On the eve of the general election, the MLP’s promise to cut the surcharge has made energy a disputed battleground. Should it be?
Let me start by stating a fact that is often overlooked and which the reader has to keep in front of him throughout. It goes like this.
The higher the price of a commodity, the greater is the VAT income for the government.
In 2001, diesel cost around e0.40, and when it started climbing it was solely due to the taxes introduced locally. The price for diesel from overseas suppliers has increased by only e0.10 since 2001.
The current price of diesel in Malta now stands at e1.01 and we shall definitely see another increase after the general election (due to euro FAIR pricing). Malta imported 102,379.206 tons of diesel (EN590) in 2006 and the trend shows an upward increase of 10 - 17 per cent in imports per annum. If this continues with the same rhythm, the annual revenue for the government in terms of tax will be that of e61 million in 2007. There is an additional yield of e30 million in taxes on the importation of petrol.
The question is where are all these millions going? Back to the EU in taxes which consume 75 per cent of that sum? The question is more valid when one takes into account the increase in the cost of public transport, construction, baking products and services for all this has generated a higher yield to the government in terms of VAT.
Since 2004, the cost of electricity has increased by 66 per cent, and the reason given by the government has been the increase in the price of oil. However, while the increase was the same for all countries, other EU member states have seen a price increase of not more than 10 per cent. In Malta the increase was of 66 per cent and this at a time when the dollar declining by 28 per cent. In spite of this, the rise in electricity charges is blamed solely on the rise in the price of oil.
Was it Joseph Goebbels who said that if you repeat something often enough from a position of power, it becomes the accepted truth?
The roots of the problem go back to 1989, when a new power station was built in Delimara which was intended to replace the old Marsa station by 1997. The Delimara station never worked to full capacity and the Marsa one therefore had to be kept going. The problem was a complete miscalculation of what the country’s energy supplies were to be in the future. And to this date, nobody has owned up to this blatant error that has cost us all so much.
The Marsa power station is a serious health hazard. While a normal station produces around 0.43 tons of C02 emissions, per one Mw, the Marsa power station produces around 0.89 tons per one Mw. Moreover, because it is not efficient, it requires double the amount of fuel to operate (compared to part of Delimara Power Station and similar plants in Europe).
On the eve of Malta’s general election, the PN is telling us that it will install wind turbines in the deep seas around us. What it is not telling us is how long the payback will take and who will pay for it, whether our taxes or some foreign company. It is important to know this because it is another illusionary promise that sounds good but means nothing.
If one looks at the NSO’s statistics and checks the data regarding Malta’s wind type and force, he will see that wind speed is not more than 5m/s-10Knots mean. This will limit the efficiency of a wind turbine to no more than 50 per cent. Therefore, if we were to install around 12 turbines of 4Mw each, despite the fact that their normal capacity should be of 48Mw, they will generate no more than 26Mw. Hence the payback will be much longer and this is not taking into consideration the costs and maintenance related to deep-sea installations. We shall need to wait for around 20 more years before emerging technology will enable Malta to use wind-turbines efficiently.
Research in Malta is sadly lacking. We enjoy sunshine most days of the year but we are 30 years behind the leading countries when it comes to renewable energy from the sun. In the 1980s, the then Labour administration initiated research into Cooling by Solar, but for some reason this was discontinued. This was a great pity because it is a system that is sorely needed. I am informed that a private company is currently setting up two systems using cooling by solar, but this company is not attracting much support it seems.
It really is a pity to think that, aeons ago, the people of these islands built temples like Mnajdra as a calendar-offering to the Sun God. Today we trample on His resources and throw His gifts back into his face.
Josie Muscat is leader of Azzjoni Nazzjonali