Suite Talk: AGL’s Damien Nicks on strategy, leadership and the future of energy

Can you describe the scale of the energy transition challenge and how AGL fits in?

At AGL, we believe that this is the largest transformation of Australia’s energy markets ever, requiring hundreds of billions of dollars and AGL will play a major role, investing billions as part of this transition.

The market has long relied on coal, but those plants are reaching the end of their life. Most are already 40 years old, and in another decade, they will be 50, nearing the end of their design life. The reality is that we need to rebuild the system.

AGL has a clear strategy focused on transitioning our generation portfolio by investing in renewables, such as wind and solar, along with gas peakers and pumped hydro. The focus is on replacing legacy energy sources with assets that meet our customer demand. This requires a diverse mix of renewables, firming assets, batteries, pumped hydro, and other technologies. Many overlook the importance of maintaining this balance, but it is essential for reliability, just as it has been in the past.

AGL is committing nearly $10 billion over the next decade, which is a significant investment for a company with a market cap of $7 to 8 billion. This is not a short-term shift, but a long-term strategy that reflects the fundamental changes re-shaping AGL, its customers, and the broader electricity market.

As an energy provider, our core role is managing risk for customers and shareholders. For customers, this means ensuring reliability and price stability while we handle fluctuations in market price and volume. To do this effectively, we need a diverse portfolio of assets that can absorb and mitigate those risks over time.

"As an energy provider, our core role is managing risk for customers and shareholders. For customers, this means ensuring reliability and price stability while we handle fluctuations in market price and volume.”
– Damien Nicks, CEO and Managing Director, AGL

How important is the customer relationship to your future strategy?

The customer is one of the most exciting aspects of this transition. While large-scale assets are important, customers play a huge role as they electrify, which we refer to as consumer energy resources (CER). This includes solar, batteries, EVs, and hot-water pumps. The key is orchestrating these assets, connecting them efficiently, and sharing value with customers. If we optimise their use across the market, we reduce the need for large-scale infrastructure.

Customers have embraced solar because it lowers their bills, and EV adoption is gaining momentum as battery technology improves. Beyond supporting electrification, the challenge is shifting how people think about energy and ensuring they have simple, user-friendly products and services. The only way to achieve that is through technology.

“Beyond supporting electrification, the challenge is shifting how people think about energy and ensuring they have simple, user-friendly products and services. The only way to achieve that is through technology.”
- Damien Nicks, CEO and Managing Director, AGL

Tell us more about investing in technology capabilities.

The traditional model of a few large power stations is no longer viable. The future is in managing millions of decentralised power sources. A key part of this shift is Kaluza, a technology that connects us with customers and optimises energy use.

This three-to-four-year transformation will improve efficiency as consumer energy resources scale. While not a software developer, we invested in Kaluza after years of assessment, first in Australia and later at the head company level. It is a critical part of our strategy to modernise energy management.

How does the challenging macro-economic environment – inflation, supply chain disruptions – affect your capital investment strategy?

Access to capital has actually improved for AGL in recent years, thanks to clear plans and a strong delivery track record. However, inflation and supply chain disruptions have driven up costs, particularly for renewables, batteries, and labour.

That said, I am cautiously optimistic. Battery prices are starting to fall and while labour costs remain high, our focus is on delivering the most efficient assets possible. The more efficiently we invest, both at AGL and across the industry, the lower the costs will be for consumers. Clear and stable policy settings will be critical over the next decade.

I expect inflationary pressures to ease as strong demand for energy transition drives supply chain adjustments. Battery and lithium prices are already falling, and wind technology costs should improve over time. However, we can’t afford to wait. Over the next 10 years, we must act to rebuild the power system.

“The more efficiently we invest, both at AGL and across the industry, the lower the costs will be for consumers. Clear and stable policy settings will be critical over the next decade.”
- Damien Nicks, CEO and Managing Director, AGL

How would you describe your leadership philosophy?

My diverse background working across different sectors has given me insight into managing uncertainty and staying focused on execution. I base my leadership on four non-negotiables: difference, respect, discipline, and relationships.

Difference means building a diverse team that challenges thinking and brings fresh perspectives. Nobody has all the answers, so we need people who push us to refine our approach. Respect is fundamental; you cannot earn it without giving it. It fosters trust, which is essential for alignment and success.

Discipline is about execution. There’s always noise and distraction but staying focused on our strategy is what drives results. Finally, relationships are critical. With 4,000 employees, AGL is complex, and strong connections across the organisation are key to delivering on our goals.

“I base my leadership on four non-negotiables: difference, respect, discipline, and relationships.”
- Damien Nicks, CEO and Managing Director, AGL

Best advice received?

Early in my career, a mentor said to me, “You need to get some feathers on your wings.” At first, I saw it as praise, but later, I realised he meant I needed to expand beyond working hard, and develop broader skills and deeper leadership capabilities.

That advice has shaped my approach. Leadership is about embracing uncertainty, taking on new challenges, and surrounding yourself with the right people. Fostering diverse perspectives and continuously refining our thinking is essential.

“Leadership is about embracing uncertainty, taking on new challenges, and surrounding yourself with the right people. Fostering diverse perspectives and continuously refining our thinking is essential.”
- Damien Nicks, CEO and Managing Director, AGL

Favourite productivity hack?

For me, it’s about being really focused on what’s important each day and each week. My approach is simple: at the start of every week, I define my key priorities. Then, at the start of each day, I take the first hour for myself – whether that’s reading the news, preparing for upcoming meetings, or simply thinking through what needs to be done. I also step back at the beginning of each month to ensure I’m clear on my broader objectives.

Another important tip is knowing when to switch off. As a CEO, you don’t always get to take breaks when you want, but I’ve learned to recognise when I need to recharge. If you don’t take that time, you risk losing focus on what you’re trying to deliver.

How are you positioned for the future with the board and new chair?

AGL has undergone significant change, with seven new directors joining in the past three years. This level of turnover is rare, but it has brought valuable diversity of thought.

Coming in as CEO [in 2022] during this transition was an opportunity to align on strategy from the outset. Over six months, I worked closely with the board to refine our direction, ensuring we were fully aligned before moving into execution.

Now, as we shift from strategy to delivery, we have welcomed a new chair. This board has aligned quickly, and from the start, we recognised that while our internal operations were strong, the real challenges lay externally. Once we clarified our strategy and communicated it to the market, we secured the support needed to move forward with confidence.

What trends do you see emerging in the longer term vision for the energy markets?

The key trend is the electrification of the customer. Beyond heating, cooling, hot water, EVs, and batteries, new products will continue to emerge, and the challenge will be integrating them seamlessly. The question is how to connect these assets through technology to optimise their operation.

We already have technology that helps coordinate these systems, but adoption is still developing. As more households invest in energy assets, we’ll see significant advancements, such as vehicle-to-grid (V2G) technology, where EVs feed power back into the grid. This is a major opportunity.

Ultimately, the way consumer energy assets interact with networks and large-scale generation will define the future energy landscape. Over time, these connections will become more sophisticated, improving efficiency and resilience across the market.

“The way consumer energy assets interact with networks and large-scale generation will define the future energy landscape. Over time, these connections will become more sophisticated, improving efficiency and resilience across the market.”
- Damien Nicks, CEO and Managing Director, AGL

This interview has been edited for length and clarity.