Malta needs investment to mitigate the physical risks posed by climate change in the near future, including floods and extreme weather events, according to economic consultant Gordon Cordina.

Speaking during a consultation meeting on the impact of climate change for the financial sector, Dr Cordina questioned whether sectors like insurance were sufficiently equipped to adapt to new risks.

There was the need to identify the returns that investments aimed at climate change should have, he told the meeting of the Malta-EU Steering and Action Committee.

The lowering of electricity prices, Dr Cordina pointed out, meant investments into energy-saving technology paid back less.

He highlighted agriculture and air conditioning as two under-considered areas where more needed to be done to reduce emissions.

Agriculture currently accounts for one per cent of the economy but 10 per cent of emissions.

“Climate change is making our dependence on air conditioning worse,” he said. “We need to create a market where people who invest in better air conditioners can enjoy a good rate of return.”

At the same time, he added, it was important not to invest in white elephants. Photovoltaics had the potential to lead to lower energy efficiency because energy companies had to keep a reserve in case of a sudden drop in generation due to cloud cover, he said.

Simone Borg, Malta’s Ambassador on Climate Action, said that alongside the challenges of developing a low-carbon economy, the country had to address the question of providing access to finance and also ensuring it was channelled to where it was most necessary.

“We must do away with the idea that the energy generation sector is the only one being affected,” she said. “All other sectors will need a plan to invest in becoming low-carbon. In doing so, the risks are many,” Ms Borg said.