AGL Energy is poised to transform its consumer business operations by acquiring a 20 percent stake in the electricity supply and billing platform Kaluza.
AGL CEO Damien Nicks
The $150 million transaction will result in 4 million of AGL’s consumer electricity and gas subscribers being transferred to Kaluza’s platform within the next three years.
Declaring in an ASX filing, AGL CEO Damien Nicks stated, “With the evolving technology landscape in the utility sector, characterized by the rise of new fundamental utility platforms providing enhanced adaptability and efficiency, it is crucial to form partnerships with industry vanguards, hence our selection of Kaluza.”
He further added, “Utilizing the Kaluza platform will facilitate swift product innovation, all the while substantially reducing AGL’s customer service operational expenses in the future.”
The investment will take the form of preferred stocks, granting AGL a direct 20 percent stake in Kaluza, as per information disclosed to the ASX [pdf].
Kaluza is also responsible for managing more than 80,000 client services for OVO Energy Australia’s consumer base post a migration conducted last year.
This shift is part of AGL’s ongoing retail metamorphosis initiative, with projected expenses of $300 million over four fiscal years starting from July 1, 2024.
AGL has indicated that these expenses encompass program and change administration, customer transfer, system amalgamation, and modifications in ancillary platforms.
The purpose of the program is to achieve a decrease in operational costs and capital spending, with estimated annual pre-tax cash savings of around $70 million to $90 million beginning in FY29.
Large corporate clients of AGL will not be affected by the Kaluza migration, with the energy provider asserting its commitment to “exploring transformation possibilities for these clients”.
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