Gatt’s ministry blacks out dossier’s references to Enemalta’s demands to relax emissions laws, which later allowed diesel engine to qualify for tender.
Matthew Vella An election dossier compiled by Enemalta’s top management reveals that the Corporation had identified the use of a gas turbine as “the only generating plant able to comply with present expected emissions limits in 2020.”
Despite this critical observation in the report – compiled just two days before the 8 March 2008 general election – the corporation has since opted for a diesel engine turbine for the Delimara power station’s extension.
The €200 million contract is now the subject of a motion by the Opposition for a parliamentary debate on the controversial tender. The award has also been protested by Israeli firm Ido Hutney/Bateman, which claims its gas turbine was a cheaper alternative.
The dossier – compiled as an overview of Enemalta in the eventuality of a change in ministers – was released by Austin Gatt’s ministry earlier this week, after newspaper l-Orizzont this week quoted excerpts from the report, which complains of political interference in Enemalta’s day-to-day management.
Controversially, Gatt’s ministry has attempted to black-out confidential parts of the dossier, which show that Enemalta asked the government to relax emission limits laws. MaltaToday has accessed the report and can reveal the omitted parts of this dossier.
The dossier shows that Enemalta was inclined to go for a Combined Cycle Gas Turbine (CCGT) if it was to satisfy energy demand and comply with EU emission limits, at the lowest cost. “This report identifies the use of Combined Cycle Gas Turbines (CCGT) as being the only generating plant able to comply with the present expected emissions limits in 2020.”
The dossier then refers to the ongoing tendering process for the 100MW extension to the Delimara power station: “Two of the bidders have offered gas turbine based CCGT plants which would fit within the allocated site. The other two have offered medium speed diesel engines, and require twice the area of a CCGT plant, which will result in reducing the eventual capability of DPS to accommodate new plant.”
This statement reflected the mood of the corporation, which as early as 2006 had made it clear during an Enemalta seminar that diesel engines “do not meet present” environmental standards.
But despite the bias in favour of gas, in 2009 the tender was awarded to Danish firm BWSC, which will supply a diesel engine turbine.
Indeed, the confidential parts in the dossier blacked out by Gatt’s ministry now reveal that in early 2008, the government “accepted Enemalta’s recommendations to redefine the scope of the definition of ‘diesel engines’” within the emissions law.
This redefinition appears to have paved the way for a relaxation of stringent emission levels that the BWSC engine could have been unable to meet.
Rival bidder Bateman has claimed the new power station was earmarked to run on gas, not using a heavy fuel engine, such as the one proposed by BWSC.
Bateman claims its offer was €16 million cheaper than BWSC’s. But Enemalta has insisted BWSC’s offer was “the most economically advantageous offer”.
This was determined by the fact that every kilowatt-hour of electricity produced by BWSC’s technology would cost 12.4c compared to Bateman’s 16.8c/kWh.
Enemalta has stated that “it is not true” that gas is cheaper than heavy fuel oil, and that no guarantee had been given to the bidders that the changeover to gas would take place in 2015.
The corporation said the tender allowed for fuel technologies that could be later converted for the use of gas – such as in the case of BWSC’s diesel engine, which will have to be converted into gas at an expense.
Middleman’s saga The award to Danish firm BWSC has been fraught with controversy after Labour MP Evarist Bartolo revealed that a local middleman had been carrying out informal talks with Enemalta officers for BWSC before tendering opened.
Enemalta has claimed that the “informal discussions” between BWSC’s representative – former Enemalta employee Joseph Mizzi – and the corporation’s officers in 2004 and 2005 were normal practice.
Mizzi, from San Gwann, worked at the national energy company for over 25 years. Emails sent by Mizzi to BWSC officials in Denmark, published by MaltaToday, show that Mizzi spoke of the “need to tap another source higher up in the political hierarchy”. In the emails, Mizzi was praised by Jensen as “intelligence working in fifth gear”.
A potential ‘conflict’ BWSC’s local partners also include Vassallo Builders, whose major shareholder Nazzareno Vassallo is a business partner of Enemalta chairman Alex Tranter.
Tranter says he declared his conflict of interest on 26 June 2008, when Vassallo was listed as a possible sub-contractor for the civil works on the Delimara extension.
“Once these bids were assessed in detail and it was noted by the evaluation committee that Vassallo Builders had been listed as a one of the potential Maltese civil works contractors one of the bidders (BWSC) could use, and this was brought to my attention, I took immediate steps to exclude myself from any involvement in the process and delegated the Deputy Chairman to handle all board matters related to this tender, to handle himself,” Tranter said.
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