VIK asks KS Government for a decision on price increase: Necessary increase in water prices due to rising operating costs

(Patria) - KJKP “Vodovod i kanalizacija” d.o.o. Sarajevo has been incurring significant losses from its core business for many years, which includes the service of supplying drinking water, wastewater disposal, and in recent years, wastewater treatment.

The reason for the losses is the low price of water services, which does not cover the basic costs incurred in providing water services.

"The current price does not cover all justified costs, including operating costs, depreciation costs, investment costs, and financing costs, in accordance with the Methodology for determining the minimum price of water services in the Federation of Bosnia and Herzegovina. The application of the Methodology represents the fulfillment of prerequisites for ensuring financial support from international development institutions in modernizing water services.

In the past period, all water supply companies in the country and the region have increased their service prices, while KJKP “Vodovod i kanalizacija” d.o.o. Sarajevo continues to calculate based on the lowest prices, according to the price list from 2013, and we are witnessing an increase in the costs of electricity, fuel, materials, and an increase in labor costs and all other procurements of goods, services, and works.

We note that operating costs alone have increased by KM 75 million from 2021 to 2024, and KJKP “Vodovod i kanalizacija” d.o.o. Sarajevo, as a socially responsible company, during a period of rising living costs, has made a huge contribution by subsidizing the difference in the price of communal services between the determined and actual price for all consumer categories in the aforementioned multi-million amount.

In accordance with the above, we expect the Government of Sarajevo Canton to make a decision on harmonizing prices with the Opinion of the Independent Expert Body within the next month, i.e., to adopt the proposed price for the service of drinking water supply, wastewater disposal, and treatment.

The harmonization of water service prices is aimed at ensuring the sustainability of the system and the operational readiness of the equipment for producing and distributing water to our consumers 24 hours a day, 365 days a year," stated VIK.