Investment Programme
Status of task
Scope and expected results for Task 4
The main scope for Result 4 is the development of an investment program for water supply and waste-water collection and treatment. All the measures included in the DWD and the UWWTD DSIPS as well as the specific measures proposed by the NSMS were considered and analysed, including all measures to achieve compliance with the respective EU Directives.
Henceforth corresponding project pipelines (short list and long list) were elaborated based on prioritization for allocating the measures and needed resources (estimated cost) within three main planning periods:
- 2023-2030 (Phase 1: short term / priority measures – ‘short list’),
- 2031-2040 (Phase 2: medium term /medium priority measures – ‘long list’) and
- 2041-2050 (Phase 3: long term / low priority measures).
Approach and proceedings
The measures proposed in the DSIPs were grouped by:
- Service area of water supply and
- Wastewater companies (WSSC) which will be the future beneficiaries of the investment program.
In addition, projects which are not directly related to the UKs (e.g. central laboratory) were defined as national projects.
For the measures identified in the DSIPs and the NSMS the time frame proposed in these documents has been reviewed and aligned to ensure that requirements of the DWD and the UWWTD will be met and to ensure that all projects will meet investment efficiency criteria.
It shall be noted that the assumed compliance date for the DWD is the year 2040 while the compliance date for the UWWTD is the year 2050.
Total investment costs
The total investment costs cover the period from 2023 until 2050:
- Phase 1 – 2023-2030
- Phase 2 – 2031-2040
- Phase 3 – 2041-2050
Tariffs and payment
The Levellized Unit Costs (LUC) for water & wastewater services are around 3.2 EUR/m³ – and this implies that, based on the average monthly billed amount of 7.2 m³, the cost covering bill should be as high as EUR 23.0 per month for each domestic customer. However, as shown above, the average monthly bill sent to domestic customers is currently EUR 5.5.
This implies that future tariff increases are necessary and unavoidable. But these tariff increases must be feasible from an affordability point of view: If the UKs increase the tariffs in order to cover their total costs too quickly, affordability limits will be exceeded leading to lower collection ratios, lack of cash and eventually unsustainable development. And this is the reason why the Consultant advises to increase the tariffs step by step.
Implementation of Task 4
The final draft report has been delivered in October 2023.
As a next step the project will implement a 3-days seminar, involving AKUM and the 15 regional UKs, with the aim to present the final version of the document and its attained results. It is also supposed that one of the Seminars of the financial plan’s presentation may involve international donor institutions, in order to ensure an adequate level of awareness by the international actors on the strategy of development of the water sector service in Albania, for what concerns the DW and UWWT Directive implementation, and the strategy of investment coordinated by AKUM. The Seminars will supposedly take place in October, after the consolidated version of the financial analysis will be ready. However, dates and agendas of the seminars will be defined in close coordination with AKUM.
