MEPA fines Enemalta over Marsa power station infringements

The Malta Environment and Planning Authority has fined Enemalta after three of the four energy-generating plants at the Marsa Power Station have exceeded their allocated 20,000 hours.

The penalty comes 10 days after credit rating agency Standard & Poor's downgraded the energy corporation from BB to B, saying that Enemalta's credit quality was constrained by ongoing delays in refinancing its outstanding debt, amounting to some €600 million.

Standard & Poor's also said that Enemalta's performance would be hampered by rising oil prices and inflexible capital expenditure programme.

"Enemalta was notified by the Malta Environment and Planning Authority (MEPA) that it will have to pay a lump sum penalty as well as a daily penalty, until the Marsa Power Station is completely shut down," the Environment Authority said in a statement.

The penalties include a lump sum of €177,000 and a daily fine of €428 per plant from the time when three of the four energy-generating plants at the Marsa Power Station began to exceed 20,000 hours.

This daily penalty is being applied until 31 October 2013.

"By this date, the interconnector should be operational and Enemalta should be in a position to close down the Marsa Power Station," MEPA said.

If the Marsa Power Station is not yet shut down by that date, the daily penalties will be increased to €857 per plant per day for a further twelve months

The Marsa Power Station is subject to the limited lifetime derogation under Article 4 (4) of Directive 2001/80/EC on the limitation of emissions of certain pollutants into the air from Large Combustion Plants.

This derogation allowed four generating plants at the Marsa Power Station to operate at higher emission limits than those allowed by the Large Combustion Plants Directive for a limited period of time - 20,000 hours starting from January 2008 or until 31 December 2015.

To date, three of the four energy-generating plants at the Marsa Power Station have exceeded their allocated 20,000 hours.

"MEPA is taking into consideration both the environmental impact caused by the continued operation of the plant beyond the 20,000 hours as well as the options currently available to Enemalta to mitigate such impact," the authority said.

It added that it recognised the overriding requirement for Enemalta to meet Malta's full energy demand.

MEPA said the penalties were guided by the general principles established by the European Commission for requesting the Court of Justice to impose lump sum and penalty payments in infringement proceedings.

All the funds collected from these penalties will be directed into the Environment Fund.

This fund was established under the 2010 Environment and Development Planning Act to finance environment projects, programmes and schemes.