COMMISSION STAFF WORKING DOCUMENT Energy Union Factsheet Malta Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK Third Report on the State of the Energy Union
Date: 2017-11-23
Institutions: European Commission, Secretariat-General
Subjects: Malta, climate change policy, competitiveness, economic and social cohesion, energy cooperation, energy policy, innovation, investment, regional cooperation, single market

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 23.11.2017 SWD(2017) 405 final  COMMISSION STAFF WORKING DOCUMENT Energy Union Factsheet Malta  Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK  Third Report on the State of the Energy Union  {COM(2017) 688 final} - {SWD(2017) 384 final} - {SWD(2017) 385 final} - {SWD(2017) 386 final} - {SWD(2017) 387 final} - {SWD(2017) 388 final} - {SWD(2017) 389 final} - {SWD(2017) 390 final} - {SWD(2017) 391 final} - {SWD(2017) 392 final} - {SWD(2017) 393 final} - {SWD(2017) 394 final} - {SWD(2017) 395 final} - {SWD(2017) 396 final} - {SWD(2017) 397 final} - {SWD(2017) 398 final} - {SWD(2017) 399 final} - {SWD(2017) 401 final} - {SWD(2017) 402 final} - {SWD(2017) 404 final} - {SWD(2017) 406 final} - {SWD(2017) 407 final} - {SWD(2017) 408 final} - {SWD(2017) 409 final} - {SWD(2017) 411 final} - {SWD(2017) 412 final} - {SWD(2017) 413 final} - {SWD(2017) 414 final}  
 
 
                         Energy Union –Malta 

 Malta 
                            Energy Union factsheet1 

1.  Macro-economic implications of energy activities 

Energy and transport are key sectors for the overall functioning of the economy as they provide an 
important input and service to the other sectors of the economy. The transport sector2 accounts for 
6% of the total value added of Malta and for 5.5% of total employment3 in 2015. Unfortunately, the 
value added and employment statistics for the energy sector in Malta are not available. 

(source: Eurostat) 

According  to  the  2016  Renewable  energy  Eurobarometer  of  EurObserver'ER,  in  2015  the  share  of 
direct  and  indirect  renewable  energy  related  employment  in  total  employment  of  the  economy  in 
Malta was at about 0.23%, below the EU average of 0.54%. The turnover of the renewable energy 
industry  in  the  same  year  was  estimated  at  around  EUR  0.035  billion,  the  largest  part  being 
attributed  to  photovoltaic  (71.4%)  followed  by  biofuels  and  solar  thermal  industries  in  equal  parts 
(14.29%). 

1   The indicators used in this country factsheet largely build on indicators developed for the Commission Staff 
Working  Document  "Monitoring  progress  towards  the  Energy  Union  objectives  –  key  indicators" 
(SWD(2017)  32 
final)  https://ec.europa.eu/commission/sites/beta-political/files/swd-energy-union-key-
indicators_en.pdf  

2     Gross value added and employment in NACE H-Transportation and storage 
3     National Accounts, Eurostat  

1 

 
 
 
 
 
                                                            
 
                         Energy Union –Malta 

(source: EC based on Eurobserv'Er and Eurostat) 

The  decarbonisation  of  the  energy  and  transport  sectors  will  require  significant  investments  and 
economic  activity  beyond  the  remit  of  these  sectors  themselves.  The  energy  transition  implies  a 
structural  shift  in  economic  activity.  Energy-related  investment  and  jobs  will  in  part  migrate  from 
traditional  fossil  fuel  based  activities  towards  construction,  equipment  manufacturing  and  other 
services related to the deployment of low carbon and clean energy technologies. At the moment, the 
efforts related to the low-carbon and clean energy transition in sectors beyond energy can only be 
partially quantified and are therefore not included. 

The overall investment is usually taken as an indication of the level of efforts and challenges in the 
energy sector. However, data is not available for Malta for this indicator. 

In terms of trade, Malta is nearly fully dependent for its energy consumption on the imports of fossil 
fuels, i.e. import of petroleum products. In addition, despite the absence of refinery capacity, Malta 
is also a significant player in the international trade in petroleum products. The energy dependency is 
reflected in a much larger trade deficit in energy products for Malta than for the EU as a whole. The 
deficit  has  more  than  doubled  in  terms  of  GDP  from  2006  to  2015,  namely  from  4.5%  to  9.3  %  of 
GDP.  Both  the  size  and  increase  in  the  deficit  are  mainly  accounted  for  by  petroleum  products. 
However,  in  2015  the  200MW  electricity  interconnection  from  Sicily  has  entered  into  operation 
leading to trade deficit for electricity of 0.73% of GDP. There is also a small trade deficit related to 
imports  of  liquefied  petroleum  gas.  Malta  started  to  import  LPG  in  2017  with  the  new  gas-fired 
power  plant  coming  into  operation.  The  introduction  of  gas  and  electricity  imports  is  likely  to 
structurally  reduce  the  trade  deficit 
in  petroleum  products.  However,  the  "stock  effects" 
corresponding to Malta's role in the international trade in oil products (i.e. storage on the island and 
in tankers under the Maltese flag) complicates comparisons of oil products and overall energy trade 
deficit levels between years. 

