Government says EU law does not allow capping

Government yesterday reminded the Labour Opposition that the protection of particular sectors over other sectors, in terms of favourable electricity billing, was not allowed by EU law.
It was a frank admission that government’s capping exercise, in which it capped utility bills for big industrial enterprises and hotels, had been against EU law all along.
Government yesterday accused the Labour Opposition of ignoring “basic facts” on the actual cost of water and electricity for industry.
The government said industry was paying 8c for each Kilowatt-hour (kw/h) when this was actually costing 18c for its generation. It said 14.5c was actually the price of fuel oil.
Referring to its proposals for its total cost recovery of energy and water production bills, the governmt said every enterprise that consumes more than 1 million kw/h would be paying the cost price of the generation of the energy.
It said that among its proposals, those enterprises which consume more than 10 million kw/h will be asked to pay the marginal cost of the fuel, so that the other costs incurred by Enemalta are not passed on to the enterprise.
“The problem of rising oil prices is affecting countries around us who had to also react to the situation by raising their tariffs. Our competitiveness must be measures with that of other countries which have experienced rising costs in the production and generation of energy.”

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