Lena Rücker, KDZ Centre for Public Administration Research Austria
The public provision of water supply and wastewater disposal services as basic services of general interest has a long tradition in Austria. Predominantly provided by the public sector on local level, municipal water services are characterized by high quality, reliability and customer satisfaction. Approximately 95 per cent of the population are supplied by the public water supply and wastewater treatment network, the remaining 5 per cent are inhabitants of remote, self-sufficient settlements. Austrian consumers have a high level of confidence in their water service providers and 90 per cent of consumers were ‘satisfied’ or ‘very satisfied’ with their local services.
Austria´s geographic conditions, particularly the heterogeneous topographic features, have created a contrasting settlement structure with a concentration of settlements in agglomeration regions and scattered settlements in peripheral, more alpine regions. The spatial features and the particularly low population density in some regionsare a challenge for the efficient provision of network-bound public services and have contributed to a municipal water sector structure that is characterized by a high share of small to very small service providers. Small-scale water suppliers and wastewater disposal facilities operate predominantly in rural and/or peripheral regions, and cooperative provision models are common. A few large municipal companies provide water services to larger cities and urban agglomerations, usually in delegated public management.
The joint consideration and regional perspective of spatial units in Austria has been recognized as a prerequisite for ensuring efficient and economically viable, reliable and resilient water supply and disposal infrastructure. However, the prevalence of cooperative provision models in Austria is not primarily a result of strategic planning, but often of simple necessity due to the lack of financial resources and structural weaknesses in peripheral regions.
The domestic regulatory and legal framework of municipal water supply and disposal in Austria is formed by national legislation, particularly the Act on Water (WRG 1959, Wasserrechtsgesetz), the Drinking Water Ordinance (TWV 2001, Trinkwasserverordnung) and the Environmental Support Act (UFG 1993, Umweltförderungsgesetz) as well as sub-national legislation on the level of the Länder. Based on the principle of subsidiarity, the Länder hold legislative and executive competences for water supply and wastewater disposal, but the regulations are not uniform across the nine Länder due to the federal system (Article 10(1)(10) of the Austrian Constitution). The organization of water supply and wastewater disposal services falls within the local jurisdiction, as Austrian municipalities have the right to local self-administration and are competent in all matters that are in the exclusive or predominant interest of the local community (Article 118 of the Austrian Constitution). Based on this framework, some Länder explicitly allocate the responsibility for the provision of water supply and wastewater disposal services to the municipalities. However, in practice the vast majority of Austrian municipalities assume this responsibility in one way or another (either in direct, delegated public management or in associations with other municipalities), depending on the specifications of the Länder regarding the legal models of organization.
The operational provision of water services on the local level is, with few exceptions, carried out by public companies, predominantly in direct or delegated public management. 95 per cent of drinking water supply and 96 per cent of wastewater disposal services are provided by public companies, and respectively 5 per cent and 4 per cent by private or mixed-economy companies. There are noticeable differences in the applied management models and legal form of enterprises between urban and rural areas. In urban areas, such as Graz, Linz or Innsbruck, public water utilities are often jointly operated in delegated public management. This management model represents a formal privatization, as the provision of water utilities is outsourced to enterprises that operate under private law (Eigengesellschaften as AGs or GmbHs). However, the infrastructure remains in public ownership and typically the municipalities are the largest shareholders of such companies, with only a few exceptions of minor private shareholdings. This model may reduce the financial burden of growing municipalities as it allows extra-budgetary financing and investments. An exemption is the capital city, Vienna, which directly provides water supply and disposal services through an administrative division (MA 31).
