ZOCG: Municipal water companies are facing serious problems

The Union of Municipalities of Montenegro (ZOCG) announced today that it once again wants to draw the attention of the public and all competent institutions in the country to the serious problems that municipal water supply companies have been facing in recent years, which could result in a threat to the water supply of citizens.

"Out of 24 water supply companies owned by Montenegrin municipalities, 2023 operated with a total loss of over six million euros in 11, and judging by the first reports for 2024, this trend continues, so the net loss of Pogorica's 'Water Supply and Sewerage' alone last year was over 1,2 million euros. The costs of maintaining and modernizing water supply systems have increased significantly as a result of both local and global economic trends and inflation, and the revenues generated from current water prices, including those that will be applied in 2026 based on the current methodology, are not sufficient to cover all company costs, which leads to the accumulation of debts and the inability to invest in necessary infrastructure projects," the ZOCG statement states.

The institution added that, with this in mind, ensuring conditions for continuous and quality water supply can only be achieved by finding an optimal solution for a sustainable increase in water prices, which would be accompanied by appropriate regulations to enable subsidies and thus prevent negative effects on socially vulnerable categories of the population.

"In order to prevent further financial destabilization of water utilities, the Union of Municipalities formed a working group last year that adopted proposals for changes to the methodology for determining the price of water, considering the existing legal system, as well as a proposal for amendments to the Law on Communal Services that would enable a more comprehensive redefinition of this methodology. Unfortunately, the competent Regulatory Agency rejected almost all proposals, while on the other hand, work on preparing amendments to the Law on Communal Services has been continuously delayed for several years," said the ZOCG.

They said that they believe it is time to take more decisive steps to resolve this problem in order to eliminate the danger of endangering the water supply system in the country, but also to create conditions for improving the wastewater disposal system.

"Let us recall that, according to the latest data, the coverage of public water supply services is 87,42 percent, while the coverage of the sewage network is at a very low level and amounts to only 49,70 percent. In addition, the coverage of the population with municipal wastewater treatment services is at an alarming 36,26 percent," the ZOCG statement reads.