Last Tuesday, Enemalta Corporation announced a 10-year plan to upgrade and boost the generation of energy to be able to meet the ever-increasing demand for electricity.
The corporation will be investing Lm120 million over the next few years in a bid to improve the services it provides and at the same time make these services more environment-friendly.
Nearly half of this amount – about Lm55 million – will be spent on creating a link between Malta and Italy to connect the island with the European energy grid. This will enable the corporation to buy energy directly from any European country at competitive rates.
As Investment, Industry and IT Minister Austin Gatt explained, the corporation will be able to “pick and choose”, meaning that it can buy energy at the cheapest rate on the market at the time. This, he said, would be of benefit to the consumer.
Such a system would also act as a back-up energy provider for Malta in the event of a serious power cut due to a fault developing at the local plants.
It is planned to spend another Lm40 million on a new combined cycle plant capable of generating 100 megawatts of power. As Enemalta chairman Alex Tranter explained, combined together, the link to the European grid and the new plant will create 300mw of electricity annually and will eventually lead to the phasing out of the Marsa power station, which currently generates 267mw per annum.
This power station will be closed down by 2010 or, at the latest, in 2015, by which time it will have become obsolete after having served the nation for so many years. However, the government will have to invest some Lm5 million to change boilers 1 and 2 in order to keep it running for a few more years.
Another Lm20 million will be invested over the next few years to improve Enemalta’s energy distribution centres. This is necessary because the centres need to be upgraded, once again to meet demand.
Various options are being considered to finance such a big investment, which is certainly needed as the demand for energy increases and it is felt that unless changes are made, the corporation will not be in a position to satisfy requirements.
There is a possibility of tapping into European Union funds, as this could cover 80 per cent of the costs. If this financing is secured, it would be yet another positive side of EU membership for Malta. But the corporation is looking at other ways of sustaining its costs, particularly through loans at advantageous rates and public-private partnerships.
The government deems this investment necessary due to the fact that the current set-up will not be able to meet demand in a few years’ time. Such a move is important and necessary because otherwise, the country will find itself unable to produce enough energy at the same rate that demand for it is increasing.
Enemalta’s 10-year plan also looks at other forms of energy. In its report, the corporation mentions refuse-derived fuels (3.3 per cent of anticipated demand by 2010), wind energy (with high capital costs involved) and photo-voltaic systems (again, with initial high capital costs).
In comments made in Brussels during the EU summit last week, Prime Minister Lawrence Gonzi said that the government is closely monitoring the use in other countries of offshore wind farms with a seabed depth in excess of 50 metres. Still, it seems that this is more of a long-term project which might, in the end, not turn out to be feasible.
In the meantime, Enemalta has rightly chosen to pursue an investment in the more traditional method of generating energy which, coupled with connection with the European grid, should secure the power needed for Malta in the future.