Some €24 billion are currently sitting idle in Maltese bank deposits, and they should be used as financial assistance for the capital expenditure needed towards investing in cleaner energy, Energy Minister Miriam Dalli said Wednesday.
At a business conference organized by Times of Malta in collaboration with audit firm PKF Malta, Dalli said that the financial industry has a key role to play in the rolling out of financial assistance for greener projects in Malta.
She said that there are nothing short of €24 billion currently sitting unused in bank deposits, which could be used to support Maltese investors to direct the capital opportunity towards greener business ventures rather than conventional ones.
The conference explored links between the Environment, Social and Good Governance (ESG) criteria and renewable energy.
Dalli said that the government is strongly committed to the decarbonisation transition, which will create competitiveness in all businesses.
She said that the world is now more sensitive to the human impact on the environment, and the corporate commitment towards leaner and greener business models will be essential to the long-term value creation of companies.
“ESG is an indispensable tool that will level up our enterprises and with it our national and European economic model,” Dalli continued.
Dalli said that she is conscious of the fact that the transition to greener energy will be costly, but adding that the status quo and the fear of change will prove more costly in the future.
“Maltese companies which have been investing in cleaner energy sources and other ESG criteria are returning better return to their shareholders compared to their peers,” Dalli said, explaining the benefits.
She said that the results from the government ESG portal indicate that companies who reported their ESG credentials registered an 8% decrease in their C02 emissions, and a 9% reduction in their waste consumption last year alone.
“The main aim in all this is to push capital expenditure away from traditional investment and towards green and digital investments,” Dalli said.
In 10 years, government has increased the nation’s share of renewable energy from just 10MW to 223MW, which meets and exceeds the 2030 EU target, Dalli said.
Dalli said that government is working on the second interconnector to strengthen Malta’s capacity as the enabler of large-scale development of renewable and address intermittency issues. This is in addition to a future hydrogen pipeline from Delimara to Gela.
She said government is investing heavily in strengthening and widening the electricity distribution network, which is crucial for the transition while improving grid stability.
Dalli said that government is looking to achieve beyond generating 50MW in offshore renerables by 2030, referring to the €200 million environmental project that will transform non-recyclable waste into an energy source.
She said government also looked into battery storage systems, where applications for government schemes for batteries and hybrid inverters increased to over 500 by the end of last year.
Dalli said that through the work of the Regulator for Energy and Water Services, the Energy and Water Agency and Enemalta, an ambitious package for mass renewable systems was launched, meaning a total capacity of 19MW that, if taken up, would mean an environmental investment of €30 million over 20 years.
She said the government is also looking into the potential of tapping into opportunities for energy in North Africa, as well as analysing hydrogen availability, adding that green hydrogen availability is of prime interest.
The PN’s spokesperson for Energy Mark Anthony Sammut said that Malta has the potential for floating offshore wind projects, which could place Malta at the front for research, technology and the possible maintenance of these projects.
He said that while the interconnector and the hydrogen pipeline are projects moving in the right direction, onshore operations should not be neglected, nor the infrastructure required to enable such systems to work.
Sammut said that we must improve electricity distribution networks, which are often with high unstable voltages. He added that the ESG is a key took for government, in alliance with the private sector, to align businesses and the country to compliance, with good governance, social and environmental criteria.
He said that this has political risks, which requires those who lead, to lead by example and uphold certain standards, which, he said, have been eroded in the past.
Expert Dr Srdjan Sokolovic spoke about Malta’s hydrogen potential, which would lower CO2 emissions, lower the country’s dependency of LNG supply and provide stronger energetic security.
It could have a positive impact on the tourism sector, as hydrogen petrol stations would make Malta a greener country. Sokolovic said that the biggest problem with hydrogen production is its price, however, if taken up seriously, can be reduced significantly by 2050.
Sokolovic said that while 1 kilogram of hydrogen could provide a car with enough fuel for 95 km, 1 liter of gas can only provide enough for 15km. Using hydrogen energy would also mean that Malta would be using its own sources, rather than import, he said.
Principal Consultant at Clarkson Renewables said that Malta’s potential for offshore wind development is large, where the capacity of 25 Gigawatt (GW) of floating offshore wind farms can be realized.