2 

 
 
 
                         Energy Union –Malta 

(source: Eurostat) 

2. Energy security, solidarity and trust 

2.1. Energy Mix 

With 97 % use of petroleum and products, the energy mix of energy primary products in Malta differs 
strongly  from  the  average  energy  mix  in  the  EU.  The  increase  of  renewable  production  and  the 
commissioning of the gas-fired plant in April 2017 will further diversify Malta's energy mix. There is 
already  a  strong  decrease  from  the  99%  oil  product  dependency  in  recent  years,  enabled  by  the 
electricity interconnector with Italy commissioned in early 2015. 

 (source: Eurostat) 

2.2. Import dependency and security of supply 

Malta  has  an  import  dependency  ratio  of  97.3%,  the  indigenous  production  being  represented  by 
renewables only. There is no data on the main trading partners of Malta regarding crude oil and hard 

3 

-10,0-8,0-6,0-4,0-2,00,02,04,02006201520062015MTEU28[% of GDP]Trade balance of energy product and current  account balanceGasOilCoalElectricity-4,54-9,26-2,24-1,69Trade balance of all energy products [%GDP]:2015 EU28: Energy mix*wastenuclearrenewablesnatural gasoilsolid fuels0,8%13,6%13,0%22,0%34,4%16,2%1627,5MtoeGIC -total:GIC -energy mix*1626,2Mtoe2015 MT: Energy mix*wastenuclearrenewablesnatural gasoilsolid fuels0,0%0,0%3,0%0,0%97,0%0,0%0,8MtoeGIC -total:0,7MtoeGIC -energy mix*:*energy mix as share share in GIC-excluding electricity and derivedheat exchanges ,GIC=gross inland consumption 
 
 
 
 
                         Energy Union –Malta 

coal  since  Malta  imports  oil  refined  products  only.  In  2015  there  was  no  usage  of  natural  gas, 
however this will change with the use of gas-fired plants (in 2017, Malta commissioned a new gas-
fired  plant  and  converted  an  existing  power  plant  to  run  on  natural  gas  instead  of  heavy  fuel  oil), 
which  will  receive  LNG  from  a  floating  storage  unit.  Additionally,  the  interconnector  with  Italy 
commissioned in early 2015 enabled electricity imports from and through Italy of 1054 GWh in 2015. 

(source: Eurostat) 
3. Internal market 

3.1. Interconnections and electricity wholesale market functioning 

        3.1.1. Electricity 

source: EC services based on ENTSOE   source: EC services based on                       source: EC services based on Platts and 
                                                                      Eurostat                                                          European power exchanges 

The  commissioning  of  the  electricity  interconnector  between  Malta  and  Italy  in  early  2015 
(supported by the European Energy Programme for Recovery) marked an end to the isolation of the 

4 

54,0%97,3%69,1%0,0%88,4%0,0%64,1%0,0%0%40%80%120%EU28MTEU28MTEU28MTEU28MTtotal energycarriersnatural gascrude oil and NGLhard coalImport dependency200520151,9%-2,7%12,0%na7,2%na8,4%naabsolute change 2005-2015 [pp]MTEU28MTEU28MTEU28 Russia Russia Russia 37,3% 28,8% 29,1% Norway Norway Colombia 32,8% 12,4% 24,3% Algeria Nigeria United States 10,7% 8,3% 16,0%*share in total imports for the MS and in total non-EU imports for the EU282015: Top non-EU suppliers for main energy carriers* Natural gasCrude oil and NGLHard coal 
 
 
 
 
                         Energy Union –Malta 

Maltese electricity grid from the rest of Europe. As a result, Malta's electricity interconnection level4 
increased from 0% to over 24%. 

Due  to  the  size  of  its  electricity  market,  Malta  has  been  granted  large  derogations  from  the 
requirements of the Electricity Directive on unbundling of distribution system operators, third party 
access  and  market  opening  and  a  wholesale  market  are  not  in  place.  Enemalta  PLC  is  a  vertical 
integrated company which is the designated distribution operator and remains the main producer of 
electricity in Malta.  Dispatching and balancing are also carried out by Enemalta PLC. 

3.1.2. Gas 

In  support  of  the  transition  from  the  use  of  heavy  fuel  oil  to  gas-fired  electricity  generation,  the 
European Commission has, in January 2017, approved under EU state aid rules, the Maltese plans to 
pay  Electrogas  Malta,  for  providing  energy  to  the  Maltese  electricity  company  Enemalta.  The 
measure compensates Electrogas for the additional cost of fulfilling public service obligations with a 
new facility. The facility encompasses a floating liquid natural gas storage unit and a new combined 
cycle  gas  fired  power  plant. The storage  unit supplies  gas  to  the  new  power  plant as  well  as  to  an 
existing plant. 

