The current electrical energy mix in Malta consists of 70% local generation from gas-fired plants, 20% direct imports over the Malta-Italy Interconnector, and 10% (a significant jump from 1.3% in 2013) of generation from local renewable energy sources (mainly consisting of private and commercial land-based photovoltaics (PV) and small-scale rooftop PV installations). Malta’s biggest challenge is spatial capacity. According to the National Statistics Office (NSO) by the end of 2023, the cumulative installed PV capacity exceeded 241MWp.  In recent years significant efforts have been made to increase renewable energy generation, including:

1. The publication of a National Policy for the Deployment of Offshore Renewable Energy in 2024 focused on establishing the Government’s policy for the establishment of offshore floating wind and solar projects to increase percentage of renewable energy. This was followed by the issuance of a Pre-Qualification Questionnaire for a Concession for the Design, Construction, Operation, Maintenance and Decommissioning of an Offshore Floating Wind Farm for Renewable Energy Supply, which was first published in 2024 and which seeks to invite interested parties to participate in a floating wind project (having a capacity of 280MW to 320MW) in Malta’s eventual exclusive economic zone.
2. In January 2024, the Government issued a Preliminary Market Consultation on floating solar farms, to assess the market readiness for nearshore floating solar farms in the Maltese territorial waters. This was followed by another Preliminary Market Consultation issued by the Regulator for Energy and Water Services in 2024 which sought to invite reputable companies to submit proposals for a circa 50MW floating solar technology project to be established in Malta’s territorial waters.
3. The Government has regularly issued competitive bidding processes for the allocation of financial support for renewable energy production (for projects having a capacity between 40KW and 1MW; and for projects exceeding 1MW). The most recent invitations to bid were published in May 2025.
4. In 2024, Interconnect Malta also issued a tender for the design and build of two utility scale battery energy storage systems (BESS) in Malta, with this tender still being evaluated at the time of writing.
5. The Maltese Government has also allocated over €10 million for the 2025 Renewable Energy Systems Household Grants Scheme, administered by the Regulator for Energy and Water Services (REWS). This scheme supports, homeowners in installing PV systems and battery storage solutions.
6. The Maltese Government also offers attractive feed in tariff schemes to promote renewable energy adoption among households as well as businesses and organisations having a capacity of less than 40KW.

The above projects also fall within a wider framework being promoted by the Government to tackle climate change, which also includes:

• the promulgation of a Climate Action Act and the establishment of a Climate Action Authority in 2024; and
• the successful launch of Malta’s first green bond in 2024 by Clearflow Plus plc (a subsidiary of the Government owned Water Services Corporation), the proceeds of which have been earmarked, inter alia, for the establishment of solar farms.

As explained in Q1 above, Malta has made significant strides in expanding its renewable energy capacity, focusing particularly on solar photovoltaic (PV) installations and the potential of offshore energy generation. The government has intensified its subsidy programs aimed at accelerating the adoption of rooftop solar PV systems among both residential and commercial sectors, supported by funding from the EU’s Recovery and Resilience Facility (RRF). These incentives have led to a measurable increase in distributed solar capacity, with the total installed solar PV capacity estimated to have increased by approximately 15-20% since 2023

Notably, exploratory initiatives for offshore wind have gained traction, driven by Malta’s strategic position in the Mediterranean and regional interest in decarbonizing the energy sector. Although no concrete offshore wind projects have yet been commissioned, international stakeholders have been expressing their interest in the aforementioned pre-market consultations.

Malta has also been actively pursuing international collaboration to enhance its energy sector, focussing on renewable energy, grid interconnections, and sustainable infrastructure. Most notably Malta has entered into a memorandum of understanding (MoU) with Egypt and Libya. In June 2023, Malta and Libya signed a MoU for a renewable energy interconnector between the two countries. In January 2024, Malta and Egypt signed a MoU to strengthen cooperation in the energy and electricity with a focus on:

• Exploring renewable energy systems and emerging technologies;
• Fostering research and innovation in the energy sector;
• Supporting energy efficient initiatives;
• Considering indirect electrical interconnections and virtual energy corridors to diversify energy sources.

