Tough economic times are ideal for making resolutions that will hopefully make our lives better in the coming year. Frugality and prudence have once again become fashionable and some families will be thinking on how to stretch their pay cheques even if it means giving up on a dream holiday and other not so essential leisure activities.
Investing in alternative technology carries some risk but also provides significant rewards- John Cassar White
Many European families are risking falling in the fuel poverty trap as their energy bills exceed 10 per cent of their income. Even if our mild climate ensures that our electricity consumption is kept low when compared to that of families in northern Europe, our electricity rates are high when compared to those of other eurozone states. So, managing the family’s energy bill could well be a high priority for many families.
I don’t believe there is much scope in recommending changing over to low-energy bulbs. Potential savings may not amount to much more than nibbling at the high energy cost problem. Progress in the alternative energy industry is encouraging but still not substantial enough to guarantee us lower tariffs from our utilities. I do not believe that there is some magic solution staring us in the eye, even if undoubtedly a few sharks will try to sell us pseudo solutions to very real problems.
For families who are already struggling to put bread on the table, investing in the latest available electricity generating technology is not a feasible option. Yet in a fair society the government is obliged to make sure that these families are not pushed further to the brink of fuel poverty simply because they cannot afford the capital outlay to manage their energy costs.
So, the first thing that needs to be done is to put some sense in the way that Enemalta functions. This state monopoly has debts amounting to about €700 million with debt servicing costs exceeding €20 million per annum. At the same time our electricity generating company has trade debtors amounting to €275 million when its annual turnover is just under €600 million. It is not clear to what extent these capital costs are actually related to equipment presently used to generate electricity and how much relates to capital investment that is no longer being used.
Similarly, no one has so far explained to what extent Enemalta is loading its electricity rates with administrative inefficiencies – a practice that would not be tolerated if we had a competitive market. The inability of this corporation to have a stable top management is symptomatic of the disturbed corporate environment that persists in this organisation.
For the lucky ones who are not dependant on Enemalta getting its act together, there are better options to manage their energy bills. It is generally acknowledged that photovoltaic cells technology is the most reliable one available today. Capital costs remain high but are tumbling at a very vast rate while the efficiency of the technology is improving significantly.
Solar thermal installations which make electricity by bouncing sunlight off mirrors to boil water, creating steam that drives turbines are being discarded as they can never compete on cost with photovoltaic technology. The magazine Businesweek claims that in some places like Italy and Hawaii with abundant sunshine and high electricity rates, it is already cheaper for consumers to install rooftop solar panels than to buy power from their local utility. By 2015 panels will have reached this point of so-called grid parity in much of the US, Europe, and Japan.
The manufacturing of photovoltaic panels in China has been so successful that prices have plunged to such an extent that governments are already withdrawing subsidy schemes aimed at encouraging consumers to invest in this technology. We are also seeing some countries like the UK reducing the feed-in rates guaranteed to photovoltaic panel owners who sell excess electricity generated to the utilities.
Those who are prepared to forgo a well earned cruise in the Caribbean to invest in alternative energy technology that will cut a big slice off their electricity bills will do well to seek independent technical advice on the best system to invest in and not be too influenced by the hard-selling techniques of companies who sell this technology. The timing of this investment is also crucially important especially as it is now more likely that subsidies will be eliminated or reduced as the capital costs drop at a very fast rate.
Investing in alternative technology carries some risk, but also provides significant rewards.
jcassarwhite@yahoo.com