Malta is involved in one Project of Common Interest (gas):  connection of Malta to the European Gas 
network (gas pipeline interconnection between Delimara (Malta) and Gela (Italy)). The basic design 
and  route  identification  study  have  been  completed  and  have  been  co-funded  under  the  CEF 
programme.  The  permitting  procedures  in  Malta  and  Italy  have  started,  and  related  studies, 
preliminary marine survey, FEED study, EPC tender preparation and financial engineering are being 
prepared.  

(source: ACER for the left graph and European Commission services based on Platts, gas hubs, Eurostat for the 
right graph) 

4 The interconnectivity level is calculated as a ratio between import interconnection and net generation capacities 
of the country (i.e. the 2017 value is the ratio between simultaneous import interconnection capacity [GW] 
and net generating capacity [GW] in the country at 11 January 2017, 19:00 pm as resulted from ENTSO-E 
Winter Outlook 2016/2017) 

5 

 
 
 
 
 
 
                                                            
                         Energy Union –Malta 

3.2. Retail electricity and gas markets 

3.2.1 Electricity 

Enemalta  PLC  is  100%  owner  of  the  distribution  network.  The  generation  sector  is  open  to 
competition but market size had restrained development. The electricity retail sector is not open to 
competition  and  therefore  customer  switching  is  not  possible  in  Malta  (the  physical  and  structural 
constraints are a barrier to an effective market). All consumers of electricity are on regulated retail 
tariffs  which  have  decreased  since  2013.  In  2015,  retail  electricity  prices  for  households  were  well 
below European average. Malta is proceeding with electricity smart meter roll out, with about 75% of 
household consumers having an electricity smart meter in 20155. 

(source: ACER) 

(source: Eurostat)  

(source: Eurostat) 

3.2.2. Gas 

Natural gas represents a negligible share of households' energy consumption. Therefore, Malta has 
no significant retail market for households.  

3.2.3. Market performance indicators 

According to the periodical survey of DG JUST, the Maltese consumers' appreciation of the services 
received on energy retail markets has significantly increased in recent years and has surpassed the 
EU average. 

5 according to ACER Market Monitoring report 2016 

6 

 
 
 
 
 
 
 
 
                                                            
                         Energy Union –Malta 

(source: DG JUST survey) 

3.3. Energy affordability  

Although energy expenditure for consumers in Malta was relatively low in 20086, compared to the EU 
average, the inability to keep homes adequately warm has increased in the last decade, even despite 
the lower than EU average electricity prices and energy consumption in the residential sector. 

(source: ad-hoc data collection of DG ENER based on HBS with the support of Eurostat and national statistics) 

4. Energy efficiency and moderation of demand 

Malta  managed  to  reduce  its  primary  energy  consumption  over  the  last  years,  despite  significant 
growth in GDP. This resulted in a decrease of primary energy intensity in Malta since 2005 at a faster 
pace than for the EU as a whole, and it is now lower than EU average. One of the main factors for the 
decrease in primary energy consumption is the recent investments to increase the efficiency of the 
Maltese power plants and the commissioning of an interconnector between Malta and Italy.  

6 In May 2017 when this factsheet has been prepared, 2008 was the last reported year on household expenditure 

in Malta. 

7 

 
 
 
 
 
                                                            
                         Energy Union –Malta 

Although primary energy intensity decreased over the 2005-2015 period, Malta has experienced one 
of the largest increases in final energy consumption (3%) in 2015 among EU Member States. 

(source: Eurostat) 

In 2015, transport was by far the largest energy consuming sector representing a 54.4% share in the 
total final energy consumption, which is well above the EU average (i.e. 33.1%). Malta's final energy 
consumption in the transport sector increased by 5.3% from 2005 to 2015. Malta is facing congestion 
problems due to the high use of private cars and the low share of public transport.  

Energy consumption in industry, when reported to gross value added of the sector, is lower in Malta 
than for the EU as a whole, and could be explained by a sectorial specialisation in the less energy-
intensive subsectors. Specific energy consumption by households is below EU average due to average 
temperatures being the highest in Europe which results in a very low heating demand. Nevertheless, 
energy efficiency measures would also contribute to the comfort levels of the buildings also during 
summer and could help reducing the high share of people in Malta which cannot keep their houses 
adequately warm or cooled.  

Services,  representing  a  large  part  of  the  Maltese  economy,  consumed  over  22%  of  final  energy 
consumption,  well over  the EU average  of  13.6%.  Malta should  focus  on this  sector,  as  the energy 
consumption of this sector increased considerably from 2005-2015.  

(source: Eurostat) 

There  is  no  available  data  for  final  energy  intensity  in  the  industrial  and  services  sectors.  In  the 
residential sector, final energy intensity consumption (below EU average) decreased over the period 
2005-2015.  

