Market announcement

Title

Competition Authority approved new water prices to be applied by Tallinna Vesi

Message

The Competition Authority approved the new price for water services in the
Tallinn and Saue area at EUR2.10 per cubic metre for private customers and EUR3.33
per cubic metre for business customers, excluding VAT. The price change is due
to the need to harmonize the price of water for private and business customers,
as required by law, and the need for investment to improve the sustainability of
the water infrastructure.

According to the CEO of Tallinna Vesi, Aleksandr Timofejev, the price for water
services for private customers in Tallinn and Harjumaa will remain one of the
lowest in Estonia. "It is important for us to provide sustainable water services
at prices that our customers can afford. While the average household in Estonia
spends more than 1% of its household income on water services, the average water
bill in Tallinna Vesi's service area this year averages 0.5% of household
income," explained Timofejev. For the average household, the cost of water
services will increase by around EUR2 per month. The new prices will take effect
from 1 May 2025.

"This price change takes into account the planned investments that are necessary
to maintain the quality of the water and wastewater services and ensure the
continuity of the vital service we provide," said Aleksandr Timofejev.

The obligation to harmonize the price for water services follows from the Public
Water Supply and Sewerage Act, which came into force in 2023 and stipulates that
the pricing principles for various customer groups must be harmonized by July
2026 at the latest.

Following approval by the Competition Authority, the price for water services
will change by an average of 8%, with an increase for private customers and a
decrease for business customers. Tallinna Vesi submitted an application to
adjust the components of the water price in December 2024.

Compared to the capitals of neighbouring countries, water services in Tallinn
are cheaper for its residents - from May, a cubic metre of water will cost EUR2.10
for a private customer, compared to EUR2.14 in Riga and EUR3.54 in Helsinki. These
prices are subject to VAT.

The price change is driven by the need to harmonize the price for water
services, but also by the need for investment. Two percent of the price change
is due to the increase in operating costs. Timofejev pointed out that variable
costs have only a small impact on the price change, as the CHP unit installed at
the wastewater treatment plant allows the company to reduce its daily
electricity costs. "Following the results of the cogeneration test period, we
are planning to produce around 7,000 MWh of electricity at the treatment plant
this year," said Timofejev.

Tallinna Vesi continuously invests in new technologies to ensure the continuity
of its service, with more than EUR109 million invested in assets over the last
three years. "For example, we use ice-pigging technology for cleaning pipelines,
which is the most efficient and environmentally friendly method for maintaining
high water quality in the water network. We have already implemented and are
planning further investments in the wastewater treatment plant to ensure that
the treated effluent released into the environment via the Baltic Sea is clean
and meets the strict quality requirements set by the Urban Wastewater Treatment
Directive," added Timofejev.

The price for wastewater services will not be harmonized. During the transition
period provided for in the law, Tallinna Vesi, in co-operation with the City of
Tallinn, will analyze the pricing methodology for wastewater services with a
view to updating the pricing principles and changing to a pollutant load-based
pricing methodology in 2026. In the future, the price for wastewater services
will depend on the level of pollution in the wastewater discharged by the
customer, and pricing will be based on the polluter-pays principle.

Due to the business model, the price level in the Maardu service area differs
from the rest of Tallinna Vesi's service area. In Maardu, the price for water
services will change by approximately 4%. The infrastructure in Maardu is owned
by the Maardu water company, and Tallinna Vesi operates the infrastructure in
the area, paying rent under a lease agreement with the Maardu water company.

AS Tallinna Vesi is the largest water company in Estonia, providing services to
more than 25,000 private customers and businesses and 500,000 end consumers in
Tallinn and its surrounding municipalities.

Additional information and price list can be found www.tallinnavesi.ee
(https://www.tallinnavesi.ee).


Kristiina Tamberg

AS Tallinna Vesi

Head of Communication and Marketing

+372 62 62 200
[email protected]  (mailto:[email protected]%20%0b)
 (mailto:[email protected]%20%0b)Ädala 10, Tallinn 10614
www.tallinnavesi.ee (http://www.tallinnavesi.ee/)