An investment gap that could reach 5 billion appears in the area of modernizing water supply networks, especially if the lack of rain continues in our country, as a consequence of the climate crisis.
Based on data presented yesterday by Environment Minister Thodoros Skylakakis and EYDAP Managing Director Haris Sahinis at a special press conference on the water scarcity issue, the investments proposed by water suppliers across the country (National Operational Plan for Drinking Water, February 2022) in ensuring adequacy, reducing leaks and automating water supply, amount to 5.9 billion euros (2 billion for 681 new projects and 3.9 billion for 1,446 upgrade and replacement projects).
According to the Ministry of the Environment, the projects and financing currently guaranteed are as follows:
With funding from the QREN, water supply, sewage and desalination projects worth 200 million (around 150 million in Corinthia, Saronikos, Alexandroupoli, Kassandra and Rethymno for holistic water supply and sewage projects and 50 million mainly for desalination projects on arid islands).
Emergency water scarcity projects worth €80 million financed by the Public Investment Programme (PEP) of the Ministry of the Interior. The competent departments of the Ministries of Environment and Energy and Shipping and Island Policy cooperate to give priority to the areas facing the most immediate problem (e.g. islands in the Aegean Sea). In these areas, the necessary projects are prioritized after a detailed analysis of real data (e.g. repair of networks, separation of irrigation and water supply networks, new boreholes, desalination with priority in brackish waters, dams, telemetry and digital water meters, reuse of treated wastewater for irrigation).
Desalination projects, multipurpose reservoirs, combined with RES projects, etc. in the Island Decarbonization Fund, with a minimum public aid of 166 million euros, and with the possibility of these projects reaching up to 450 million euros depending on the price of CO2.
In addition, a favorable settlement of 75% of DEYA’s (Municipal Water Supply and Sewage Companies) debts for electricity costs will be attempted with the allocation of 250 million from the surplus profits of energy companies. This action aims to obtain the possibility of bank loans for DEYA to carry out projects.
The above figures result in the investment gap of 5 billion. They are essentially indicative as the investment needs record of 5.9 billion is not locked in as long as project requirements are dynamic.
It should be noted that the picture of water supply networks, as presented by the Ministry of Internal Affairs, is extremely disappointing. Of the mere 42% of organizations that systematically submit data to the relevant information system, it turns out that the total percentage of losses (water leaks) is on average 35.6%, although it is more likely, according to the political leadership of the Ministry of Internal Affairs, this percentage should be higher.
Among the measures proposed by the Ministry of Foreign Affairs and which will take the form of a bill is the reform of DEYA with the creation of stronger providers, reducing their number to 1/4 and the activation of the EYDAP Islands to support the islands and Crete for the implementation of larger projects, where the provider is weak and the collection is insufficient.
As far as Athens is concerned, there is a sharp decrease in water reserves – from 1,100 million m3 (data – October 2022) to less than 700 million m3 (estimate for October 2024). In the event of continued drought, existing water reserves are sufficient for about 4 years.
Among other things, a project is underway to transfer water from the rivers that feed Lake Kremasta (in the medium term) and from the lake itself, which is located between the prefectures of Etoloakarnania and Evrytania (in the long term). These are projects with a total budget of €750 million, but they are still in the early stages of study and so it is not excluded that they will be “stuck” during the tender process.
As a strategic reserve or as an immediate implementation measure for Athens, the Ministry of Foreign Affairs mentioned yesterday the option of desalination, while among the other measures under consideration is the reuse of water from Psittalia for industrial use and irrigation, as well as for the enrichment of the water table.
What will happen to water bills?
However, the way water tariffs will be decided will change soon. At this stage, it is not known whether there will be any changes to tariffs (increases or reductions), as a Joint Ministerial Decision (JMD) establishing full cost recovery for water services is expected to be issued.
The need for more investment, however, due to water shortages, leads to the assessment that tariffs will increase, without it being possible to know at this stage how much and when.
However, based on the KYA, tariffs will be determined by the supplier and will be controlled by ERA (the Waste, Energy and Water Regulatory Authority), and cannot (as a general rule) increase more than the Harmonised Index of Consumer Prices, while it is possible to determine different prices from the same supplier by region.