8 

2015 EU28: Final energy consumptionwasteservicesagriculture/forestry/fishingresidentialtransportindustry0,4%13,6%2,3%25,4%33,1%25,3%1084,0Mtoe2015 MT: Final energy consumptionother (non-specified)servicesagriculture/forestry/fishingresidentialtransportindustry0,4%22,1%1,5%13,7%54,4%8,0%0,6Mtoe 
 
 
 
 
 
 
 
 
                         Energy Union –Malta 

(source: Eurostat)  

(source: Eurostat)  

       (source: Odyssee dataabse) 

Malta notified in its latest Annual Report that in 2016 the government decided to extend some of its 
current energy efficiency programmes, e.g. grant schemes for the replacement of old cars with more 
environmentally  friendly  ones,  and  provided  retrofitting  of  street  lighting,  incentives  for  building 
envelope  improvement,  tax  credits  for  CHP  technology,  and  the  grant  scheme  for  solar  water 
heaters.  

(source: Eurostat)  

        (source: Eurostat and DG MOVE pocketbook) 

9 

 
 
 
 
 
 
 
 
 
 
 
 
 
                         Energy Union –Malta 

(source: Eurostat)  

In 2016, the Government adopted an ambitious National Transport Strategy with a 2050 horizon and 
an Operational Transport Master Plan to 2025. The adoption of the Strategy and Master Plan was an 
ex-ante  condition  for  unlocking  ESIF funding to  the  transport sector.  The Strategy and  Master Plan 
are comprehensive while also putting significant emphasis on the challenges of road congestion and 
climate  change.  The  documents  include  (the  continuation  of)  a  diverse  set  of  measures  such  as 
infrastructure  works,  intelligent  transport  systems,  fleet  renewal,  modal  shift  and  incentives  for 
behavioural change. The estimated budget is EUR 231 million for 2016-2020 and an additional EUR 
397 million for 2021-2025.  

5.Decarbonisation of the economy 

5.1. GHG emissions 

The  main 
Hydrofluorocarbons (HFCs) and transport. Malta has the lowest emissions per capita in the EU.  

in  Malta  were  evidenced 

in  two  particular  fields  – 

in  emissions 

increases 

Malta is the only Member State that required the use of flexibility mechanisms in order to meet its 
non-ETS  GHG  emission  reduction  targets  for  2013  and  2014,  and  will  still  be  required  to  continue 
using  such  flexibilities  in  order  to  meet  its  2015  and  2016  targets  (as  2016  proxy  estimates  show). 
Therefore, it is expected that Malta will make use of the flexibilities available to it, to be able to meet 
its targets set till 2030, if the basis of the ESR proposal remains the same beyond 2020.  

According  to  the  approximated  data  submitted  to  the  Commission  in  2017,  it  is  expected  that  the 
2016 target will be missed by a 16 pp. margin. Similarly Malta's projection for 2020 expects its target 
to  be  missed  by  an  11pps  margin  (based  on  WEM  scenario,  quality  checked  by  the  EEA  and 
accounting for revised AEAs). This is mainly due to a continued increase of transport emissions and a 
strong  increase  of  HFCs  emissions  over  recent  years;  due  to  replacement  of  ozone  depleting 
substances  with  F-gases  in  the  use  of  refrigerators  and  air-conditioners.  A  smaller  proportion  of 
overall emissions (6.6%), Malta's share of emissions from waste were double that of the EU average 
in 2015. 

10 

 
 
 
 
                         Energy Union –Malta 

(source: EC and EEA)   

(source: EC and EEA based on UNFCCC)   

Malta  is  currently  developing  a  Low  Carbon  Development  Strategy  and  after  a  public  consultation 
closed in June 2017, is working on sector-specific strategies. 

On accounted emissions from land use, land use change and forestry there are currently no available 
data for Malta.  

CO2 emissions in transport and alternative fuelled vehicles 

In Malta, the CO2 emissions from road transport in 2015 were 95.7% above 1990 levels. Emissions of 
greenhouse gases from traffic continue growing and Malta is likely to fail to reach its 2020 emission 
targets if it does not resort to flexibilities provided.  

Malta has adopted an ambitious National Transport Strategy with a 2050 horizon and an Operational 
Transport  Master  Plan  to  2025.  They  include  a  diverse  set  of  measures  to  rationalise  the  use  of 
private cars, promote alternative mobility solutions and make more efficient use of multimodal and 
collective transport systems. While these measures are projected to make significant improvements, 
congestion  is  still  projected  to  rise  and  greenhouse  gas  emissions  from  transport  to  decrease  only 

11 

 
 
 
 
 
 
 
 
 
 
 
                         Energy Union –Malta 

modestly  until  20307.  However,  further  updating  is  needed  on  the  quantification  of  emission 
reductions and targets stemming from the variety of policy measures adopted under the Transport 
Master Plan.  

The reduction of the CO2 emissions may be possible in the future also due to the low CO2 emissions 
level of new cars sold on the Maltese market which is below the EU average.  