In rural areas, water supply services are provided either through municipal companies (Regiebetriebe) in direct public management or bundled in water cooperatives (Wassergenossenschaften) or water associations (Wasserverbände). In general, water associations (Wasserverbände) and water cooperatives (Wassergenossenschaften) can be established for the same purposes, such as e.g. waste management or water supply and wastewater disposal. In contrast to water cooperatives, water associations are established for the implementation of measures and activities that extend over an area of several municipalities and therefore, the members of associations are usually municipalities (and may also be cooperatives) (WRG 1959, Article 87). Water associations are one of the oldest examples for institutionalised inter-municipal cooperation for the provision of public services in Austria. Water cooperatives are constituted by three or more parties, which are typically property owners (WRG 1959, Article 74). This small-scale, bottom-up model is frequently used in remote and/or scattered rural settlements out of the need to compensate for the lack of financial resources of the responsible municipal authorities (especially considering the trend of population decline). The wastewater services sector has a similar structure: many small treatment plants with low individual capacities dominate in rural-peripheral regions and mergers between municipalities in the form of wastewater associations (Abwasserverbände) are the most common model.
The prevalence of cooperative models as a particular feature of the Austrian municipal water sector is reflected in the figures: There are approximately 5,500 water suppliers in Austria, of which more than 60 per cent (3,400) are water cooperatives, 35 per cent (1,900) are municipal companies and around 3 per cent (165) are associations. The figures also show the structural differences between urban and rural regions: Despite their large shares in the total water suppliers, associations only provide services to about 10 per cent and cooperatives only to 11 per cent of the population. Almost 50 per cent of the population is supplied by municipal companies. The majority (54 per cent) of the 1,927 wastewater treatment plants have a capacity of less than 500 PE, but 66 per cent of the total installed capacity in Austria is installed 66 large treatment facilities, which are less than 4 per cent of the total treatment plants.
The small-scale structure of the Austrian municipal water sector is a financial factor, as cost recovery is more difficult to achieve for smaller municipalities and enterprises operating in rural areas. On average, the relation between expenses and revenues is 96 per cent in the water supply and 106 per cent in the wastewater disposal sector, while larger municipalities tend to reach cost recovery more often than smaller municipalities. This discrepancy can be explained with the disproportionally higher capital cost for smaller municipalities. Privatization of public services is seen with skepticism in Austria and the regulatory framework was not adapted to ease the entry for private actors. Each local government may individually decide whether to delegate water services to private sector actors or not. While this option is still rarely exercised, financial pressures for local governments have been increasing over the last decades, particularly for rural municipalities facing structural weaknesses and/or population decline. Therefore, some smaller municipalities, e.g. Ruden, Kötschach-Mauthen (both Carinthia) or Ernsthofen (Lower Austria), have chosen the model of formal and material (=full) privatization of their wastewater disposal services.
In general, the Austrian municipal water sector provides water supply and disposal services with a high level of quality, reliability, affordability and customer satisfaction. Hence, especially from the consumer´s perspective, this area of public services can be considered good practice. Structural challenges and issues of the Austrian municipal water sector do not so much affect the quality provided but rather concern the long-term sustainability of the system´s organization regarding existing financial disparities as well as the capacity and resilience of decentralized systems and thus the security of supply in peripheral regions. The urban-rural divide in the provision of network infrastructure is steadily increased by the trends of population decrease in peripheral regions and migration to agglomerations, both increasing the pressure on municipal budgets. They also disproportionally increase the risk of leaving rural municipalities and settlements, which cannot make use of economies of scale as a competitive advantage in the provision of municipal services, behind. Water associations and cooperatives have proven successful models to bridge gaps and counteract disparities between urban and rural regions in Austria. However, in the future, additional focus must be placed on the further regionalization and improved interplay of the highly decentralized systems, especially in order to increase their resilience and adaptability to the impacts of climate change.
