In a national address, Prime Minister Robert Abela called a snap general election for 30th May, citing an “extraordinary international situation”, particularly “energy”.

Russia’s war against Ukraine, the US-Israeli conflict with Iran, and rising tension around the Strait of Hormuz have pushed energy to the top of the international agenda, and, with it, the local one. Oil-based chemicals are in short supply, not just for energy but also for cosmetics, fertilisers, and plastic.

Maltese households have been largely shielded from the price shocks felt elsewhere in Europe, cushioned by Energy Support Measures expected to cost taxpayers roughly €1 billion by the end of 2026.

Beyond that, Malta’s experiences with blackouts – most notably in 2023 – have raised concerns over the long-term suitability of the country’s energy grid, and the investment needed to match supply with population and tourism growth.

The issue has been a key policy area that the PL and PN have tried to exploit, with Minister Miriam Dalli trading barbs with her counterparts over proposals.

Behind the back-and-forth lies an important question: what does Malta’s energy future look like?

Energy Support Measures: The €1 Billion Shield

Before the last general election, energy held its own dedicated ministerial portfolio. 

Since 2022, however, it has been folded into Miriam Dalli’s expansive super-ministry covering Energy, Environment, and Public Cleanliness.

The ministry commands one of the largest budgets in government, with a projected annual expenditure of €767 million in 2026. 

The Ministry is one of the largest spenders on direct orders and has maintained an uncompetitive public procurement system since Robert Abela became Prime Minister in 2020.

The United Equipment Co (UNEC) Ltd, part of Bonnici Group, was the top beneficiary, receiving over €32.2 million in direct orders for power generation, infrastructural works, industrial supplies, equipment procurement and more.

The Ministry’s single largest outlay is the Energy Support Measures – subsidies designed to shield households and businesses from rising global energy prices – projected at €172 million for 2026, following an actual spend of €183 million in 2024. 

Malta introduced the subsidy in 2022 in response to surging international energy prices, triggered by the post-COVID economic rebound and the Russia–Ukraine war.

The mechanism is, in effect, a universal price freeze: the government issues direct grants to state-owned Enemalta (electricity) and Enemed (fuel) so retail prices remain pegged to 2014 levels, a “zero-energy inflation rate”. 

It was accelerated in April 2022, when Malta’s long-term LNG hedging agreement expired. The country shifted from a fixed cost of €9.40 per unit of gas to a price indexed directly to Brent crude. That will expire in August 2026.

“Instead of passing increased energy prices on to consumers, the government decided to freeze retail energy prices by fully compensating the losses of the energy companies,” the IMF said in a country report.

The measures have worked as social policy. According to the Central Bank, they have prevented low-income households from bearing an inflationary burden roughly twice as heavy as that of wealthier households, because their energy spending is higher relative to their income and wealth. GDP in 2022 was around 1.2% higher than it would have been without intervention.

But the price has shown up in the public accounts. The European Commission has identified the measures as a primary driver of Malta’s national deficit, and the country was placed under an Excessive Deficit Procedure in 2024. 

The EU uses this mechanism to ensure that members of the eurozone have sound public finances and one country’s overspending does not destabilise the entire currency area.

Continuing the subsidy, the Central Bank estimates, will add roughly 4% to Malta’s debt-to-GDP ratio. 

The Central Bank has also warned of a less visible cost:: by holding prices artificially low, the subsidy mutes the very market signals that would otherwise push households and businesses to invest in energy efficiency or solar power.

It has called for a “phased and well-communicated exit” between 2025 and 2027, paired with targeted social support and stronger renewable incentives.

“[This] emerges as the most balanced path toward fiscal sustainability, energy efficiency, and environmental alignment with EU goals,” it wrote.

The Energy Transition:

Geography and density are part of the story. Malta has limited land for utility-scale solar, no operational offshore wind, and a grid that largely depends on LNG and an interconnector from Sicily. A second interconnector is on track to be finished by 2026, according to the government. 

Malta’s transition to renewable energy has grown, but at a relatively sluggish pace. Malta’s renewable energy share is the third-lowest in the EU, and trails behind regional peers like Cyprus.

• 2022: 12.9% renewable energy
• 2023: 13.6% renewable energy
• 2024: 15.7% renewable energy
• 2025: 16.2% renewable energy

Malta has committed to hitting only 10% of its renewable energy benchmark, and its 2030 projections fall significantly short of EU requirements. 

On paper, Malta’s climate performance appears strong. In 2023, Malta boasted the third-lowest net greenhouse gas emissions per capita in the European Union.

This success is largely due to the transition from heavy fuel oil to liquified natural gas and the launch of the Malta-Italy electricity interconnector.

The trajectory, though, is harder to assess. Malta recorded the fastest emissions growth in the entire EU between 2023 and 2024. That pace has since moderated, but total emissions continue to climb.  

Energy production is the island’s leading source of pollution. Transport is also a top contributor.
Under the EU’s Effort Sharing Regulation, where most member states have committed to a 40% reduction in emissions by 2030, Malta negotiated a much more modest target of just 19%. The government said it considers that target too ambitious for Malta.

