Issue link: https://maltatoday.uberflip.com/i/1501789
2 NEWS maltatoday | WEDNESDAY • 21 JUNE 2023 2 CONTINUED FROM PAGE 1 He said it was in 2011 that Labour started aiming for a 25% reduction in energy bills, through the switch-over to gas – a prospect already laid down in the national energy policy issued under a Nationalist administration in 2006, but which was ignored when it procured a BWSC turbine powered by heavy fuel oil. He denied that he had been lobbied by businessmen on a future gas plant. He referred to Paul Apap Bologna, with whom he met some three times, saying they had discussed medicines shortag- es; and Tumas magnate George Fenech, with whom he discussed the prospect of the Arriva public transport system his company was invested in. He said it was the Nationalist adminis- tration that had been lobbied by private companies to switch over to gas. "On the surface, the opposition to this seems this was because the gas turbines were too expensive, and that Enemalta could not afford it. Our innovation was intro- ducing a private partner that removed the burden for the State," he said. He later likened his privatisation idea for energy, as akin to the Nationalist administration's outsourcing of elderly care to the private sector. "The econo- mies of scale on sourcing fuels and the know-how needed to run a gas plant, are costly for a small country like Mal- ta." Muscat says an MOU signed internally by Labour while in opposition with En- ergy World, was a non-binding agree- ment to underline the feasibility of be- ing able to forge ahead with a gas plant and guarantee lower energy bills. "This company did not even win the Delima- ra contract, having itself contested the award of the contract to Electrogas," Muscat said, pointing out that the NAO had found the elimination of this com- pany, justified. "I am here to defend this project… not the barbarous murder (of Daphne Caruana Galizia)… without this project this country would not have recovered economically," he told MPs. After 2013, Muscat says that – com- pared to the opacity on the BWSC ten- der under the PN administration – the Delimara gas plant attracted 13 bidders, evaluated transparently, underwritten by international banks like Societe Gen- eral, BNP Paribas, HSBC International, BOV, and Nataxis, and even vetted by the European Commission. He said this private element was necessary in the switch-over to gas because Malta in 2013 was under the EC's excessive defi- cit procedure, and the State could not finance the project itself. Muscat denied meeting any business- man after 2013 to discuss the Delimara contract. "The only interface were em- issaries from foreign governments or ambassadors, who tried to lobby in the favour of their countries' companies' interests in the tender. These were the advances we had." Muscat said that once Electrogas was awarded the tender, under EU rules the government had to forge a security of supply agreement binding the State to buy energy from Electrogas should the State utility Enemalta go bankrupt and be unable to acquire electricity from Electrogas. "That security of supply agreement was dependent on the European Com- mission's green light, so until that ap- proval was issued, the government took a calculated risk to issue a temporary guarantee for Electrogas, up until the EC clears the security of supply agree- ment… Electrogas paid €12 million to the State for this guarantee," Muscat said. He said the State also created a securi- ty of supply agreement with Electrogas partner SOCAR, the Azerbaijani state oil company, to force the company to sell its stake to the government should it fall out with Electrogas. "All these agreements have since then been re- voked." He said it was MP Joe Debono Grech, then a Council of Europe PACE mem- ber reporting on Azerbaijani relations, who alerted him to the advantages of tapping the gas-rich nation's resources. "He said it would be just like China had been for Mintoff… today EC president Ursula von der Leyen describes Azer- baijan as a trustworthy partner, not a corrupt nation. We were first in line." Muscat said the State pays Electrogas's €2 million in annual excise taxes, be- cause it extracted €30 million up front from the company in 2014 to immedi- ately reduce energy bills by 25%. He also insisted that while the Mal- ta-Sicily interconnector's capital cost was probably €20 milion less, this did not take into consideration its deprecia- tion. Today we know that in the last five years, we know that when compared with the interconnector – on which the success of the gas plant also depends, because they are interdependent – Mal- ta would have had to pay over €150 mil- lion without the gas plant." Muscat also credited disgraced former energy and health, and tourism minister Konrad Mizzi as a project manager for government projects whose promising political career had been cut short. "He is the most competent person in pro- ject management and the gas plant was question of project management more than energy," he told the PAC. Appointing Mizzi as minister for health was a good decision, too, he told MPs, because he had found solutions for Malta's shortage of medicines prob- lem. But was he a transparent operator, PAC chairman Darren Carabott asked? "He could have been more transpar- ent… it is a pity that a man of his capa- bility had to end his career in politics," Muscat said, referring to Mizzi's role in the Panama Papers. Muscat also said his former finance minister Edward Scicluna's comment about the former PM having a 'kitchen cabinet' had been entirely misquoted. "I had different groups of advisors on vari- ous subjects, like health or education…" "I am here to defend this project… not the barbarous murder (of Daphne Caruana Galizia)… without this project this country would not have recovered economically." 'Konrad Mizzi could have been more transparent on Panama Papers' PAC chairman Darren Carabott (cemtre) led the grilling of Joseph Muscat