Abstract
The Italian Integrated Water Supply system suffers from major infrastructural deficiencies, and many of its water mains and wastewater treatment plants are inadequately maintained. It has been estimated that there is a need for €25.3 billion in investments over the next 5 years in order to realign the situation to EU standards. The uncertain and changing regulatory framework, the high number of small operators, and a wide range of risk factors associated with the water industry have been preventing investments for years. The establishment of an independent national regulator in 2011 represented a key turning point for the industry, since it positively contributed to restoring investors’ confidence. Despite the recovery phase being experienced, with about €1.5 billion in investments paid in tariffs in 2015, the water industry still needs additional forms of financing to quickly bridge the gap with other European countries. If, at the beginning of the 2000s, bank loans and project financing were the most common financial tools, in recent years, new instruments have come along, moving investors towards new forms of financing. A remarkable growth in bond issues has occurred, as the newly established regulatory framework has encouraged the spread of ad hoc tools such as mini bonds, hydro bonds and project bonds. Furthermore, private equity funds and public funding currently represent effective means to channel resources into the water industry. Despite the renewed interest in the water sector, concrete steps forward can be taken in order to provide a more attractive market for investors. Measures aimed at reducing the high fragmentation, establishing steady governance, cutting red tape, and reducing risks factors should hence be further developed and implemented.
Keywords
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
Utilitatis (2017), BlueBook.
- 2.
Delibera 656/2015/R/idr.
- 3.
Art.9 Directive n.2000/60/CE.
- 4.
XXIV Rapporto congiunturale e previsionale CRESME.
- 5.
Only the first six months of 2017.
- 6.
Also thanks to the so-called Hydrobond 2 operation, which involved five water companies.
- 7.
Decreto Cresci-Italia (gennaio 2012), Decreto sviluppo (giugno 2012), e Decreto Sblocca Italia (novembre 2014).
- 8.
Art.9 Directive n.2000/60/CE.
- 9.
Taking into account loans granted by Cassa Depositi e Prestiti, which represent a good proxy for the total resources available to local authorities (84% in 2014).
- 10.
ItaliaSicura (2015), Sviluppo delle Infrastrutture Idriche.
- 11.
Law 221/2015, art. 58, created the Guarantee Fund for water infrastructures established within the Cassa conguaglio per il Settore Elettrico.
References
AGICI Finanza D’Impresa (2016). Elettricità, gas, idrico e rifiuti. Strategie e performance delle maggiori utilities italiane—Rapporto Annuale 2016.
De Vincenti C. (2012). Finanziamento delle local utilities e investimenti di lungo termine. ASTRID Foundation.
European PPP Expertise Centre (2011). State Guarantees in PPPs, A Guide to Better Evaluation, Design, Implementation and Management.
EIB (2016). Investment and Investment Finance in Europe—Financing productivity growth. EIB Publishing.
Garotta, V., Mileno, R., Bordin, A., Caputo, A., Mele, D., Russo, P., Camerano, S. & Dell’Aquila, C. (2017). Blue Book 2017—I dati sul servizio idrico integrato in Italia. Utilitatis Foundation.
ItaliaSicura (2015). Sviluppo delle infrastrutture idriche. Investimenti pubblici nel Servizio Idrico Integrato.
OECD (2010). Innovative financing mechanisms for the water sector, Paris: OECD Publishing. doi:http://dx.doi.org/10.1787/9789264083660-en.
Ricerche, R. E. F. (2017a). Idrico e finanza: è vero amore?. Collana Acqua: Laboratorio SPL.
Ricerche, R. E. F. (2017b). Finanziamenti al servizio idrico: arrivano le garanzie del “Piano Juncker”. Collana Acqua: Laboratorio SPL.
Ricerche, R. E. F. (2017c). Correttivo al codice degli appalti: ripartono i bandi per l’idrico. Collana Acqua: Laboratorio SPL.
Regulatory Authority for Electricity, Gas and Water (AEEGSI, 2017). Relazione annuale sullo stato dei servizi e sull’attività svolta—Vol. I and II.
Vecchi V. & Leone V. (2016). Partnership Pubblico Privato—Una guida manageriale, finanziaria e giuridica. Egea.
WWAP (World Water Assessment Programme). (2012). The United Nations World Water Development Report 4: managing water under uncertainty and risk. Paris: UNESCO Publishing.
Acknowledgements
The author wishes to thank Ms. Maria Elena Perretti and Ms. Silvia Tranfa for their valuable preparatory work related to this contribution.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2018 Springer International Publishing AG
About this chapter
Cite this chapter
Camerano, S. (2018). Financing Infrastructures in the Water Industry. In: Gilardoni, A. (eds) The Italian Water Industry. Springer, Cham. https://doi.org/10.1007/978-3-319-71336-6_3
Download citation
DOI: https://doi.org/10.1007/978-3-319-71336-6_3
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-71335-9
Online ISBN: 978-3-319-71336-6
eBook Packages: Earth and Environmental ScienceEarth and Environmental Science (R0)