The campaign by 11 unions encouraging people not to pay their energy bills is "misguided" and "misleading", the government charged yesterday as financial results indicated Enemalta was set to suffer heavy losses in the last financial year.
The Infrastructure Ministry said preliminary financial results "shown to the Ministry by Enemalta" indicate the corporation will be making a heavy loss in 2007/2008, notwithstanding a government subsidy of close to €64 million.
A ministry spokesman said the tariffs introduced on October 1 are "not even enough" to cover Enemalta's outlay to buy oil products during the previous three months when oil was at a record high.
The ministry insisted that, under the previous surcharge regime, Enemalta should have imposed a surcharge of 190 per cent on bills issued after October 1.
The surcharge used to cover the expense incurred by the corporation to buy oil in the preceding three months.
A table published by the ministry, comparing what a typical bill would have cost with the 190 per cent surcharge and what it would amount to now with the new tariffs, shows substantial savings for consumers of up to 30 per cent and over in some cases.
The savings for consumers have resulted in bigger losses for the corporation, according to the ministry.
In the financial year that ended in December, which covers a 15-month period, Enemalta spent a total of €322.6 million to purchase 705,746 tonnes of fuel oil and 92,964 tonnes of gasoil.
When averaged over 12 months, Enemalta's expenditure last year was 56 per cent higher than in the financial year 2006/2007.
The ministry also described as "nonsense" the statements made at the Labour's general conference over the weekend on how Enemalta purchases its oils.
A spokesman said international tenders are issued regularly every six months or yearly for the supply of fuel oil and gasoil.
He explained that the price consists of the "average spot price Platts Mediterranean for the month, either when the order is placed or the month of delivery".
Enemalta's supplier is Totsa, a member of the Total Group, and only one or two consignments of fuel a month are imported. "There is no such thing as a hedging agreement," the spokesman underlined.
"Enemalta enters into a number of different transactions which are normally each for a small part of its fuel requirements. These hedging transactions are entered into at different price levels and cover different time periods," he added.
The ministry said all final decisions on hedging are taken by a specialist board at Enemalta consisting of the chairman, the deputy chairman, the chief executive officer, the chief financial officer, a Central Bank appointee, the head of the Oil Division at the Office of the Prime Minister and a foreign oil consultant.
Rebutting the claims made by Labour deputy leader Anġlu Farrugia that the government has not disclosed information on Enemalta's practices, the ministry said this was a "blatant lie".
"The innuendos in his speech are nothing but explicit and malicious deceit," the ministry charged.
It insisted Mr Farrugia and fellow Labour spokesmen Charles Mangion and Marlene Pullicino were briefed on the procedures adopted by Enemalta to purchase its oils.
ksansone@timesofmalta.com