(source: European Environment Agency) 

The  share  of  alternative  fuel  cars  in  total  sales  on  the  Maltese  market  is  still  marginal  (i.e.  below 
0.04% in 2015), with a peak in 2014 when 0.33% of the cars sold in Malta were electric (i.e. 21 cars). 

Market  uptake  of  the  electric  car  is  also  supported  by  a  growing  numbers  of  charging  points.  The 
number of electric charging points in Malta has from 2014 to 2016 increased from 26 to 36 units.  

(European Environment Agency) 

(European Alternative Fuels Observatory) 

7 It should be noted that there are several other measures contained in the Transport Master plan which would 
also have a positive impact on GHG reduction. These measures could not be put into the Transport Model in 
order to quantify their individual and cumulative impacts  because the respective policies or measures had 
not been developed to a sufficient level of detail to enable accurate modelling. 

12 

 
 
 
 
 
 
 
 
                                                            
                         Energy Union –Malta 

National Policy Frameworks under Directive 2014/94/EU on alternative fuels infrastructure have to 
establish targets, objective and measures for the development of the market of alternative fuels in 
the transport sector and the deployment of the relevant infrastructure.  

To this date, no notification has been received from Malta and the Member State has failed to fulfil 
its obligations under Article 3(7) of Directive 2014/94/EU.  

5.2. Adaptation to climate change 

The current Maltese National Adaptation Strategy was adopted in 2012. The 2015 Climate Action Act 
formalises the requirement to maintain a strategy that is reviewed and updated at least every four 
years.  Several  sectorial  action  plans  are  available,  covering  the  most  vulnerable  sectors,  which  are 
water  resources,  infrastructure  and  land  use,  natural  ecosystems,  agriculture  and  fisheries,  health, 
civil  protection  immigration  and  vulnerable  groups,  and  finally  tourism.  Monitoring  of  adaptation 
measures is done through the screening of Malta's National Environment Policy under the sections 
related to climate change, while monitoring on the strategy implementation is done by the sectorial 
focal persons on the Inter-Ministerial Committee on Climate Change. 

5.3. Taxes on energy and transport8  

Malta does not have a carbon tax in place, but both car registration tax rates and car ownership tax 
rates depend on CO2 emission performance. This is significant since Malta has a relatively large and 
old car fleet. 

Malta's  overall  tax  burden  on  energy  and  transport  in  relation  to  GDP  has  fallen  since  2007,  but 
remains at 2.75 % in 2014, still nearly 0.4 p.p. higher than the EU average. Contrary to the trend for 
the EU as whole, the tax burden on transport, both as regards vehicles and transport fuels, has fallen 
significantly  (by  about  0.4  p.p.  of  GDP  each  over  the  period).  Taxation  of  heat  and  electricity  has 
remained below the EU-average, as the increase has been roughly in line with the increase of the EU-
average. 

(source: Eurostat) 

8 There is no data on fossil fuel subsidies for Malta. 

13 

 
 
 
 
 
                                                            
                         Energy Union –Malta 

5.4. Renewable energy  

For  renewable  energy  in  general,  Malta  is  on  track  to  reach  its  10%  renewable  energy  target  for 
2020. Malta met its 2013/2014 indicative trajectory on RES share in gross final energy consumption 
and is well above its 2015/2016 indicative trajectory towards the 2020 RES targets.   

Whereas renewables in electricity generation have increased from nearly 0 to 4% in the period 2010-
2015, the renewable energy share in heating and cooling has slightly decreased since 2013 due to an 
increase of energy consumption in the sector while consumption of renewable energy was stable. 

 (source: Eurostat-SHARES) 

(source: Eurostat-SHARES) 

In  Malta,  electricity  from  renewable  energy  sources  is  promoted  through  a  combination  of  feed  in 
tariffs and investment grants. Malta has a good climate for solar based renewables. However, most 
of Malta’s land is already developed or otherwise protected, leaving little land available to dedicate 
solely to solar installations, most of the renewable generation is therefore produced by decentralised 
rooftop photovoltaics. Solar water heating systems in private households are supported with grants. 
Deployment of such systems took place mainly between 2009 and 2011 but uptake has levelled off. 
The  cost  of  solar  based  renewables  support  schemes  is  supported  through  the  state  budget  (and 
ERDF in the case of capital grant schemes) rather than being passed directly onto final consumers.  

Uptake  of  renewable  energy  sources  in  the  transport  sector  is  mainly  driven  by  a  substitution 
obligation  on  importers  of  fossil  fuels,  which  mainly  blend  biofuels  produced  from  waste  and 
residues to meet their obligations. It is estimated that Malta avoided in 2015 only about 5.2% of the 

14 

 
 
 
 
                         Energy Union –Malta 

fossil fuel in gross inland consumption and about 4.0% of GHG emissions at national level, compared 
to the EU average of respectively 10.1% and 9.1% reduction9. 

