Smart Water Magazine
Connecting Waterpeople

You are here

Mariano Blanco (EurEau): "We want policies that reflect the Cost Recovery Principle"

1
188
  • Mariano Blanco (EurEau): "We want policies that reflect the Cost Recovery Principle"
    Mariano Blanco

About the entity

EurEau
EurEau is the European federation of national water services. We represent national drinking and waste water service providers from 29 countries, from both the private and the public sectors.
Schneider Electric
· 188
1

Last month Europe’s water services, EUREAU, held elections to choose its Executive Committee, including the appointment of Dr Claudia Castell-Exner as President for the next two years, and today all parties take up their new positions.

For this occasion, we speak to Mariano Blanco, representative of Spain as member of the General Assembly through AEAS and member of the Federation’s Executive Committee, on the main challenges in terms of water governance in Europe and the importance of urban water in Spanish policies.

Question: Who does EUREAU represent and what are its main objectives?

Answer: EurEau represents public and private drinking and waste water operators from across Europe, through its national water associations.

The European water services sector delivers and treats over 44.7 billion m³ of water annually, protecting the environment, and it employs directly 476,000 people.

Water operators, represented by EurEau, are committed to delivering clean drinking water and treating waste water so that it can be safely returned to the environment, while recovering resources, and all at an affordable price.

EurEau has stablished recently 10 big challenges for the water sector:

  1. Protecting a vulnerable resource
  2. Fostering sustainable economic growth and creating jobs
  3. The value of water in the circular economy
  4. Source-control approach for micropollutants
  5. Setting the right price for water
  6. Growing impact of climate change on water
  7. Resource efficiency in the water sector
  8. Managing long-term assets in a fast changing environment
  9. Increasing the public understanding of the water sector
  10. Reinforcing the resilience of water services to security risks

Water operators, represented by EurEau, are committed to delivering clean drinking water and treating waste water so that it can be safely returned to the environment, while recovering resources, and all at an affordable price.

Q: What is your role as Member of the Executive Committee of EUREAU?

A: Spain, through AEAS, is a member of EurEau and therefore has a representative in the General Assembly, which periodically chooses one of its members as the president; in turn he/she forms an Executive Committee with 7 members at most, in addition to the 3 presidents of working Commissions. I have the honour of representing Spain as a member of the General Assembly; as well, I have been elected as a member of EurEau's Executive Committee.

The Executive Committee takes all initiative resulting from the decisions and guidelines issued by the General Assembly and implements the strategy and the policy decided; it also coordinates the activities of the 3 Commissions and lays down the policy work plans.

In my case, my role involves representing the interests of Spain, participating in the design of strategies to advise and influence the different European Union institutions; the objective is always for legislation and new directives to encourage sustainability, efficiency and innovation in the sector.

Q: What are the European legislation’s main issues that the new committee will have to tackle during its new mandate?

A: As we have explained in a recent manifesto, a robust Water Framework Directive, including the Groundwater and Environmental Quality Standards Directives, protect our water resources and the environment, keeping our groundwater, rivers and lakes free from pollution.

We want policies that reflect the Cost Recovery Principle. The directive’s ambitions should be maintained after 2027 and the communication of progress should be improved. All EU legislation or policies –particularly on nitrates, pesticides and REACH*– need to be better coordinated and implemented.

The main pieces of legislation to take care are the following:

  • Water Framework Directive (WFD).
  • Drinking Water Directive (DWD).
  • Urban Waste Water Treatment Directive (UWWTD).
  • Bathing Water Directive (BWD).
  • Water Reuse Regulation.
  • Common Agricultural Policy.

We want policies that reflect the Cost Recovery Principle

Q: Is European investment in water infrastructure sufficient? What role does the public-private collaboration play in solving this challenge?

A: The water sector is very intensive on investments, taking into account some domestic data from European countries, the main drivers for CAPEX are identified in 5 main fields:

  • Investment to reach compliance under existing legislation (mainly WFD/DWD/UWWTD and floods/scarcity protection).
  • Re-investment in aged infrastructure (replacement, reconstruction).
  • Investment in potential new requirements (e.g. micro-pollutants, climate change and security).
  • Potential overview in other sectors (e.g. agricultural pollution, energy production, etc.).
  • Investments in operation & process optimisation (e.g. water and energy efficiency).

In the case of Spain, the sector estimates around 60,000 million euros needed for the above five fields on investments, and 70% specifically for the first two fields.

The Water Framework Directive was an important challenge for Spain. Achieving quality objectives has required an important effort by the authorities; the role of public funding has been and will continue to be essential, but we have also have to consider the feasibility of accessing different financing options through public-private partnerships (PPP), which ultimately favour cost recovery and avoid the borrowing restrictions that public authorities often have.

Financial resources in the public realm, released annually, can be complemented with projects that take into account the design, construction, exploitation and financing phases. Among other benefits, this type of projects limit public borrowing and transfer risks to the private sector, ultimately becoming a tool to stimulate the economy and therefore encourage the private sector to contribute to advancing infrastructure in the country, whether it is a developed country, as in the case of Spain, or an emerging country, where the growth needs are even greater.

One of the best known models is the one known as the “concession model”, where there is a direct link between the private partner and the final user: the private partner provides a service to citizens “in lieu of” the public partner, but under its control. In addition, the operator is paid through tariffs and fees collected from service users, complemented, where appropriate, with subsidies by public authorities.

Q: What are the main challenges in terms of water governance? Should every country have a regulator?

A: Water Services are services of general (economic) interest. They are regulated at EU and national level. The Water Framework Directive (WFD) and the ‘water industry’ Directives (DWD, UWWTD, and BWD) govern the environmental and health standards at EU level and are implemented in national legislation. The organization of water services (the choice of the management) is subject to subsidiarity (Protocol 26 to the TFEU*) and it is a competence of Member States. The EU institutions are neutral in regard to the choice of management models. The way water services are organized is the result of historical and cultural factors that reflect the diversity of European countries (Direct public management, Delegated public management, Delegated private management and Direct private management).

