LGI Faces Market Volatility Despite Strong FY25 Growth and Carbon Credit Advances
LGI Limited reported robust FY25 results, expanding electricity capacity by 44% and increasing EBITDA by 14%, driven by new landfill gas contracts and battery storage projects. The company is well positioned to capitalize on Australia’s renewable energy transition and evolving carbon credit market.
- 44% increase in electricity generation capacity to 21.1MW
- 14% growth in EBITDA to $17.4 million
- Six new contracts signed, including five landfill gas rights and a battery storage system
- Over 493,000 Australian Carbon Credit Units created across 17 projects
- FY26 EBITDA guidance growth of 25-30%, subject to market conditions
Strong Growth Amid Energy Transition
LGI Limited has delivered another year of solid progress in FY25, reinforcing its position as a leader in renewable energy generation from landfill gas. The company expanded its electricity capacity by 44%, finishing the year managing 21.1 megawatts, up from 14.7 megawatts the previous year. This growth was underpinned by six new contracts, including five for long-term landfill gas rights and a significant battery energy storage system (BESS) project at the Belrose landfill in Northern Sydney.
Operationally, LGI commissioned the 4MW Eastern Creek Power Station in Sydney and increased generation capacity at its Canberra power station by 50%. Both projects were delivered on time and within budget, highlighting the company’s maturing project management capabilities within a complex regulatory environment.
Carbon Credits and Market Positioning
LGI’s environmental credentials remain strong, with over 493,000 Australian Carbon Credit Units (ACCUs) generated across 17 registered carbon abatement projects, a 14% increase from FY24. The company supports the Clean Energy Regulator’s new landfill gas carbon abatement methodologies, which aim to standardize baseline calculations industry-wide, enhancing market integrity and fairness.
With Australia’s ambitious 2030 emissions reduction targets and a shift towards renewable electricity generation, LGI is strategically positioned to benefit. Its portfolio of geographically diverse, flexible, and responsive assets, combined with proprietary Dynamic Asset Control Systems (DACS), allows LGI to navigate the increasing volatility of the National Electricity Market effectively.
Financial Performance and Outlook
Financially, LGI reported a 10% increase in net revenue to $33.9 million and a 14% rise in EBITDA to $17.4 million for FY25. The company achieved a fleet availability rate of 98%, reflecting operational excellence and a strong focus on asset reliability and safety, with zero lost time injuries recorded.
Looking ahead, LGI has confirmed guidance for underlying EBITDA growth of 25% to 30% in FY26, contingent on market dynamics and timing factors beyond its control. The company’s near-term development pipeline exceeds 80MW, signaling continued expansion and opportunity.
People and Innovation Driving Success
LGI attributes much of its success to its dedicated workforce and ongoing investment in technology. The development of its Dynamic Asset Control Systems ensures the company stays ahead in managing an evolving asset fleet. The management team’s focus on safety, operational efficiency, and customer service remains a cornerstone of LGI’s strategy as it advances its mission to engineer a zero carbon, clean energy future.
Bottom Line?
LGI’s FY25 momentum sets the stage for accelerated growth, but market volatility and regulatory shifts will test its agility in FY26.
Questions in the middle?
- How will the new landfill gas carbon abatement methodologies impact LGI’s future carbon credit revenues?
- What are the risks and opportunities associated with LGI’s expanding battery energy storage projects?
- How will increasing grid volatility influence LGI’s operational strategy and financial performance?
