A Government proposal for a gas pipeline would reduce electricity tariffs, Prime Minister Lawrence Gonzi said in Berlin yesterday where he met German Chancellor Angela Merkel.
This was the first time that a Government official directly linked lower electricity bills with the gas pipeline and eventual conversion of the Delimara power station to gas.
Reacting later, Labour leader Joseph Muscat said: 'First they told us it is impossible to lower utility bills, then they told us our proposal is a gimmick and now they are saying they will do the same.'
The Government specified it had always insisted tariffs should be kept at the lowest sustainable level possible, hence the interconnector and the gas pipeline plans. The benefits would be enjoyed by consumers, businesses and industry, it said.
Asked in Berlin whether the Nationalist Party was committed to reduce tariffs through the eventual conversion of the power station to gas, Dr Gonzi said: “We have been saying this.”
He said the Government proposed to have a gas pipeline to deliver fuel to the power station, funded partly by the European Union and private investment.
“Labour has chosen a different alternative and I would like to know why,” he said.
Although the EU has, in principle, agreed to part-finance a gas pipeline, everything depended on the approval of its forthcoming budget. The Government has said a pipeline will only be feasible with EU funds.
Dr Gonzi said he was “flabbergasted” that Labour’s proposal was dependent on two government projects the Opposition had been criticising for the past five years: the interconnector cable to Sicily and Delimara extension.
Dr Gonzi said his party had warned that Labour’s plans would cause a financial hole and the gas terminal proposal showed the risks would increase dramatically.
He said it was also interesting that Labour was refusing to publish all its reports and details, failing to say which investors they met, when and what was “formally or informally” agreed.
The PN would publish its own reports in the coming days, Dr Gonzi added.
The Prime Minister’s comments came as Labour’s plan to fix the price of electricity for 10 years and complete the project within two years was questioned by a former chairman of Enemalta.
“Power purchase agreements do not normally work on a fixed-price formula but they would have built-in mechanisms that cater for fluctuations such as the price of fuel,” Robert Ghirlando said.
The short timeframe was also raised by Michael Falzon, a former Infrastructure Minister who had been responsible for the building of the Delimara power station in the early 1990s.
“The Labour proposal is certainly not a gimmick and it is interesting but I believe that a period of between 30 and 36 months to build and commission is more realistic,” Mr Falzon said.
Finance Minister Tonio Fenech branded Labour’s energy plan unrealistic with timelines impossible to achieve.
The Labour leader addressed this point during a business breakfast yesterday, saying that he understood scepticism expressed by some quarters on the timeframes because the country had “become accustomed to mediocrity”.
Dr Muscat insisted that his party’s proposals were “credible and doable”.