Furthermore, Malta’s National Energy and Climate Plan has also highlighted that discussions on the renewable energy sector have also taken place with Tunisia, and that it is expected that a formal agreement will be entered into between Malta and Tunisia for the creation of an “energy partnership”.

While Malta understands the challenges it faces in terms of renewable or low-carbon hydrogen production and consumption, concluding that it is not feasible to produce green hydrogen indigenously from onshore RES due to economies of scale, spatial requirements and water scarcity, the government is nonetheless taking steps to address these issues. The Maltese government has also declared that it will be upgrading the planned Malta-Italy gas pipeline to a hydrogen-ready pipeline and will be assessing the feasibility of importing green hydrogen through this pipeline as an option for the decarbonization of Malta’s domestic power generation sector and other inland sectors. This will be designed to facilitate bi-directional flow, offering the potential for hydrogen to be transported from Malta to Italy, contingent upon further investment in compression infrastructure.

Malta has committed to achieving carbon neutrality by 2050, a target enshrined in law through the EU Climate Law framework, which makes this commitment binding on all EU member states, including Malta. This aligns Malta’s national climate policy with the EU-wide goal of net zero greenhouse gas emissions by 2050.

Interim targets form part of Malta’s National Energy and Climate Plan (NECP) of December 2023, which specifies that Malta should increase its share of renewable energy to 24.5% by 2030. The plan also sets a target to reduce greenhouse gas emissions by at least 19% compared to 2005 levels by 2030, reflecting Malta’s contribution to collective EU commitments under the Paris Agreement.

In addition to legal targets, Malta’s energy policy framework emphasizes energy efficiency improvements, electrification of transport, and reduction of carbon intensity in power generation. These goals are supported by legislative instruments such as the Energy Efficiency Regulations and the promotion of clean technologies through public funding programs.

Additionally, with the establishment of the Malta Climate Action Authority and Malta being a party to the United Nations Framework Convention on Climate Change (UNFCCC) and its protocols and agreements, and in accordance with EU legislation, Malta has the obligation to submit an annual inventory of anthropogenic greenhouse gas emissions by sources and removals by sinks.

The Climate Action Authority is designated by law as the national GHG Inventory Agency for the country, thus being responsible for the annual compilation of Malta’s GHG inventory. The inventory is submitted to the European Commission and to the UNFCCC Secretariat and is subject to separate annual reviews by expert review teams in accordance with EU legislation and with UNFCCC decisions.

The Climate Action Authority’s work in respect of GHG inventories includes deciding on the methodologies for the estimation of emissions and removals, gathering the necessary activity data for all relevant activities, performing the necessary calculations, compiling the results into the approved reporting format and preparing a detailed written report that presents the approaches used for each activity category.

The most recent GHG Inventory for Malta (2024 submission covering the time-series 1990-2022), including the written National Inventory Document (NID) and the detailed Common Reporting Tables (CRT) may be accessed here:  https://unfccc.int/sites/default/files/resource/Malta_GHGInv_1990-2022_NID_Sep2024_Final.pdf

The Electricity Regulations (Subsidiary legislation 545.34 of the laws of Malta), define “energy from renewable sources” or “renewable energy” as “energy from renewable non-fossil sources, namely wind, solar (solar thermal and solar photovoltaic) and geothermal energy, ambient energy, tide, wave and other ocean energy, hydropower, biomass, landfill gas, sewage treatment plant gas, and biogas”.

Similarly, the Feed-in Tariffs Scheme (Electricity Generated from Solar Photovoltaic Installations) Regulations (Subsidiary Legislation 545.27) define ‘renewable energy sources’ as “non-fossil energy sources, that is, wind, solar, geothermal, wave, tidal, hydropower, biomass, landfill gas, sewage treatment plant gas and biogases”.

This is generally in line with the definition of ‘energy from renewable sources’ or ‘renewable energy’ under Directive (EU) 2018/2001 of the European Parliament and of the Council of 11 December 2018 on the promotion of the use of energy from renewable sources (recast).

