2005 - 2006 - Pinsent Masons Water Yearbook 2012

CZECH REPUBLIC PART 2: COUNTRY ANALYSIS
water and sewage company cut leakage rates from 44% of distributed water in 1989 to 30% in 2003
and seeks to cut leakage to 19% by the year 2013.
Urban Services
Safe drinking water 90%
Access to sewerage 77%
% Sewage treated 73%
The economics of water and sewerage
The Czech Government has been strongly in favour of privatisation since 1993, and with the sale of
Prague Water in 2001, the initial privatisation of water and sewerage services is complete.
Since the end of communism in 1989, water consumption has been cut by nearly half, primarily as a
result of a 40-fold price rise. Consumption is also down because of the decline of the country’s heavy
industry. In 1989, average consumption was 300L per person per day, declining to 163L in 2002.
The cost of a cubic metre of drinking water was kc19.5 (€0.62) in 2002, while the collection of a cubic
metre of sewage cost kc15.9.
All cities and municipalities with over 10,000 people are equipped with a waste water treatment plant.
EU compliance related work on the sewerage network and industrial effluent treatment was estimated
at €2.47 billion in 2004, with 600 WWTW's needing to be built or upgraded, so as to provide EU
compliant sewage treatment for all cities and towns with more than 2,000 inhabitants by 2100.
Freshwater
Total (1998, km 3 ) 58.21
Per capita (1998, m 3 ) 5,692
Withdrawals (1991, km 3 ) 2.74
For domestic use (1991) 41%
For industry (1991) 57%
For agriculture (1991) 2%
Privatising water and sewerage services
Since 1993, 57 water and sewerage companies have been set up, subdivided from the original eight
regional entities and Prague Water. With the exception of the latter, shares were offered for alI of
these entities, although in a number of cases, effective control of the operating companies has
remained in municipal hands through the acquisition of shareholdings. With the exception of North
Moravia’s SMVAK, the asset owning company is held by the relevant municipalities and the
government, which rents the infrastructure and approves water charges to the privatised operating
company via a contract, which includes the agreed price formula. Nine of these companies, serving
more than 3.85million people have been fully privatised, with foreign investors involved.
The agriculture ministry is seeking to advise municipalities on utility sales, amid concerns that water
and sewage works could be sold too cheaply or too quickly. It also intends to use its so-called golden
shares in the water utilities yet to be privatised in order to block what it sees as unsuitable sales. The
plan is that the commission would monitor the situation and then would oversee sales until the year
2010. Around 40 concerns remain in local authority hands. The ministry has already used their
golden share to so far block the sale of Vodovody and Kanalizace Zlin in South Moravia to foreign
investors, while a similar scenario is set to follow for Vodarny Kladno-Melnik in Central Bohemia.
MAJOR CITIES
Population 2000 2015 Status
Prague 1,203,000 1,203,000 Prague Water privatised
Privatisation of Prague Water
The concession for Prague's water supply companies (Prazske Vodarny) and sewerage service
companies (Prazsje Kanalizace a Vodni Toky) was awarded to AWG and VE in early 2001 after the
two companies joined forces (a 66% share sale for Kč6.1 billion (US$163 million), with a 15 year
operating contract, with the balance of the shares being held by the city). The contract supplies
1.16million people in Prague and a further 0.2million in Central and Eastern Bohemia via the sale of
78 Pinsent Masons Water Yearbook 2005 – 2006