APA Group CEO Adam Watson: Focus on keeping energy costs low

Adam Watson is focused on doing everything he can to keep energy costs low, amid an uncertain environment.

APA Group CEO Adam Watson.

CEO SURVEY: FULL COVERAGE

Economy

How would you rate the momentum of the Australian economy as we head into 2025? Official forecasts have Australia trimming interest rates from the first half of calendar 2025, is that consistent with your view? What are you seeing around inflation in your own business?

The environment is uncertain right now. While there are signs of resilience, global challenges and domestic factors such as rising energy costs and inflation continue to pressure businesses and households.

We are focused on cost discipline and doing everything we can to ensure our part of the energy supply chain remains affordable and cost competitive. Market factors like reduced pressure in supply chains and an easing of inflation would have a big impact, but we also need to be disciplined in our own business.

Outlook

What excites you heading into 2025? Are you likely to increase, hold steady, or trim your investment spend?

Energy remains key to our future and decarbonisation across the economy continues to evolve.

I’m excited that natural gas has finally been acknowledged as a central component in ensuring energy security, supporting the accelerated development of renewables and powering essential Australian industries affordably and sustainably.

I’m also encouraged by the strong momentum in the delivery of our growth strategy. We continue to work with customers on new projects and have several organic growth projects to progress in 2025. This includes progressing opportunities in the Pilbara and emerging projects in the Beetaloo.

Reform

As we move into an election year, in your mind, what’s the single biggest lever that can/should be used to lift Australia’s competitiveness or productivity? This could be across any area from labour market, tax reform, training or other areas to encourage investment.

Regulatory and policy certainty, particularly in the energy sector, is key. Investors have been telling me directly that they are pulling investment from Australia and instead choosing to invest their capital elsewhere – in places that have a more stable and supportive policy environment.

The second opportunity is to focus on removing the barriers to project delivery to allow the private sector to get on with delivering projects that can create jobs and drive economic growth. An example is unlocking new domestic gas in the Beetaloo. We know this is a critical nation building project that can provide the gas consumers and business need. Local, state and federal governments need to work together to streamline approval processes to get this project to market.

Geopolitics

Will a Donald Trump presidency have a potential impact on your business or sector (tariffs or streamlined regulation)? Does geopolitics drive a bigger part of your decision-making?

The obvious risks include trade tensions, which could affect global markets and supply chains. However, reassuringly, Australia has historically been resilient in navigating these types of challenges.

People

Has your organisation’s approach to flexible working – including working from home – evolved during the year. Is this likely to change further into 2025?

We recognise the importance of empowering our team to design their own week, combining days in the office and working from home.

While we continue to support hybrid working arrangements, we’ve found there are days when our office is bustling and it’s hard to find a seat. This suggests we are striking a balance that works – our team appreciates the flexibility, but in-person collaboration is still essential.

And let’s not forget that we have thousands of people who operate our assets on site, who don’t have the option to work from home, for the benefit of our customers and communities who depend on the reliability of our infrastructure 24/7.

Technology

Where is your organisation along the AI journey – is it in the developmental stage, or are you now using the technology at scale across your business? If so, are benefits matching the promise?

We are trialling the use of AI across our energy assets, including gas pipelines, gas compressors, and solar farms, to enhance monitoring, tracking, and optimisation of performance. For example, in solar farms, AI can identify variations in output against asset capacity and historical performance trends. For gas pipelines and compressors, AI has the potential to further optimise gas flow.