The €360 million State guarantee for the power station project proved that Labour’s pledge to build the plant in two years through private investment was not based on the truth, the Opposition said yesterday.
“Joseph Muscat had pledged to resign if this project would not be delivered on time but he is still Prime Minister even though construction works on the Electrogas plant have barely started,” PN deputy leader Mario de Marco said during a news conference at the party headquarters in Pietà.
He said the government was forced to make such an unprecedented State guarantee to save the Prime Minister’s face as, otherwise, Electrogas would not have been granted a massive €450 million loan to finance the project.
The Prime Minister transformed his political gamble into a commercial risk
“The Prime Minister transformed his political gamble into a commercial risk and lumped it on us all,” Dr de Marco added.
The government insisted the guarantee was a temporary 22-month measure until the European Commission approved a security of supply agreement. Nevertheless, Dr de Marco cast doubts on such an assurance saying the Prime Minister’s credibility on the energy sector had become questionable.
“This no-pain-only-gain situation for Electrogas runs counter to the pre-election claim by Dr Muscat when he had repeatedly insisted that private companies were prepared to finance the project,” he continued.
In its electoral manifesto, the Labour Party had promised to reduce utility rates by about 25 per cent as a result of the construction of a more efficient gas-fired power plant. While the tariffs were cut as promised, the project fell behind schedule and is set to be inaugurated in June next year,15 months after the original deadline.
Asked about the PN’s plans for the sector, Dr de Marco said the “lack of transparency” on the government’s dealings in the energy sector made it very hard for the party to have a clear idea of the situation. “The agreements over the new power station and the selling of the BWSC power plant to Shanghai Electric were never published and so we know very little about the current state of play,” he said.
Dr de Marco argued that the reduction in utility rates was only possible due to cheaper electricity bought from Italy through the interconnector and thanks to a drastic drop in the price of crude oil.
The news conference was also addressed by Nationalist MP Ċensu Galea.