Municipal Water and Wastewater Project, Yerevan, Armenia

Challenge:

The water sector in Armenia faces serious problems following the collapse of the Soviet Union. Insufficient funding and poor management led to the deterioration of network and increased losses. Water supply duration was insufficient and the quality of the supplied water was at a hazardous level. The customers received on average a 4-6 hour water supply per day or even less. The collection rate for water and wastewater services was at a low level and covered only 15 per cent which could be hardly enough for covering the costs of energy power.

Solution:

The involvement of the private sector through PPP arrangements was considered as one of the main directions to overcome this challenge, and it indeed has resulted in significant performance improvements. In particular, the management and lease contracts with private water operators have been concluded along with large investments in water infrastructure upgrades. All this resulted in a remarkable improvement in service delivery, the reduction of operation costs and the increase of revenues. Currently there are five water companies which are managed by three private operators:

  1. Armenian Water and Sewerage Company (AWSC) serving a population of 0.62 million in several regions of Armenia under a Management Contract with SAUR
  2. Yerevan Djur serving a 1 million population under a Lease Arrangement with Veolia

Three regional utilities (Nor Akunq, Lori WS and Shirak WS) serving a 0.32 million population under a Management Contract with a consortium of companies MVV Decon, MVV Energie, AEG Service under SAUR’s leadership

SDG Impact:

SDG 3: Improvement of health and well-being are impacted by the development water facilities

SDG 6: Water duration has increased up to almost 24 hours with an increase in water quality

SDG 9: Quality of infrastructure ensured water security; and

SDG12: Promotion of rational and sustainable energy consumption

Compliance with UNECE People-first PPP criteria:

The Project:

  • Improved access to essential services (especially groups underserved) and achieved equity, social cohesion and justice
  • Multiplied economic effectiveness with an impact on human well-being; and
  • Impacted on environment by promoting green economy