This robust growth is driven by water utilities increasingly adopting digital technologies to enhance efficiency and build more resilient infrastructure amid rising energy costs and operational pressures.

“The business case for digital water solutions in Europe has strengthened, partly due to rising energy prices and increasing
pressure on water utilities to reduce operational costs,” says Maria Cardenal, a Municipal Water Analyst for Europe at Bluefield Research.

This Insight Report forecasts utility spending on digital water across 35 technology segments by geography, technology segment, product type, water type, utility size, spend type, and software type to determine the size and growth outlook of the Europe digital water market from 2024 to 2033.

Rising energy prizes and European Funding Initiatives as drivers

Over the past five years, energy prices in Europe have doubled, spurring the adoption of digital solutions that optimize energy use and enable real-time asset monitoring. Funding initiatives from the European Union and the European Investment Bank have also accelerated digital modernization, particularly in Southern Europe, where utilities are upgrading aging infrastructure.

Europe Digital Water Forecast by Region & Solution Category, 2024–2033, Source: Bluefield Research

For instance, Italy is investing US$2.1 billion in leakage reduction, while Spain has committed US$3.3 billion to digitalizing its water cycle, and the U.K.’s AMP8 program is fueling growth in metering, leakage detection, and network optimization.

While traditional systems such as SCADA, GIS, and metering continue to account for the majority of current spending, utilities are increasingly integrating artificial intelligence, cloud computing, and cybersecurity measures to comply with stricter EU regulations on data privacy and water quality monitoring. Bluefield forecasts that spending on cybersecurity, compliance, and data management in the water sector will grow at a CAGR of 12.2% from 2024 to 2033.

High competitive dynamic underscores the high-growth potential

As utility demand intensifies, workforce and resource constraints grow, and compliance requirements increase, the business case for proven digital solutions will gain wider acceptance. This will, in turn, continue to drive greater competition across the vendor landscape.

“The digital water market is currently dominated by established water technology players like Suez, Siemens, and Xylem, but new market entrants are making inroads through strategic acquisitions and partnerships,” Cardenal notes.

Traditional equipment providers like Diehl Metering, Grundfos, and Aliaxis are expanding into the European digital water space, while emerging startups are challenging the status quo, particularly with software-based solutions.

The full report “Europe Digital Water Market Outlook: Key Drivers, Competitive Shifts, and Forecasts, 2024–2033” is available for purchase from Bluefield’s website.