Saving is the motto! Today cuts are made in almost all the fields of the public sector – and thus also in communal water supply. A few years ago a community used to have the responsibility for supplying its inhabitants, but now it is being increasingly considered to have the precious element provided by a few supraregional providers – with the aim to reduce the costs. However, this does not mean that water from unknown sources is coming from the tap.

That this way of thinking reflects a European-wide trend shows a comparison between countries. In Italy there are presently about 10,000 water suppliers, in Germany about 6,000, in Spain and Belgium only 129 remain, or rather 139, and in the "model country of privatisation", in Great Britain, even only 26.

In our country this concentration process has not gone that far yet; In Austria we still have about 4,000 water suppliers, but this number does not include the small cooperatives. Including them, the number increases to about 6,000 water suppliers.

Concentration processes on the advance

"Advocates of the concentration process point to a considerably better water quality, the high investments in infrastructure improvements and the lower prices. The companies complain about the national regulator having only authorised and claimed tariff reductions in the past few years.

This policy, according to the companies, has reached dimensions that do no longer allow proper maintenance," explains Christian Hasenleithner, the head of the Wasserdienstleistungs-GmbH (WDL) (water utility) in Upper Austria.

Right in the middle of the concentration process is water supply in Lower Austria. According to NÖSIWAG managing director Gerhard Jechlinger, the advantages of the incorporation of the NÖSIWAG into the EVN lie in the wider scope of services for the Lower Austrian communities. Within the EVN group the NÖSIWAG will constitute the "Competence Centre Water" and be part of a multi-utility enterprise.

Last year already about 500 communities and more than 100 particular recipients, as, for example, industrial plants, were supplied with about 24 million cubic metres of water. "It is planned to extend the business activities from supraregional to regional water supply," says Jechlinger.

In the future NÖSIWAG will also deal with the construction and operation of local networks, or rather of local water supply facilities, such as wells, treatment plants, drinking water reservoirs and mains outside the supraregional networks. Moreover, it is planned to increasingly get engaged in wastewater treatment; it is obvious that the training of water masters, or rather skilled workers for purification plants required by the law constitutes a major financial and organisational burden.

Therefore training and further training measures for skilled personnel are promoted and NÖSIWAG engineers with a respective professional experience in wastewater treatment plants are being prepared for their new activities. "In particular cases, the fields of consulting, planning and advice shall be offered in the frame of an engineering office – in cooperation with civil engineers and specialised companies. The advantage that planning, construction and operation come from one source shall also be used for local facilities of the communities," adds Jechlinger.

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Export hit water know-how

The pressure of economies opens many a new field of activities for Austrian water suppliers. The Salzburg AG, for example, has discovered that water know-how made in Austria is an export good in great demand. "We offer our experience as operator on the free market and are thus active in consulting, project management and also in the field of industrial management," explains Heinrich Gernedel, managing director of the "Center Wasser" within the Salzburg AG.

The entire scope of services is thus not only offered in the city of Salzburg – the Salzburg AG also operates the "Wasserverband Salzburger Becken" – and the water know-how from the Mozart-town has already been applied in Romania and Nepal. "Providing services is a prospect field of activities for every water supplier. Our aim is to reach a share of 20 to 30 percent of the total turnover in a couple of years," says Gernedel assessing the economic potential of this development.

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Clear trend toward outsourcing

In the supply region of the WDL GmbH owned by the Linz AG, the Energie AG and the Raiffeisenlandesbank the outsourcing business is booming. Thus, already 19 communities situated around the city of Linz have entrusted the WDL with water supply. As to wastewater treatment already 37 communities cooperate with this company. That this shall lead to a cost reduction for the communities is obvious.

"The economies naturally depend on the current level of services and range between 10 and 35 percent according to the community – not counting the investments necessary for the increase of efficiency – like automation, for example.

Positive long-term effects in view of maintenance and reinvestment are not included," says Hasenleithner. With the principle "sale and lease back" the WDL comes up with an interesting financing model. For example, the community of Grieskirchen has sold two construction segments of the sewer system to the WDL and has leased them back from it. The sewer system, however, continues to be operated by the community itself.

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Electricity, TV and water from one hand?

Austria’s electricity generating plants develop increasingly to multi-utilities companies offering the whole scope of services on the communal level – from energy supply, cable TV to drinking water. Heinrich Gernedel, the head of the Center Water who has also been working for a "multi" since the merging of the Salzburger Stadtwerke with the former Landesstromgesellschaft Safe to the Salzburg AG of today, sees the advantages definitely on the side of the new mother companies. Customer binding, it is true, costs a lot of money – money that has to be made available by economies affecting the water sector as a result.

"Until now we have been able to reinvest the revenues from water selling. Thus, we have reached a very good standard. I fear that we will drain for some time from the existing funds and that the right time for new investments will be overlooked. The water quality is regulated in the Drinking Water Ordinance, but it is increasingly difficult to comply with it," explains Gernedel the current trend in the Austrian energy management, and takes a stand against the privatisation of water supply – which should remain in the hands of the communities since it is a vital domain.

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Controversial: EU water market

The liberalisation in the energy sector may lead to lower electricity and gas prices for the final consumer, but, according to Heinrich Gernedel, this is highly controversial for hygienic reasons. "There is no supraregional distribution network for water. Water is regionally restricted to the amount of resources and transporting becomes unprofitable when the distance becomes too great," says Gernedel describing the economic reasons speaking against water liberalisation. In addition, the mixability of different waters could pose problems.

"Our philosophy as suppliers in Central Europe is to bring our water to the tap of the customer and to supply top quality drinking water. This philosophy is not applicable in water-scarce regions. Particularly in southern countries where water is chlorinated and has to be considered as service water, there are totally different quality levels," explains Gernedel the differences and refers vividly to the naturalness of the Austrian water. (Source: aqua press Int. 2/2001)
Dr. Alexander Tempelmayr

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Information & Contact:

WDL GmbH
DI Christian Hasenleithner
Hasnerstraße 2, A–4020 Linz
Phone +43 732 61 76 04
Fax +43 732 61 76 04-15

NÖSIWAG
DI Gerhard Jechlinger
Südstadtzentrum 4
A–2344 Maria Enzersdorf
Phone +43 22 36 44 601
Fax +43 22 36 44 601-46

Salzburg AG
DI Heinrich Gernedel
Strubergasse 21, A–5020 Salzburg
Phone +43 662 44 80-24 00
Fax +43 662 44 80-24 04