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## Review of Operations 

## Delivering gas and electricity to wholesale and retail markets 

Merchant Energy manages the risks of procuring and delivering gas and electricity for AGL’s wholesale and retail portfolios. It also manages AGL’s compliance with mandatory renewable energy targets. 

Merchant Energy’s business groups are: 

> Energy Portfolio Management – which manages procurement of AGL’s wholesale electricity and gas requirements, including management of the commercial aspects of operating AGL’s own electricity generation assets and management of AGL’s green product obligations. 

> Power Development – which develops all AGL’s electricity generation projects. 

> Merchant Operations – which operates and maintains AGL’s portfolio of electricity generation assets including wind farms, hydro assets and gas-fired generation plants. 

> Business Customers – which sells electricity, gas and other energy services to AGL’s large commercial and industrial customers. 

## Helping an Australian icon achieve success and sustainability. 

AGL’s 175 year history is rich with events that have helped shape Australian industry. Today, AGL provides a range of energy-related services to more than 300,000 large business customers. 

2012 is a significant year for both AGL and our valued customer Coopers Brewery as it celebrates 150 years of operation. AGL’s relationship with Coopers Brewery began in 2002 with the construction of a custom-built co-generation power plant within its Adelaide premises. The plant generates 4.4 MW of power which meets most of Coopers’ electricity needs. This enables the production of more than 30,000 cartons of beer each day in an environmentally sustainable way. 

## Merchant Energy 

> Energy Services – which provides customers with expert advice on a range of energy related matters, including energy efficiency, and project development and management. 

## Energy Portfolio Management 

Energy Portfolio Management manages the price risk associated with procuring electricity and gas. It also manages AGL’s green product obligations such as those relating to the mandatory renewable energy target, and controls the dispatch of owned and contracted electricity generation. Energy Portfolio Management’s operating EBIT increased by 26.1% to $540.4 million. 

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## Yesterday, today, tomorrow... 

From the old days of coking coal to produce town gas, AGL has always managed the risks of procuring and delivering supply the changing needs of its industrial and commercial customers. Today the fuel sources are different as we grow our renewable energy assets, but the need to manage risk and change with our customers remains. 

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