Will EU’s Procurement Shift Slow or Speed Smart Water Upgrades?

From 2026, new EU thresholds will reshape how utilities plan and fund smart water projects

18 Dec 2025

In January 2026 Europe will adjust a set of numbers few citizens have heard of, but many water utilities will feel. Revised procurement thresholds under the EU Utilities Directive will subtly change how investments in pipes, sensors and software are planned and bought.

The update raises the financial limits that trigger full EU tender procedures for publicly influenced utilities. For supplies and services the threshold will climb to about €443,000; for works it will reach roughly €5.54m, according to the EU’s adoption published in the Official Journal. The law itself stays the same. The sums do not.

Those sums matter. Modernising water networks increasingly means bundling meters, leak-detection tools and digital platforms into large programmes. Such projects can easily exceed the new limits, pulling them into more formal and time-consuming procurement processes, with heavier documentation and longer evaluations. Planning and procurement, once sequential, are becoming inseparable.

“This is not just an administrative adjustment,” says a European procurement adviser working with regional water operators. “Thresholds influence how projects are structured and when they move forward.”

The timing is awkward but logical. Europe’s water systems are ageing, stressed by droughts and floods, and under pressure to become more efficient. Digital tools promise better data and lower losses over time. Yet combining hardware, software and services quickly inflates contract values. A smart ambition can, on paper at least, become a major tender.

Suppliers have noticed. Big firms such as Siemens and Xylem now stress standardised offerings, lifecycle costing and compliance readiness as much as technical flair. Winning work increasingly depends on navigating procurement rules as deftly as designing sensors.

Utilities are divided. Some worry that larger tenders will slow projects and add complexity, particularly for smaller operators with thin administrative capacity. Others welcome clearer, updated thresholds, which may encourage more structured competition and support longer-term partnerships for big digital upgrades.

None of this makes headlines. Yet procurement is emerging as a quiet lever of policy. By resetting the numbers, Brussels is nudging how quickly and smoothly Europe’s water utilities can turn digital plans into pipes and code on the ground. The change is technical. Its effects will not be.