A projected increase in the capacity of an offshore wind farm at Is-Sikka l-Bajda is why the estimated investment has shot up by more than €150 million.
The wind farm could have as much as double the capacity originally planned due to an expansion of the grid through the connection with Sicily, the Resources Ministry said.
In the last budget, the private sector investment for an offshore wind farm at Is-Sikka l-Bajda was estimated at €130 million.
Announcing the government's plans last Tuesday, Prime Minister Lawrence Gonzi said the estimate has risen to anything between €280 million to €335 million. It was estimated the wind farm would feed electricity to around 40,000 households although studies have yet to be conducted.
Wind Energy Committee secretary Tonio Sant said: "The grid we have now is small and isolated, which presents difficulties because wind fluctuates. By connecting the grid to Sicily, we can transfer any surplus energy to Sicily and take it back when required."
He explained that with the present grid, Enemalta would continuously need to regulate the output from power stations to maintain stability in electricity voltage. And there were technical limitations in power stations to provide this stabilisation.
"By connecting to the Sicily grid, we will be part of a larger network that can enable us to sustain a larger wind farm capacity, which also allows us to benefit from economies of scale," Dr Sant added.
The offshore wind farm could provide four per cent of energy requirements. It was the largest of three sites proposed by the Prime Minister.
The other two sites, Wied Rini in the limits of Baħrija, and the Ħal Far Industrial Estate, could cater for another 7,900 households through land-based wind turbines. Together with the one at Is-Sikka l-Bajda, the three wind farms could generate up to 4.8 per cent of energy consumption.
Malta has to meet an EU target of 10 per cent of energy requirements from renewable sources by 2020.
But doubts are being voiced as to whether delayed action to meet renewable energy targets would now compromise sound judgement. Labour environment spokesman Leo Brincat said his party was supportive of wind farms but questioned the process.
"Government seems to have been caught in a catch-22 situation - between years of inaction as a result of which so far none of our energy needs comes from renewable sources, and the urgency to come up with visible deliverables in the run up to the MEP elections just five weeks away."
Political considerations seem to have prevailed, Mr Brincat said, referring to the contradictory conclusions over Is-Sikka l-Bajda made by the same consultants.
"Reading through the Mott MacDonald report of last January, it is evident they have rescued Is-Sikka l-Bajda from oblivion after they previously dismissed it in their 2005 report," he said.
The ministry has already submitted a planning application for the erection of a temporary wind mast at L-Aħrax tal-Mellieħa for a period of two years to measure wind capacity at Is-Sikka l-Bajda.
A pending issue with the location of the offshore wind farm is that the area hosts the largest conservation project on the islands dedicated to studying and protecting a nocturnal seabird - the Yelkouan Shearwater.
The project, worth almost €1 million, is co-ordinated by Birdlife Malta. It is partly funded by the EU and includes four governmental bodies.
The environmental organisation welcomed the investment in wind energy but said any significant damage on biodiversity had to be avoided. It pointed out that according to EU law an Environment Impact Assessment was not enough.
Birdlife, Nature Trust and Friends of the Earth said a more diversified renewable energy mix could eliminate the need to build a waste-to-energy incinerator proposed for Delimara, and save on the high financial and environmental cost.