Austrian Federal Constitution (B-VG, Bundes-Verfassungsgesetz), BGBl. no 1/1930 (WV) idF BGBl. I no 194/1999 (DFB)
Act on Water (WRG, Wasserrechtsgesetz), BGBl. no 215/1959
Scientific and Non-Scientific Publications:
Getzner M and others, ‘Vergleich europäischer Systeme der Wasserversorgung und Abwasser-entsorgung. Endbericht (Langfassung)‘ in Informationen zur Umweltpolitik 197 (Kammer für Arbeiter und Angestellte 2018)
Österreichischer Wasser- und Abfallwirtschaftsverband (ÖWAV), ‘Branchenbild der österreichischen Abwasserwirtschaft 2020‘ (ÖWAV 2020) <https://www.oewav.at/upload/medialibrary/oewav_bb_2020_gesamt_DL.pdf>
Rasztovits D, ‘Ökonomische und räumliche Analyse der Trinkwasserversorgung und Abwasser-entsorgung in den Ländern Österreich, Frankreich und Portugal‘ (dissertation, TU Vienna 2016)
Österreichische Vereinigung für das Gas- und Wasserfach (ÖVGW), ‘Die österreichische Trinkwasserwirtschaft. Branchendaten und Fakten‘ (edn 3/2018, ÖVGW 2018) <http://www.trinkwassertag.at/wp-content/uploads/2018/04/%C3%96VGW_Branchenbild_Trinkwasserwirtschaft_2018.pdf>
Nöbauer RT, Genossenschaften als Chancen für Kommunen: Potentialanalyse genossenschaftlicher Infrastrukturbetriebe (Diplomica 2012) Gruber M and others, ‘Raumordnung in Österreich und Bezüge zur Raumentwicklung und Regionalpolitik‘ (no 202, ÖROK 2018) <https://publik.tuwien.ac.at/files/publik_271716.pdf>
 Michael Getzner and others, ‘Vergleich europäischer Systeme der Wasserversorgung und Abwasserentsorgung. Endbericht (Langfassung)‘ in Informationen zur Umweltpolitik 197 (Kammer für Arbeiter und Angestellte 2018) 93-94.
 Österreichische Vereinigung für das Gas- und Wasserfach (ÖVGW), ‘Die österreichische Trinkwasserwirtschaft. Branchendaten und Fakten‘ (edn 3/2018, ÖVGW 2018) 35 <http://www.trinkwassertag.at/wp-content/uploads/2018/04/%C3%96VGW_Branchenbild_Trinkwasserwirtschaft_2018.pdf>.
 Markus Gruber and others, ‘Raumordnung in Österreich und Bezüge zur Raumentwicklung und Regionalpolitik‘ (no 202, ÖROK 2016) 23 <https://publik.tuwien.ac.at/files/publik_271716.pdf>.
 Denise Rasztovits, ‘Ökonomische und räumliche Analyse der Trinkwasserversorgung und Abwasserentsorgung in den Ländern Österreich, Frankreich und Portugal‘ (dissertation, TU Vienna 2016) 52.
 See Getzner and others, ‘Vergleich europäischer Systeme der Wasserversorgung und Abwasserentsorgung‘, above, 119-120.
 See Roland T Nöbauer, Genossenschaften als Chancen für Kommunen: Potentialanalyse genossenschaftlicher Infrastrukturbetriebe (Diplomica 2012) 12.
 See Getzner and others, ‘Vergleich europäischer Systeme der Wasserversorgung und Abwasserentsorgung‘, above, 120.
 ÖVGW, ‘Die österreichische Trinkwasserwirtschaft‘, above, 15-16.
 Österreichischer Wasser- und Abfallwirtschaftsverband (ÖWAV), ‘Branchenbild der österreichischen Abwasserwirtschaft 2020‘ (ÖWAV 2020) 20 <https://www.oewav.at/upload/medialibrary/oewav_bb_2020_gesamt_DL.pdf>.
 See Getzner and others, ‘Vergleich europäischer Systeme der Wasserversorgung und Abwasserentsorgung‘, above 140.
 Rasztovits, ‘Ökonomische und räumliche Analyse der Trinkwasserversorgung und Abwasserentsorgung‘, above, 53.