In 2019, the regulation of the ARERA water service turns seven. A period in which it has experienced intense changes for the sector, culminating with the recent provisions on technical quality. The evolutionary path of companies is, however, far from finished. They have to face major challenges such as climate change, infrastructural renewal, investments in reservoirs, quality of service.
These are the reflections on which the Study "Economic, social and environmental impacts of regulation in the water sector" is based, which will be presented on 15 May from 10 to 13, as part of the Water Festival in Bressanone, in a seminar organized by Agici by Professor Andrea Gilardoni and by Utilitatis.
The study analyzes the main transformations that have taken place in the IIS, through the direct and indirect effects of an economic, social and environmental nature, assuming the point of view of operators, stakeholders and the community.
In summary, the main results are:
- The investments made grew by 80%, going from around 1 billion in 2008 to 1,8 billion in 2018. Furthermore, public spending on the integrated water service decreased: the Territorial Public Accounts in the period 2009-2016 recorded expenditure ranging from 1,29 €.0,67 billion to €70 billion. On the other hand, EIB loans increased by 2007% between the periods 2012-2013 and 2018-XNUMX.
- The Added Value Generated by companies in the sector, in the period 2008-2017, grew by about 60% from 2008 to 2017, going from €3,6 billion to €5,9 billion. Remuneration of employees and suppliers are the largest components, followed by retained value which represents the wealth used for new investments, for shareholders (municipalities) and to increase equity.
- The regulation of the water sector has not affected the social sustainability of the tariffs. Bills, in fact, while increasing by about 5,2% annually in the period 2008-2012, and by 5,9% in the period 2013-2018, remain below the threshold of 3% of the average net income of Italian families.
- By 2040, the achievement of the technical quality objectives set by ARERA will result in a net benefit in economic, environmental and social terms of over €50 billion. In fact, against €30 billion in water service costs, there are benefits of over €80 billion due to the reduction of leaks, the reduction in service interruptions, the improvement of drinking water and the purification service and the reduction of sludge disposal in landfills.
- The economic, social and environmental impacts derive from the comparison between an inertial hypothetical scenario, in which the absence of ARERA is expected, and a scenario with the intervention of ARERA which determines the accelerated achievement of the technical quality objectives and their maintenance in the years.
- The greatest benefits are those related to the reduction of losses, equal to approximately €59 billion. The smaller quantity of water dispersed, in fact, determines, on the one hand, a saving in the cost incurred to generate the resource and, on the other, a lower environmental impact, in terms of CO2, as a result of the lower energy consumption in the aqueduct phase.
- The impact due to the improvement of the purification service equal to €18,3 billion is also significant. In fact, compliance with EU rules on purification avoids both the payment of fines and environmental pollution, thanks to the reduction of pollutants due to greater purification of waste water. Added to this are the lower atmospheric emissions due to the greater efficiency of the plants and recovery.
“ARERA – reads a note from Agici – in these seven years has contributed to the improvement of the IWS by ensuring that operators reach and maintain a good economic-financial balance. This balance has made it possible not only to raise the quality level of the service but also to create wealth for employees, suppliers, shareholders, the State and, ultimately, the community. All the positive impacts of the change are immediately noticeable, but a substantial part of the improvement will take place in the future as long as we continue on the path towards excellence”.
"Finally - continues Agici - thanks to the regulation of the technical quality, it will finally be possible to have a shared and transparent database on the performance of the SII managers, the first step towards the design of effective and efficient policies in the sector".
