The idea to link Malta to the European power grid was just a dream up to some time ago. But if all goes according to plan, it will now take shape by the end of 2013.

One entrepreneur who had vigorously promoted the idea in his time was the late Anthony Miceli Farrugia, the Farsons’ managing director, who never ceased speaking of the possible benefits an interconnector could bring about to the island. Many years on, and countless of power cuts later, the government has now taken the plunge as it has signed a contract with a French company for the laying of an interconnector.

Needless to say, its commissioning, when it is hopefully done in time as planned, would be a landmark in the island’s infrastructural development, for no economic, and, indeed, even social, progress could be assured without having an adequate and reliable supply of energy. With the Marsa power station in a moribund state (it is scheduled to close down within two years), the government has had to move ahead and go for the interconnector besides expanding even further the Delimara power station.

The Finance Minister referred to the project only fleetingly in his Budget speech. But he had occasion to give an overview of the plan, and give other details, at the signing of the contract with the French company, Nexans. Under the contract, worth €182 million, Nexans will lay a single alternating current cable with a carrying capacity of 200 megawatts, linking Malta to Marina di Ragusa in Sicily. The minister said the interconnector would most likely lead to cheaper electricity rates but he was careful enough to add this depended on the contracts that have yet to be signed with the power generation companies. He explained: “The cable gives us the opportunity to buy electricity from the much larger EU market, which may be cheaper than we if had to produce it ourselves.”

The key word here is may. Only time will tell if this will ever be possible, though, naturally, consumers would welcome any reduction in the rates they are paying now. For the truth of the matter is most people have still not got used to paying such high rates for water and electricity. The government was right in deciding to remove the subsidy; its mistake was in doing the exercise rather haphazardly. As suggested by many at the time, it could have raised the rates gradually. Maybe the time will come when Malta strikes oil but, until then, both electricity and water remain costly, something that is only now beginning to sink in the minds of many people.

As to the funding of the interconnector project, 50 per cent of the cost is to be financed by the European Investment Bank, €20 million would come from European Union funds and the rest from domestic banks. It was said at the signing of the contract that Enemalta Corporation would recoup the cost of the interconnector through its tariff structure, which already caters for a return on invested capital.

With the laying of the cable, Malta will hopefully considerably reduce the possibility of having a total power cut for, if such a blackout were to occur, the system would be able to switch to the link to the continental grid. “This project,” said the minister, “will provide Malta with an economically viable source of energy as well as giving us peace of mind.” Amen to that.