Ministry for the Environment, Energy and Public Cleanliness (Ministry)

The Energy Ministry is the central governmental authority responsible for shaping Malta’s energy (including renewable energy) policy. The ministry formulates strategy, coordinates the implementation of EU directives, and coordinates funding programs. The Ministry is also heading the implementation of the Malta’s National Energy and Climate Plan.

The Regulator for Energy and Water Services (REWS)

REWS is the regulator for energy and water services in Malta and is granted a wide array of responsibilities involving the regulation of practices, operations and activities in the energy and water sectors. REWS also administers the feed-in-tariff schemes and the bidding processes for the allocation of feed-in-tariffs, and in 2024 also issued a preliminary market consultation for the floating solar technology in Malta’s territorial waters.

Interconnect Malta

Interconnect Malta is fully owned by the Government of Malta, and has been tasked with developing various infrastructural projects, including Malta’s second interconnector to Sicily; a hydrogen ready pipeline; an offshore floating wind renewable energy project, as well as a battery energy storage system (BESS).

Water Services Corporation

Water Services Corporation is the Government utility company which is responsible for operating and maintaining the water, drainage, and secondary water networks in Malta.  This Corporation has however promoted the issuance of Malta’s first green bond through its subsidiary entity Clearflow Plus plc, the proceeds of which will inter alia be used for the carrying out of certain investments in renewable energy projects.

The Environment and Resources Authority (ERA)

ERA manages environmental permitting and assessments, critical for renewable project approvals, ensuring sustainable development and environmental protection. It is Malta’s main environmental regulatory authority responsible for safeguarding environmental protection and quality. In terms of renewable projects, ERA is tasked with carrying out Environmental Impact Assessments, particularly with respect to marine, land and environmental aspects.

The Malta Climate Action Authority (MCA)

The Climate Action Authority was established in 2024 and is responsible for inter alia, implementation of strategy and study of matters related to climate change; the coordination and issuance of climate related polices in alignment of EU climate targets; the EU ETS Scheme; and the Carbon Border Adjustment Mechanism.

The Private Sector

The Maltese private sector is actively contributing to the country’s renewable energy transition through various initiatives in solar energy, energy storage and international collaborations. The majority of the private sector is concentrated in the installation and operation of PV systems. These range from small scale roof top systems on residential and commercial buildings to larger ground mounted solar farms. We are also experiencing an increase in international collaborations mostly as a response to the Government bids and tenders relating to renewable energy.

The most popular approach for businesses to access renewable energy in Malta remains the installation of solar panels on their rooftops. These solutions are popular given the established frameworks and the availability of feed-in-tariffs, together with the relative ease in installing solar panels and their scalability. Businesses are also drawn towards this solution in accessing renewable energy as it can translate into a direct reduction in the businesses’ energy costs.

A number of businesses have also taken up initiatives to electrify their commercial vehicles. These include a significant uptake in the use of electric vehicles as well the installation of EV charging stations on their premises. It is expected that businesses will continue this uptake of electric vehicles particularly in view of Malta’s obligations at EU level and the proliferation of charging stations in Malta.

Due to derogations which Malta has from the EU Electricity Directive (Directive (EU) 2019/944 of the European Parliament and of the Council of 5 June 2019 on common rules for the internal market for electricity and amending Directive 2012/27/EU (recast)), the sole distribution system operator in Malta is Enemalta plc.  Since over the past years there has been a low threshold of electricity generated from renewable energy sources, and since there has been very limited use of guarantees of origin or renewable energy certificates, there has not yet been the development of the purchasing of green power from a supplier, or having direct corporate PPAs with Enemalta plc.

Yes, over the last 12 months, there has been a noticeable shift in how Maltese businesses engage with renewable energy, driven by multiple converging factors.

As a result of the of the EU’s legislative package on Environmental, Social, and Governance (ESG), primarily the EU’s Corporate Sustainability Reporting Directive (CSRD) and EU Taxonomy regulations, investments in renewables as part of the carbon reduction commitments of companies with international ties or listed entities has accelerated and has intensified pressure for transparency and measurable green investments.