 (source: EEA) 

5.5. Contribution of the Energy Union to better air quality 

In the last years, air quality in Malta is reported to be generally good, with exceptions. Nevertheless, 
for  the  year  2013,  the  European  Environment  Agency  estimated  that  about  230  premature  deaths 
were attributable to fine particulate matter (PM2.5) concentrations10. 

In  2015,  Malta  reported  no  exceedances  of  the  binding  EU  air  quality  standards11  (see  figure 
below12). 

(Source: EEA) 

The health-related external costs from air pollution in Malta have been estimated to be more than 
EUR 182 million/year (income adjusted, 2010), which includes the intrinsic value of living a healthy 

9Avoided GHG emissions mentioned here have a theoretical character as these contributions do not necessarily 
represent 'net GHG savings per se' nor are they based on life-cycle assessment or full carbon accounting. 
10  European  Environment  Agency,  2016,  Air  Quality  in  Europe  –  2016  Report,  table  10.2.  The  report  also 
includes details as regards the underpinning methodology for calculating premature deaths.    
11 Directive 2008/50/EC of the European Parliament and of the Council of 21 May 2008 on ambient air quality 
and cleaner air for Europe, OJ L 152, 11.6.2008, p.1-44 
12  Compliance  data  as  reported  by  the  Member  States  as  part  of  their  official  annual  air  quality  report  for  the 
calender year 2015 (available on the European Environment Agency's (EEA) Eionet/Central Data Repository), 
http://cdr.eionet.europa.eu/mt/eu/aqd 

15 

0123NO2 Annual limit valuePM2.5 Annual limit valuePM10 Daily limit value[number of zones]Air quality zones in exceedance of EU air quality standards number of zones exceedingnumber of zones not exceedingMT 
 
 
 
 
 
 
                                                            
                         Energy Union –Malta 

life without premature death as well as the direct costs to the economy such as healthcare costs and 
lost working days due to sickness caused by air pollution13. 

The  Energy  Union  can  substantially  contribute  to  further  improve  air  quality  through  measures 
reducing emissions of both GHG and air pollutants such as PM and nitrogen oxides (NOx) from major 
contributing  sectors  such  as  (road)  transport,  energy  production,  industry  and  residential  heating 
(e.g. stoves and boilers) as shown in the figure below14. 

(Source: EEA. This table reflects only sources of primary PM2,5 emissions.) 

6. Research, innovation and competitiveness  

6.1. Research and innovation policy  

Malta’s national research and innovation system has undergone a rapid process of change in recent 
years,  with  the  goal  of  increasing  intensity  and  capacity  for  R&I.  The  National  Research  and 
Innovation Strategy15 2014–2020 is the principal document for the development and coordination of 
policies  and  initiatives  to  increase  public  R&I  in  sectors  that  can  add  value  to  the  economy.  The 
document is built on the Smart Specialisation Strategy in which several areas were identified through 
the Entrepreneurial Discovery Process (EDP).  While “energy” does not feature as a stand-alone area, 
energy is featured in the smart specialisation area of “Resource-Efficient Buildings”. 

Malta is not an active contributor to the ongoing work of the Strategic Energy Technology (SET) Plan. 
It does not participate in any of the fourteen temporary working groups which have been set up to 
implement the integrated SET Plan. 

Regarding  the  Horizon  2020  programme,  Malta  has  received  so  far  EUR  0.7  million  of  the  EU 
contribution devoted to the 'secure, clean and efficient energy' part of the programme through 10 
participations of Maltese organisations in Horizon 2020 projects.  

13  See  also  the  EU  Environmental  Implementation  Review  Country  Report  for  Malta,  SWD(2017)51  final  of 
3.2.2017 
14 National emission data as reported by the Member States to the EEA (available on the EEA's Eionet/Central 
Data Repository), http://cdr.eionet.europa.eu/mt/eu/nec_revised 
15 http://mcst.gov.mt/policy-strategy/national-research-innovation-policy/ 

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                         Energy Union –Malta 

6.2. Investments and patents in the Energy Union R&I priorities  

With  respect  to  public  (national)  funding,  between  2015  and  201716  the  Malta  Council  for  Science 
and  Technology  disbursed  approximately  EUR  0.94  million  in  projects  related  to  energy  and  low-
carbon technologies through its FUSION17 programme. 

Private  investment  in  the  Energy  Union  R&I  priorities  in  2013  was  estimated  at  EUR  10  million 
(0.06 % of the private R&I investment in Energy Union R&I priorities in the EU). This investment was 
dedicated  to  the  Efficient  Systems  (73%)  and  Sustainable  Transport  (27%)  priorities  of  the  Energy 
Union.  

In 2013, the most recent year for which complete patent18 statistics are available, 3 companies and 
research  organisations  based  in  Malta  co-filed  3.519  patents  in  low-carbon  energy  technologies 
(0.05% of the EU total) in the Efficient Systems (71%) and Sustainable Transport (29%) priorities. 

