Energy-saving loans of up to €400,000 for tourism industry

Businesses catering for tourists can now apply for a low-interest loan of up to €400,000 for energy-saving projects in a new scheme launched by the government.

“Hotels are large consumers of energy,” Parliamentary Secretary for Tourism Mario de Marco said yesterday, pointing out that water and electricity bills make up 25 per cent of the operating costs of five-star hotels and 30 per cent for four-star resorts.

Guesthouses, hostels, farmhouses, snack bars and restaurants can also apply for the soft loan, which carries an interest rate of 1.5 per cent over the discount rate.

Although such enterprises had long been complaining about utility bills, Dr de Marco said subsidising them would be sending the wrong message. The government would rather help the industry cope in the long term by investing in cleaner energy and projects to reduce consumption.

The incentive, which will remain open until December 2013, will enable investors to obtain soft loans from Malta Enterprise for up to 80 per cent of the total cost.

The money could go towards projects that would use cleaner fuels, reduce energy consumption, such as double glazing, and invest in alternative energy resources.

“We don’t want tourism that leaves a negative effect on the environment,” Dr de Marco said.

The industry is going through a critical period. Last year, however, was a record one for the sector, with 1.3 million tourists visiting the island. Tourists’ expenditure has increased by 20 per cent, Dr de Marco said.

Malta ranked 26th out of 133 countries this year in the Tourism and Travel Competitiveness Report of the World Economic Forum – up from 29th in 2009.

Finance Minister Tonio Fenech pointed out that, although Osama bin Laden’s death had led to a drop in fuel prices, energy challenges were here to stay. “If we want sustainability, we need to look at alternative sources,” he said.

Speaking at the launch, Winston Zahra Sr of Island Hotels Group welcomed the new scheme. He highlighted how the increase in electricity costs added a burden to the industry.

He said his company, which employs about 1,000 people, was currently investing €65 million in an environmentally sustainable project in Ħal Ferħ called Oasis at Golden Sands.

It is also planning to extend the Coastline Hotel by 100 rooms and refurbish the Radisson Blu Resort in St Julians.