Interview with Hon. Miriam Dalli, Minister for Energy, Enterprise and Sustainable Development, Malta

21 Dec Interview with Hon. Miriam Dalli, Minister for Energy, Enterprise and Sustainable Development, Malta

The Mediterranean island nation has positioned itself as a global hub for innovators in the green, blue and digital economies.

The recent United Nations’ Climate Change Conference, COP26, was a milestone in the debate on climate change and sustainable development. How satisfied are you with the results of the conference?

I’ve participated in a number of the COP conferences: I used to represent the European Parliament and I participated in COP21, where the Paris Agreement was struck, and also the one that was held in Germany two years later. I always look forward to these COPs, even if they are not as ambitious as one would like them to be. 

I say this because climate change is one of the biggest global challenges at this point in time, so you always need ambition from the major polluters and also from the major stakeholders. I’m saying this as well because my reactions to COP26 are a bit mixed: it could have been more ambitious on certain things, but then we also saw positive steps. You had, for example, the agreement that was reached from the Glasgow Financial Alliance for Net Zero, which was a step in the right direction. 

You also always have mixed reactions when you see what happens after the COPs. With the Paris Agreement, COP21 was hailed as one of the most successful COPs, but then we started seeing the US taking a bit of a step back and some other countries not being as ambitious as they had pledged to be. So, whilst it’s good to have these conferences held annually, because you can see the progress achieved, ultimately it all boils down to implementation by the different countries and, in particular, the biggest polluters. 

I say this because, from the perspective of Malta, a very small island state, we share the concern that other islands have across the world. Many people speak mainly about Mauritius and other islands that are facing, I would say, almost extinction because of climate change. Malta has its challenges as well. The Mediterranean is being singled out as one of the places where the most aggressive impact of climate change will be felt: we’re right in the middle of the Mediterranean region and, as a very small island, we’re very sensitive to the impacts of climate change. So, we are doing our part. But as a small island, we also look around us for other countries to do their part as well, because this is a global challenge that will have an impact on everyone. 

There is also a direct link to the finances that countries are willing to dedicate and commit to climate change. It is being stated that we require something like a hundred trillion in financing to make sure that we limit the temperature rise to 1.5 degrees Celsius higher than it is at the moment, which means a very hefty investment — between seven times the wealth that the European Union (EU) currently has or three times as much as the GDP of China and the US together — so that’s no mean feat. And if we really want to decarbonise our economies by 2050, we need to be very serious about this. We can’t postpone things any further.

Can you describe Malta’s energy mix and how is the cost of energy affecting business competitiveness in Malta?

We are an island state. We have our own national production of energy, which is based on liquefied natural gas (LNG), which is still a fossil fuel, but it is the cleanest of fossil fuels. We’ve taken quite a step forward in recent years, because our energy and electricity production was previously mainly based on heavy fuel oil and we managed to move to LNG in 2015. That will reduce our carbon dioxide emissions by more than half. 

We are also interconnected with mainland Europe, through Sicily, to get electricity from the EU grid as well. But we are investing a lot in renewables and that is where we are also roping in enterprises. We are supporting both businesses and also our domestic consumers to invest more in renewable energy, and we understand that the biggest change can only happen if enterprises are part of this transition. At this point in time, we are producing around 200MW of energy from renewables — which is a massive step forward when compared to 2013 when we had only 50MW of energy produced from renewables. But we’re not happy with just 200MW, we want much more than that.

To give you a bit of an insight into our current energy landscape: we have these 200MW that are being generated from renewables, we get 200MW of electricity from the interconnector with mainland Europe and we produce around 250MW megawatts of energy from LNG. We need to ramp up more renewables and, at the same time, to strengthen our grid. So we have also announced a second interconnector with Sicily and we’re planning for it to be ready by 2025. 

That would give us an extra allocation of 200MW, which means that we will have a stronger grid for enterprises as well — because we are planning that our economy will continue growing and that we will attract more investment, which would require more energy supply. We’re also moving towards electrification of our vehicle fleets, which would require more energy supply. In addition, we’re investing in offshore projects involving ship technology: we’re planning that, when we have ships coming into our ports, they will switch off their engines and take energy from our electrical supply, which would continue reducing emissions, particularly when it comes to our ports.

