ENERGY provider AGL has agreed to pay a $6 million fine for failing to deliver stand-by power when it was paid to do so.
The company admitted the breaches occurred at its Bayswater power station in NSW between September 2018 and August 2020, and at its Victorian Loy Yang A station between December 2019 and May 2020.
The company and the Australian Energy Regulator made joint submissions to the Federal Court on Thursday, October 26 over the contraventions.
The court was told important frequency switches were turned off at the power stations during times when AGL said they could provide contingency power.
No losses or damages arose from the contraventions but it could have risked the security of the power grid, the regulator's barrister James Arnott SC said.
The regulator accepted AGL did not deliberately commit the breaches, rather it was "careless but inadvertent," he said.
There was a breakdown in communication between the power stations and the trading team but AGL had since developed and introduced better systems, the barrister said.
"The regulator is now satisfied with the improvements made by AGL to its processes," Mr Arnott told the court.
AGL's barrister Ruth Higgins SC said the company was regretful over the contraventions.
It had not profited from its mistakes, instead paying back the money it received for being on stand-by, she said.
She said the energy provider also complied fully with the regulator's investigation and self-reported some of the compliance breaches.
"As soon as they became aware of the failures, they tried to rectify them," Dr Higgins said.
AGL and the regulator agreed on penalties of a $2.8 million fine for the Loy Yang A breaches and a $3.2 million fine for Bayswater.
Justice Catherine Button was satisfied the proposed penalties were appropriate and adequate.
She will hand down her full orders and reasons at a later date.
