In 2004, Morrison & Co drew on 15 years of energy operating experience, registering for a licence to establish Infratil Energy Australia on behalf of Infratil. Infratil Energy Australia comprised of two businesses, Lumo and Direct Connect.


Lumo started life as Victoria Electricity and registered its first customer in May 2004. By July 2006 Lumo serviced 100,000 customer accounts in VIC and SA and by 2015 provided energy to over 546,000 customers in VIC, SA, NSW and QLD. Lumo became the fourth largest energy retailer in the National Electricity Market (NEM) and the largest tier 2 retailer after the three incumbents. The strong and highly flexible wholesale portfolio was supplemented by 163.4 MW of diesel peaking generators and generation development site options.

Direct Connect became Australia's largest utilities connection services provider (UCSP) for the home moving market, with exclusive relationships with more than 50% of real estate offices in Australia. Nationwide real estate agents would generate customer leads which became utility and other moving services connections. 

  • Morrison & Co organically built Infratil Energy Australia in 2004 to a business that become the largest new entrant with 2014 revenues of A$719m

  • In September 2014, Infratil Energy Australia was sold for A$646m to Snowy Hydro Limited generating a 18% ungeared IRR over 10 years.


Investment rationale and strategy

Morrison & Co saw the deregulation in Victoria and the potential for the same outcome in other states as a new entrant opportunity. Sector consolidation, vertical integration and a shift to more sophisticated forms of pricing, retention and customer acquisition were also considered attractive when deciding to build Infratil Energy Australia with the economics supporting a build rather than a buy decision.

Infratil Energy Australia built a multi-channel customer strategy with a diversified and proprietary mix of Direct Connect, internal inbound sales, online, telesales and door-to-door teams to optimise target customer reach. A favourable non-vertically integrated wholesale strategy was also supported by peaking generation providing insurance against periods of low liquidity in wholesale markets.

In September 2014, Morrison & Co recognised that the market dynamic was favourable for a successful sales process to maximise the investment return for Infratil. The process was initiated in May 2014 with strong interest from local and international players and in September 2014, Infratil Energy Australia was sold for A$646m to Snowy Hydro Limited generating a 18% ungeared IRR over 10 years.

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