Malta contracted to buying electricity from Gasan/Fenech’s power station at €70 million a year more than we are paying now

Early in January 2013, Labour leader Joseph Muscat and Konrad Mizzi, who cropped up out of nowhere, presented the public with what they called their “energy roadmap”.  They announced that it was “concrete and costed”. The general election campaign was about to begin formally.

It was a crazy time. Tensions were running high, people were sick to the gills of the Nationalist Party and the non-stop scenes made by Franco Debono, Jeffrey Pullicino Orlando and John Dalli – three self-serving and corrupt individuals who are now firmly entrenched in Muscat’s party. Labour, though replete with fossils from the 1970s and 1980s, with their history of abuse and corruption, seemed fresh, new and exciting. It was a classic case of extraordinary popular delusions and the madness of crowds.

So electors were dumbstruck in awe as Konrad Mizzi, a civil servant in his early 30s posturing as a jet-setting, high-flying technocrat, blinded them with facts and figures and management-speak which, when boiled down to their essence, meant nothing. Some of the more politically attuned amongst us recognised that he was talking about a done deal, about arrangements the Labour Party had made already for purposes beneficial to itself or to the party’s most powerful decision-makers. We suspected China, and turned out to be partly right.

Back then, the Nationalist Party – and Tonio Fenech in particular – argued vociferously that the real solution to expensive electricity was not the building of a new power station but the Sicily interconnector. But the madness of crowds had taken hold, and when there were the slightest signs that people might start listening, Muscat and Keith Schembri discovered a clock that a couple of cooperative newspapers found terribly fascinating. Three years later, facts were revealed in the Panama Papers that proved beyond doubt what many suspected back then: that Schembri was in bed, in a series of hidden and illegal transactions, with the managing director of one of those newspapers.

Those newspapers, together with the Labour Party, drove electors to near-obsessive interest in that damned, ridiculous clock while showing no interest at all in the machinations behind the Labour Party’s plans for a new power station. The role of the newspapers at that point should have been to scrutinise the reasons for a power station and also to scrutinise Konrad Mizzi himself, since he appeared to come from nowhere to sit at Muscat’s right hand along with the shady Schembri.

But the newspapers and the Nationalist Party, all of which knew exactly who Schembri was because he sold them printing machinery, paper and ink and other supplies (except for The Malta Independent, which never had its own printing-press) and they owed him money, stayed off the subject of Schembri altogether and he remained completely invisible to the public.

Three years into the Labour government, when his shady operations were discovered in Panama, the British Virgin Islands, Gibraltar and Cyprus, the newspapers had to begin almost at the point of explaining to their readers who Keith Schembri is and identifying him in photographs. That is how bad things were.

When Joseph Muscat, Keith Schembri and Konrad Mizzi – already identifiable as a triad behind the scenes before the general election – threw that ruddy clock at Tonio Fenech with the help of their newspaper friends, they did it for one purpose only: to get people to stop listening to him on the subject of their cracked power station plans. And it worked. Today, we are paying the price – several hundred million and counting, and it’s set to rise – for the madness of crowds.

On 9 January 2013, Konrad Mizzi told the nation that by voting Labour into government, we would save €187 million every year on our electricity bills. Of that money, he said, €77 million would be used to cut electricity tariffs and the balance of €110 million would be used for the new power station and to cut Enemalta’s debt.  

Then Muscat, with the newly-installed Louis Grech as a decorative book-end, called a press conference and told us that Konrad’s amazing plan was “doable and credible”. Over the last three and a half years, we have been discovering slowly that it is neither.

The savings of €187 million were based on the price of oil at €140 a barrel.  But the price of oil has since stabilised at €50 per barrel, and there are no savings to fund the tariff reduction, nor to cut Enemalta’s debt. Instead, Konrad Mizzi, Joseph Muscat and Keith Schembri sold a third of Enemalta Corporation and the whole of one power station to China for €200 million.

Then, through the out-of-the-blue revelations in the Panama Papers, we discovered that their corrupt accountant, Brian Tonna, set up a secret company in the British Virgin Islands for Cheng Chen, the man who negotiated with Mizzi, Muscat and Schembri, for the Chinese government’s Shanghai Electric Power, on that deal. He had already set up secret companies, this time in Panama, for Keith Schembri and Konrad Mizzi, and a third one for somebody so important that Mossack Fonseca received his identity only via voice on Skype. So there are no records in the tranche of Panama Papers emails.

Since the general election, neither Mizzi nor Muscat has mentioned the savings of €187 million again. Electricity tariffs have been lowered only because the power plant they sold to China (the BWSC power plant of which Muscat was so critical during the general election campaign) has made possible a saving of €50 million every year. And the Sicily-Malta interconnector has come on stream, making it the cheapest source of energy. Malta now buys 70% of its electricity via the interconnector.

Today, The Malta Independent has reported on this shocker of a story, on its front page. Now we know for certain what many of us suspected immediately Muscat mocked the Opposition leader, calling him a stupid idiot, for saying that he thought electricity tariffs would be lowered, in last week’s Budget.

Muscat, Konrad Mizzi and Keith Schembri have committed the country to buying electricity from Gasan’s and Fenech’s power company, Electrogas Malta Ltd, at €70 million more than we are already paying today. Malta, its businesses and its householders, will be the big losers, paying over the odds for electricity as Muscat’s, Schembri’s and Mizzi’s 18-year contract with the businessmen who backed them for election plays out over the course of an entire generation.

The Panama Triad have bound the country over under contract to buy all the electricity that the Fenech/Gasan outfit produces, regardless of whether Malta needs it or not, at 9c6/kwh. This when electricity bought via the interconnector costs half of that.

The Fenechs and the Gasans will be laughing all the way to the bank alongside their fellow shareholders in the corrupt state of Azerbaijan.

The deal makes so little sense for Malta and those who live here, that we have to ask why Konrad Mizzi, Joseph Muscat and Keith Schembri negotiated it, struck it, and signed off on it. It can’t be simply because those people backed and bankrolled the Labour Party. After today’s story in The Malta Independent on Sunday, the question that has been on every sensible person’s lips since the summer of 2013 has become more pressing and legitimate still: what might Muscat, Mizzi and Schembri have acquired personally and secretly, and on what scale of magnitude to cripple Malta with the equivalent of another three Malta Drydocks for the next two decades?