This document discusses an upcoming conference titled "The States General on Technology Transfer Between Israel and Italy in the Integrated Water Service" to be held June 21-23, 2023 in Bari, Italy. It provides an overview of the multi-level governance structure for water services in Italy including the roles of national, regional, local and district authorities. It also summarizes Italy's regulatory authority ARERA and its tools for ensuring investments and improving quality, such as infrastructure planning requirements and economic regulation of tariffs. Finally, it discusses ARERA's involvement in European and international cooperation on water issues.

1. 2023
Organizzazione Con il patrocinio di
Da un’idea di
LE TECNOLOGIE DI DOMANI PER L’ACQUA DI OGGI
GLI STATI GENERALI SUL TRASFERIMENTO TECNOLOGICO FRA ISRAELE E ITALIA NEL SERVIZIO IDRICO INTEGRATO
TOMORROW'S TECHNOLOGIES FOR TODAY'S WATER
THE STATES GENERAL ON TECHNOLOGY TRANSFER BETWEEN ISRAEL AND ITALY IN THE INTEGRATED WATER SERVICE

2. Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
Water regulation: governanceand investments
Roundtable:Political and legal cooperation
FABIO TAMBONE
Director, Head of External International Affairs
ARERA, The Italian Regulatory Authority for Energy, Networks and Environment

3. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
ARERA in Italy: regulatory action VS
governance, quality and investments
3

4. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
NATIONAL LEVEL
ARERA
Minister of environment and
energy security [MASE]: set
general principles and rules
concerning all water
resources uses (including SII)
REGIONAL LEVEL
Regions define the boundaries into which water service is organized (Ambiti
Territoriali Ottimali, ATO) and set the competent Authority for each ATO (Ente
di governo dell’Ambito, EGA)
LOCAL LEVEL
62 EGA: legal entity in charge of public functions of
planning and tariff proposal for a specific territory (i.e.
Ambito Territoriale Ottimale, ATO)
SOVRA-REGIONAL/ DISTRICT
LEVEL
7 District Authorities: set District Management Plan (in compliance with WFD 2000/60/CE),
including “…the contribution made by the various water uses to the recovery of the costs of water
services … ” , “ … having regard to the economic analysis … ” and “… in accordance in particular
with the polluter pays principle” (art.9, par. 1 & 2)
About 2.000 operators (but over 80% of population is
served by about a hundred of medium-large operators)
Integrated water service:
Complexity of multi-level governance
4

5. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
➢ Operators heterogeneity, small size
The balls volume shows the number of operators in each class of population
Operators serving less
than 5.000 population
Operators serving more than
1.000.000 population
▪ Rationalization of the operators number:
from 2.600 operators in 2014… to around 2.000 operators
12,0%
88,4%
88,0%
11,6%
0%
20%
40%
60%
80%
100%
Numerosità Gestioni Popolazione residente
Comuni gestori
Società e consorzi
➢ Among the (nearly) 2.000 operators, more than
1.700 are Municipalities offering directly the
services at 11,6% of the Italian population
Water service operators
Operators Population
Municipalities
Companies and consortium
Aqueduct Sewerage Wastewater treatment
population
LACK OF DATA
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6. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
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ARERA adopted a comprehensive definition of tariff proposal, named “specific regulatory scheme”, to be
adopted by EGA, with the involvement of service supplier, and to be detailed for a four-year regulatory
period. The “specific regulatory scheme” includes:
Tariff methodology:
regulatory scheme
▪ disentangling all the relevant measures to be
implemented in order to achieve the
predefined quality objectives
INFRASTRUCTURE AND MANAGEMENT
PLAN (IMP)
FINANCIAL AND ECONOMIC PLAN
(FEP)
▪ specifying revenues, average tariff for end-
users and all the costs to be reimbursed to
the supplier
ENTRUSTMENT CONTRACT (EC)
▪ clarifying liabilities of EGA and service supplier
according to the standard framework
defined by ARERA
Evidence-based information, both on accounting data and on technical
and contractual parameters, are combined with the objectives to be
achieved and with the corresponding envisaged measures, in a
framework in which the roles and liabilities of the parties are clarified.
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7. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
Infrastructure measures: instruments for planning
INFRASTRUCTURE &
MANAGEMENT
PLAN (IMP)
includes:
▪ Criticalities of the territory
▪ Targets to reach, in order to solve
critical issues
▪ Infrastructures to realise during
the regulatory period to reach
targets
STRATEGIC
INVESTMENTS PLAN
(SIP)
▪ includes strategic infrastructures to realize:
- which realization requires necessarily more than 1 year, also due to their technical complexity
- considered a priority by the Local Authority
▪ time period 2020-2027
▪ admitted infrastructures:
- for every service (aqueduct, sewerage and wastewater treatment)
- useful life not less than 20 years
the time schedule specifies elements of
coherency with River basins planning and
foreseen public contributions
Since the 1st tariff method:
Since 2020:
by 2027, should foresee a rate of
renovation coherent with the asset
useful life and have to specify
convergence measures
particular relevance
of work in progress
.
7

8. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
Some key data: planned vs realised Investments
RQTI EFFECTS:
▪ An increase in Planned Investments
▪ Technical quality is increasing among operators in terms of water losses,
service interruptions, sewerage system adequacy, sludge disposal and
wastewater treatment
▪ Strong positive correlation between realised investments and
performances in technical quality
2020-2023
263
€/per capita
Since 2014:
▪ CAGR 14-21 +14,9%
Planned Investments
▪ Similar trend in realised
investments 97,8% in 2019
In the third regulatory period:
▪ Planned investments 2020-
2023 per capita are about
263€
(65,75 euro per year)
8

9. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
9
Planning vs technical quality
Distribution of planned investments2020-2023
M1 - Water losses
M2 – Continuity of supply
M3 – Water quality
M4 – Sewerage system adequacy
M5 – Sludge disposal in landfill
M6 – Treated wastewater quality
Prerequisites
Contractual quality (MC1 & MC2)
Other
9

10. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
10
Interrelation among regulatory and not regulatory instruments
• include measures
to achieve quality targets
• consider the amount of public contributions
Close link among
regulatory and non-
regulatory instruments
PLANNING
TARIFFS
QUALITY NEXT GENERATION
EU/NRRP
• require planning update
• reduce tariffs with stable
investments (but the
objective is to accelerate
investments)
technical quality indicators:
• determine planning and define
Next Gen EU/NRRP objectives
• contribute to determine the
efficient frontier for
endogenousoperating costs
• determine relevant payoffs
(total premiums amounts to
10% of OF+Ofisc)
• Quality is a target finance quality
improvements
10

11. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
ARERA in the Europeanand International
context:
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12. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
12
A public perspective on European water services

13. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
13
WAREG at glance https://www.wareg.org/

14. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
14
• Water is a public good with no market
• Services typically offered under local monopoly, with no price signals for
efficient expenditure
• Externalities to address (i.e. affordability, EU environmental targets)
• High CAPEX and OPEX for dw & ww services to recover (art. 9 WFD)
• Public utility targets for companies: consumers need to be protected (i.e.
good quality, security, continuity of services)
Regulators ensure universal access to drinking water & sanitation services,
promoting good quality, fair prices and environmental sustainability through tariffs
Why regulating drinking water and waste water?
14

15. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
Institutional
Advocacy
• KPIs on quality of services
• Consumer protection
• Innovation
• Environmental
sustainability
Promoting
Compliance
with EU
acquis
• Support full
implementation of EU
water acquis in Members’
Countries and progress in
EU Candidate and EU
Partner Countries
Capacity
Building
Specialised training
Technical assistance
Exchange know-how on
regulatory competencies
Sharing
Best
Practices
• Collaborationof Members
• Exchange best practices
• Share data & information
on dw & ww sectors
15

16. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
16
Extension of the data collection
process
Advocacy
and
support
To policy
makers
and Government
Ensuring
rapid
deployment
of EU legislation
European regulators and their
association (WAREG) are providing
a triple support to national and
EU Institutions
Ensure a fast compliance with EU
Legislation
Advocacy and support to policy
makers
Data Collection
1
2
3
Regulators collect data continuously
to develop incentive-based
regulation and monitor sectors,
including data on risks and
environmental impacts
EU institutional relations: promoting EU targets
16

17. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
Observer in EC Expert Groups
• Implementation of the Drinking Water
Directive
• Implementation of the Urban
Wastewater Directive
Invited to the Zero Pollution
Stakeholder Platform meetings
Member in the Common
Implementation Strategy of the
Water Framework Directive
(CIS WFD)
• Strategic Coordination Group
• Working Group on Economics
• Working Group on Water Scarcity
and Droughts
• Working Group on Ecological Status
EU institutional relations: participation in EC advisory groups
17

18. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
Monitor and report on regulatory activities in Europe
• Surveys & reports
• Workshops and Seminars
• Collaboration with research Institutions (ex. EUI/FSR , Universities, etc.)
Promote Compliance with EU rules
• Explain EU water legislation
• Bi-weekly Bulletin on EU water topics
• Position papers
• Participation in Horizon Europe Research Projects
Sharing Best Practices – Capacity Building
• Organise specialised training
• Offer technical assistance (Collaboration with the EC)
• Exchange know-how
Dissemination & Institutional Advocacy
• Multistakeholder dialogue - EFRWS 2019 and 2021
• Open dialogue with EU Institutions and European stakeholders associations
• Cooperation with International Organisations
Sharing knowledge: internal reports & public papers
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19. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
Regional cooperation: research & training
19

20. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
20
Disseminating knowledge: the EFRWS

21. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
21
❖The OECD Network of Economic Regulators
(NER) promotes dialogue between over 70
regulators from across the world that operate
in different sectors like communications,
energy, transport and water.
❖https://www.oecd.org/gov/regulatory-
policy/ner.htm
❖NER members share their experiences,
challenges, and innovative solutions.
❖ The “NER Bureau” provides more detailed
direction to the OECD Secretariat on issues
of management and the planning of the
Programme of Work of the Network.
❖ https://www.oecd.org/gov/regulatory-
policy/ner-bureau-members.htm
❖ Bureau members contribute to the planning
of each NER meeting by the Secretariat and
take part in consultations on on-going work.
ARERA is member of the
Network of Economic
Regulators Bureau
Network of Economic Regulators (NER)

22. 2023
Centro CONGRESSI
FIERA DEL LEVANTE - BARI
21 - 22 - 23 GIUGNO 2023
Organizzazione Con il patrocinio di
Da un’idea di
Thank you for your attention!
ftambone@arera.it

23. Organizzazione Con il patrocinio di
Da un’idea di
www.waterinnovationsummit.org