- AGL Energy has faced a political campaign against its closure of the ageing Liddell coal-fired power station.
- CFO Brett Redman says the company will stick to its plan to transition from carbon to renewables.
- Redman was appointed in August as the interim CEO of AGL.
Former Australian Prime Minister Tony Abbott savaged AGL’s recent refusal to sell its ageing coal-fired power station, Liddell, to Alinta Energy as a “strike against the national interest”. The comment typifies the high-profile criticisms being made of the A$14 billion ASX-listed company, which this year posted a record net profit result. The Coalition wanted AGL to extend the life of Liddell to shore up NSW’s power supply and lower the risk of damaging blackouts.
Many leaders would have crumpled when faced with such a vigorous political offensive. AGL stuck to its plans. It wanted to move from coal-fired generation to renewables. And a key plank of that plan was to shut Liddell in 2022.
I’m right in the middle of one of the most important changes going on in Australia right now. That’s what gets you through the dark days.
In the middle of this debate sits the company’s former chief financial officer, Brett Redman FCA, who was appointed interim CEO in August, after the resignation of AGL chief executive Andy Vesey. The experience hasn’t always been enjoyable: there are days, he says, “when I think I could swap this for life at the beach quite easily”. But his role at AGL puts him “right in the middle of one of the most important changes going on in Australia right now” – moving the economy to one based on renewable energy. “That’s what gets you through the dark days.”
Redman is lending his credibility and expertise as a CA to the debate, arguing strongly that from a rational perspective, the transition to renewables will benefit the community as a whole and drive a new phase of prosperity for Australia. “Liddell is high-profile, but it’s a very narrow flashpoint in a much bigger transition.”
His declaration comes as AGL profits climb. For the 2017-2018 financial year, net profit nearly trebled to $1.6 billion, on higher market prices for energy and favourable hedging contracts.
Redman grew up in Camden, south-east Sydney, then a coal and dairy area. His father was also an accountant, working at a large company before establishing his own practice. Redman first thought of following in his dad’s footsteps when cadets from the then “Big Eight” firms visited Hurlstone Agricultural High School. He immediately saw a way to “get out of home and get into the city”.
He started a cadetship at Deloitte Haskins and Sells Australia in February 1988 at just 17 years old, working in general audit across a raft of industries. “But right from the beginning I formed a view that I wanted to work for big industrial blue-chip companies. I really liked the culture.”
After leaving Deloitte, he secured senior positions at CSR, Email (a large Australian conglomerate at the time) and BOC, including a stint in the US, before an opportunity opened up to join AGL in 2007. “It was an ASX50 head office with the type of culture I wanted to join.” He became chief financial officer in November 2012.
The broader business actively seeks us out and makes sure someone from the finance team is in every important meeting ...
Redman’s CFO role incorporates multiple responsibilities. He says he adopts a unique philosophy for his traditional CFO duties: he embeds his finance team deeply in the business. While that means handing across a lot of controls and decision-making, Redman says it actually strengthens his team. “The thing I love about it is the broader business actively seeks us out and makes sure someone from the finance team is in every important meeting that goes on around here.”
AGL’s Chief Executive, Andrew Vesey, has also charged Redman with a wider remit to drive growth. Redman says that strong finance leaders “should be leaders around strategy – and a big part of strategy is driving growth”.
“I’ve always been passionate about growth and passionate about customers. You’ve got to constantly look at that top-line growth in any business in order to keep growing and to keep offsetting the more mature parts of the business.”
In 2012, Redman drove AGL’s move to full ownership of Loy Yang A, the biggest coal fired generator in Victoria, which at A$3.1 billion was then the biggest project finance deal in Australian history. He also led AGL’s 2014 A$1.5 billion purchase of Macquarie Generation (MacGen) in NSW.
Redman is now helping to drive AGL’s broader transition from carbon to renewables. AGL, currently the nation’s largest carbon emitter, has committed to close all existing coal-fired power stations by 2050 and won’t build new ones. Instead, it is investing heavily in renewable alternatives, including solutions that provide consumers with reliable energy supply, such as battery storage.
Redman led the establishment of the A$3 billion Powering Australia Renewable Fund (PARF), a finance initiative that will fund the development of 1000mW in large-scale renewable projects. The fund is already building the Coopers Gap Wind Farm north-west of Brisbane and the Silverton wind farm in western NSW.
But the transition is taking place amid surging energy prices, which has triggered a backlash from politicians concerned that closures will lead to higher long-term prices, erratic supply and a surge in blackouts along the east coast.
All about the maths
A keen ocean swimmer used to remaining calm while being buffeted, Redman admits that weathering the controversy can be tough. “We’re not so thick-skinned or so closed-eared that we don’t hear the concerns out there in the community,” he says. “It does force you internally to debate whether this is the right thing to do.”
But despite the difficulties, Redman says he and AGL are firmly committed to the path. He says that Australia must transition to renewables. “Coal-fired generation built this nation’s prosperity, but it’s had its time.”
Redman’s faith in the project is also borne out of a belief that he is doing the right thing for the community. His parents were active in Lifeline, Rotary and the Uniting Church. “They believed strongly in community and service and that is something they instilled in me.”
Redman’s community commitment saw him serve for four years on Waverley Council. He says he still feels guilty about his decision to step away from politics and focus on work and family, but he believes his role at AGL benefits not just his career but the community.
Redman’s faith in AGL’s difficult transition is underpinned by the maths. He says that one of the most important things he can do is to bring credibility to the financial part of the debate. “The maths is there,” he says. “As the CFO and as a CA I sit there and say, the maths says there is no question that – firmed up with other forms of backing generation and other storage like batteries – renewables is cheaper than coal. You then start to move beyond the emotion of the discussion.”
One of Redman’s role models in this challenge is the current chair of the Energy Services Board, Dr Kerry Schott, who faced considerable political pressure as managing director of Sydney Water from 2006 to 2011. “She had her moral compass tested, but she stood firm to her principles around what was the right thing to do. The way she acts and carries herself is how I’d like to model my behaviours: doing the right thing and standing up for what you believe in, but also getting stuff done. They’re really inspiring principles.”
Redman advises other CAs who might find themselves caught up in controversies that there are a number of principles to guide them through:
1. Be authentic. “People see through if you’re trying to talk corporate-speak or being a bit duplicitous about what you stand for. The bedrock of what we do is be authentic.”
2. Focus on actions not words. “A lot of people talk a lot about what you should do. What I love about AGL is that we do do. I’m really happy to be judged on actions and let others fill in the words.”
3. Surround yourself with excellent people. “I couldn’t be more pleased and proud of the team I get to lead and get to be part of. It’s people that will ultimately drive this forward.”
Redman says that when things become challenging, he often reflects on the pioneering builders of the current generation fleet of energy, including Sir William Hudson, the commissioner and chief engineer who build the Snowy Hydro Scheme. “What was it like to stand in front of a bunch of mountains and rivers and say ‘we’re going to turn this into one of the biggest hydro schemes in the world’, and in doing so create so much prosperity for Australia?”
“I wonder if I’m in the middle of a similar transition,” he adds. “The great energy revolution of the 2010s and 2020s.”
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