A clean energy policy – avoiding excesses of the past..

Source: Mr George M Mangion¸ PKF Malta

As published on Media Today Wednesday 16th October 2013 


Readers may be shocked by the picture of a power station with a chimney belching dark smoke into the clear blue sky . Yes this was the situation in one of our power stations which not so long ago was burning black coal which used  to be stored at the quayside in Marsa and as can be expected in windy day fine black powder used to blanket cover the entire harbour area. When the government decided to switch using coal and start burning oil in the old power station at Marsa (targeted to be closed in 2009 but still much needed today) the villagers could rejoice and look to the future without the heavy incidence of lung cancer or to bouts of asthma.Even so changing to low sulphur oil came with a higher cost of electricity generation and this was blamed by the  government on the vagaries of international oil prices over which it had no control (except Enemalta procurement team officially aims to buy oil at the cheapest and hedge the Euro/ Dollar positions). There were many protests over the high cost of living caused by exaggerated increases in the tariffs with industrialists claiming subsidies to be able to stabilize their prices more so since such upward revisions coincided at a time when recession badly hit their export markets. There is no doubt that the inefficiencies of both the Marsa and Delimara generating plants (only  reaching 23 % and 30 % maximum efficiency ) added handsomely to the cost of operation and of course we now discover that credit rating of Enemalta was marked down due to its highly leveraged position with foreign banks .Many highly criticized the selection of building an extension using a prototype BWSE  engineering model running on heavy fuel oil .

HFO may be cheaper to buy but when adding  the cost of storage and disposal of its obnoxious waste makes it expensive fuel in the long run. One need not go into the merits of the political motive to invest in this risky equipment as this was one of the topics much discussed in the debates prior to last general election. Suffice to say that it is expensive to convert the plant to run on diesel or other fuel oil with lower CO 2 emissions yet the incumbent government has promised to switch the operation to run on gas while in the meantime continue to risk contamination in the air continue on HFO insuring no accident happens in the meantime during storage and disposal of obnoxious burnt ash. Electricity generation using a cleaner fuel was promised by the Labour government which is taking a high risk to quickly rush through a tendering process to invite international companies to install a plant running on LPG promising to reduce existing tariffs  to households by 25% across the board by March. Industry will enjoy the reduction  in 2015.

Hot on the heels of the announcement of the lucky bidder that will provide clean electricity at a fixed price in the first five years  one welcomes a consortium lead by a Maltese team of two companies ( Tumas  and Gasan ) with other international partners which is to build the new gas-fired power station . Amid much fanfare and razzmatazz the energy minister proudly announced the winning consortium as “a world class” team and their bid was able to get bank finance for the project. Much to the chagrin of the opposition party he boasted that it was his government hard work and determination that saw a first move by the private