AS Tallinna Vesi submitted an application to the Competition Authority on 21/09/2023 to increase the price for water services by 17% on average due to the increase in costs.
The application concerns the price for water services in the main service area in Tallinn and Saue, the service area in Maardu and for other water companies. If the application submitted to the Competition Authority is approved, the price for water services in the main service area (in Tallinn and Saue where AS Tallinna Vesi is also the owner of the assets) will be EUR 2.04 per cubic meter for private customers instead of the current EUR 1.56, and EUR 3.79 per cubic meter for commercial customers instead of the current EUR 3,57, plus VAT. This would increase the average household expenditure on water services by approximately EUR 3 per month. Depending on the proceedings of the Competition Authority, the new prices will take effect no earlier than from the next year.
According to Aleksandr Timofejev, Chairman of the Board of AS Tallinna Vesi, the price change is necessary to ensure the high quality of drinking water, the continuity of services and the cleanliness of the Baltic Sea. “The justified costs in all cost categories, included in the price for water services, were last amended in 2019, and last year only the amount of electricity costs was amended,” Timofejev said. The change in the consumer price index has been more than 40% in the last four years, which has also affected the costs included in the price for water services. “The necessary investments and the cost changes caused by inflation have led to an increase in justified costs, which need to be reflected in the price for the service to function,” Timofejev noted.
The investments made by Tallinna Vesi are guided by the need to ensure continuity of operation, cost efficiency and availability of the service also in emergencies. “This year our investments amount to EUR 35 million, which is EUR 10 million more than the year before. Renewing assets reduces the environmental impact of water consumption and ensures a high-quality service with as few interruptions and blockages as possible,” Timofejev said. “This year we are reconstructing more than 25 kilometers of networks plus investing EUR 8 million in wastewater treatment and EUR 4 million in water treatment,” Timofejev noted.
The Public Water Supply and Sewerage Act, which came into force in July 2023, imposes an obligation on all water companies to harmonise the prices charged from private and commercial customers over three years to ensure that all consumer groups are treated equally. Harmonisation in the areas where this has not been done is introduced gradually and therefore the increase in prices for private customers is higher in percentage terms. The new law allows for price differentiation depending on the level of pollution of the wastewater discharged by customer.
The price for water services for private customers in Tallinn and Saue has been and will remain one of the most favourable prices in Estonia. The average household expenditure on water services in Estonia is about 1% of the household’s net income, and in Tallinn it will remain at about 0,5% after the price change.