Contract Renegotiation at the Berliner Wassertriebe

Press release of the Berliner Wassertisch.

On 13 February 2011, a referendum initiated by citizens (“Unser Wasser” = Our Water) was won by votes from 666 235 Berliners. It required the disclosure of the sales contracts, secret until now, concerning 49.90% of the water in Berlin. This victory will bring about the withdrawal of RWE and Veolia from the “Berliner Wasserbetriebe” (BWB, the water company in Berlin).

The text of the referendum stipulates that all contracts, past, present, future have to be made public.

The Berlin State Senate just negotiated a new contract with RWE to buy back their participation (24.95%) held by the holding company in the “Berliner Wasserbetriebe” (BWB). This new contract was approved by the Senate but not yet ratified by the Parliament (close for holidays). It will be discussed by the Parliament when it reopens after the break.

This new contract with RWE, based on the PPP contract from 1999 to 2028, states that RWE will sell its participation in the Berliner Wasserbetriebe (BWB) for € 650 million. These € 650 million represent the profits of the 16 remaining years from the old contract. During the first 11 years, RWE has already recouped its purchase price of € 800 million. This means that the company will gain from 2012 onwards the total of all the profits secured by the 1999 contract and will have no further responsibility.

The Constitutional Court of the State of Berlin had ruled that the text from which the contract was signed in 1999 was unconstitutional. The Berliner Wassertisch, the citizen’s initiative at the base of the referendum, criticized the Senate for not having abolished the law and canceled the contract but instead to have calculated the amount for the buy-back based on the secret contract signed between the State of Berlin, RWE and Veolia in 1999.

The € 650 million should logically be supported by the state budget. But because of the golden rule, and to prevent further debt, this amount will be levied on the water bills of Berliners for years to come. It is still the logic of PPP that applies.

So it is a Pyrrhic victory for Berliners as they are likely to see their water bills continue to rise in the near future. Since 1999, this bill has increased by over 30%.

Spokes persons of the Berliner Wassertisch:

Ulrike Kölver, Gerlinde Schermer, Dorothea Haerlin and Ulrike von Wiesenau