Update 3 | ‘Admit PN’s energy plan was better option’ – Fenech tells Mizzi

George Pullicino says PN in government ‘would not commit itself to buy energy from ElectroGas’ • PN deputy leader urges government 'to come clean' on energy deal

PN MPs Tonio Fenech and Mario de Marco
PN MPs Tonio Fenech and Mario de Marco
Nationalist MP Ryan Callus
Nationalist MP Ryan Callus
George Pullicino
George Pullicino

Shadow energy minister George Pullicino urged government to publish the contracts signed with the Maltese consortium ElectroGas, the preferred bidder chosen by Enemalta to build a new gas power station and supply electricity.

Addressing the budgetary vote for the energy ministry, Pullicino said that despite a pledge of transparency, the government failed to publish the numerous contracts pertaining to the government’s energy deal.

“The Prime Minister was convinced the power plant would be built within two years of the election and said he would resign. Now he is twisting words,” he said.

Pullicino insisted that there was nothing stopping the government from publishing the contract signed with the ElectroGas consortium, as this was separate from that signed with the Chinese-state owned company Shanghai Electric Power.

The shadow minister said that what Labour branded as the “cancer factory” – the Delimara phase 2 plant – will now be sold for €320 million to the Chinese.

Pullicino said the €30 million cash consideration was never paid by ElectroGas to the government, despite an agreement that this would be handed to government upon the signing of the deal.

“The €30 million should have financed the reduction of energy bills for households while the construction of the new power plant by March 2015 should have financed the reduction for businesses. None of these were delivered. So how is government financing the reductions?”

Pullicino suggested that the reductions were either being paid by “an increase in taxes”, “a cheaper price of crude oil” or an increase in fuel prices paid by consumers.

“The price of oil is currently the cheapest it has been over the past five years. Yet families are still paying high prices. €6 of the €30 consumer pays for diesel are taxes,” he said. 

Pullicino argued that the average energy market price in Italy is of 5c2 per unit, while Malta will be paying 9c6 to buy electricity from ElectroGas. Insisting that a PN government would not bind itself to buy energy from ElectroGas, he said that purchasing energy from the interconnector would be cheaper and more flexible.

He said that Malta would be producing a surplus of energy: “Malta on average consumes between 240MW and 260MW. Combined, ElectroGas and SEP will be producing 300MW. What are we going to do with the surplus energy? Who’s going to buy that surplus when prices of Sicily would be cheaper?”

The shadow minister appeared unphased when the energy minister denied that lawyer Neville Young had accompanied him to a recent trip to China. In parliament, Pullicino claimed that Young had traveled to China with the minister, questioning whether the government was now preparing to sell part of the Water Services Corporation to China.

Pullicino added that the government should not be boasting of the tearing down of the Marsa power station “because boilers 1 to 4 had been decommissioned since before the general election”.

He questioned what was happening at Enemalta after yet another executive director of human resources resigned, marking the fourth resignation from the same post in 20 months.

‘Admit PN’s energy plan was better option’ – Fenech tells Mizzi

Fenech took the government to task over the delayed construction of the power plant and its failure to meet the timeframes announced in the run-up to the 2013 general elections.

According to the MP, the government turned to the Chinese because “it realised it could not finance its original plan”.

“And now I’m hearing that the Chinese also want to control the management of Enemalta because they don’t really have confidence in the present leadership,” Fenech alleged.

Shanghai Electric Power has purchased a 33% stake in Enemalta, a deal which should now be in its stages of finalisation.

He put into question the government’s argument that the energy deal was delayed following SEP’s involvement, claiming that the Chinese would have never told government “to put on hold” the €30 million cash consolidation which should have been paid by ElectroGas.

Fenech claimed that Enemalta could not do without SEP’s investment: “Beggars can’t be choosers and it is clear that the Chinese are asking more money. You have reduced this country as beggars of the Chinese.”

“You should come clean on this project and apologise for the mistake you did and admit that the project of the Nationalist administration, that of the interconnector, was the right answer.”

‘Questions left unanswered’ – De Marco

Taking the floor, PN deputy leader Mario de Marco said that the government admitted that ‘Plan B’ – that which included the Chinese investment – was better than ‘Plan A’, which did not included the sale of 33% shares from Enemalta.

“Or, we are being given the impression of a Plan B because it would have appeared ugly to announce it before the general election,” de Marco said.

The energy minister had argued that it would have been “irresponsible” of him if he were to turn down the Chinese investment opportunity. According to de Marco, this also meant that Labour’s original plan as presented during the electoral campaign was “irresponsible” because it would have not been financially viable.

He said that the government left parliament, the citizens and the media in the dark over the details of its plan.

De Marco said that the delay in the completion of the new power plant meant that the taxpayers were forking out €187 million. This, he said, resulted from Konrad Mizzi’s argument that cost savings as a result of tariff cuts would be to the tune of €187 million.

Enemalta workers transferred ‘because they’re uncompatible with team’

MP Ryan Callus said that a number of Enemalta workers received a transfer after the entity’s CEO informed them that they were no longer “compatible with the team”.

“Is this what government meant by his meritocracy pledge?” he said.

Callus said that Enemalta, who owed MEPA €2.7 million in penalties, had asked the planning authority to review the mechanism by which penalties were calculated in order to reduce the penalties to €1.1 million.

“Why would such a request be made if, going by the Prime Minister’s words, Enemalta was now back on its feet?” he said.

Callus said Enemalta should not be treated any differently from any other citizens facing penalties by the Malta Environment and Planning Authority. The young MP told Mizzi that if the minister were a project manager with a private company, he would have been fired for failing to deliver the project on time.

More in Budget 2015