Related to the Regulator, we have to recognize that the European water industry operates under country specific regulatory frameworks; it is highly capital intensive and each country has set its own rules to set tariffs to recover the costs of providing the water services as well as to govern the relationships between the different stakeholders, including central and local governments.

In my opinion, the complexity of providing public services, and the existence of multiple operators, makes it advisable to create entities that regulate general interest services.

The basic requirements of water supply services are continuity, quality, price and environmental protection. In order to reach a balance, essentially between costs and service quality, the consensus of all stakeholders, including citizens, is required.

I believe that it would be wise to have in our country an entity to regulate integrated water cycle services, the same as exists in other European countries and elsewhere in other continents. It would not only analyse and approve tariffs and regulations to be applied by local governments, but also would monitor the achievement of objectives established in management plans themselves and service quality objectives.

The basic requirements of water supply services are continuity, quality, price and environmental protection

Q: What policies does EUREAU propose to boost the circular economy in the water sector?

A: The circular economy is one of the strategies that are currently being promoted in the urban drinking water and sanitation sectors. The European Commission encourages this strategy to progress in the reuse of treated waste water, to reach higher quality levels in reuse processes and limit the use of raw materials; the expected results will lead to greater technological development in the sector and greater job creation. We would like to see legislatives advances in regard to the quality of reclaimed water, the use of sludge from sewage treatment processes, nutrient recovery, and decreasing energy consumption.

This concept of circular economy will determine financial aid policies and legislative advances at the European level in the coming years.

Q: How is digitalization impacting the provision of urban services? And what is EUREAU doing to accelerate its adoption?

A: One of the main issues for the sector, when we talk about digitalization, is the concept and strategy of “smart-city”. A developed water governance program has to advance the implementation of this concept, mainly based on the "pursuit of efficiency through innovation”, and the only way is through digitalization of the different process of the water cycle.

The smart cities are moving towards this new management model with three main goals:

  • More sustainability: they will become test-beds to experiment innovations, where new water technologies must be tested in urban areas.
  • More innovation: maximizing operational efficiency (reducing losses, minimizing energy consumption and CO2 emissions), and implementing a predictable economic framework.
  • More technology: an integrated technological vision is needed to ensure that urban functional systems really operate in an intelligent way.

Digitalization and the smart-city concept is a non-return path for our sector in Europe. EurEau is analysing tendencies from its members, trying to share experiences to learn from each other, and taking into account the current legislation as the main driver to impulse this new approach.

Q: What is your opinion on the revision of the Water Framework Directive?

A: We are currently asking the different countries of EurEau about this issue, and we don’t have yet a common position. In my personal opinion, I think it is not necessary to support a revision of the WFD nowadays, in fact it is a very ambitious directive in terms of the goals to achieve and it will take a long time to fully accomplish them.

Q: AEAS is the Spanish representative of EUREAU. What does the new appointment of Dr Castell-Exner as President of EUREAU mean for AEAS?

A: Claudia Castell-Exner comes from the German association DVGW, where she leads the water management, quality and usage team; she is also the Director of European Water Policy, a person very involved in the water sector.

AEAS has very good relationship with her and we share a lot of similar points of view to face the different matters and current goals of the sector, as explained above.

Q: How does AEAS contribute to EUREAU’s water industry positions?

At AEAS we want to continue to move forward to achieve our own country objectives, such as:

  • Address the current investment deficit.
  • Improve cost coverage.
  • Achieve regulatory harmonisation.
  • Encourage constant innovation.
  • Agree, reach consensus upon, ultimately reach a nationwide agreement on water.

Q: Could you tell us about the importance of urban water in Spanish policies compared to other water uses?

A: Urban water in Spain is a much-needed resource, for basic domestic uses as well as commercial and industrial consumption in cities, small and medium municipalities.

Water quality is one of the main policies, jointly with ensuring the continuity of the water supply; in Spain we can ensure a first class European service. Having said that, I insist on the fact that the sector faces a series of challenges to ensure the economic, social and environmental sustainability of the service.

Another important political aspect is universal access, always ensuring the human right to water and meeting the different social demands of citizens.

All of the above means we will continue to encourage sustained investment in infrastructure and continue to advance in regard to cost recovery mechanisms.

In other sectors that consume water, such as the agricultural sector, the policies implemented mirror those of the urban sector, but with even longer implementation periods, and depending on subsidies and public transfers, which for now are needed.

Urban water in Spain is a much-needed resource, for basic domestic uses as well as commercial and industrial consumption in cities, small and medium municipalities

Q: After the Spanish elections in May, do you think there will be any changes in urban water cycle policies?

A: The recent elections in my country have led to changes in the ruling political party in some large cities; however, I do not expect any drastic changes in how the sector will evolve.

True enough, there is a “remunicipalisation” trend nowadays; in my opinion the term is not correct, because the urban water sector assets and infrastructure have always been public property, regardless of the management model. In general, there is no private urban water supply infrastructure; usually the municipal or regional authorities own those assets.

The essential thing with the political change is to continue to move forward in the path towards efficiency, which I see as a vector in a three-dimensional space: sustainability, transparency and innovation. That is the objective, to be increasingly more efficient, regardless of whether the management model is a public one or a public-private one.

 

*REACH: European Union regulation dating from 18 December 2006 for Registration, Evaluation, Authorisation and Restriction of Chemicals.

*TFEU: Treaty on the Functioning of the European Union.

 

Featured news

10/10/2018 · Bottled water · 24

The EU should deliver healthy and affordable drinking water for all