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AS TALLINNA VESI OPERATIONS PERFORMANCE H1 2010

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AS TALLINNA VESI OPERATIONS PERFORMANCE H1 2010                                 

AS Tallinna Vesi's overall operating performance in the first half of 2010 was  
good. The company is pleased to report that the key indicator of water quality  
is at its highest ever level. Other indicators in the first half of 2010 were   
impacted by the extreme weather conditions, which greatly affected leakage      
levels and the number of service interruptions. The company is however pleased  
to report that the action plans it put in place during April have delivered     
significant benefits and the performance in Q2 2010 showed a significant        
improvement from the first quarter. AS Tallinna Vesi is on target to achieve its
required levels of service and quality standards agreed with the City of Tallinn
in the Services Agreement by the end of 2010.                                   

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| Operation Performance                              | 2009 H1    | 2010 H1    |
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| Water                                              |            |            |
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| Water compliance at customers premises %           | 99,72      | 99,86      |
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| Total number of customer interruptions (unplanned) | 281        | 269        |
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| Average unplanned interruption time per property   | 3,38       | 4,11       |
| hrs                                                |            |            |
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| Number of customer complaints regarding water      | 4          | 7          |
| pressure                                           |            |            |
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| Loss of water in distribution system %             | 17,18      | 21,1       |
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| Wastewater                                         |            |            |
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| Number of sewer blockings                          | 571        | 725        |
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| Number of sewer collapses                          | 57         | 55         |
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| Wastewater treatment compliance %                  | 100        | 100        |
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| Sludge used in reclamation projects %              | 100        | 100        |
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| Network Extension Program                          |            |            |
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| Number of properties given access to public        | 76         | 29         |
| sewerage network                                   |            |            |
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Water                                                                           

99,86 per cent of water samples taken from the taps of the customers of AS      
Tallinna Vesi were compliant with the requirements in the first half of 2010,   
making this the best water quality result ever. This was achieved through the   
refurbishing of the company's ozone generators, which are among the largest in  
the world and have greatly improved the quality of drinking in water in Tallinn.

Water quality remains on a very similar level to last year and there have not   
been any signs of residue from the accident that occurred on March 18th.        

Water quality in Lake Ülemiste is affected by rising water temperatures, but    
remains on a similar level as in last year. The Company monitors the situation  
in the lake closely in order to be able to take prompt actions to ensure the    
best water quality.                                                             

Network                                                                         

The company's objective has always been to repair the leakages as quickly as    
possible, but this year special attention was paid to notifying the customers of
repair works prior to commencing. thus greatly reducing the number of unplanned 
interruptions to 269, despite the increased number of pipe bursts.              

The level of leakages has increased in the water and wastewater network due to  
pipe bursts in the winter, but an action plan has been devised and implemented  
to reduce leakages even further. The quality regulation in Tallinn requires AS  
Tallinna Vesi to reduce water loss in the network to 26%, but despite the severe
winter the Company's level of leakages in the first half of the year was 21,1%. 
                                                                            
Wastewater Treatment Plant                                                      

Excessive snowmelt in the beginning of the second quarter had minimal impact on 
the environment, as the wastewater treatment plant in Paljassaare treated more  
load than ever before. The quality of effluent after treatment in Paljassaare is
of high standard and complies with stringent environmental requirements.        
However, due to risk of failing to meet the parameters for nitrogen removal in  
the future, the Company will be building an additional treatment stage at the   
wastewater treatment plant. The construction of the biofilter will commence in  
July this year and will be completed by July 2011.                              

Network Extension Program                                                       

The company is committed to delivering the network extension program by the year
2011 as agreed with the City of Tallinn and as required by the European Union   
directive for wastewater collection. The start of the construction season was   
delayed by the winter lasting well into April, but nearly a half of the planned 
network for 2010 has been built already. AS Tallinna Vesi will be constructing  
5,1 kilometres of water pipes, 39,4 kilometres of wastewater pipes and 12,5     
kilometres of stormwater pipes in 2010. This construction programme will give   
over 1,100 homes the opportunity to connect to the wastewater network.          

Maardu                                                                          

July 1st marked the anniversary of the beginning of cooperation between the City
of Maardu and AS Tallinna Vesi, whereby AS Tallinna Vesi is now operating the   
assets of AS Maardu Vesi..                                                      

AS Maardu Vesi has now received the designs for connection pipes between Maardu 
and Tallinn for the delivery of quality surface water from Lake Ülemiste to     
Maardu and to remove Maardu's wastewater for treatment at the Paljassaare       
wastewater treatment plant. Designs have also been completed for giving more    
than 3,000 properties in Muuga access to the public water and wastewater system,
for reconstructing sewerage pipes in Vana-Narva road area and for rebuilding the
pipes network in Kallavere. The connection pipes between Maardu and Tallinn will
be built by the second half of 2011 and the Muuga network will be completed by  
the end of 2012.                                                                

Customers and Community                                                         

The company held its annual open door day at the Paljassaare wastewater         
treatment plant in May, attracting over 240 people and more than 30 children.   
The visitors were treated to a tour of the facilities                           

The company has sold over 10 000 tons of soil reconditioner, which is a         
by-product created in the wastewater treatment process and is used for          
reforestation and landscaping. The company also distributed nearly 1200 tons of 
soil reconditioner as part of a community project in the districts of Mustamäe  
and Northern Tallinn in cooperation with local municipalities to restore the    
regions' greenness after the winter.                                            

A major contributing factor to sewer blockages is the low awareness of consumers
about what is disposable in the sewerage system and what isn't. For this purpose
the company launched an awareness campaign in June, informing the public of the 
correct maintenance of the sewerage system.                                     

AS Tallinna Vesi will be holding its annual open door days at the Ülemiste water
treatment plant on August 28th, inviting everyone to see the process of water   
treatment and enjoy a fun family day that coincides with the running competition
around Lake Ülemiste. Last year more than 700 people participated in the tours  
and over 2,000 runners took part in the race.

Priit Koff
Head of Public Relations
AS Tallinna Vesi
+372 6262 209
[email protected]