Malta’s targets for renewable energy

Last week, when writing about Japan’s tragedy and the damage to its nuclear energy plants, I made reference to the safety of this alternative source of energy. I also mentioned that, given the reaction of several deve-loped countries to this incident (that is, their decision to close down some reactors) and the fact that some renewable sources of energy are still too costly, the world will have to continue relying on oil for cheaper energy. Some weeks ago the National Audit Office published a performance audit report on renewable energy in Malta. It was a follow-up to the report published in 2009 but acquires additional significance in the light of global deve-lopments and their impact on Malta.

One needs to remember that, when undertaking a performance audit, the NAO is guided by the principles of economy, effectiveness and efficiency, as measured through the inputs, outputs and outcomes. The audit objectives were two: “Evaluating the process adopted in the development of Malta’s energy policies” and “determining Malta’s progress with regard to the renewable energy programme”. It is again to be remembered that the government assigned the energy policy drafting role to the Malta Resources Authority, which is part of the portfolio of the Ministry for Resources and Rural Affairs.

One needs to put this into a very specific context. This context includes a number of aspects such as the significant extent of our imports of fuel, the vulner-ability of the economy to the international prices of oil in terms of the impact on the rate of inflation, the high costs that the country has to generate electricity, and the financial situation of Enemalta Corporation. This context also includes the targets for renewable energy as stated in the National Renewable Energy Action Plan and the obligations that the country has to fulfil within the European Union framework by 2020.

The NAO report states that Malta progressed only to one third of its 2010 projected targets for renewable energy sources. On the other hand, the report is hopeful that the 2020 EU targets shall be met if the current drive is maintained and there are no further delays in the implementation of projects in this sphere. Moreover, the report concludes that the attainment of the 2020 targets is dependent on the feasibility of a number of major projects and the achievement of the projections contemplated in these projects.

To complete the description of this context we need to state an obvious fact – although we have no natural resources that generate energy, we are certainly blessed with a climate that does provide renewable energy. Yet with all the sunshine that we have, a country such as Germany produces more solar energy than we do. Admittedly, the technical knowhow that Malta has in this field is infinitesimal when compared to that of Germany, but the availability of sunshine should have enabled us to attract leading-edge technology in this sector. That we have not done so must say something about an innate barrier that may exist to seek to develop renewable energy.

One very important highlight of the report of the NAO is the estimated cost of one kilowatt-hour of energy produced through the photovoltaic grant schemes launched by the government. For the domestic sector this was estimated at five euro cents, which is considerably less than the price that we pay for electricity.

The conclusion that I draw from this report is that our effort to make use of renewable sources of energy must increase, irrespective of the EU obligations that we may have. We should seek to attract companies that are investing in technology that makes the production of energy from such sources more costeffective. Meeting the EU targets is good, but making Maltese businesses operating in Malta more competitive because of cheaper energy is even better.