The situation in the water supply and sewerage sector The UK services sector operates mainly through operators organized as joint stock companies with local government ownership. Currently, 57 operators operate in the sector, 53 of them are equipped with a license to exercise the activity and 48 operate with rates approved by ERRU. Sewage service is not provided by all operators. This service in the sector is provided by 32 operators, 5 of which also carry out the treatment of polluted water. ERRU finds that the companies have the will to fulfill and support the regulator's efforts to create a stable and transparent regulatory environment in the sector.

The Albanian government drafted and is implementing the administrative-territorial reform, a reform which marks an important step also in the way of organizing water supply services and the removal of polluted water.  The reorganization of these services according to the new territorial division in the Republic of Albania is necessary to realize an optimal situation in guaranteeing continuous supply of drinking water and significantly improving the functioning of the sewage system.

Within this reform, the Decision of the Council of Ministers no. 63, dated 27.01.2016 "On the reorganization of operators that provide the service of drinking water supply, collection, removal and treatment of polluted water", defines all the necessary legal steps that must be followed by new municipalities for the reorganization of operators of UK services, the transfer of UK systems that are newly included in the administrative area of municipalities, their inventory and accounting, up to the licensing and approval of tariffs for reorganized operators. Further, the operators must apply for a license and tariff approval at ERRU, which may be differentiated for urban and rural areas.

The sector has developed in a stable manner, although the levels and progress of the indicators are not appropriate compared to the strategic objectives for the sector and those of ERRU's good performance.

The main concern in the sector is the high level of losses, an indicator which has not seen a significant improvement. ERRU has consistently emphasized that reducing losses should be the priority of operators' work, even though controlling and reducing losses requires time and investment.

Coverage with the water supply service has had a positive trend, but the sewerage service continues to lag behind both in terms of coverage and the required level of service to enable the protection of water and the environment.

The main sources of financing for companies have been the state budget and financing from foreign donors in the form of loans or grants in approximately equal ratios. These investments are mainly focused on the rehabilitation of water and sewerage supply systems as well as on the construction of wastewater treatment plants.