Former AGL Energy managing director and CEO, Andy Vesey, has returned to the global energy stage, to take up the role of president and chief executive officer of California’s biggest utility, Pacific Gas & Electric.
The new role at PG&E – which has around 5.4 million electric customers – comes almost exactly one year after Vesey’s unceremonious departure from AGL, where he served a nearly four-year stint attempting to lead the utility into a coal power-free, distributed renewable future.
As we reported at the time, Vesey’s sudden departure was never properly explained, but coincided with last year’s federal leadership spill, when then Prime Minister Malcolm Turnbull was ousted over deep divisions in the Coalition over energy policy.
At the heart of that debate had been – and continues to be – the future of AGL’s ageing New South Wales Liddell coal power plant, which Vesey had insisted would close on its 2022 use-by date, and be replaced with solar, storage and some gas.
Given that two weeks before he left AGL, at the company’s full-year results presentation, Vesey had said he had “no current plans to retire,” it looked a lot like Australia’s Conservative political forces had won the day, and claimed the scalp of the renewables forward CEO.
Indeed, just two weeks ago, AGL’s capitulation appeared to come full circle, when it announced it would delay the closure of Liddell by one year, to April 2023.
None of this is Vesey’s concern now, of course, as he moves in to the lead role at the biggest utility in the world’s fifth-largest economy, and in a state with a 100 per cent renewable energy target.
It’s no small undertaking, after the company filed for bankruptcy in January in the face of billions of dollars in liability claims from two years of deadly wildfires, some of which have been linked back to PG&E’s power lines and other equipment.
As Bloomberg News put it in January, however true those charges are, “the California fires — and the utility’s response — have turned PG&E into a poster child for climate-change dangers.”
“A bankruptcy would make it the largest company to seek protection while blaming the effects of a warming planet for the situation,” Bloomberg said.
Vesey himself has no trouble accepting the science on global warming – all the better for the Conservative forces in the federal Coalition to build a case against him.
In his tenure at AGL, he frequently talked about climate change, and the importance of businesses and governments acting in line with the global targets established in the Paris climate treaty.
“If we are serious about 2°C, or even 1.5°C, we have to ask ourselves how to get there,” he said in mid-2017. “Some serious thought has to be given to the long term (such as carbon budgets).”
He had also argued that the Finkel Review blueprint – and precursor to the Coalition’s troubled National Energy Guarantee – should be adopted in its entirety, as opposed to just 49 out of the 50 recommendations, with the Clean Energy Target left out.
“You set the rules, I will find a way to (get returns for customers), he said. “It is not a menu. We are ready, let’s get it done. It’s time to get this done.”
Two years later, few rules have been set, not much of anything is getting done by way of federally driven climate action, and Vesey has left the building.
One major consolation for the new PG&E boss will be that that company, at least, has no old coal assets to worry about.
The utility currently uses a mix of natural gas – it has three natural gas power plants – and renewable energy sources including wind, solar and geothermal energy.
According to this 2018 report, nearly 70 per cent of PG&E’s electricity comes from sources that are greenhouse-gas free.
This will be a relief to Vesey, who used to joke that when he was interviewed for the job at AGL thought the company was the biggest investor in renewable energy in Australia, but by the time he got here it was the biggest operator of coal-fired generation.