Global energy market volatility, particularly the increase in natural gas prices following geopolitical tensions (notably the Russia-Ukraine conflict), has pushed Maltese businesses to seek energy cost mitigation through renewables notwithstanding the stabilisation of energy prices in Malta through Government subsidies. Solar PV and energy storage have become increasingly attractive for their predictable cost structures in juxtaposition with the improved Government schemes available to the public and private sectors. The constant energy security crisis together with inflation and increased costs of capital and supply chain continue to pose huge challenges for large scale investments.

Discussions around carbon emissions reduction have become significantly more visible and mature in Malta’s business community, particularly among medium and large enterprises. The increasing integration of carbon reduction strategies and climate risk assessments into corporate strategy and investment planning reflects heightened awareness is evident, with steady government backing through policy and financial incentives. Malta Enterprise (Malta’s economic development agency, tasked with attracting new foreign direct investment as well as facilitating the growth of existing operations), offers a multitude of support schemes which include green mobility and smart and sustainable investment grants which provide funding to support investments that lead to more sustainable processes.

Principally, the EU’s shift from soft laws to hard laws of the past decade have contributed substantially to the maturity of discussions and policy making. Energy efficiency has also become a core topic, especially given Malta’s energy import dependence.

A new generation capacity will require an authorisation from the Regulator for Energy and Water Services in accordance with the Electricity Regulations (irrespective of the type of energy being generated).  Exemptions apply in de minimis scenarios, which consist of producers which:

• (a) produce electricity solely for own use, are not connected in parallel to the distribution system and have installed a total peak generation capacity of less than 1500 kVA; or
• (b) produces a total peak generation capacity rated up to and including 16 Amps per phase, single-phase or multi-phase, 230/400V AC produced solely from renewable sources of energy or cogeneration plant (though a notification requirement to the Regulator would still apply here).

Energy storage facilities do not require an authorisation from the Regulator for Energy and Water Services, though they are to be notified to the Regulator, and are still subject to certain regulatory requirements.

The transfer of any licence would also require the approval of the Regulator for Energy and Water Services, and the same criteria which needs to be met for obtaining a licence would also need to be satisfied by a transferee of a licence for the Regulator to grant its approval to a transfer.

Other permits, licences or consents may also be required depending on the specific type of project with these other permits, licences or consents possibly consisting of:

• Development and environmental permits;
• Grid Connection consents;
• The granting of certain rights over property;
• Licences for certain activities to be carried out on Malta’s continental shelf/ exclusive economic zone (for offshore projects).

As seen in our above replies, the Government (and Government companies or entities) are key players in the renewables industry, and they are seeking to drive the renewables industry in Malta both through actual investment as well as through the provision of incentives to the private sector.

Enemalta plc, which is the sole distribution system operator in Malta, benefits from derogations from EU law which also allow it to participate in generation activities and has also been active in the renewables sector. Interconnect Malta has also been spearheading other projects as described above.

The Maltese Government has a clear decarbonisation strategy which mainly focuses on the development of the renewables industry.  As seen in our above replies:

• The Government has, for several years, granted incentives for solar projects to be installed by households and commercial entities in small scale/ rooftop projects, and has also granted financial support through competitive bidding processes for larger solar farms (between 40KW and 1MW; and for projects exceeding 1MW);
• Given the spatial limitations in Malta, the Government has amended various laws to cater for the possibility of introducing floating wind structures in Malta’s eventual exclusive economic zone;
• The Government and the Regulator for Energy and Water Services have been exploring the possibility of floating solar panels being installed in Malta’s territorial waters;
• There has recently been the enactment of the Climate Action Act which also established the Climate Action Authority which is tasked with dealing with climate change related matters.

The government has launched a number of incentive schemes which are aimed at promoting renewable energy.  These incentive schemes are offered on both a commercial and residential basis.

These incentives include subsidies for photovoltaics (PV) panels for both residential and non-residential units aimed at helping applicants with the initial investment costs. Incentive schemes are also separately in place which subsidise the purchase of both hybrid and battery invertors, however these schemes are only open for residential units or organisations which are not engaged in an economic activity.

