CPNN.com.cn: SEP Boosts Construction of Beautiful Malta with Green Energy
The tiny Mediterranean island of Malta is well-known for its unique geographic location and beautiful scenery, which attracts tens of thousands of tourists from around the world every year. Nevertheless, Malta, which relies on tourism as its pillar industry, is facing a dilemma between economic development and environmental protection like all those countries with weak infrastructure.
As China is further deepening cooperation with countries involved in the Belt and Road Initiative, SEP, a major subsidiary of SPIC, has been carrying out business in Malta for four years since its equity investment in a local energy enterprise in 2014. Through leveraging its advantages in management experience, capital and technology, SEP continues to make contributions to the green energy development of Malta and has achieved multi-win in terms of economy, society and environment eventually.
Marsaxlokk, located in the southeast of Malta, is a popular tourist resort on the island. Delimara power station, also located here as an import power source for the whole island, becomes a unique part in such a beautiful landscape painting. D3 Power Plant within the site of Delimara power station had just eight heavy oil-fired power generation units at the beginning of construction, with annual power generation of 136.8 MWh only. At that time, the power supply of Malta relied mainly on the submarine cable connected with Sicily of Italy, which was highly susceptible to the environmental impact, and thus the island country often suffered from power outages. In 2014, the annual average time of power outage was 9.69 hours for Maltese consumers.
Stevo Mandic, who come from Serbia, has fallen in love with Malta since he travelled here as a tourist ten years before. When he came to Malta again in 2016, he was employed by SEP (Malta) Holding Ltd. (SEPM). When he joined the company, an oil-to-gas conversion project was under way at D3 Power Plant, with the original heavy oil-fired units transformed to dual-fuel type units using natural gas and light oil. Thanks to the conversion project, the island country had its first natural gas-fired unit. Besides retrofitting on the internal combustion system, the flue gas system had been upgraded accordingly. After the conversion, various environmental indicators of the units became superior to the level required by the local government, and hence the power plant obtained the ISO14001 certificate. Moreover, the power plant is now able to meet the dispatching needs of the power grid rapidly, which ensures the stable supply of electricity to a great extent during the summer peak season especially. In 2017, the average power outage time of Maltese users decreased to 0.44 hours, with the optimization rate reaching 90 percent.
In the meantime, SEPM is developing a series of wind power and solar power projects jointly with its local partner Enemalta aimed at completing a total capacity of 300 MW on and outside the island of Malta in the coming five years. Among them, Marsa Roof-mounted Distributed PV Power Project, the first PV power demonstration project on the island of Malta, realized commercial operation with full capacity in the end of 2017. The two companies have also joined hands to develop projects overseas, taking the continent of Europe as the first step, with Mozura Wind Power Project in Montenegro expected to go into operation by the end of 2018. Among the first batch of countries with positive response to the Belt and Road Initiative, Serbia and the Balkan region, where the former is located, is the key area for SEPM's project development in the next phase.
SEPM was founded as a wholly-owned subsidiary of SEP on November 26, 2014. Through a flattened overall operation mechanism, the company pushed forward four projects located in Malta in a synergistic manner: it acquired 33.3 percent shares of Enemalta PLC, Malta's only state-owned energy company, and helped the latter realize transformation; it also invested 150 million euros for the acquisition of 90 percent stake of Delimara 3, a major power plant in Malta; it established International Renewable Energy Development Ltd(IREDL) jointly with Enemalta to develop renewable energy projects in Malta and on the continent of Europe; through equity participation in International Energy Service Center, SEPM provides professional electricity O&M services centering on Malta while expanding to the surrounding market gradually in order to realize coordinated development.
SEPM knows that it cannot improve the energy situation of host country merely by project development. Only through cooperation with local enterprises, fundamental improvement of infrastructure and realization of energy structure transformation, the company will be able to achieve mutual benefit, win-win result and sustainable development eventually.
As the Malta's only state-owned power company engaged in generation, transmission, distribution and retail, Enemalta had been confronted with a number of problems such as redundant personnel and weak infrastructure before the transformation. After investing 100 million euros to acquire 33.3 percent shares of Enemalta, SEPM assigned several senior executives to the company and participated in its daily operation. Thanks to the injection of capital and management experience, Enemalta was able to turn around and realize successful transformation eventually with the reliability, stability and safety of the power grid enhanced substantially. Following sustained improvement in its financial performance, Enemalta's corporate rating was also upgraded. Through optimization of local energy structure, the residential power tariff in Malta was reduced by 25 percent, and the country's sovereign rating was upgraded to "A+" for the first time in 20 years.
The development achievement of SEPM has won applause from both China and Malta. The company was praised by Maltese Prime Minister as "a win-win model of economic and trade cooperation between Malta and China". SEP's Malta project was selected as an excellent case of "going global" by State-owned Assets Supervision and Administration Commission (SASAC) in 2016 while the company was granted the title of "advanced collective" by SPIC. Besides, SEPM was considered as "small investment but big influence, small scale but big potential, late comer with good experience" by Xiong Weiping, Chairman of the Supervisory Board for Key Large State-owned Enterprises. In 2017, "Optimization of Maltese Energy Structure by SEP" was included as a classic case in the Overseas Sustainable Development Report of Chinese Enterprises in 2017 jointly released by the United Nations Development Programme, Ministry of Commerce of China and SASAC.