Water reform, how were regional companies created? The goal, increasing the quality of service and the financial sustainability of the companies
The latest reform in the water supply and sewage sector began in May 2022. According to forecasts, from a system distributed across 58 companies in 61 municipalities, the sector would move towards restructuring into 15 regional companies, with the aim of increasing efficiency, service quality, and financial sustainability.
Currently, 14 regional societies operate, while Tirana still remains, which according to the reform should merge with Vora and Kamza.
With the restructuring, the Ministry of Infrastructure and Energy owns 51% of the shares of the newly created companies, while before the reform, the shares of the water utilities were owned 100% by the municipalities where they operated. The latter now own 49% of the shares. The largest share of the shares is held by the municipalities that are regional centers, while the smaller ones own fewer shares.
In a report published a few weeks ago, the Water Regulatory Authority announced that the reform has yielded concrete results, marking significant improvements in financial reporting, revenue management and customer service. However, according to the Regulatory Authority, despite the progress, the reform has been accompanied by inherited challenges, such as financial discrepancies, outstanding liabilities, lack of qualified staff or blocked bank accounts, which have created difficulties in operation.
Meanwhile, in addition to the establishment of the National Water Operator, an important objective remains the unification of tariffs within regional companies. The plan foresees progressive increases in tariffs accompanied by improvements in the quality of service, aiming for a fairer and more sustainable system for all citizens.
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