Italy struggles to make progress
- From: Vol 7, Issue 1 (January 2006)
- Category: General
- Region: Europe
- Country: Italy
- Related Companies: Proaqua
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The annual report on the Italian water sector shows that there is a growing gap between the investment required and the money available.
In its 260-page annual report to the Italian parliament, the water watchdog Comitato di Vigilanza paints a thorough picture of the Italian water sector as it struggles to implement the reforms laid out in the Galli Law of 1994.
Commenting on the report, environment minister Altero Matteoli, who is responsible for several of the areas covered by water and wastewater services, said that the road towards an “efficient and effective” service was still long. “We still have to deal with fragmented services, inefficient management, obsolete infrastructure, damaged networks that leak up to 40% of the water they distribute,” he added.
By the end of 2004, the report found, 87 of the 91 ATOs (optimum territorial areas) envisaged by the Galli Law had been set up, but only 66 had completed and approved their plans. According to these plans, about €38 billion will have to be spent to upgrade infrastructure. A recent Blue Book by research group Proaqua had used similar data to calculate that an overall investment of €55 billion would be needed nationwide (GWI, November 2005, p14).
More specifically, the report highlights with concern the fact that investment in the water sector has not kept pace with inflation in recent years. Equating all water sector investment in the year 1993 to 100, investment amounted to only 63 in 2001 and 2002. As a percentage of total infrastructure investment in Italy, the water sector fell from about 10% in 1993 to 5.5% in 2002.
Investment in that 10-year period can be attributed mainly to sewage networks (45%), followed by water distribution (37%) and wastewater treatment (18%). More worryingly, most of the investment occurred in the north, while southern Italy and the two major islands (Sicily and Sardinia), where most of the infrastructure problems are to be found, lagged behind. Average investment per person in the period 1993-2002 was €90 in the south, less than half that spent in the north.
* Water and wastewater services in the province of Milan “will remain 100% public”, according to the provincial authority’s chairman, Filippo Penati. The decision was made following a series of meetings in December. The authority plans to set up a public company to deal with the infrastructure of the province, which currently has 33 public operators. The estimated €800 million needed to be spent over the next 10 years is expected to be financed by tariffs and EU funding. However the move is likely to be opposed by the regional authority, which is in favour of privatisation.
Elsewhere Italy’s resistance to competition in water continues. Lanciano has become the fifth out of six of the central regions of Abruzzo to decide that water and wastewater services in its 92 municipalities will be run by publicly-owned operators who will be awarded concessions through a so-called “in-house” procedure.