Aguas Argentinas and Buenos Aires authorities have reached final agreement on the contract second five-year plan, following discussions provided for in the contract regulatory framework.
Initiated end of 1999, the discussions involved various national, provincial and municipal authorities. A total of 800 people, including authorities, the regulator and consumers associations examined a proposal for the concession’s next five-year plan under public hearing. The public hearing took place over two days at the end of June 2000 and was available on the Internet.
The new five-year plan comprises a water tariff increase, beyond inflation, of 3.9% per year for the period covering 2001 – 2003. It includes various measures aiming to improve cost recovery, encourage water conservation and simplify the various elements of the water bills. In addition, a social fare was created to better account for customers payment difficulties.
Commenting on the announcement, Gérard Payen, Chairman and CEO of the Water Division, Suez Lyonnaise des Eaux said: “ The renegotiations allow us to implement a substantial investment plan in Buenos Aires over five years. This plan will directly benefit our customers.”
The concession will benefit from the necessary financial resources to carry out a five-year investment plan aiming to:
- Connect an additional 1.5 million people to the water or wastewater system;
- Renovate or rehabilitate existing network to improve level of services;
- Initiate the Integral Wastewater Plan for the city of Buenos Aires and its suburbs, including the construction of an outfall and two wastewater treatment plants. The plan will substantially improve the quality of the environment and the Rio de la Plata shores;
- Acquire IT equipment to achieve higher performance and raise level of service to customers.
The renegotiations reinforce the balance of the contract.
The Buenos Aires concession is the world largest water and wastewater concession contract. Lyonnaise des Eaux has been operating the contract through Aguas Argentinas since in 1993.
It currently provides water to 7.7 million people and wastewater services to 6 million people in Buenos Aires and its suburbs.
Aguas Argentinas is a consortium led by Lyonnaise des Eaux with 39% and Aguas de Barcelona with 25% (Spain leading Water Company owned by Lyonnaise des Eaux and Caixa). In 1999, the Buenos Aires concession had a consolidated turnover of 500 million Euros.
