27 October 2026, Barcelona, Spain: Europe’s water utilities face mounting pressure to improve performance without corresponding increases in financial and personnel resources. These challenges, shaped by aging infrastructure, water scarcity, tighter environmental regulations, and workforce shortages, are accelerating the adoption of digital solutions, including investments in predictive analytics, automation, and optimization.
In a new report, Europe Digital Water Landscape: Trends, Utility Strategies, Growth Forecasts, 2026–2036, Bluefield Research forecasts annual spend on digital water solutions across Europe will more than double, from US$12.6 billion to US$27.9 billion by 2036, representing a compound annual growth rate (CAGR) of 8.25%. Cumulative spending is forecast to reach US$211.8 billion over the decade.
“Water utilities have traditionally relied on metering, monitoring, and control systems to track network conditions, identify failures, and meet regulatory requirements,” says Maria Cardenal, a senior analyst at Bluefield Research. “Now, investment is increasingly shifting toward technologies that help them anticipate problems, reduce water losses, and optimize energy consumption.”
Smart Metering and Network Optimization Reshape Europe’s Digital Water Investment
Metering and customer management represent one of Europe’s largest digital water growth segments, with spending projected to grow at a 7.8% CAGR through 2036. Utilities are accelerating the transition from conventional meters and automated meter reading to advanced metering infrastructure, enabling more frequent consumption monitoring, improved leak detection, and more accurate billing. Large-scale deployments in Spain and Italy, alongside the U.K.’s AMP8 investment program, are driving adoption, supported by regulatory requirements and public funding.
As these smart meter deployments expand, the investment opportunities are also going beyond the meters themselves. Spending on meter data management and customer engagement platforms is forecast to grow at CAGRs of 10.1% and 14.5%, respectively, as utilities seek to improve billing accuracy, gain deeper insights into consumption patterns, and give customers greater visibility into their water usage.
Beyond metering, network and plant management represents one of Europe’s largest digital water investment categories, accounting for nearly half of projected spend through 2036. While established monitoring and control systems continue to underpin utility operations, some of the fastest-growing opportunities are in advanced monitoring, predictive maintenance, and network and plant optimization. These solutions are helping utilities identify potential failures earlier, reduce water losses and energy consumption, and make more informed decisions about maintenance and capital investment.
Moving Beyond the Dashboards
As utilities expand their digital capabilities, artificial intelligence (AI) and machine learning are being leveraged to analyze network conditions, anticipate equipment failures, and prioritize maintenance in real time. Bluefield forecasts AI-native digital water solutions to grow at an average annual rate of 17.8% through 2036, more than twice the pace of the overall market. Rather than replacing established monitoring and control systems, these technologies are building on existing infrastructure to improve operational performance.
The transition, however, remains gradual. Conventional closed-circuit television inspections still account for 39% of spending across key wastewater network monitoring strategies, underscoring the continued reliance on established inspection methods even as more advanced digital solutions gain traction.
The U.K. Leads Growth; Western Europe Anchors Scale
Digital water investment varies significantly across Europe, reflecting differences in utility scale, infrastructure needs, regulatory pressures, and access to funding. Western Europe represents the largest regional market, accounting for US$96.3 billion in cumulative spending through 2036, with France and Germany driving substantial investment in system upgrades. The U.K. is the fastest-growing individual country market, with spending forecast to increase at approximately 10.5% annually, supported by the AMP8 regulatory investment cycle and leakage reduction targets.
In Southern and Eastern Europe, investment priorities remain more focused on foundational infrastructure, metering, and monitoring capabilities. EU co-financing plays a key role in supporting these upgrades, particularly for utilities with limited financial resources. As such, opportunities for technology providers differ not only by geography but also by utilities’ operational needs and position along the digital adoption curve.
“Europe is not a single digital water market,” Cardenal notes. “Utilities in more digitally advanced markets are investing in predictive analytics and optimization, while others are still building out the necessary metering, monitoring, and data infrastructure. For technology providers, understanding these differences will be critical to identifying where demand is emerging and which utilities are positioned to adopt.”
Europe Digital Water Forecast by Region and Product Category, 2026–2036
Source: Bluefield Research
Data Management and Cybersecurity Gain Importance
As European utilities broaden their deployment of smart meters, sensors, and connected operational systems, managing and securing the growing volume of data is becoming an increasingly important investment priority. Information management is the fastest-growing digital water solution category, with spend forecast to increase at an 11.3% CAGR through 2036.
Greater connectivity also increases utilities’ exposure to cybersecurity threats. The EU’s NIS2 Directive is reinforcing requirements for cybersecurity risk management and resilience, adding pressure on utilities to protect critical operational systems and strengthen their ability to detect, respond to, and recover from cyber incidents.
About Bluefield Research
Bluefield Research provides data, analysis, and insights on global water markets, covering the municipal and industrial sectors across infrastructure, policy, and technology. As a leading provider of water market intelligence, Bluefield helps strategic decision-makers understand where the water market is going—and why.
The Insight Report, Europe Digital Water Landscape: Trends, Utility Strategies, Growth Forecasts, 2026–2036, provides a comprehensive, bottom-up forecast of the European digital water landscape through 2036, covering hardware, software, services, and connectivity across all major technology segments. The full report is available for purchase and can be downloaded immediately from Bluefield’s website.
