology for preparing wholesale transfer prices.

The people & performance Committee: (AGL Corporate Governance 2008)

Key persons in the Committee

Mark Johnson Graham Reaney Max Ould

(Chairman) (Non-executive Director) (Non-executive Director)

The people and performance Committee comprises of 3 main persons, Mark Johnson (Chairman), Graham Reaney (Non-Executive Director), Max Ould (Non-Executive Director).

Role of the people & performance Committee:

This committee encourages employees to give their best and reward them for their good work.

This is a link between the company and their customer.

This committee is the most important in terms of Company- Customers relationship.

These are the peoples who interact with AGL's customers directly to help them solving their problem.

It is in their hand to keep AGL's customer happy and satisfied.

The committee also provides time to time training sessions for their employees to serve AGL customers in better way.

Encourages team work & shared learning

Recommending Board about any changes required in planning and Director Remuneration policy.

Motivates employees to work hard.

Problem solving.

The Safety, Sustainability & Corporate Responsibility Committee: (Board Safety Charter 2009)

The Board of Directors look after this Committee. The purpose of this committee is to ensure employees safety as well as avoid environmental impacts by going green.

Responsibilities of the Safety, Sustainable & Corporate responsibilities Committee:

To ensure healthy and safe working environment within the organisation.

Implementing safety norms introduce by Australian Government and to monitor whether these norms are used by everyone.

Solve any safety issue i.e. technical or physical.

Updating new safety policies for ensuring more safety of employees.

Reporting higher authorities about any incident taken place.

Ensuring Emergency services are available 24/7.

Promoting Sustainable power generation.

Implementations of Environmental Policies introduce by Australian Government to avoid CO2 emission and help fight the problem of "Global Warming."

Keeping a track record of CO2 emitted each year and action to reduce CO2 emission.

Developing new safety methods and implementing them from time to time.

Reviewing AGLs Sustainable policies

Preparing & approving AGLs annual Sustainability report.

Preparing new schemes for AGL customers to promote Sustainable power.

Achieving the Sustainability target enforced by Australian Government on every power generating company in Australia to promote green power generation.

Corporate responsibilities consist of reviewing legislative matters and approval of new policies from Safety and Sustainable committee.

SWOT Analysis of AGL:


Over 170 years in the field of electricity & gas generation.

Australia's largest private owned Power Company.

Australia's only Power Company in ASX.

World's largest Wind Farm project is being built by AGL.

As they are very old players in field of electricity, AGL has a goodwill which their competitors don't have.

Australia's largest retail company.

Over 3million customers all over Australia.

Fully Australian owned so, people have soft corner.

Moderate financial ratio minimum target and

Conservative dividend policy.


Aggressive growth strategy :

AGL has started many different projects all over Australia and even many are in pipeline. If there are more projects running at a time, every project has an initial investment which is high and a project takes atleast 2 years to complete depending on the size of the project. This results in facing of different constructional, economic, social challenges for AGL. So, lots of capital gets stuck for over a period of time in these projects.

AGL should work out new market strategies and not stick to the old policy because the market is changing widely.

Higher Cap price.


AGL has great opportunities in future with just little modifications in their market strategies and policies. As I mentioned in the Strength section that AGL is the Australia's largest single energy retailer company with over 3millions customers already with them. This figure is very difficult for their competitors to achieve. Each and every person in Australia knows about AGL which is the greatest achievement and that competitors cannot do. AGL has manpower, capital, projects, and contacts which keep them apart from the competitors and as power generation is the booming field in Australia, there are lots of opportunities for AGL especially in the field of Renewable Energy. As we all know, Australia's new President Ms. Julie Gillard promotes sustainable power and have introduce lots of schemes like carbon tax, etc. So, this is the right time for AGL to rise in renewable power generation as its Australia's target that by 2020, 20% of total power must be generated through renewable sources.


The biggest threat for AGL is the competitors like Origin, TruEnergy, Red energy which are also big giants in Power generation.

Due to privatisation of electricity there is no bar on new companies being introduced in the market each year.