Who is using the energy?

Between 2022 and 2024, the top three energy consumers remained unchanged, with commercial and public services consistently leading, followed by households and the industrial sector. 

Transport, despite being a lower-volume consumer, has seen the most dramatic relative growth, which correlates with the expansion of Malta’s electric car fleet.

What to watch for:

For voters cutting through the rhetoric, the questions that matter are simpler than the manifestos suggest. The €1 billion already spent on the shield was never put to a vote. The next billion will be, directly or otherwise.

Is any party prepared to say what happens to the subsidy? Is anyone pushing for new renewable capacity? Is the second (and the proposed third) Sicily interconnector the answer to resilience? Is the 19% emissions target being defended on its merits, or quietly conceded as one Malta will miss?

The shield has held this long. The election is about who carries it next and what, if anything, is being built behind it.

Environment Minister Miriam Dalli made the bold claim at an informal meeting of EU Environment Ministers in Aalborg this July, while discussing new EU measures and targets to curb pollution, policies that could prove both costly and unpopular at home.

Yet Malta’s energy policy has come under criticism from EU institutions. Council has urged the government to “wind down the emergency energy support measures”, which is estimated to be worth around 1% of Malta’s GDP on subsidising climate-harming fuels. In a meeting with social partners, Prime Minister Robert Abela promised to retain these subsidies in the 2026 budget.

According to the Commission, Malta maintains sizeable fossil-fuel subsidies without a planned phase-out before 2030. Many of these subsidies neither protect vulnerable households nor safeguard energy security, and hinder the shift to cleaner transport and industry.

Both narratives overlook one crucial factor: Malta’s environmental footprint extends beyond its coastline. Our impact extends outward through ships and planes, our waste and electricity, and all that we consume to keep the island running.

Against this backdrop, Dalli’s claim raises a key question: is Malta really such a small polluter?

Speaking in Aalborg, Minister Dalli said:

“To achieve [Climate neutrality by 2050] we need to have specific targets, but we want those targets to be fair, ensuring they follow the most cost-effective path. We want the national circumstances of different countries to be taken into consideration, particularly in our case, since we [Malta] are among the countries that pollute the least.”

“We need to make sure that what we are agreeing upon is being implemented and is realistic for countries, particularly for small countries like Malta, where our position is to keep insisting that Malta is the country with the lowest per capita pollution in the European Union. We are making every possible effort, but we do not want to place a burden on the people.” 

In 2023, more than a third of people (35%) in Malta reported exposure to pollution, grime, and other environmental problems. This is the highest share in the EU and nearly three times the EU average of 12%. High-earning households were even more affected than low-earning ones. However, the share was 40% in 2013.

When we look at domestic net greenhouse gas emissions per capita, Malta’s are indeed third-lowest, as of 2023. But this calculation has an important caveat: “emissions from international aviation and maritime transport are excluded”.

Counting emissions strictly within national boundaries fails to capture the total pollution generated by a country’s economy.

Many other EU economies emit greenhouse gases to produce the goods and services people need, such as food or household items.

Malta has the lowest share of agricultural production in its economy (alongside Luxembourg), the third-lowest share of manufacturing, and even the third-lowest share of construction.  That means, for all the added value generated in the Maltese consumer economy, the contribution of productive industries is minimal.

To account for this, the EU also calculates greenhouse gas footprint. Here, as of 2022 Malta ranks in the middle third of EU countries emissions per capita linked to consumption.

Malta’s invisible emissions: The sea and air

That’s not everything. Footprint calculations follow “the concepts and definitions of national accounts.” These accounts do not include international aviation and navigation (shipping). According to UN standards, these are reported separately and are not subject to the limitation and reduction commitments under the Kyoto Protocol . This has left governments with fewer incentives to reduce emissions in these sectors.

Malta’s tourism boom has seen an increase in aircraft travelling in and out of Malta.

The Malta International Airport reported nearly 59,000 aircraft movements in 2024, up from around 51,000 in 2023 and some 40,000 in 2022. The amount of cargo flown in also increased, with planes transporting almost 24,000 tonnes of cargo in 2024. As of April Malta’s aircraft registry has 929 planes and other aircraft types.

Meanwhile, Malta’s maritime registry grew by almost 10% in 2024, strengthening Malta’s position as the largest maritime registry in Europe and the sixth largest in the world.

Ships can register in any country, without having links to it. Shipping companies, which already enjoy VAT advantages, can register in low-tax jurisdictions and compete with more environmentally friendly means of transportation.

According to NSO’s latest data, there were 8,644 vessels under the Maltese flag as of 2022, with 797 new vessels added. Three-quarters of these new additions were pleasure yachts.

The government has announced that in the first quarter of 2025, the registry surpassed 10,000, and Malta has the largest registry of superyachts in the world. 