The Government also offers feed-in tariff schemes for electricity generated by PV installations which do not exceed 40KW. The feed-in tariff is paid per KwH of energy that is generated and subsequently exported to the grid. Electricity producers which avail of this scheme can either opt to sell all the electricity that they produce or consume the electricity produced first and export any excess electricity that is not required for their internal consumption.

Contracts for difference are also offered for renewable energy projects which exceed 40KW and 1MW, though these are allocated through competitive bidding processes.

Furthermore, the Pre-Qualification Questionnaire for a Concession for the Design, Construction, Operation, Maintenance and Decommissioning of an Offshore Floating Wind Farm for Renewable Energy Supply which was issued in 2024, and which is currently ongoing, also considers that the eventual contract with the preferred bidder will include a contract for difference.

Though Malta is exposed to the fluctuation in energy prices, including the impact of high gas prices on electricity price formation (whereby natural gas remains, in most cases, the marginal price-setting technology in electricity markets across Europe), the Maltese Government has over several months recognised the importance of electricity price stability and has cushioned the Maltese economy from higher electricity prices through the provision of subsidies.

We are not aware of any plans to de-link the price of renewable electricity from gas prices.

Though there are various incentives promoting renewable energy projects in Malta, the main barrier which limits investment in this sector is the limitation of space in Malta where these projects (particularly larger projects) may be deployed.

It is for this reason that the Government is now also looking towards projects in Malta’s territorial waters and even in areas which may be declared to be Malta’s exclusive economic zone.

The key contracts which will be entered into will depend on whether the relevant projects form part of a particular competitive bidding process or otherwise.

Since most current (and envisaged) projects follow a competitive bidding process, the main documents would typically consist of a Contract for Differences to be entered into with the Government, a concession contract, and agreements with the distribution system operator to cater for the electrical connection (depending on the size of the project).

In certain instances, a power purchase agreement may also be entered into particularly where no Contract for Differences is entered into.

Malta’s small grid and isolated electricity system means there is currently no capacity for exporting renewable electricity abroad. Hence, there are no specific export restrictions on renewable energy, but practical export is not feasible.

There are no formal legal requirements mandating minimum local content in renewable energy projects. However, government policy encourages local employment and participation through procurement preferences and capacity-building initiatives.

Malta has no specific domestic supply obligations for renewable energy technology or equipment.

With reference to the EU Net Zero Industry Act (Regulation 2024/1735) – we expect a limited impact on this given Malta’s small industrial base.  Malta will however need to align its national policies with the requirements of this regulation.

Since renewable energy projects in Malta are usually relatively small in nature (in light of the geographical limitations of Malta) and given the interest in investing in renewable energy projects, there have not been any significant non-country specific factors which have impacted the deployment of renewable projects in Malta.

Refer to our replies in Question 1 and 2.

As mentioned above, the Government has issued a Pre-Qualification Questionnaire for a Concession for the Design, Construction, Operation, Maintenance and Decommissioning of an Offshore Floating Wind Farm for Renewable Energy Supply, which seeks to invite interested parties to participate in a floating wind project (having a capacity of 280MW to 320MW) in Malta’s eventual exclusive economic zone. This shows that the Government is taking an active role in newer technologies, and positioning Malta as one of the leaders in this area.

In relation to green hydrogen, Malta demonstrates a level of confidence, particularly for niche applications such as industrial decarbonisation and transport fuel. The country’s abundant solar resources provide a favourable basis for electrolyser deployment. While challenges remain, including limited economies of scale and infrastructure development, Malta is well-positioned to leverage European Union funding instruments and strategic partnerships to accelerate progress in this sector. A hydrogen-ready gas pipeline interconnection between Malta and Gela (Sicily, Italy) is also being planned for. Following a positive assessment by the Commission pursuant to Article 24 (1) and (2) of TEN-E Regulation (EU) 2022/869, the project has retained its Project of Common Interest (PCI) status in the 6th PCI list of 2023. The project was submitted as a candidate for inclusion in the TYNDP 2024 as a first step to the 7th PCI list selection process of 2025.