It is very difficult for AGL to cope up with the rates that their competitors provide to customers.

In states of Victoria and NSW AGL has one of the highest rate for /KWh than the other competitors.

Due to different marketing strategies implemented by new companies to have their impact on people, it's time for AGL to rework on their policies.

Now, Companies goes to the customer's doorstep to market their product which is a very effective method of marketing and AGL was the last company to implement this strategy.

AGLs relationship with their Customers:

Code of Conduct:

This is the policy of AGL to deal with their customers and keep them satisfy. AGL works on the principle of "Action-not Words." The Code of Conduct policy of AGL is for their employees, customers and each and every person linked with AGL by one or the other means. The Code of Conduct has following subclasses:

Acting honestly and with integrity.

Valuing and maintaining professionalism.

Respecting confidentiality

Looking after the community.

Observing the law.

Managing conflicts of interest.

Acting honestly & with integrity:

This sub-session of Code of Conduct designed by AGL has following conditions:

All the AGL employees must perform their duties with honesty & integrity.

They should not misuse or damage the AGL property.

They should act wise and avoid malpractices at workplace.

AGL employees should not misguide their customer by any means or in other words false information. If they found doing such things strict action could be taken on the person.

Not participate in any activities such as corruption or bribery.

Valuing & maintaining Professionalism:

AGL as an organisation helps their employees in maintaining professionalism in following way:

Time to time training is provided by AGL to improve their skills.

Seminars from experts are conducted so that employees can learn about professionalism and can act at workplace.

Support employees in managing their careers.

Treat all employees equally with respect & courtesy.

AGL expect following qualities from their employees:

The employees should be willing to learn new things.

The employee should be a fast learner.

The employee should be keen to learn new things and a good observer.

The employee should be polite to the customers he is talking and should have business ethics.

Should strictly avoid intake of alcohol or drugs while performing his/her duties.

Should avoid coarse language at the place where he works and should be very professional through his body language.

Don't affect your work due to personal reasons.

Be punctual in your duties like regularly reporting to your seniors via emails, telephones or personal meetings.

Do not discriminate while dealing with different customers.

Respecting Confidentiality:

It is very important for an employee to not leak any information to a third party person or even to his close ones

All the employees should read the company policy and act as mentioned in those policies.

AGL will provide following to their employees so that it would be easy for the employees to act:

AGL will make it easy to understand all the policies to the employees.

AGL will provide safe & secure working environment at the workplace.

AGL will not tolerate any harassment done to any employ and will take strict action.

AGL will provide a peaceful and fun environment so that employees will feel relaxed and enjoy their work.

AGL provides Employee Assistance Service to help their employees in better way.

Looking after the community:

Neither the employees nor AGL as a whole organisation should affect outer environment in any way.

AGL should take all the precautions to reduce environmental hazards caused by generation of electricity or by any employee as an individual.

Safety measures should be understand and implemented by each and every AGL employee.

The entire employee should try to adopt eco-friendly methods in their day to day life.

Observing the laws:

To assist the employees understand the different laws AGL do the following:

AGL distributes free booklets to each employee to study and understand each and every company policy and legislative laws.

Seminars are conducted so that employees can have face to face interaction with the expertise and their quarries can be solved if any.

Make readily available materials on different laws and regulations for employees and have easy access to these study material.

Role of employees in observing the laws are:

To study and implement all the company rules and regulations while working.

Keeping updates of new or updated laws.

Keep habit of looking at the notice board everyday for notice about new policies ir legislative laws.

Not buy or sell share in AGL or any other company about which AGL have access to price sensitive information and which is not generally available to the public.

Managing conflicts of interest:

Employees should not make use of their current employment to obtain opportunities for future employment.

Not accept any bribes in any form such as cash, gifts, etc.

Notify senior officials about unsolicited gifts received in excess of $250.

Do not disclose any issue in public or make any public comment about any matter or any malpractice in any political activities, which can affect AGLs image in market.

Code of Conduct beneficial for AGL Customers:

Code of Conduct policy is like a feedback and reporting of any complaint for AGL customers.

