Investment Plan for Europe supports better water supply and waste management services in Portugal

• The project will boost AdIN’s renewal and rehabilitation of water and wastewater infrastructure, delivering substantial environmental quality improvements and health benefits for citizens.
• The agreement is supported by the European Fund for Strategic Investments (EFSI), the main pillar of the Investment Plan for Europe.

The European Investment Bank (EIB) will provide up to €28.2 million in financing to support the water distribution optimisation investments of Águas do Interior – Norte (AdIN), a company that exclusively provides water supply and waste management services to eight municipalities in the north of Portugal. The operation is supported by the European Fund for Strategic Investments (EFSI), the main pillar of the Investment Plan for Europe.

Thanks to the EU bank’s support, AdIN will be able to carry out its five-year investment programme aimed at improving water supply and waste management services for about 95 000 people in the municipalities of Freixo de Espada à Cinta, Mesão Frio, Murça, Peso da Régua, Sabrosa, Santa Marta de Penaguião, Torre de Moncorvo and Vila Real.

The EIB will support the company’s rehabilitation of water supply systems to reduce water losses as well as the upgrading and rationalisation of wastewater collection and treatment systems to comply with EU and regional environmental requirements. Overall, the EIB investment backed by EFSI will help to reduce pollution by improving the quality of the effluents that are discharged into the region’s surface water and it will contribute to increased resilience against climate-related risks.

The project is aligned to the Portuguese Government’s reform of the water sector, the PENSAAR 2020 programme. Adopted in 2015, the plan calls for reorganisation of this sector, notably through the aggregation of operators at municipal level, with the aim of increasing the efficiency of services while ensuring greater territorial cohesion in terms of access, quality and pricing of services.

Commissioner for the Economy Paolo Gentiloni said: “This agreement between the EIB and Águas do Interior – Norte, backed by the Investment Plan for Europe, will help to improve water supply and waste management services for the benefit of about 95 000 people in the north of Portugal. This is an important contribution from the European Union to safeguard Portugal’s water resources, which is especially important in the context of increasing climate-related risks.”

EIB Vice-President Ricardo Mourinho Félix, responsible for the Bank’s operations in Portugal, said: “As the largest international lender to the water sector in Portugal, we are delighted to back AdIN’s investment programme to improve the provision of basic public services such as clean water supply and effective wastewater for citizens in the north of Portugal. This operation highlights the success of the Investment Plan for Europe and reinforces the EIB’s long-standing support to the country’s water sector.”

“Contracting this loan with the EIB constitutes an important step towards achieving the objectives that inspired the incorporation of the company. The current condition of the water supply and wastewater sanitation systems requires substantial investment, impossible to achieve exclusively with self-financing and community co-financing resources. The amounts involved, repayment terms and interest rates provided by the EIB cannot be compared with those offered by the market. The numerous benefits to the company resulting from this loan will be reflected in the long-term protection of the environment, the quality of service provided to users and the evolution of the tariffs to be applied”, said Carlos Silva, Chairman of AdIN’s Board of Directors.

Background information

The European Investment Bank (EIB) is the long-term lending institution of the European Union and is owned by the EU Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals both in Europe and beyond.

The European Investment Bank is active in around 160 countries and is the world’s largest multilateral lender for climate-related projects. The Bank has recently adopted its Climate Bank Roadmap to deliver on its ambitious agenda to support €1 trillion of climate action and environmental sustainability investments in the decade to 2030 and to deliver at least 50% of EIB finance for climate action and environmental sustainability by 2025. By the end of 2020, all EIB Group financing activities will be aligned with the goals of the Paris Agreement.

The European Fund for Strategic Investments (EFSI) is the main pillar of the Investment Plan for Europe. It offers first-loss guarantees that enable the EIB to invest in increasingly risky projects. It is estimated that the projects and agreements approved for financing under EFSI have so far mobilised €546.5 billion in investment.

More information on the results of the Investment Plan for Europe here.

Águas do Interior – Norte, EIM, SA (“AdIN”) was incorporated on 15 November 2019 pursuant to Law 50/2012 of 31 August (legal framework of the business activity of municipalities) as a local authority company by the Municipalities of Freixo de Espada à Cinta, Mesão Frio, Murça, Peso da Régua, Sabrosa, Santa Marta de Penaguião, Torre de Moncorvo and Vila Real. AdIN’s activities comprise the management of municipal water supply and wastewater management services in the aforementioned municipalities.