War, energy and subsidies discussed on Xtra

The energy crisis developing as a result of the conflict between the United States, Israel and Iran, and its effects on inflation and prices, both of energy and fuels as well as imported products, were among the topics discussed during the programme Xtra on TVM, presented by Saviour Balzan Thursday evening.

Energy Minister Miriam Dalli said that the sources from which Malta imports its fuels provide a level of stability for the country. She explained that the energy imported by Malta does not come from the Middle East. Asked about the possible effects on the prices of imported products,

Dalli referred to the COLA agreement, which compensates for inflation. She said it is important for sources of fuels and energy to be diversified so that the country can purchase at the best possible price.

The Nationalist Party’s shadow minister for energy, Mark Anthony Sammut, said he agrees with subsidies on electricity. He noted that the price of an electricity unit changes according to the level of consumption. However, he stressed that substantial investment is needed in renewable energy to reduce dependence on imported energy.

For her part, Dalli said studies are currently being carried out on offshore technologies for energy production. She explained that these technologies are still expensive, but the government wants to be prepared and ready to invest in them when they mature and become economically viable.

The minister and Sammut disagreed on the liberalisation of the energy market. The European Union derogation is expected to expire next year, although there is the possibility that it could be extended for another eight years. Sammut stressed that even in a liberalised market, the government would still be able to choose to subsidise prices. However, Dalli said that with a new layer of regulation, prices would increase.

Sammut said the government will have to face this change regardless, whether the derogation expires next year or is extended for eight years. He added that he hopes the government is already preparing a plan for this transition in the energy market.

Asked whether this crisis could lead to an early election, Sammut said he sees no particular reason why the crisis alone would trigger one. He added that if an early election were to be called, it would most likely be because Prime Minister Robert Abela feels it would be politically advantageous to do so.