Water utilities

The water market in Russia shows stable, positive dynamics which are secured by the steady growth of tariffs and the arrival of private investment to the sector. Investment prospects are based on the guaranteed demand for services and the good potential for cost saving.

There are interruptions in water supply in more than half of the 24,000 municipalities in Russia; on average, a mere 71% of water samples in the country comply with sanitary standards. The Pure Water Federal Target Programme for 2011-2017, signed in December 2010, aims to increase the coverage of water and wastewater services in Russian regions with the goal of reaching 95% for safe water supply coverage and 84% of wastewater collection and treatment by 2017. The construction and rehabilitation of infrastructure are expected to create new opportunities for equipment suppliers and engineering firms as well as construction companies. Emerging interest in advanced solutions, such as membrane systems, ultraviolet and ozone treatment creates good development prospects for the market’s participants.

A large number of water supply systems require rehabilitation as the low capacity of centralized water supply systems impedes the development of localities. The deterioration of pipes in some cities is above 60%.

Capital expenditure on water and wastewater infrastructure is forecasted to nearly double from US$1.4 billion in 2011 to US$2.7 billion in 2018.

Today the issue of water supply and wastewater treatment is addressed within the framework of the Housing Special-Purpose Federal Programme, special-purpose federal programmes for territorial development, programmes for development of the republics in the south of Russia, Far East, Trans-Baikal, and Kaliningrad Oblast. The programmes provide for a set of activities to construct and rehabilitate water supply facilities, sanitation systems, and wastewater treatment plants.

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