Water is finally getting the attention it deserves in Europe. In February 2025, the European Commission launched a call for evidence for its first-ever Water Resilience Strategy, a landmark initiative to strengthen long-term water security, drive investment in digital and advanced treatment technologies, and integrate water policy into the EU’s broader climate and industrial strategies.
This strategy marks a step forward, bringing together a host of fragmented water directives under a unified vision. While previous EU policies—such as the Water Framework Directive and the Urban Wastewater Treatment Directive (UWWTD)—have laid important groundwork, they have often lacked cohesion, clear funding pathways, and strong enforcement mechanisms. The WRS seeks to address these gaps by providing a comprehensive and forward-looking approach to managing Europe’s water challenges.
Why now? The case for a water resilience strategy. Europe’s water sector is under growing strain, making resilience measures a top priority. Climate change has intensified droughts, floods, and extreme weather events, with 30% of Europe’s population experiencing water stress. Without intervention, the financial cost of climate-related damage could reach €45.9 billion annually by the 2050s. At the same time, the region faces significant infrastructure challenges—only 37% of European surface waters meet ecological health standards, and contaminants such as per-and polyfluoroalkyl substances are becoming more difficult and costly to remove, with remediation estimates exceeding €100.0 billion per year.
Beyond environmental concerns, the strategy responds to a pressing need for investment. Bluefield Research estimates €437 billion in water and wastewater infrastructure capital expenditure investment between 2024 and 2030, scaling from €55 billion annually in 2024 to €69 billion by 2030. Yet, despite these figures, securing and disbursing funds efficiently remains a challenge. By mid-2024, only 20% of climate-related Recovery and Resilience Facility funds had been allocated, highlighting gaps in financial execution.
What the strategy aims to achieve. The Commission has structured its plan around three core priorities: restoring and protecting the water cycle, ensuring clean and affordable water for all, and promoting a competitive EU water industry. These objectives are designed to provide a coordinated, long-term framework that balances environmental protection, economic resilience, and public health.
Restoring and protecting the water cycle is a fundamental part of the strategy, focusing on strengthening natural water systems to mitigate climate risks and enhance biodiversity. This means improved watershed management, better flood and drought response measures, and stronger protections for freshwater resources. A resilient water system safeguards ecosystems and supports industries and communities that depend on reliable water supplies.
Ensuring clean and affordable water for all remains a critical goal. Water quality regulations have been tightening across the EU, particularly in response to growing concerns over pollution and emerging contaminants. The revised UWWTD, which entered into force on 1 January 2025, expands its original scope by introducing stricter discharge limits and compliance requirements for smaller communities. The challenge, however, lies in implementation. Many member states continue to struggle with wastewater collection, nitrate control, and effluent quality due to financial and technical constraints.
Promoting a competitive EU water industry will also be key to achieving resilience. By investing in digitalization, efficiency, and circular economy principles, the strategy aims to drive innovation across the sector. The European digital water market, already larger than the market in the U.S, is expected to grow from €12.6 billion in 2024 to €25.0 billion by 2033. Utilities are increasingly deploying smart meters, Internet-of-Things sensors, and AI-powered analytics to optimize operations, reduce energy use, and enhance compliance. Engineering consulting firms are crucial in helping utilities navigate this digital transition, integrating new technologies with existing infrastructure while managing workflow design and change management.
Challenges and gaps: Can the strategy deliver? Despite its ambition, the strategy faces notable hurdles. One of the primary challenges is regulatory fragmentation. A patchwork of directives has historically governed water management in the EU—each focusing on a specific aspect, such as drinking water, wastewater, floods, or marine environments, and governments. While the WRS aims to unify these efforts, inconsistent implementation at the national level remains a persistent issue. Member states have varied levels of enforcement, and infringement procedures for non-compliance are often slow and ineffective. Fundamentally, the absence of commitment and targets among member states presents a marked barrier to rollout.
Funding and execution also present obstacles. The strategy emphasizes investment, yet the EU’s track record in disbursing water-related funds efficiently is mixed. For example, Spain has received substantial EU support for digitalizing urban and irrigation water systems, but delays in fund allocation and project implementation have hindered progress. These delays raise concerns about whether the new strategy will be able to mobilize funding at the level required for meaningful change.
Another key issue is the balance between stricter regulations and industry feasibility. The updated UWWTD addresses pollution with a polluter-pays principle, placing a more significant financial burden on industries. While this approach incentivizes cleaner practices, it also risks creating friction between regulatory bodies and industrial water users, particularly in sectors where compliance costs are high. Many utilities and companies lack the financial or technical resources to meet new standards, which could slow adoption and widen regional disparities.
What’s next? Europe’s road to a resilient water future. Despite these challenges, the WRS would set an essential foundation for future European water governance and investment. By playing from Europe’s Green Deal, the water resilience strategy strengthens the case for a long-term commitment to sustainable water management. It could also pave the way for the European Blue Deal, a long-discussed but yet-to-be-proposed initiative focused on water security and innovation.
To ensure the plan’s success, the EU must prioritize enforcement, streamline funding mechanisms, and strengthen coordination across existing directives. Transforming high-level policy into tangible action hinges on critical steps—setting binding resilience targets, creating flexible financing options for utilities, and aligning water priorities with broader climate and industrial policies.
The coming years will determine whether the WRS will be a turning point for Europe’s water sector or another well-intended framework without teeth. The momentum is there; the challenge now is translating ambition into results. Bluefield Research is closely tracking policy developments, funding allocations, and industry responses as this strategy unfolds, providing insight into the future of water resilience in Europe.
