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Generator Business Booms Amid Maltas Power Crisis
August 10 2024 07:14 by PCLMedia
Malta is currently grappling with frequent power outages, which has led to a significant increase in generator-related expenses, both in the public and private sectors. This situation underscores the growing profitability of the generator business as the country faces ongoing challenges with its energy distribution system.
Recent government spending highlights substantial investments in generator repairs, rentals, and maintenance across various public institutions. A notable expenditure includes €45,810 paid to the Italian company Wärtsilä Italia to repair a generator at Mater Dei Hospital, intended for emergency use only. This expense follows a power outage last July that left the hospital without electricity for nearly an hour due to the failure of its backup generators.
Other significant costs include €31,752 for generator rentals at Gozo General Hospital and €50,495 in direct orders to Honey Comb Services for generator rentals at Mount Carmel Hospital. Honey Comb Services has also been contracted to supply Enemalta with diesel generators to mitigate the ongoing power outages, with potential costs reaching up to €4,700 per day if all ten generators are operated continuously.
€23 Million in Direct Orders for Enemalta Network Upgrades
These expenditures highlight the broader energy crisis Malta is facing. The Malta Employers’ Association (MEA) recently issued a severe warning about the detrimental impact of sporadic electricity outages on industry and business, calling the situation "unacceptable and unsustainable."
The MEA criticized the government's longstanding neglect and underinvestment in the power infrastructure, which has forced businesses to shoulder the costs of these failures.
A report from the National Audit Office confirmed that the high-voltage network has suffered from insufficient investment, making it unable to meet the increasing demands driven by socio-economic growth and changing climate conditions. This crisis, compounded by rapid population growth and poor planning, has led to significant disruptions for businesses and the economy as a whole.
Despite Energy Minister Miriam Dalli's assurances of major investments, including a new €37 million emergency generation plant, the MEA argues that these efforts are inadequate.
The ongoing reliance on generators highlights the deficiencies in Malta's current power infrastructure, which could harm the country’s competitiveness and reputation as a destination for foreign direct investment.
The NAO report also revealed that the power outages experienced in 2023 were not isolated incidents but rather indicative of systemic issues within the network. Enemalta's capital expenditure on the high-voltage network has been declining, even as demand has increased, leaving Malta poorly equipped to handle peak energy loads.
In response to the crisis, the government has allocated €23 million in direct orders to some of Malta’s largest contractors to upgrade the electricity distribution network. However, despite the installation of 82 kilometers of new cables, power cuts continue to affect both Malta and Gozo.
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