AGL's Bayswater power station could close as early as 2030 due to unrelenting pressure to reduce emissions combined with the rise of renewables in the energy grid.
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The company, which has just completed a $152 million upgrade of the plant, had previously said it would close the plant in 2035.
It has now created a three year closure window between 2030 and 2033.
AGL also announced Victoria's coal-fired Loy Yang power station will also close three years earlier than expected as part of an update on the company's demerger plan on Thursday.
The company plans to split into two listed entities - energy retailer AGL Australia and electricity generator Accel Energy - by June 30.
The two entities have now been assigned emissions reductions targets, putting them on course to reach net zero in coming decades.
Under the climate goals, Accel Energy will bring forward its coal closure date for Loy Yang A and Bayswater.
"As a result, emissions from Accel Energy's electricity generation assets will be reduced by a further 90 million tonnes over the period financial year 2023 to financial year 2050 compared to modelled outcomes of our previous commitments," AGL said.
The update was announced in AGL's first half results release issued on Thursday.
AGL's bottom line first-half net profit is back in the black at $555 million, after last year's result was hit by significant and one-off items resulting in a more than $2 billion loss.
The net underlying result was down 40.9 per cent to $194 million, excluding the impact of hedging and other items.
AGL also on Thursday narrowed its earnings guidance for the 2021/22 year.
It now expects pre-tax underlying earnings of between $1.28 billion and $1.4 billion and a net profit between $260 million and $340 million.
"Despite the strong first half performance, earnings are expected to be lower in the second half due to increased costs of capacity to cover periods of peak electricity demand, which are higher in the summer months," AGL said.
Meanwhile, AGL says a rise in global energy demand will boost future earnings.
"With the rise in energy and commodity prices across the globe, AGL Energy is well positioned to benefit from improving wholesale electricity prices seen over the past six months," CEO Graeme Hunt said on Thursday.
"We expected to see this reflected in future earnings beyond financial year 2022."
AGL will pay an interim dividend of 16 cents, down from 41 cents last year.
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Matthew Kelly
Matthew Kelly has worked as a journalist for more than 25 years. He has been working as a general reporter at the Newcastle Herald since 2018. In recent years he has reported on subjects including environment, energy, water security, manufacturing and higher education. He has previously covered issues including the health and environmental impacts of uncovered coal wagons in the Hunter Valley, the pollution of legacy of former industrial sites and freedom of information issues.
Matthew Kelly has worked as a journalist for more than 25 years. He has been working as a general reporter at the Newcastle Herald since 2018. In recent years he has reported on subjects including environment, energy, water security, manufacturing and higher education. He has previously covered issues including the health and environmental impacts of uncovered coal wagons in the Hunter Valley, the pollution of legacy of former industrial sites and freedom of information issues.
