Why subsidise Enemalta?

I read the article by Anne Zammit about renewable energy (The Sunday Times, January 16) and Professor Edward Mallia's reaction (January 30) with great interest. I am glad that finally the discussion about renewable energy (RE), and especially solar energy (PV systems), is taking off.

I am in the middle of installing a small domestic PV system myself, and I get great co-operation from both Enemalta and the MRA. They all seem more willing to help someone who is not only talking about PV systems, but actually wants to install one.

There is only one big drawback, which Professor Mallia also points out. Instead of stimulating the use of PV systems in Malta, the MRA and Enemalta seem to discourage anyone who wants to invest in PV.

From the article "The electricity surcharge saga" by Mario Fsadni and Edward Mallia (The Times, January 28) I learned that the real unit price is around 10c. Many people keep saying that PV systems are too expensive to be successful. But it all depends on the price of the electricity in comparison with the amount of sun, and therefore the amount of electricity you are able to generate per day.

The more energy you generate per day and the higher the price you get for your kilowatt hour (kWh) the sooner the break-even point (or payback point) is reached. Because Malta has a lot of sun and light, payback time should be short. After the break-even point it does not cost any money any more, but it will generate money.

With a fee of 2c per unit payback time for a solar system in Malta is approximately 40 years. With a fee of 4c per kWh this would go down to 20 years, and with 8c per kWh you would be facing 10 years before you have earned back your initial investment.

Every kWh a PV system in Malta is generating saves Enemalta 10c. When Enemalta decides to pay the full 10c to every PV system owner it would not cost Enemalta anything and payback time would be below 10 years! When you consider that most PV panels have a guaranteed lifetime of at least 25 years this would mean that the system would pay back more than twice the initial investment! Enemalta could even decide to invest in PV systems itself.

Some months ago an Enemalta employee told me that I would receive the same price for the kWh my panels generate as I pay for the kWh I buy from Enemalta. According to Enemalta's Website the prices for a two-person household are: 2c for the first 412,5 kWh per quarter including meter charge. After that the price goes up to 4c per kWh. Because most people's consumption is way above the 412,5 kWh mark, three quarters of what you pay is at a 4c rate.

I have only recently been informed by Enemalta that they are not going to pay 4c, but only 2c for the kW hours my panels will generate! So while I am paying them 4c for the electricity I generate myself, I get only 2c back!

In this way I am afraid no one will ever want to invest in a PV system or any other form of renewable energy! And I cannot understand why Enemalta would pay so little. At the moment anyone who installs a PV system is actually subsidising Enemalta!

And there are so many good reasons for Enemalta or the MRA to promote the use of PV systems:

PV systems produce electricity in an environment-friendly way. They would help in reaching the targets which are set for European countries as regards to RE.

Malta would have a constant price, independent of the price of oil, and no need to import oil which is good for the import/export balance. You do not have to invest in new power plants. Decentralised generation of electricity makes the grid less sensitive for power failures and overloads. PV matches supply with demand.

PV systems are widely used by many European countries already: Spain, England, Austria, Cyprus, Greece, Germany, Italy, the Netherlands, Belgium, Luxembourg and France. Many of these countries do not have as much sun as Malta has. PV does not need any large-scale investments; you can start with it today.

The only thing is what are we waiting for? A better price for the generated RE!