According to Eurostat (2023 data), with nearly 46,000 ships, Malta ranked 9th in the EU in terms of vessel arrivals. Meanwhile, data from Transport Malta shows that 779 vessels arrived in Malta with wheeled cargo, such as vehicles. Additionally, 470 ships transported crude oil, and 420 vessels carried cruise passengers.

In 2023, the European Federation for Transport and Environment, an advocacy group, published a study on the cruise industry and stated that “The sector still relies almost entirely on fossil fuels of the dirtiest kind, full of toxic substances including sulphur.”

In 2021, researchers at Indiana University estimated that a superyacht with a permanent crew, helicopter pad, submarines and pools is “by far the worst asset to own from an environmental standpoint”.

Oxfam’s 2024 analysis found that “an ultra-rich European on their yachts emits, on average, as much carbon as an ordinary European would in 585 years”. It shows that 22% of superyachts’ overall emissions are generated while moored, which means that Malta-flagged superyachts moored elsewhere would pollute another country while enjoying exemptions from EU carbon pricing.

A 2023 strategy document by the Transport Ministry aimed to “make Malta a jurisdiction of choice for the superyacht industry”, adding that “diligence must be exercised to ensure that coastal infrastructure and other activities associated with yachting do not cause pollution or deterioration of the coastal environment.” Words like ‘emissions’, ‘carbon’ and ‘greenhouse’ are never mentioned.

The EU has taken steps to account for the pollution from planes and ships within the bloc. Companies flying to and from the EU must obtain emissions allowances. Since last year, the EU Emissions Trading System (EU ETS) has been extended to maritime transport (shipping) emissions. For now, 12 companies are assigned to report to Malta.

These changes mean that counting and reducing emissions is gradually becoming mandatory for ships and planes, through international frameworks that require reporting and impose reduction obligations— though these systems do not yet set absolute caps on total emissions. The rules on shipping are new and will be phased in gradually, so we will need to wait for statistics.

Malta’s waste overseas: Over 130,000 tonnes sent abroad for recycling

Waste is another item that Malta partly offloads to other countries. Its reliance on exporting waste for recycling (see our earlier reporting) makes it challenging to calculate what share of exported waste is actually recycled and what ends up burnt or landfilled abroad, generating emissions without satisfying consumer demand the way real recycling does.

According to 2023 NSO data, Malta sent around 130,000 tonnes of waste abroad for recycling and nearly 12,000 tonnes for energy recovery. 

Plugged In Abroad:  A third of Malta’s electricity is imported

Energy supply figures show that Malta’s dependence on energy imports increased between 2023 and 2024.

Last year, nearly a third of Enemalta’s supply came from the Malta-Sicily interconnector (less than a quarter in 2023).

About two-thirds of this import was generated by natural gas – a fossil fuel – and only 8% by renewables.

In absolute terms, the increase in electricity imports appears even more striking, rising from 648.36 GWh in 2023 to 970.42 GWh in 2024. Italy itself is a net importer – it imports energy for its own needs.

Through the interconnector, Malta can also export energy, but these exports dwindled between 2022 and 2024.

Minister Dalli refers to a “burden” in her comments after EU recommendations to stop subsidising fossil fuels.

In July, ARMS Ltd, an entity under Dalli’s ministry, circulated individual letters to households, saying, “The government is fulfilling its commitment to support families amidst the increase in international oil and energy prices, which support is resulting in continuous savings for you.”

According to the European Environment Agency, fossil fuel subsidies in 2023 in Malta represented the highest share of gross domestic product (GDP) among EU countries. Energy subsidies were the third-largest item in the Programmes and Initiatives category of the state budget, in the first half of 2025, after social security benefits and church schools.

A recommendation drafted by the European Commission was scathing: “In Malta, fossil-fuel subsidies – such as the ongoing support to Enemalta, subsidies for petroleum producers, and a reduction of excise duties on petrol and diesel – are economically inefficient and act as disincentives to the uptake of renewables and the decarbonisation of economic activities. Moreover, they represent a budgetary burden on Malta’s public finances.”

When considering domestic net greenhouse gas emissions per capita alone, Malta is indeed among the lowest polluters. However, it refuses to recognise the full picture.

In the context of climate change, it is relevant to consider the total demand generated by each country’s consumer economy, not only emissions within its national boundaries. 

When a country’s economy benefits from sectors not accounted for in the national emissions accounts, such as shipping, consumer products, and other services like electricity, it is essential to account for their emissions when examining the environmental impact of Malta’s economic activity. 

Given Malta’s consumption emissions place closer to the EU average, its wide shipping industry, growing air travel, and increasing external electricity production, Minister Dalli’s statement that Malta is among the least polluting countries in the EU is misleading, especially when considering that one in three people in Malta have reported exposure to pollution, the highest in the EU.

This is especially true in the context of measures to rein in climate change, which include phasing out environmentally harmful subsidies.

This project is supported by the European Media and Information Fund. The sole responsibility for any content supported by the European Media and Information Fund lies with the authors and it may not necessarily reflect the positions of the EMIF and the Fund Partners, the Calouste Gulbenkian Foundation and the European University Institute.