Infrastructure Minister Austin Gatt said in Parliament today that even if Bateman equipment had been selected for the power station extension, it would have still needed to use diesel or other liquid fuel when it was commissioned in 2012.
Furthermore, choosing Bateman over BWSC would have cost the country €30m more per year (in production costs), even if the equipment of either company used the same fuel.
Speaking at a meeting of the Public Accounts Committee, where he repeatedly asked the Auditor-General to confirm his statement, Dr Gatt said the tender specifications had been clear that the generating equipment in all cases had to operate on either gas or liquid fuel.
Since the infrastructure for gas operation would not be ready at least until 2015-2016, should Israeli company Bateman have been selected, it too would have had to operate using liquid fuel in 2012.
Dr Gatt asked the auditor to confirm that BWSC were cheaper than Bateman even when conversion from fuel to gas was considered.
An official from the audit officer confirmed that was the case.
Finance Minister Tonio Fenech said it was always the government's intention for the power station extension to operate using gas, but that was not possible before 2015 and 2016 because the necessary infrastructure would not be in place before that. That was why the tender specification laid down that the new equipment could use both gas or other fuel.
The Audit Office officials agreed.
Mr Fenech said both the liquid fuel and gas options met the EU emission standards and the government therefore retained the option of choosing between gas and fuel, once the infrastructure was available. A major factor would be cost.
Dr Gatt asked the Auditor-General to confirm that the BWSC offer was some €296 million cheaper than Bateman, all considered including plant costs, maintenance for five years, disposal of waste and conversion from liquid fuel to gas.
The Auditor-General confirmed.
He also asked him to confirm that BWSC production costs were 3.4c per unit cheaper than Bateman.
The officials confirmed.
Dr Gatt said this meant that had Bateman been selected,the Maltese people would have been required to spend €30 million more per year than the BWSC plant, using the same fuel.
This, he said, was equivalent to the increase in the power tariffs announced last January. But whereas that was strongly criticised, is seemed for somebody that it was OK to incur the extra cost to engage Bateman.
Evarist Bartolo (PL) said the new equipment could not use gas because the government had not built its infrastructure on time, despite having shown interest and issued a call for tender in 2006. It thus brought itself in a position where it had no choice.
Dr Gatt said it was a call for expression of interest for the supply of natural gas which was issued, and it was found that this was not economically viable. However, studies on the laying of a pipeline were continuing.
Mr Bartolo said the fact remained that the Cabinet had decided that the power station was to have used gas. Then the decision was changed to heavy fuel oil.
Mepa in March 2006 told Enemalta that in order to meet EU emission levels, the new generation plant had to be gas fired. But rather than install the necessary infrastructure for the provision of natural gas, the emission threshold were subsequently changed by legal notice. Gas prices, Mr Bartolo said, were falling and would mean lower utility tariffs.
Finance Minister Tonio Fenech said the government still wanted to use gas. The issue ultimately was financial. Gas could not be bought overnight and the infrastructure took years to be built. Yet the option to use gas remained. Furthermore, the interconnector option - linking Malta to the European power grid - could ultimately be even cheaper.
Mr Bartolo said it would cost €27 million to convert to gas.
Dr Gatt said the BWSC option was still cheaper than Bateman.