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Market News

 February 16, 2009
Hungary: Water & Wastewater Industry

 Summary

In Hungary public water services are provided by state-, municipality- and jointly-owned water utilities. Safe drinking water is available throughout most of the country. However, the EU requires that Hungary improve its drinking water infrastructure, to the tune of about USD 1.2 billion over the next five years. Despite recent upgrades, Hungary’s wastewater utilities still lag behind those of advanced EU states. Particularly in the capital, Budapest, as well as other cities and townships, new investments in wastewater are necessary. Hungary plans to spend USD 5.8 billion in sewage treatment programs through 2013.

Market Demand

The EU is set to provide 22.4 billion euros (USD 32.7 billion) to Hungary, from 2007-13, to finance infrastructure upgrades, as part of the New Hungary Development Plan. Water and wastewater-related projects are among the areas of focus. These include: wastewater treatment, water quality, waste management, remediation, re-cultivation, Water Framework Directive, nature protection (NATURA 2000 areas, habitat protection, and bird protection), renewable energy, energy efficiency, sustainable consumption and environmental protection. About 200 billion HUF (USD 1.2 billion) and 1,000 billion HUF (USD 5.8 billion) is projected to be spent on water and wastewater, respectively.

Drinking water quality and supply

Drinking water is available in every town in Hungary, with 93.7 percent of households connected to drinking water supply. By 2004 the total pipe network was 64,400 kilometers, 18.6 percent more than in 1991. The annual public utility drinking water supply is close to 560 million m3. However, a considerable proportion of the network does not meet EU or Hungarian standards. About 2.5 million people - 25.1 percent of Hungary’s population - in 873 municipalities are supplied by "unsatisfactory" water (i.e., water contaminated with unacceptably high levels of arsenic, nitrite, boron, fluoride or ammonium).

Improving this situation is a high Hungarian government priority. About 97 percent of Hungary’s water supply comes from underground sources, and the country has more than 1600 water bases. In addition, there are 75 prospective water base areas that have development possibilities and could be used for strategic reserves. All of Hungary’s prospective - and 600 currently operating - water bases are located in ecologically and geographically vulnerable areas. Almost 6 million people are affected by vulnerable water supplies, which is more than 60% of total built up capacity.

In 2001, the National Drinking Water Improvement Program was established to (a) ensure that drinking water supply fulfills all safety requirements; (b) reduce regional differences in drinking water quality; and (c) improve water level and safety of supply. New investments will continue these objectives, with a focus on a comprehensive drinking water improvement process. Key elements on this initiative will include individual projects, certain settlements (or parts thereof) and future technical interventions, such as building out water treatment technology, switching to other water bases, switching to other water supply systems, reconstructing the existing drinking water pipeline systems and/or a combination of these solutions.