Lanzarote’s main water supplier, Canal Gestión, announced yesterday that it would formally initiate legal proceeding against the island’s Water Consortium and claim millions in compensation.
The company, a subsidiary of Madrid’s public supplier, Canal Isabel II, alleges “systematic and critical breaches” of the existing contract by the Consortium, and has threatened further action “to preserve its reputation and financial resources.”
The announcement comes a month after the Water Consortium voted to terminate the contract with Canal Gestión on the grounds of breach of contract, alleging “serious disruption” to the service and losses of over 55% of all water produced.
Canal Gestión, in response, claims that “the Consortium committed to carrying out and financing investments valued at €78.7 million, which it has failed to do” and alleges that the Consortium allocated a €50 million fee paid by Canal “to purposes unrelated to the service.”
Canal also claims that the Water Consortium has consistently refused to raise water tariffs since 2017 despite a ruling of Canarian Supreme Court. They say this has led to a deficit of €40 million, which they intend to claim.
Meanwhile, around 30,000 residents of the island were once again left without water yesterday, as Canal Gestión announced water cuts in mainly rural areas.
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