In terms of our electricity costs, we have amongst the most competitive prices. We are very sensitive to our businesses and to all our customers. At this point in time, we’re seeing a spike in energy prices across the world, particularly across Europe, due to the hefty spike in gas prices. That is impacting everyone and it impacts all the different sources of energy — we saw a massive spike in the cost of the energy we get from the interconnector, for example. It has a domino effect: once you see that prices are increasing for gas, then prices are increasing for oil, prices are increasing for coal and it is this domino effect that is leading to a sharp rise in many countries. 

As an island, our businesses face different challenges because they are not part of mainland Europe. As a government, we’re very sensitive to making sure that we address those challenges. When we are faced with such an increase around us, we’re making sure that the government absorbs that increase. Particularly at this point in time, which is post-pandemic, we make sure that our customers don’t end up getting undue economic shocks. 

We want to make sure that our enterprises have the possibility to prosper in this country, and we also want to give them a good chance of being competitive. When it comes to such increases that are not dependent on these enterprises, particularly at this time, we make sure that, as the government, we ensure their competitiveness because, ultimately, we want companies in Malta to grow, prosper and create quality jobs on our island.

Expo 2020 Dubai is the first world expo to be held in the Middle East, Africa and South Asia. The event’s focuses are sustainability, opportunity and mobility. Malta is present in Dubai with a pavilion in the Opportunity District that has the theme “Connecting Cultures, Generating Opportunities”. What is the meaning behind this theme and how can this event expand Malta’s partnerships with the Middle East, for example?

It comes naturally to us to say that we want to connect different people from around the world. I believe that the fact that we are placed geographically in the middle of the Mediterranean, between Europe and Africa, between the Eastern and Western sides of the world, means that it comes naturally to us to try and connect people with different backgrounds and from different countries.

As an island, we’re very diversified. We have a very diversified population and that makes it easier for us to connect people together. When we saw the opportunity to be present in Dubai for this expo, we wanted to be there and we want to make our presence felt as well. It is the first time that we have been present in this manner and we’re really proud to be part of the Dubai Expo, because we believe that Dubai is the place to be at this point in time, in order to meet people from different countries, with different ideas and innovative proposals. 

We also believe that Malta is the best place from which to reach out to other continents and to their economies. Due to the fact that we’re exactly between Europe and Africa, and that we also understand the different cultures, the different ways of doing business and the different ways of interacting, we feel that we’re really well positioned to reach out to these different continents. 

We are in the Opportunity District of the expo because Malta has a lot of opportunities to offer. Also, because we’re a very small island, it’s in our nature to try and find opportunities even when there are challenges. When we had the Covid-19 challenge, we made sure that we did not look at this challenge as something that is going to keep us back. All the time, we are looking out for opportunities and to attract opportunities as well, and we are also doing that from the business point of view. 

Just yesterday, we opened up a new pharmaceutical plant in Malta. The firm was initially looking at Malta because it was interested in medical cannabis, then Covid-19 came along and everything was on pause, but we continued working with this company because it was developing a medicine to address the symptoms of Covid-19. As a country, we try and make sure that when we have a challenge, we rise to the occasion and try and find those opportunities that can help us prosper and move forward. 

We have been in touch with a number of enterprises in and via Dubai, and we look forward to continue fostering these relationships, which are extremely important for us. I will attend the expo again in January, having already visited it before. I have to say I was positively surprised — it’s an amazing occasion, event, venture: call it what you may! We are really looking forward for the months to come to make sure that we grasp every opportunity that comes along.

How attractive a destination is Malta for investors or people who might be thinking of living and working in the country?  

It’s very important to relay that we are making sure that we make it easier for companies that want to invest in Malta to actually do that. We’re working a lot when it comes to startups and we offer amongst the most ambitious incentives, including financial incentives, to attract startups as much as possible. We’re always on the lookout for innovation, particularly when it comes to digitalisation, but also to the green and the blue economy. 

To make things easier for people to establish themselves here in Malta, we launched our nomad residency programme and soon we’ll also be launching a startup residency programme. We really want to attract new startups with innovative ideas, which are looking for a place that can be the ideal location as a test bed for pilot projects and then for launching such projects on a bigger scale. Given the size of our country, I believe that we’re best placed to serve as a base for pilot projects. You have the proximity to the market and the small scale, but with the entire infrastructure and all the facilities that a bigger country would have, making a pilot project much more manageable. And if something works on our islands, it’s easier for a company to roll out that on a larger scale.

In addition, our climate, our culture and the fact that we speak English make it even easier for investors, entrepreneurs or startups in Malta.