Sociologist, local councillor, activist from Malta

Wednesday, February 04, 2015

Energy stability in the dark

The Times, Monday, February 2, 2015
http://www.timesofmalta.com/articles/view/20150202/opinion/Energy-stability-in-the-dark.554385



Let us assume that the Labour government has an energy road map destined to succeed. Does this entitle the government to lack transparency in its decisions and deals? I certainly do not think so.

Instead of having clear information on energy policy, Maltese society is being provided selective information by the government. Indeed, a number of documents have been tabled and press conferences have been organised. But concrete information is lacking on various fronts.

In the meantime, Enemalta is part-privatised through minority Chinese State shareholding. We are being promised various developments in addition to lower utility bills.

For example, the government is stating that the already delayed Electrogas plant will be ready by June 2016 and that it will provide 50 per cent of Malta’s energy, through a fixed price for five years.

The so-called BWSC plant, benefitting from a cash injection of €320 million, will provide 30 per cent of energy and the interconnector from Europe will provide 20 per cent of energy. Malta can also export energy to the latter. We are also being told that a Chinese-Maltese company will construct renewable energy equipment which can be exported.

Finally, a national technical committee will assess and tweak the purchase of Malta’s energy. The positives here include Malta’s newly-required freedom from oil dependency, the closing of Marsa’s power station and the injection of funds to Enemalta, which was in a precarious financial situation.

On the other hand, there are various unknowns, which, to date, remain unanswered by the government. The lack of publication of all contracts and agreements that Malta has signed surely does not help things.

For example, is the injection of Chinese State funds unconditional or does it come at a cost? Will it result in a new dependency, thus compromising Malta’s strategic choices? It is true that other European countries, such as Italy and Denmark, are also conducting deals with China but the geo-political aspects of Malta’s deal is unclear.

What happens once the five-year guarantee of a fixed gas rate from Electrogas expires? What if the price of its gas shoots up?

And, in the meantime, do we risk paying an inflated price for energy, as is the case with petrol and diesel?

With regard to talk of Malta as an energy hub and an exporter of renewable energy equipment, can we have more concrete details? Is the latter related to Malta’s requirements to increase renewable energy internally? Is it or is it not in the interest of Malta’s gas providers to have increased renewable energy in Malta? Will Malta have excess energy capacity and is this related to the ‘hub’ discourse?

Given that there is no such thing as an energy plan free from risks, can the government explain why comprehensive impact assessments are at best shrouded in mystery and at worst inexistent?

As regards the lowering of utility bills, can consumers be provided with clear costings showing how this is being financed? Or are short-term electoral concerns more important than sustainability?

What is the situation of Enemalta workers? I ask the General Workers’ Union, which has regularly been vigilant to protect the rights of workers it represents, whether it can make a public statement in this regard.

In sum, if Malta is truly going to diversify its energy mix, then this is most welcome. At best, this would mean that Malta would be able to provide and purchase energy from the best available sources while having cleaner energy.

In this case, perhaps such liberty may be accompanied by the possibility to export excess energy through the interconnector. But what if it transpires that such energy produced in Malta is costly? Who will buy it?

Once again, despite the government’s promises for a more robust Enemalta, energy security and lower utility bills, the lack of transparency in all areas raises concern on the long-term ramifications of the energy plan.

The conspicuous silence of the energy regulator, the Malta Resources Authority, is worrying. The regulator should ensure that prices and competition are fair, that the consumer is not short-changed and that price decisions are transparent. Here, the inevitable question is: how independent is the regulator from the government?

One only hopes that Malta’s energy plans are not the result of a mish-mash of obligations that may reap short-term electoral results but which render Malta as a dependent colony of energy oligarchs.

It would be more productive for Labour to provide concrete information on the myriad of questions that are being asked by opposition parties, by civil society and the press rather than justifying its policies by comparing itself with the previous administration.

If, according to Labour, its Nationalist predecessors were characterised by a non-transparent governance, then the same Labour is even more obliged to ensure transparency.

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