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Water Operator Reluctant To Explain Another Price Rise


Armenia -- A water reservoir.

Armenia’s national water distribution network on Wednesday again declined to explain an almost 8 percent increase in the price of drinking water sought by it.

The company, Veolia Jur, formally asked the Public Services Regulatory Commission (PSRC) on August 7 to raise the tariff from 180 drams to 194.3 drams (40 U.S. cents) per cubic meter for the vast majority of consumers. The commission has 80 days to examine and rule on the request.

The regulators already sanctioned a nearly 6 percent rise in the water price last December. The PSRC chairman, Robert Nazarian, told Veolia Jur representatives at the time to “operate in a way that will preclude further tariff increases.” He said the Armenian subsidiary of France’s Veolia utility group must specifically crack down on “illegal water consumers.”

Veolia Jur has still not publicized its justifications for another price hike that were submitted to the regulatory body. A spokesperson for the company told RFE/RL’s Armenian service (Azatutyun.am) that it will not comment for now.

According to Artak Manukian, an independent economist, the operator claimed falling water consumption and increased spending on electricity powering water pumps in its application submitted to the PSRC. Manukian dismissed those explanations are unconvincing.

He cited government data showing that water consumption in Armenia actually rose by 1.2 percent in the first half of this year.Manukian also argued that the PSRC cut the domestic electricity prices by at least 2.6 percent last December.

Armenia’s drinking water and wastewater treatment facilities are run by Veolia in accordance with a 15-year management contract which it signed with the Armenian government in November last year.

The French giant managed the water and sewerage network of Yerevan in the past 10 years. It significantly improved water supply in the Armenian capital in that period not least because of capital investments made in the aging network.

In a November 2016 statement, Veolia said that it will attract $200 million in funding from the European Bank for Reconstruction and Development and the German development bank KfW over the next four years for similar infrastructure upgrades across the country. “By 2030 the entire population of Armenia will thus be supplied with drinking water [around the clock] thanks to Veolia,” said the statement.

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