Infrastructure Minister Austin Gatt has confirmed in Parliament that Enemalta and the Water Services Corporation are to apply to the regulator to raise the utility tariffs.

He said the increase had become necessary because costs had risen and the tendency was for the international oil price to continue to rise.

The minister pointed out that Enemalta was expected to make a €21.4 million loss for the period April to December this year because the tariffs announced in March were lower than the eventual market prices.

The consumption of electricity had fallen by 8% since the last revision, the minister said, while non-technical losses remained unchanged at 6%. The changes between the projections made before the March tariffs and the actual results stemmed from the changes in the world economy, Dr Gatt said.

He explained that when the current tariff was established in March, the price of crude oil was $54.70 and it was now $76. During the same period, fuel oil had risen from $314 to $469.75, gas oil from $484 to $631.50 and the dollar had fluctuated from $1.35 to $1.47.

The tariff changes were therefore required to cover this year's losses and next year's oil price increases.

The minister said the price of crude oil was, according to the market, due to rise to $78.26 in the first quarter of next year, $79.91 in the second quarter, $81.21 in the third quarter and $82.34 by the end of next year.

Fuel oil would end next year at $519 and gas oil at $632.

The minister said Enemalta was keeping its administration costs in check, including salaries, overtime, unbilled units and depreciation, and progress was being made in some areas. However the oil price accounted for 62 per cent of Enemalta's total spending and therefore cost reductions elsewhere only had a limited effect.

He said the governemnt would continue to help those who had a low income - 28,000 account holders are currently being assisted.