Ampol has decided to withdraw from the residential electricity retail market, ending a three-year effort to sell power to homes, particularly for electric vehicle (EV) users. The company will now concentrate on developing its EV charging infrastructure across its national network of fuel stations, which it views as a better use of capital and resources.
The move marks the sale of Ampol’s energy retail operations in Australia and New Zealand, with around 70,000 customers set to be transferred. AGL Energy will take over Australian accounts, while Meridian Energy will assume control in New Zealand. Ampol will receive NZ$70 million (about A$64.4 million) from Meridian, while the deal with AGL involves only a nominal payment. The company expects the exit to result in annual savings of approximately $30 million.
Chief Executive Matt Halliday explained that Ampol lacked the scale to compete effectively with integrated energy companies like Origin and EnergyAustralia, which generate their own power. He acknowledged the value in offering bundled services for customers but said the company’s efforts would be better focused on roadside charging solutions, where it already has a presence.
Though Ampol remains committed to EV infrastructure, its rollout of roadside chargers has faced delays due to challenges in securing grid connections, despite the federal government’s policy support for electrification. Last year, the company reduced its charging station rollout targets, though it has not shifted its long-term ambitions.
Initially, the home electricity business was seen as a strategic move to appeal to EV drivers through bundled energy plans and on-road charging discounts. However, without a large enough customer base or control over energy generation, the model proved financially unviable.
Halliday noted that Ampol still believes in the potential of integrated services but plans to explore this through partnerships rather than owning the entire value chain. As part of the exit agreement, Ampol will work with AGL and Meridian to offer charging discounts to their customers at Ampol EV sites.
The market responded positively, with Ampol shares rising 2.2% following the announcement, beating the broader market’s 0.4% gain. One shareholder, who asked not to be named, said the company was right to abandon the strategy once it became clear it wasn’t sustainable.
Ampol’s retail energy business faced significant structural disadvantages. Unlike larger energy companies with power generation assets, Ampol had to buy electricity on the wholesale market, often at high cost, while competing for a relatively small number of customers. This model became even less viable as wholesale prices rose and customer growth remained limited.
Australia’s EV adoption has also progressed more slowly than expected, falling behind regions like Europe. Despite generous tax incentives from the federal Labor government, demand has remained modest. However, usage of the tax breaks has exceeded initial estimates, indicating potential for future growth.
Accelerating the transition to EVs is central to Labor’s climate goals, which include reducing emissions by 43% by 2030 and achieving net zero by 2050. This shift is also vital for Ampol’s future, as its traditional fuel business faces long-term decline.
Ampol is continuing to expand its EV charging network but is being cautious not to get too far ahead of demand. Halliday predicted a gradual increase in EV adoption, shaped by economic conditions, advancing technology, and evolving policy. He described the path forward as “bumpy” but ultimately necessary.
There’s some debate about how much commercial providers like Ampol will contribute to the future charging landscape. With Australia having the world’s highest uptake of rooftop solar, many EV owners are expected to prioritise home charging. Still, on-road charging will be essential, particularly for long-distance travel and urban dwellers without home infrastructure.
Ampol and competitor Viva Energy are positioning their service station networks as convenient locations for fast charging. Both companies are also strengthening their broader retail offerings to remain competitive against supermarkets and other public charging providers.
While Ampol is stepping away from residential electricity retail, the company remains focused on staying relevant in a low-emissions future, using its established retail footprint to support the EV transition through partnerships and targeted infrastructure investment.
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