In 2013, private investments in Energy Union R&I priorities, when normalised by GDP, were higher 
than the EU average. In contrast, the number of patents normalised by population was lower than 
the  respective  EU  indicator.  In  the  period  2007-2013,  private  investment  in  Energy  Union  R&I 
priorities decreased by 3% per year on average, while at EU level it increased by 6%. For the same 
period,  the  number  of  patents  in  the  Energy  Union  R&I  priorities  increased  by  10%  per  year  on 
average, a lower rate of increase compared to the EU indicator (15%). 

(Data  sources:  Patent  data  based  on  the  European  Patent  Office  PATSTAT  database20.  Private  investment  as 
estimated by JRC SETIS. Detailed methodology available from the JRC21.) 

16  

includes data up to August 2017 
17 http://mcst.gov.mt/ri-programmes/fusion/ 

18   In  the  context  of  this  document,  the  term  'patent'  refers  to  patent  families,  rather  than  applications,  as  a 
measure  of  innovative  activity.  Patent  families  include  all documents  relevant to  a  distinct  invention (e.g. 
applications to multiple authorities), thus preventing multiple counting. A fraction of the family is allocated 
to each applicant and relevant technology. 

19   According to the JRC methodology, a single patent family can be split across a number of applicants and 

priorities 

20   https://www.epo.org/searching-for-patents/business/patstat.html#tab1  
21   https://setis.ec.europa.eu/related-jrc-activities/jrc-setis-reports/monitoring-ri-low-carbon-energy-

technologies  

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                         Energy Union –Malta 

6.3. Competitiveness 

In 2014, the real unit energy costs (RUEC)22 in Malta (8.0) were far below the EU average (15.3), and 
most major global economies, with the exception of the US (7.5). This can be partly explained by the 
sectorial specialisation, with little energy intensive industry.  The electricity prices paid by industrial 
customers in Malta are above the EU average but have been decreasing since 2010. 

 (source: ECFIN) 

(source: Eurostat and IEA) 

Malta appears to have a weak competitiveness performance in wind and solar energy technology, in 
both  absolute  terms  and  vis-à-vis  the  EU  as  a  whole.  As  indicated  by  the  revealed  comparative 
advantage  indicator23  being  close  to  zero  and  thus  far  under  the  level  for  the  EU,  the  Maltese 
economy is specialised neither in solar PV nor in wind energy technologies. The gap with the EU has 
become significantly larger over the period 2005  – 2015 as regards wind energy technology. While 
the  conditions  are  more  favourable  for  photovoltaic,  Malta  does  not  have  a  large  manufacturing 
sector  and  hence  is  not  well  placed  to  produce  solar  components.  The  relative  trade  balance24 
confirms  that  Malta  is  a  net  importer  of  both  solar  PV  and  wind  energy  technologies  and 
components, hence it is more dependent on foreign supply than the EU average. 

22  This indicator measures the amount of money spent on energy sources needed to obtain one unit of value 

added. 

23The RCA index for product "i" is defined as follows: RCAi =

Xj,i
∑ Xj,i
i
Xw,i
∑ Xw,i
i

 where X is the value of exports, and j is the 

country and w is the reference group, the World economy. 2005 refers in the text to the indicator average 
over the 2000-2009 period, while 2015 represents the average over the 2010-2016 period. The same applies 
for the RTB indicator - see below. 

24The RTB indicator for product "i" is defined as follows: 𝑅𝑇𝐵𝑖 =
exports and 𝑀𝑖 imports. 

𝑋𝑖−𝑀𝑖
𝑋𝑖+𝑀𝑖

 where 𝑋𝑖 is the value of product's "i" 

18 

 
 
 
 
 
 
 
 
                                                            
                         Energy Union –Malta 

(source: UN comtrade) 

7. Regional and local cooperation 

Malta  is  a  member  of  two  regional  Groups  established  under  the  TEN-E  Regulation:  North-South 
electricity  and  gas  interconnections  in  Western  Europe.  Regional  cooperation  on  infrastructure 
development  is  necessary  to  optimise  the  identification  of  regional  infrastructure  priorities  and  to 
coordinate  cross-border  investments.  For  an  island  Member  State  as  Malta,  the  access  to  the  EU 
wide energy market provides security of supply, increases competiveness and can reduce emissions. 

This cooperation led to the first connection of the Maltese electricity grid in 2015 and facilitated the 
abandonment of heavy fuel oil for electricity generation in 2017, following commissioning of the gas 
plant and LNG facilities. 

European  Territorial  Cooperation  –'Interreg'  –  under  EU  cohesion  policy  provides  further 
opportunities for cross-border, transnational and interregional cooperation, including in the Energy 
Union areas. 

Cities and urban areas have a key role in the energy and climate challenge. The Urban Agenda for the 
EU,  established  by  the  Pact  of  Amsterdam  in  May  2016,  better  involves  cities  in  the  design  and 
implementation of policies, including those related to the Energy Union. It is implemented through 
Partnerships, in which the Commission, Member States, cities and stakeholders work together on a 
number  of  important  areas,  including  on  Energy  Transition,  Urban  Mobility,  Air  Quality,  Climate 
Adaptation and Housing. 