Malta’s strategic ambition to position itself as a regional leader in offshore renewable energy and hydrogen, through regulatory clarity, investment facilitation, and alignment with broader EU energy and climate objectives is evident and gives great confidence to Malta potentially becoming a leader in offshore wind and possibly also in hydrogen.

To-date most projects have been limited in size given Malta’s spatial limitations.  Renewable projects are consequently typically financed through private investment, and/ or through bank financing.

Moreover, and this in addition to our replies to Question 2 and 5, there is an increased desire for local and foreign companies to set up joint ventures for the investment in and operation of large scale projects, which we believe will spill over into projects outside of Malta (particularly in the Mediterranean region).

Although not utilised in great number, there have also been instances of financing though the capital markets. In support of Malta’s and the European Union’s commitments to the promotion of sustainable finance and investments, the Malta Stock Exchange together with the the Malta Financial Services Authority approved the establishment of an MSE Green Market. The Green Market serves as the listing platform of Green Bonds on the local capital markets. Issuers seeking to raise finance for green projects must meet the MSE’s Green List criteria (based on the International Capital Markets Association’s Green Bond Principles). Issuers meeting these requirements will qualify for discounted listing fees.

Qualifying issuers would need to invest in projects that contribute towards one of the environmental objectives inter alia: Climate Change Mitigation, Climate Change Adaptation, Pollution Prevention, Sustainable Use of Water and Marine Resources.

Malta’s first green bond was a €25 million bond issued in 2023 by ClearFlowPlus plc, a subsidiary of the Water Services Corporation, where portions of the raised capital was to be used for, inter alia, investment in: the development of solar farms; a new reverse osmosis plant; and wastewater treatment.

Malta’s renewable energy sector is poised for significant growth over the next 5 (2030) to 25 years (2050), driven by ambitious national targets, EU commitments, and technological advancements. As part of Malta’s National Energy and Climate Plan (NECP) diversification was identified as an underlying pillar of Malta’s energy vision. The diversification of energy sources is a key strategy for Malta, by increasing the share of renewables including solar PV systems and offshore renewable energy projects and exploring a hydrogen ready natural gas pipeline.

The successful switch of the electricity generation capacity from heavy fuel oil to natural gas based on high efficiency combined cycle gas turbine (CCGT) power plant as well as the establishment of a Liquefied Natural Gas (LNG) Floating Storage Unit (FSU) facility with onshore regasification were crucial steps in Malta’s energy transition. To further diversify supply options for the power plant, a hydrogen-ready natural gas pipeline, further connecting Malta to the TEN-E/European gas grid via Sicily (Italy) is being explored. Furthermore, Malta is committed to commissioning a second electricity interconnector by 2030 to strengthen Malta’s capacity as enabler of large-scale development of renewable projects and to address intermittency issues. This will further sustain the transition towards decarbonisation, and further electrification of vehicles whilst sustaining strong economic growth, strengthening the energy mix potential.

The Government is invested in its efforts to support the deployment of renewable energy. Existing support to renewable energy technologies, namely solar, which are particularly well suited to Malta’s geographic location, are being kept. Malta is also committed to pursuing the deployment of offshore renewable (floating wind) energy farms, in efforts to achieve a minimum of 350MW of offshore renewable generation capacity, which could further be boosted to reach 380MW, by 2030. The National Energy and Climate Plan has also identified possible collaboration in renewable energy with North African countries (i.e. Tunisia, Libya and Egypt), which may result in further developments in the renewable energy sphere particularly as technology in these industries continues to develop.

Complementing these efforts, the government is making significant accelerated investment in the electricity distribution network. Strengthening the grid will help address electricity distribution bottlenecks, enable further integration of renewable energy, as well as support the electrification and decarbonisation transition.

It is clear that both the Maltese Government, as well as local and foreign investors are willing to continue to invest in renewable energy projects despite the geographical limitations which Malta offers.