-Privatisation aims to make more efficient use of available resources-

Cleaning up the water industry

Like other Mediterranean countries, Greece has been suffering drought and decreasing rainfall. In response, steps have been taken to restructure the country's water companies to make them more efficient in managing the available resources. The former state-owned Water Supply & Sewerage Corporation of Athens (Eydap) was partly privatised recently, leaving only 70 per cent in government hands.

It is now a profitable company with ambitious plans for its future expansion. "Our goal is to become a leader in southeast Europe as a multi-utility company," says managing director Dionissios Xenos. Privatisation was a difficult exercise, says Dr Xenos. One problem was the debts owed to Eydap, mostly by state-owned companies and even by the government itself. But a three-year plan for payments to be made in installments has been set up, and Eydap has more freedom of action, both at home and overseas. "We have the possibility of organising branches with foreign companies, and of providing services around Attica and in neighbouring countries," says Dr Xenos. "Eydap will be a real player, like the French and the British."

Attica is the region surrounding Athens, and at present it is not fully covered by the company. There are still a few municipalities that are responsible for their own water supply. "Our goal is to buy all the networks and to cover the whole of Attica," he says. Profits are also on the rise. "In 1998, Eydap was a company with a profit of 16.7 billion drachmas, and in 1999 this had reached 21.8 billion drachmas," says Dr Xenos. "Eydap expects to have made over 35 billion last year and more than 40 billion this year." These increases were partly achieved by raising tariffs, but mainly as a result of higher consumption. The big problem for Eydap was the mentality of the state company employees, who had been used to the monopoly situation. But this has now changed dramatically. "Although we still have many improvements to make in our services and productivity, the process is under way," says Dr Xenos.

Eydap aims to provide customers with a top-quality product at a competitive price. The company does not intend to confine itself to supplying water, however, and has plans to expand into the fields of energy and telecommunications. "The company's first target is to be able to produce energy. Three hydro-electric plants are under construction so far. But the biggest project, which is now ready, involves the production of energy by biogas." He explains: "Psitalia is a huge project: a sewage treatment plant located close to Piraeus. It receives 800,000 cubic metres of waste water a day, and in the course of treatment we produce biogas, which can be burnt nowadays without causing any environmental problems. We expect to be able to produce 7.2MW of power. "The total cost of this project was four billion drachmas, financed equally by Eydap and the EU. In the near future we shall extend the activities there to increase power production," he adds.

The other potential business area being looked at by Eydap is the telecommunications sector. The company is carrying out a study for making use of its network to install optic fibres. The first results have been very positive and Eydap is seeking a licence from the Telecommunications Authority. "The idea is to use the sewage network for telecommunications," says Dr Xenos. "You can only install the cables in the sewage pipelines because they are not under pressure. There have been experiments of this kind in cities such as Rome, Zurich, Berlin and Tokyo, so we are expecting more details in the next few months." The Thessaloniki Water Supply & Sewerage Company (Eyath) is responsible for supplying water to the one million inhabitants of Thessaloniki.

Eyath has not been privatised as yet, although there are plans for the government to do so, and the company has wider ambitions as well. "Eyath is a brand-new company," says president Christos Tsongas. "It was created from the merger of two major water supply and waste water organisations. And it has ambitions to play a leading role in the water sector in northern Greece and the whole of southeast Europe." He adds: "Our first major project is to become a well-developed modern company. We will have to renew and rehabilitate the pipelines that supply Thessaloniki with water. The total length of our system is 1,300km (more than 800 miles), with the sewer network having a similar length."

A principal objective is to reduce leakages, and Professor Tsongas says that the company has experienced some success in this area, advised by the British company Hyder. "We hope that within the next two years we will be able to save about 30,000 cubic metres a day." In addition, there is a big scheme under way to take water from the rivers. "This project has three stages," he says. "In total we shall have about 800,000 cubic metres of water coming into Thessaloniki." Eyath has a new sewage treatment plant as well. "It is one of the best in Europe and it officially started operating in April," says Professor Tsongas. "The technology is very modern and this will improve the quality of the sea surrounding Thessaloniki. It will also help the agricultural sector in and around the city."

He adds: "In order to clean up the gulf and the sea surrounding Thessaloniki, I came up with the idea of cleaning the river Axios, which flows from Skopje to Thessaloniki. The EU has granted funds to get this project under way, though we haven't started on it as yet. It is very important for the whole region and for our company. We have many other things to do, but for the moment this is our priority."