The increase in water tariffs is being used in some cases more to cover the consequences of mismanagement and inefficiency of water utilities than to improve their performance. The Supreme State Audit raises this concern in the audit of the Water Regulatory Authority, highlighting extremely high levels of Non-Revenue Water in Lezhë, Fier and Shkodër.
According to the Albanian Supreme Audit Institution, the No Revenue Water indicator reaches 74.14% in the Lezhë Regional Water Supply Company, 69.59% in Fier and 67.01% in Shkodra. The audit assesses that the problem is not being addressed with concrete and binding measures in proportion to the impact it has on the costs borne by consumers who regularly pay their bills.
“Under these conditions, tariff increases are mostly used to cover the consequences of mismanagement and inefficiency of these companies,” the SAI concludes, while saying 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 of the three operators analyzed results in Lezha. The company produced about 13.65 million m³ of water per year, but only 16.3% of production was metered. Non-revenue water reached 74.14%, a level that the documentation used in the regulatory process itself considers unacceptable. The problem is related to technical losses, illegal connections and inaccuracies in the assessment of water quantities.
In Shkodra, the problem is even greater in terms of the reliability of the database. The annual production is about 14.8 million m³, but it is almost 100% estimated, as only a few sources have water meters. Of this production, the company bills only 32.98%, while the Non-Revenue Water is 67.01%.
The 313-kilometer network is largely depreciated, especially in Vau Dejës and Malësi e Madhe. Meanwhile, 73.7% of consumer connections have water meters, but metering is missing precisely at the production level, creating uncertainty about the volume entering the system.
In Fier, 20.79 million m³ of water is 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 highlights the source of losses: 31.93% represent administrative losses, which include illegal connections and underbilling, while 37.01% are real or technical losses.
The ALSHI estimates that, when the level of Non-Revenue Water is so high, the tariff increase risks transferring the burden to legitimate consumers, while the problems created by the losses continue.
For this reason, the SAI requests that the WRA, when approving tariffs for operators with high losses, set binding performance conditions and not just declarative objectives. Operators must have verifiable action plans, deadlines, concrete indicators and regulatory consequences if the objectives are not met./ ekofin.al