Climate pressure, developments in the regulatory framework, and the growing need to modernize infrastructure are radically reshaping the water management sector in Greece, directly affecting public utilities, municipalities, the evolving regulatory framework, investors, and the broader ecosystem. This is the conclusion drawn from a new analysis by EY-Parthenon, the corporate strategy and transactions arm of EY Greece.
According to the analysis, water infrastructure is not solely related to a basic public good, but constitutes strategic and critical infrastructure of growing importance for economic resilience, environmental sustainability, and public policy planning.
As EY-Parthenon notes, the sector is at a critical turning point. Prolonged drought conditions, declining water reserves, and network losses are increasing the need to ensure water supply security in Greece, and, combined with the new regulatory framework and stricter compliance requirements, are transforming the planning, necessary financing, and management of water services in general. These developments accelerate the need for modernization and the adoption of a long-term strategy for making more structured decisions that will effectively address environmental challenges, as well as the need for management bodies to adapt in order to cope.
High fragmentation of the sector
One of the key characteristics of the water resources management sector in Greece remains its high level of fragmentation: the market currently comprises 129 municipal water and sewerage companies (DEYA), more than 450 irrigation organizations, and a broad network of local authorities, while the two largest companies in the sector serve Greece’s two main metropolitan centers and cover approximately half of the country’s population. This fragmentation affects scale, efficiency, and the pace of modernization, particularly in an environment of heightened demands regarding resilience, governance, service quality, and regulatory compliance.
Signs of dynamic growth despite the challenges
The EY-Parthenon review also highlights a number of practical challenges facing water service providers. Many of the smaller utilities continue to operate under financial pressure, with revenue from bill collections often failing to fully cover and recover operating costs, significantly limiting their ability to make investments.
At the operational level, water losses exceed 30% to 40% and, in certain parts of the network, may even exceed 50%, a fact that reflects the aging of the infrastructure and the need for better maintenance, the required increase in transparency of flow and consumption data, and the optimization of systems. Water reuse also remains limited (approximately 2%), while irrigation continues to account for an extremely high percentage (approximately 85%) of total water use, with over 70% coming from groundwater reserves. These figures highlight the need for more efficient and circular approaches throughout the value chain.
Despite these pressures, the water sector in Greece shows clear signs of dynamic growth, as a broader investment cycle takes shape, supported by public funding, EU financial instruments, corporate capital expenditures, and growing strategic interest. Medium- to long-term water infrastructure needs are estimated at approximately €10 billion, while the two largest companies alone have planned or are currently undertaking investments to upgrade, expansion, modernization, and performance improvement of the networks, which exceed €3 billion. Investor confidence and visibility regarding the sector’s outlook also appear to be strengthening, and this is reflected in the market capitalization performance of listed companies operating in the water market over the past few months.
The regulatory framework creates opportunities and requirements
Developments in the regulatory framework are another key driver of change. The expansion of the Waste, Energy, and Water Regulatory Authority’s (RAEW) jurisdiction to include services related to water management, stricter European obligations regarding wastewater, and the emphasis on policies to reduce fragmentation are shifting the sector from theoretical intentions for reform to the implementation phase. This creates significant opportunities, but also increased demands: a more structured and transparent determination of revenue and cash flows, increased data and reporting obligations, greater accountability, and a growing need for reliable long-term planning. The implications extend across the entire ecosystem, affecting businesses, investors, regulators, municipalities, and, ultimately, consumers—who should be the direct beneficiaries.
The challenges are no longer exclusively technical or operational, but extend to business planning, investment prioritization, financial sustainability, pricing policy, open communication with stakeholders, regulatory support, as well as the design of operational models and digital transformation. Within this context, water sector entities need support that combines strategic knowledge with practical application.
Commenting on the findings of the analysis, Mr. Tassos Iosifidis, Partner at EY Greece and Head of EY-Parthenon in Greece, stated: “Beyond being a basic public good, water is linked to strategic and critical infrastructure that is crucial to economic resilience, social cohesion, and sustainable development. Today, the sector’s challenges are not limited to climate change and infrastructure issues, but extend to financial sustainability, pricing policy, regulatory compliance, and the coordination of all stakeholders. In such a multifaceted and demanding environment, to manage the next phase of the sector’s development, companies and organizations—both private and public—across the water value chain must collaborate to chart a clear strategic roadmap that combines economic and infrastructure development with resilience and sustainability.”.
For his part, Konstantinos Thanaskos, Director and Head of Economic Studies at EY-Parthenon in Greece, added: “The water sector is expected to be an area of significant and growing interest in the coming years, as a market that will balance financing and the recovery of investments that ensure sustainability, security, and adequacy of supply, while preserving the public nature of water as a good that will be accessible to all households. Public policy and financial support, combined with private initiative and regulatory practice, are expected to form the right mix, leading an entire ecosystem of activities into the future.
You can read the full analysis here.