If the customer is not happy with the service or has an issue with any of the AGL employ then through AGL's Code of Conduct policy he can directly report it to the higher authorities.

First, customer has to report the matter immediately to the leader.

If any customer feels that no action is taken after reporting to the leader he can then take his complaint at the upper level i.e. to General Manager.

This policy of AGL is a two way flow both for employees as well as for the customers which make their bonding special. This is the reason why AGL stands apart from all its competitors because AGL's business has transparency and any customer can take his/her complaint to the higher level.

Financial Analysis of AGL:

Table 7 shows the current assets with AGL (AGL annual report 2010, p.51)

Table shows the current assets with AGL. The table has three columns in which first column refers to the Notes means the detailed transaction of the assets of particular subclass while the other two columns are the assets for year 2010 and 2009 respectively. In this report I won't be explaining all the subclasses in details but just to give you the rough idea I will cover few subclasses in details.

In the Current asset class the first subclass is cash & cash equivalents. In the note column the number written is 12 which means Note number 12 gives the detail description of the subclass called cash & cash equivalents which is shown in table 8. Cash & cash equivalents means cash deposited in bank i.e. company account or hard cash in hand and the other form of cash & cash equivalents can be safe deposits like Fixed deposits (FD) for a specific period of time. In year 2009 AGL $67.5 million of cash at bank while in year 2010 i.e. till the date 30June 2010 AGL has $41.8 million in bank and cash in hand, while the short-term deposits are $438.6 million and $555.6 million as on 30 June 2010 and 2009 respectively. The other subclass is Trade and other receivables and the detailed information of this subclass could be seen in table 9 which is Note 13. This section tells about the amount that AGL has to receive from the market. It could be a dead investment or a kind of loan given in the market to other firm. In Table 5 it clearly specifies the receivables and they are unbilled amounts from customers, amounts owing from the associates or any firm and amount owing from joint venture i.e. partnership firm. So, in the same way table 10 describes about other subclasses. Finally, after deducting all the liabilities and adding all the current & non-current assets AGL has about $5,799.9 million as on date 30 June 2010.

Table 8

Table 9

Table 10

Table 11shows the revenue of AGL in different area of operation (AGL annual report 2010, p. 65)

Table 11 shows revenue AGL gets from its different areas of operation. As I had mentioned before AGL operates in 3 main fields i.e. Retail Energy, Merchant Energy, and Upstream Gas. This table also gives the investment made by AGL in field of Energy. From the table it is clear that most of the revenue that AGL receives is from Retail sector. So, the revenue of AGL has increased than last year i.e. in 2009 the total revenue AGL received from all the 3 sectors was $7,979.9 million while as on 30 June 2010 the total revenue is $8.067.9 million which is a very significant figure. The reason for this increase is due to the rapid development in field of Sustainable energy.

Table 12shows the income statement for the financial year end 30 June 2010. (AGL annual report 2010, p. 49)

Table 12 shows the overall Income statement of AGL for the year end 30 June 2010. The table gives the income received from revenue and other financial sources. It gives the profit that AGL grabbed before deduction of tax and after deduction. AGL has grabbed a profit of $428.9 million which is an increase by 13.2% than the previous year including all the profit from shares.

AGL on ASX list:

AGL is the second company to mark his presence in Australian Stock Exchange. AGL official enrolled its name on 12 October 2006. AGL is issued with a code AGK on stock market.

Fig. shows the share price of AGL for a particular period (ASX 2010)

Above fig shows the graph of AGL Energy shares and the trend of variation in the price of AGL shares over a period of time. The graph covers a period from March 2010 to October 2010. The red line in the graph represents the price of the primary security over a period of time. The blue line represents the price of the secondary security over a period of time and the green line is the average price of red and blue line. The figure on the left hand side of the graph shows the actual closing price of the share for that specific period. The bar graph below shows the volume of AGL shares that are in the market.

Table 13 (ASX 2010)



% Change



Vol *

22 Oct 2010






21 Oct 2010






20 Oct 2010






19 Oct 2010






18 Oct 2010






* Volume of shares shown represents only those shares traded on ASX.

