Enemalta is awaiting approval from the Malta Resources Authority on two schemes it is proposing, chairman Robert Ghirlando said on Friday.

Addressing a conference organised on the occasion of the corporation's 25th anniversary at the Mediterranean Conference Centre, he said that a major problem with efficient distribution was the low power factor experienced, particularly in summer.

The power supplied to a customer's site is made up of two components: the voltage and the current. The higher the voltage, the lower the current is. Certain types of load need a larger than usual amount of current.

The types of load that may cause this include air conditioning, lifts, fans or any equipment that contains an induction motor. The knock-on effect of this is that even though the customer is not using this power, the size of the local electrical distribution network needs to be larger to accommodate the higher current, and the electricity distribution company needs to spend more money on installing larger cables than would otherwise be necessary.

The power factor reflects this inefficient use of power. So far, low power factor is not reflected in consumers' bills. "We have therefore proposed a scheme whereby we would meter our bigger consumers on kVAh (kilovolt amp hours) rather than kWh (kilowatt hours) as at present, so that their bill would also take into account the power factor element.

"To make this scheme attractive we proposed a new tariff so that consumers who fall under this scheme and who have a power factor of 0.92 would pay as much as they are paying now.

"However, if their power factor is better than this, they would get a reduction in their bills and, conversely, if it is worse they would receive higher bills. There would therefore be an incentive to improve the power factor."

Professor Ghirlando said Enemalta also suggested that at first the scheme could be introduced on a voluntary basis.

"So far, we have convinced our minister, the Federation of Industry and the Malta Hotels and Restaurants Association of the validity of our proposal and are now waiting for the Malta Resources Authority to give its assent.

"I would like to take this opportunity to beg the MRA to give us their go-ahead. We have been working on this idea for a very long time and they have known about it all along, it took us ages to convince the FOI and MHRA; so please let us not dilly-dally any longer."

Professor Ghirlando said that another scheme that was currently before the MRA - and he could not understand why it had not yet been given the green light - was aimed at encouraging the introduction of solar water heaters.

"It is a small step, but it is all that Enemalta can do at the moment. Under this scheme, any applicant for a new single phase service who installs a solar water heater, at the time of installing the service would have his application fee of Lm70 refunded.

"In other words, Enemalta would be offering a sort of subsidy of Lm70 for the installation of a solar water heater with new single phase electricity services," he said.

The chairman said that Enemalta was concerned about the effect that renewable energy systems directly connected to the grid could have on the stability of the electricity system.

Although not against this kind of development, Enemalta would like to understand what the connection of such systems to the grid implied from a technical point of view.

"Everybody is aware of the disastrous consequences of a trip of one of our boilers and turbines if we do not manage to contain the fault fast enough.

"Imagine the effect on the system of a sudden drop in wind while a number of wind generators are in operation.

"We are therefore keen to set up a project, which would study such scenarios, preferably using dynamic modelling.

"We have the model on our computers at Marsa. What we need is some manpower, such as a university student and/or one of our engineers working on this, ideally, full time."

The Prime Minister said that it was his government's policy to eventually liberalise other areas of the energy market, including the importation and distribution of fuels for the inland market.

"We have negotiated, with the European Union, for a transition period up to 2005 for the opening up of this market.

"This is not only required to give Enemalta more time to adjust its operations to the new market conditions, but also to allow us to gradually adjust our fuel prices to fully reflect market conditions."

Dr Fenech Adami referred to electricity and the EU's electricity directive. He said this was meant to create a single market for electricity in Europe. But as long as Malta remained a small, isolated system, it could not form part of that single European electricity market.

"Indeed, the directive itself recognises that it may not be practical or beneficial to the consumers to open up a small isolated system, and allows for a number of derogations from the directive.

"We shall be applying for these derogations on accession," he said.

The ultimate improvement, apart from a more efficient use of electricity by consumers, would be the use of natural gas to power our electricity generating plant.

"We are therefore keen to see the result of the study that is currently being conducted by ENI and Enemalta, and which should be completed by the end of the year.

"I understand that the marine study has been completed and that both sides have gathered all the necessary data and agreed on the underlying assumptions.

"A survey of the best route for a pipeline to connect Delimara to Marsa will be undertaken shortly," he said.

The Prime Minister said that preliminary indications seem to suggest that the project would require grants from international institutions and substantial financial support to make it attractive.

Closing the conference yesterday, Economic Services Minister Josef Bonnici referred to the potential that Malta held as a base for industrial and commercial activities in support of developments in the energy sector within neighbouring countries and the Mediterranean region in general.

"One practical example could be the establishment of an engineering service centre in Malta geared to provide maintenance and other support services to energy sector installations in North Africa and Southern Europe.

"Malta is ideally situated to develop this kind of business," he said. "The required perspective must transcend the conventional division between investment promotion, trade facilitation and enterprise support that has characterised our thinking to date.

"We must no longer regard these considerations as being related but distinct facets within our overall development strategy, but, instead, look at them as integral aspects of the development path upon which we want to embark."

The minister said that at the practical level, the development of such a regional strategy required input from the MDC, METCO and IPSE but this input must be integrated and formulated as part of a common strategy.

"Hence our decision to move to towards the establishment of Malta Enterprise."