Bringing Cash into Your City's Water Utility
City to grant "Water Utility" in partial concession
Capturing investments for your water utility isn't a one-trick pony - it requires drawing from multiple financial wells, including city, regional, and federal budgets. Vladimir Heĭko, your city's deputy mayor, advocates for a concession route, but he's quick to add that the utility itself should remain municipally owned.
"Water is the lifeblood of our bustling city, and we should keep the utility in our control," Heĭko shared in an interview with E1.RU. However, he mentioned that specific projects might be put up for concession, starting as early as the end of this year.
Concessionaires can expect proposals for deep-trench sewer construction,primary infrastructure hubs, and troublesome networks that demand substantial financial investments. Additonally, Heĭko mentioned that documents are being prepared for the refurbishment of the South Aeration Station, with a hefty price tag of 20 billion rubles.
The city has fielded proposals for concession from both "Rosvodokanal" and "Rossiiskie Kommunal'nye Sistemy" (tied to billionaire Victor Vekselberg's structures). Yet, Heĭko expresses doubts about whether anyone will bite at the current interest rates.
"I'm not sure if we'll find takers in this credit climate," Heĭko concluded.
The Exodus of Millionaire Vitailiy Kochetkov's People from "Water Utility"
The idea of outsourcing the "Water Utility" has been a hot topic for quite some time. Various power players, from the aforementioned "Rossiiskie Kommunal'nye Sistemy" to other influence groups, have made bids to take over the utility.
Overhauling the utility's network is estimated to require a whopping 600 billion rubles.
Insights from Enrichment Data
Public Funding
- City Budget: Allocate city resources to water infrastructure development, with local authorities' support.
- Regional Partnerships: Collaborate with neighboring municipalities or regional authorities for shared water infrastructure financing.
- Bulk Procurement: Group purchases can help reduce costs and increase project appeal.
Concessions
- Public-Private Partnerships (PPPs): Engage private companies to manage and invest in water utilities through concession agreements.
- Design-Build-Operate (DBO): Allow companies to design, build, and operate water infrastructure, offering a comprehensive solution.
- Promoting Sustainability and ESG: Highlight utility's commitment to sustainability and ESG principles, attracting tech-savvy and eco-conscious investors.
Interviews- Heĭko, V. 2023. Talk with E1.RU.
References- [4] Invitation to Tender for Concession of Waterworks. Rossiiskie Kommunal'nye Sistemy, 2023.- [5] A New Era for Water Infrastructure Investment in the USA. Investment Executive, 2023.- [6] The Impact of Inflation Reduction Act on Water Projects. Clean Tech Insider, 2023.
"The city has received proposals for concession from companies like 'Rossiiskie Kommunal'nye Sistemy,' which could potentially invest in the utility's infrastructure projects, as advocated by Heĭko."
"To attract private investments, it's crucial to promote the commitment of the water utility to sustainability and ESG principles, as suggests the Enrichment Data."
