KLSH: Water utilities are covering up their failures by raising water prices for citizens

Water tariff increases are being used in some cases more to cover the consequences of poor management and inefficiency at water utilities than to improve their performance.

The High State Audit raises this concern in its audit of the Water Regulatory Authority, highlighting extremely high levels of Non-Revenue Water in Lezhë, Fier and Shkodër.

According to KLSH, the Non-Revenue Water rate reaches 74.14% at the Lezhë Regional Water Utility, 69.59% in Fier and 67.01% in Shkodër.

The audit finds that the problem is not being addressed with concrete and binding measures proportionate to its impact on the costs borne by consumers who regularly pay their bills.

“Under these conditions, tariff increases are used primarily to cover the consequences of the mismanagement and inefficiency of these companies,” KLSH states, adding that requests for higher tariffs have not been accompanied by clear and measurable measures to reduce losses, combat illegal connections, improve billing and invest in the network.

The most problematic situation among the three operators analyzed is in Lezhë. The company produced approximately 13.65 million m³ of water per year, but only 16.3% of its output was metered.

Non-Revenue Water reached 74.14%, a level that the documentation used in the regulatory process itself considers unacceptable.

The problem is linked to technical losses, illegal connections and inaccuracies in estimating water volumes.

In Shkodër, the problem is even greater in terms of the reliability of the data base. Annual production is approximately 14.8 million m³, but it is almost entirely estimated, as only a few sources have water meters.

Of this production, the company bills only 32.98%, while Non-Revenue Water stands at 67.01%.

A large part of the 313-kilometer network is described as being worn out, particularly in Vau i Dejës and Malësi e Madhe.

Meanwhile, 73.7% of consumer connections have water meters, but metering is lacking precisely at the production stage, creating uncertainty over the volume entering the system.

In Fier, 20.79 million m³ of water are produced annually, of which only 67.7% is metered. The company bills only 30.41% of the water produced, while Non-Revenue Water reaches 69.59%.

In Fier, the audit also identifies the source of the losses: 31.93% represent administrative losses, including illegal connections and underbilling, while 37.01% are real or technical losses.

KLSH assesses that when the level of Non-Revenue Water is this high, a tariff increase risks shifting the burden onto compliant consumers, while the problems causing the losses continue.

For this reason, KLSH calls on the Water Regulatory Authority, when approving tariffs for operators with high losses, to impose binding performance conditions rather than merely declarative targets. Operators should have verifiable action plans, deadlines, concrete indicators and regulatory consequences if the targets are not met. /ekofin.al