Malta signs €182 million interconnector contract
‘Malta will buy energy from nuclear plants’
Malta will be linked to the European electricity grid by the end of 2013 under a €182 million contract signed by the government and a French company that will be responsible for the laying of the underwater cable.
Nexans will be laying a single alternating-current cable with a carrying capacity of 200 megawatts, linking Marina di Ragusa in Sicily to Magħtab. Here, a new substation will be built, linked to the Kappara distribution centre.
The contract was signed yesterday by Nexans vice-president Yvon Raak and officials from the Contracts Department in the presence of Finance Minister Tonio Fenech and Enemalta’s top brass.
The interconnector would most likely lead to cheaper electricity rates, Mr Fenech said, insisting, however, it all depended on the contracts signed with electricity generation companies once the cable became operational.
“The cable gives us the opportunity to buy electricity from the much larger EU market, which may be cheaper than if we had to produce it ourselves. However, the advantage is that, for the first time, the country will have an energy mix that is partially generated domestically and partially obtained from abroad,” he added.
He said the infrastructure that would be built had the potential of accomodating a second cable in the future.
“One cable is deemed enough to cater for the economy’s needs for the foreseeable future,” he said.
The interconnector and the extension to be built at the Delimara power station are vital developments because they will provide the additional energy required to substitute that generated by the Marsa plant, which must be closed down in two years’ time.
As a result of the interconnector, Malta will be able to buy electricity from nuclear power plants abroad, which pollute less than those run on fossil fuels, or from plants running on renewable energy. This would help the island reach the EU’s emissions targets.
The cable is expected to have an underwater route length of 95 kilometres and will be laid in sea depths of about 160 metres.
Enemalta’s chief technical officer, engineer Peter Grima, said the interconnector would enable the corporation to re-energise the island immediately if a total blackout occurred.
A cable connection to the mainland was important, he added, if Malta were to develop large scale alternative energy plants such as wind farms.
Mr Fenech said 50 per cent of the project’s cost would be financed by the European Investment Bank, another €20 million would come from EU funds and the rest of the financing from domestic banks.
The contract needed to be signed before year’s end so Enemalta does not lose the EU funding allocated for the project. The corporation will recoup the cost of the interconnector through its tariff structure, which already caters for a return on invested capital.
Nexans was selected because it had the cheapest bid after a second round of bidding. The first call for tenders was cancelled in July. Fresh bids were then requested from four shortlisted companies but only three submitted a bid – ABB, Nexans and Prysmian PowerLink . The Nexans bid was €25 million cheaper than second-placed ABB.
“This project will provide Malta with an economically viable source of energy as well as giving us peace of mind,” Mr Fenech said.
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Eto Demerzel
Dec 16th 2010, 03:29
Just curious, why AC? several times I've read that high voltage DC is more efficient.
Albert Bezzina
Dec 15th 2010, 22:00
Cont....
3) The interconnector will not guarantee a supply of electricity to our Island in adverse international political upheavals. Most of Europe’s fossil fuel supply comes from outside the block and the supplying countries may not give a hoot if Europe falls into energy starved chaos. Strained political relations could alter supply of these fuels which in turn would increase demand for RE and nuclear generated within the producer state, defaulting on export. In such a scenario we can be left high and dry within a short interval.
4) RE generation locally will remain token projects which will not make much difference on Malta’s projected emissions and definitely will have no effect in contributing to Malta’s energy security. (For energy security read water supply)
Albert Bezzina
Dec 15th 2010, 21:58
The interconnector is necessary. It is essential for RE projects to become viable on Maltese territory as surplus RE generation can flow into the vast European grid.
However, the main benefits for the interconnector being exalted by the authorities is that Malta can reduce its emissions by purchasing electricity from generating plants in other European countries.
1) Some months ago, politicians claimed that Malta can cut down its emissions by getting our electricity generated in other countries. If the source of the imported electricity is conventional fossil fuel powered (coal, fuel oil or gas), I doubt whether the emissions (especially CO2) released in other countries on OUR behalf can be offloaded onto the producer state’s emissions inventory.
2) With a scramble by all European countries to cut down on their CO2 emissions to reach their respective EU emissions targets, I find it hard to believe that RE and nuclear sourced electricity will be available in excess and not be given to the highest bidder. The assumption that there will always be cheap, clean electricity available to us on demand is naive.
Victoria Micalleef
Dec 15th 2010, 18:58
This is just what we want in Italy: charge the Maltese a high price for electricity..Ha! Ha!
And whenthe price of electricity is doubled by 2020 you will all say I told you so.
This is a money making exercise with little if any thought for Malta. The Italians cream off the fat at the Maltese expense.
John Pace
Dec 15th 2010, 12:25
The big customers will get the cheap electricity. Malta will have to accept what's left
albert leone ganado
Dec 15th 2010, 10:03
Well done to all . We now have an alternative source of power which I incidentally proposed over twenty years ago in this paper but was of course laughed at by the so called experts at that time.
However now that we have an alternative source of power, it is time that the EneMalta monopoly in energy supply distribution is dismantled. We are paying for the inefficiences of this power provider and it is time that energy generation is separated from energy distribution. I am sure that Sicilian and Italian operators will then be able to offer attractive and better pricing packages to EneMalta. I hope that the EU competition commissioner will insist on this matter as it is not only an obligation under EU funding rules but will offer a potential relief to the high energy pricing we Maltese long suffering consumers pay.
One has to congratulate the planners in taking the opportunity of passing a large number of digital communication cables together with the energy cable. They will no doubt help to turn Malta into a more effective hub for digital communications and I suppose strengthen the vision of turning Malta into a truly highspeed smart virtual Island.
V.Spiteri
Dec 17th 2010, 11:29
Could it be that 20 years ago it actually was a laughable proposal, while nowadays it is not...
Times change, as well as needs...what was good and feasible back then may not be now and vice-versa.
Please choose the reason of your report below: