The energy crisis

Malta's total dependence on imported hydrocarbons as its source of energy has made all of our economy more vulnerable. The rising price of oil will further erode our economy's competitiveness and damage the welfare of our citizens. Yet, it is wrong to assume that this predicament is unavoidable and beyond our control, as has been repeatedly stated by the Prime Minister.

The negative effects of an increase in the price of oil and the burden of higher electricity rates on the consumer could have been alleviated. This could have been achieved if the government had pursued the right initiatives in alternative energy sources, engaged in better energy management (also at household level) and implemented a forward-looking energy strategy plan that could have lessened our dependence on oil imports.

The Maltese consumer will now have to pay the full price for the government's shortcomings, which have been aggravated by a series of misguided decisions, the latest of which was announced in Parliament by Ninu Zammit. The minister told deputies he is still waiting for a breakthrough in renewable energy sources technology before considering such alternatives! It seems Mr Zammit remains trapped in a world of his own while the EU is pushing forward its ambitious renewable energy sources (RES) agenda.

Sicily already has power plants based on solar energy. France uses tidal energy while Austria and Denmark are using the wind for power generation. The UK is exploiting wave energy to supply an area with a population equivalent to that of ours!

Malta seems to be the only ill-fated EU country to have a minister who can afford the luxury to simply ponder on such developments and do nothing in the meantime. Indeed, Mr Zammit also confirmed that Malta does not have a strategy plan for the energy sector, albeit he assures us that the Malta Resources Authority (MRA) is now planning to tackle the problem.

The MRA was specifically set up more than three years ago to draw up an energy strategy plan (which still does not exist) that would form the basis of its regulatory function. It seems that the MRA has wasted those three years even if taxpayers forked out Lm40,000 annually for the authority just to rent its offices in Marsa.

Despite the urgent need of a coherent energy policy, the MRA's chief executive officer, Antoine Riolo has recently stated that we have to wait for another nine months before the MRA finally draws up its energy plan. He also insists that, meanwhile, the MRA will not approve any projects based on renewable energy sources before this plan is issued! Such statements prove that regulatory authorities in Malta are not only becoming a burden on the taxpayer but also hinder much-needed progress.

Labour believes that energy production in Malta needs to move from a state of self-induced paralysis dependent on hydrocarbon imports to a state closer to self-sufficiency and energy efficiency. The local availability of renewable energy sources, namely solar energy, wind and wave energy, should be exploited for economic and environmental reasons. Indeed, the link between the increasing use of hydrocarbons and global warming is generally established.

EU policy is quite clear about renewable energy sources and has set a target for the next few years ensuring that a portion of electrical production in member states has to come from RES available within their own territory. Some EU member states have reached admirable levels of electrical production based on RES. Austria already gets over 20 per cent of its electrical energy from these alternative sources.

Successive Labour administrations have been proactive in the energy sector and worked on a three-pronged strategy that worked very well and to the benefit of the citizen, until the Nationalist government decided to bungle all three approaches.

Firstly, the Labour government sought to protect the consumer (and the economy) from large variations in the cost of fuel by introducing a hedging agreement with oil exporters. The PN government decided to scrap this agreement. As a result, taxpayers will have to pay for the expected increase in electricity rates. Secondly, we pursued more energy efficient electrical production by introducing the energy efficient combined cycle power plants at Delimara power station in 1998. This decision was a quantum leap in efficient energy production compared to the low-efficiency and environmentally damaging turbines installed by the PN government.

Thirdly, when Labour took office in 1996, it immediately started an oil exploration programme that resulted in the drilling of an oil well in Gozo. Despite the good prospects, our adversaries in key administrative positions increased the odds by purposely procrastinating the drilling process in order to increase costs for the Labour government. Following the change in government, the entire operation was sabotaged when the ill-advised PN government decided to use unsuitable enhanced oil recovery techniques that ruined the prospects for an oil strike in Gozo.

Now, citizens of this country are being asked to pay more for the spiralling price of imported oil.

Mr Mizzi is the Labour Party's main spokesman for infrastructural services.