Robert Abela has shot down a proposal to strip Enemalta of its monopoly in energy distribution and open the market up to private competition.

Speaking on Saturday, Abela argued that liberalising energy distribution market would lead to higher costs for consumers and lower wages for Enemalta workers.

“If you allow the market to lead in the energy sector, prices will shoot up,” he said. “And we all know what competition means for workers,” he went on to say, without elaborating.

The proposal to liberalise energy distribution was presented on Friday by the Nationalist Party, as part of a multi-point plan to fix ongoing energy issues.

Enemalta currently enjoys a monopoly on energy distribution, thanks to derogations from the EU’s Electricity Market Directive negotiated in 2008 under a PN administration. Those derogations are set to expire in 2027. 

The EU encourages open energy markets, arguing this increases service levels and leads to more competitive pricing. It allows member states significant leeway in setting public service obligations to protect ensure price stability and transparency for consumers.

The PN is not the first local player to propose opening up energy distribution markets to private investment: the Malta Chamber had also made a similar proposal in its pre-2023 budget document.

“The energy market distribution must be liberalised to allow competitive market forces to bring down prices and increase efficiency,” the lobby group had argued in that document.

Abela said the PN proposal had “startled him”.

“I know the catastrophic impacts [liberalisation] would have,”  the prime minister said.

He argued that the PN’s mantra was to “let the market lead” and noted that it had also spoken critically of the government’s decision to subsidise energy prices.

He also accused the PN of being inconsistent.

“A few months ago, they told us in writing that they would not privatise energy distribution. Yesterday, they said they want to do so. They don’t even know what they believe in,” he said.

Power cuts came as Malta suffered through a 10-day-long heatwave, and Enemalta engineers have blamed the prolonged high temperatures for having damaged underground cables.

Abela has argued that rising temperatures mean the country must be equipped to deal with similar heatwaves in the years to come. He used took a dig at PN leader Bernard Grech, saying his statements verged on climate change denial.

“When he speaks, it’s as though he almost doesn’t believe in climate change,” Abela said. “He seems to be the only person on the planet to not acknowledge its impacts.”

In a 40-minute radio interview on ONE, Abela touched on several topical issues, ranging from Friday’s MCESD meeting to discuss power cuts to controversy surrounding the death of Jean Paul Sofia.

Among other things, Abela said:

• Increased investment in electricity distribution will focus on adding distribution centres, substations and “tens of kilometres” of new cables to the national grid
• Other countries have similar challenges related to electricity distribution
• Preparations to set up a climate change authority have been going on for “months”
• The construction sector needs to raise its standards, and a new licencing law for contractors will help achieve that
• He “could have been more sensitive” in the way in which he handed the Jean Paul Sofia issue