Table 13 shows the AGLs share value for last week. The share prices remained nearly constant with some minute variations in the price. On 22nd October 2010 the AGL share closed at 16,500 and the volume of shares were 1,252,542 which was 0.67% increase in share price than the previous day i.e. on 21 October 2010 the market closed at 16,390 and AGLs share price had dropped by -1.32%.

Table 14 shows the profit of AGL for three consecutive years

AGL in Sustainability:

AGL has achieved its aim of supplying 1TWh of renewable energy, which makes AGL Australia's largest retailer in renewable energy. Some of the renewable projects by AGL are listed below with their respective capacities:

Table 15 shows different Wind projects of AGL in Australia. (AGL annual report 2010)

Name of the Wind Farm project




AGL Hallett 1

South Australia



Wattle Point

South Australia



AGL Hallett 2

South Australia

71.4 MW


Oaklands Hill


67 MW

Under construction

AGL Hallett 5

South Australia

52.5 MW

Under construction

AGL Hallet 4

South Australia

132 MW

Under construction



420 MW

In development

The Macarthur when complete will be the largest Wind Farm Project in Southern hemisphere. AGL also has started dealing in solar power with rebates given by Australian government on installation of solar panel at homes. Australian government have made it mandatory to all the electricity generating company in Australia that 20% of total electricity must be generated through renewable energy by the year 2020. As AGL has the maximum number of customers it is very important for them to achieve this target within the specific time frame. The scheme works in following manner:

AGL have sent a letter to its entire customer about the Australian Renewable Policy.

The letter states about the solar panel installation at the homes.

After the letter is received to the customers, the customers who are willing to install or enquire about solar panel gives a call to AGL's customer service.

Before installing a solar panel at customer's house, they need to go through roof inspection which is done by AGLs engineer visiting customer's house.

Customer has to pay $500 for inspection, which are refundable if they fail in the inspection.

After the inspection the engineer submits the report to AGL stating that whether it is possible to setup solar panel at customer's house or no.

If it is possible then a representative from AGL calls to the specific customer and tells him that you have successfully gone through the inspection and solar panel could be setup at your house.

If the customer is willing to install then he has to pay $4000 for the solar system. The actual cost of this system is around $10,000 but its Australian Government rebate that customer only has to pay $4000 and the remaining $6000 is paid by Government.

After installation of solar panel at the customers house, the customer gets 68 cents/kW of electricity generated which is the highest amount AGL gives than any other company.

Future of AGL:

AGL has a wide scope in future especially in field of Sustainability. The reason is because of the new president elected Ms. Julia Gillard who supports green power and is more concerned about Green house gas emission issues. As AGL is the largest energy retailer in Australia it will make significant change in field of renewable energy and also for Australian government to achieve their target of 20% renewable power generation, AGL is the key company for them and need to concentrate on them.


In conclusion, AGL is a growing firm and has achieved a significant profit of $428.9 million, which is almost 13.2% increase in last year's profit margin. AGL is making tremendous development in field of sustainability which is going to be the future of not only Australia but worlds. So, AGL has a wide scope in Australia as well as in world and could be one of the biggest renewable energy generation company in the world. AGL knows how to treat their customers and for AGL their customers are the main assets so, AGL makes all possible precautions to keep its customer happy. It is true that competitors have increased, but it hardly makes any difference to AGL because AGL is in the power business from last 170 years and the goodwill they have achieved I don't think so any other company or their competitors have that. But one thing is for sure that AGL needs to keep itself upgraded each time by modifying their policies with varying time and depending on the market flexibility if they want to stay in the number 1 position. All and all AGL is doing great and has a great future in Power sector.


AGL annual report 2010, < >, p. 16-65.

AGL Code of Conduct 2009, < >, p 1&2.

AGL Energy Board Charter 2009, < >, p. 1-5

AGL Energy 2010, < >

ASX 2010, <>

Board Safety Charter, Board Safety, Sustainability and Corporate responsibility committee charter 2009< >, p1-4.

Wholesale Energy Risk Management Policy 2008, <>p. 1-5.

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