By 2016, in the context on the Covenant of Mayors, the sustainable energy action plans delivered by 
24  Maltese  municipalities  had  been  assessed.  These  municipalities  represent  28  %  of  the  total 
population  in  Malta.  All  together,  these  municipalities  committed  to  reduce  by  2020  the  GHG 
emissions by 24.5% (as compared to 1990 baseline).  

(source: JRC 2016. Notes: SEAP=sustainable energy action plan, GHG=greenhouse gas emissions) 

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                         Energy Union –Malta 

In  Malta,  by  September  2016,  no  cities  have  yet  committed  to  conduct  vulnerability  and  risk 
assessment  and  develop  and  implement  adaptation  plans  in  the  framework  of  the  Covenant  of 
Mayors for Climate and Energy. 

8. Cohesion policy and EU clean energy investments  

EU  cohesion  policy  makes  a  key  contribution  to  delivering  the  Energy  Union  objectives  on  the 
ground, including important investment possibilities to implement energy policy objectives in Malta 
which are complemented by national public and private co-financing, aiming at optimal leverage. It 
also  ensures  integrated  territorial  solutions  to  energy  and  climate  challenges,  supports  capacity 
building and provides technical assistance. 

Over 2014-2020, cohesion policy is investing some EUR 46 million in energy efficiency and renewable 
energy  improvements  in  public  and  residential  buildings  and  enterprises  Malta.  Cohesion  policy  is 
also  investing  significantly  in  R&I  and  in  SME  competitiveness  in  Malta,  based  on  the  national 
strategy  for  smart  specialisation.  For  Malta,  the  strategy  includes  different  areas  of  specialisation, 
plus  ICT  as  a  horizontal  enabler.  One  of  these  areas  targets  resource  efficient  buildings,  aiming  to 
develop solutions for improved resource efficiency in new and existing buildings through, inter  alia, 
demonstration  projects  and  optimisation  of  building  design.  At  this  stage,  the  allocations  foreseen 
for  investments  in  R&I  and  adoption  of  low-carbon  technologies  in  Malta  are  not  specified,  but 
should  become  available  in  line  with  the  evolving  content  of  the  smart  specialisation  strategy.  A 
further  estimated  EUR  52  million  is  invested  in  supporting  the  move  towards  an  energy-efficient, 
decarbonised transport sector. 

(source: DG REGIO) 

These  investments  are  expected  to  contribute  to  a  decrease  of  around  170,000  kWh  per  year  of 
primary  energy  consumption  of  public  buildings,  and  around  80  MW  of  additional  capacity  of 
renewable energy production. Overall, the EU cohesion policy investments in Malta over 2014-2020 
are  expected  to  contribute  to  an  estimated  annual  decrease  of  GHG  emissions  of  around  68,000 
tonnes of CO2 equivalent. 

For  example,  the  project  Promotion  of  Renewable  Energy  Sources  in  the  Domestic  Sector  (2016-
2018)  promotes  the  introduction  and  use  of  renewable  energy  sources  (RES)  through  support 
mechanisms.  The  project  provides  financial  support  to  cover  part  of  the  costs  of  the  procurement 
and installation of PV systems installed for domestic use. The scheme is open to all energy consumers 

20 

0102030405060Energy and Low-carbon R&ILow-carbon transport[Million EUR]MTERDF and Cohesion Funds allocation on energy, low-carbon transport and low-carbon R&I 2014-2020 4652Total alocation [mn EUR] 
 
 
 
                         Energy Union –Malta 

in the domestic sectors and will seek to promote the production and distribution of energy derived 
from renewable sources, will increase demand and attract more consumers to make use of RES and 
will reduce dependency on traditional energy sources and reducing harmful emissions. 

Through  its  support  to  sustainable  transport  systems,  the  Connecting  Europe  Facility  (CEF)  also 
contributes to the goals of the Energy Union. Following Maltese participation in the CEF – Transport 
2014-2015  Calls,  the Maltese action  portfolio  comprises  2  signed grant agreements,  allocating EUR 
39 million of actual CEF Transport Funding to Maltese beneficiaries (state-of-play February 2017)25. 
The  transport  mode  which  receives  the  highest  share  of  funding  is  road  (99.5%  of  actual  funding). 
The main CEF action in Malta is the upgrading of the modal interconnection on Malta's TEN-T road 
core  network.  The  action's  objective  is  to  eliminate  bottlenecks  through  the  construction  of  an 
overpass link. The action will also introduce modal shift initiatives: park & ride, bus lanes, cycle lanes 
and  footpaths.  The  removal  of  this  major  traffic  bottleneck  will  improve  connectivity,  accessibility, 
safety,  sustainability  and  reduce  significant  negative  environmental,  social  and  economic  impacts 
resulting from transport externalities.26 

25Note that European Economic Interest Groups and International Organisations are excluded from the analysis. 
26Source: INEA 

21