Spain is looking for European approval to reuse more than one billion euros of post-pandemic recovery funds to make Valencia more resistant against climate change after the Mediterranean region suffered large catastrophic rains last year.

The conversations began a few weeks after the torrential rains caused floods in October that killed more than 220 people in cities of vicinity east of Valencia. Experts say that the disaster was worsened by irregular flood defenses, many of which had been destined to improve the works decades before.

The EU reallocated funds would be a small part of what companies such as Spain acts, Sacyr and Cox Group hope to be a new wave of investment in the water business in Spain.

Related: The Bank of Spain estimates that floods cost 0.2% of GDP in the fourth quarter | The record floods of Spain push insured losses above € 4 billion ($ 4.2 billion)

These companies have been active in countries that face water stress such as Saudi Arabia and Morocco, but now finding solutions for home problems presents growth opportunities, as well as relieve part of the misery carried out in the communities.

Water investments have risen to the political and national level agenda, they told Reuters at local and national levels, corporate officials and experts said.

Prime Minister Pedro Sánchez said in December that “Spain is one of the countries most vulnerable to climate change.”

The European Commission has determined that extreme climatic events in Spain have cost 7.7% of GDP in the last 40 years, three times the European average, with risks for critical sectors such as agriculture and tourism.

The Minister of Economy, Carlos Body, said that EU Spain sought permission to reuse in part to repair damaged water systems in the Valencia region, as well as develop desalination plants against prolonged droughts that damage their great agricultural sector

Negotiations with the European Commission on the allocation of 1,500 million euros ($ 1.56 billion) previously assigned to other projects are still ongoing the established end date, said the Ministry of Economy.

Spain has already assigned around 3 billion euros for the water of the approximately 77 billion euros in European recovery funds disbursed by the block in the last four years, according to industry sources.

The Minister of Environment and Ecological Transition, Sara Aagesen, told a Congress Committee last month that the Government was committed to finance the reconstruction of Valencia water systems and the completion of urgent hydrology works in the area.

He also announced that his ministry would create a water consumption observatory and planned to double the budget for works to increase water supplies through reuse and describing plants in the country.

Aagesen’s ministry refused to provide Reuters with more project details, how they will be financed or their schedule for its completion.

Companies expect more investment

A PWC report in 2024 focused on Spain’s investment in urban water systems found that it had underestimated 5 billion euros per year due in part to limited state budgets, following other European countries such as Portugal, Italy, Italy, Italy, France and Germany. The urban water cycle is mainly related to purification, supply, sewerage, treatment and reuse of water in urban environments.

Eduardo Campos, who directs the Sacyr water business, said he expected the flood of Valencia to be a turning point, which adds hydraulic mitigation and flooding works such as clearing the beds of the debris remains: “These are projects necessary, (yes) are expensive and not beautiful. “

Sacyr is already evaluating work to restore wastewater and water treatment networks in the flood of Valencia, said Campos, estimating that the most urgent repairs will cost more than 350 million euros.

Campos also said that there was great growth potential in Spain amid the growing need to reuse wastewater and the digitalization of water management.

Manuel Manjon Vilda, Chief of the Agua Water Business, said there were many potential water infrastructure projects in Spain. “What has not been the money or political will to carry out an investment plan of 15 to 30 billion euros,” he said, adding that he hoped they became “a key concern … executed as a priority “.

Even with a high political will, new projects will still take time to realize.

Water projects generally take an average of at least three years to be approved, dragged by the slow coordination between national, regional and local administrations, according to the Executives of the Spanish Water Company Reuters.

While Valencia was beaten by floods, the Mediterranean coast of Catalonia to Gibraltar suffers deep water.

At the tourist point of Barcelona, ​​the authorities allocated half a billion dollars last year for two desalination floors near the city coast.

In the southern Andalusia region, the world’s oil capital in the world, the regional government launched a plan of 400 million euros in November for more than double the water than the recycling region at the end of 2027.

($ 1 = 0.9591 euros)

(Corina Pons and Pietro Lombardi report; Aislinn Laing, Frances Kerry and Alison Williams)

Photography: A man walks along a street affected by floods in Valencia, Spain, Saturday, November 2, 2024. (AP Photo/Manu Fernández, Archive)

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