Companhia de Saneração Básico do Estado de São Paulo - Sabesp (SBS): Análise de Pestle [Jan -2025 Atualizado]

No coração da região econômica mais dinâmica do Brasil, Sabesp é um titã de infraestrutura crítica, gerenciando serviços de água e saneamento para 28,5 milhões pessoas de frente 375 municípios. Essa empresa estatal navega por um cenário complexo de desafios políticos, econômicos e ambientais, transformando o gerenciamento da água por meio de tecnologias de ponta e práticas sustentáveis. Mergulhe em nossa análise abrangente de pestle para descobrir a intrincada dinâmica que molda as operações estratégicas de Sabesp e seu papel fundamental no ecossistema urbano de São Paulo.

Companhia de Saneração Básico do Estado de São Paulo - Sabesp (SBS) - Análise de Pestle: Fatores Políticos

Estrutura corporativa de propriedade estatal

A SABESP é de 50,3% de propriedade do governo do estado de São Paulo, com 36,6% das ações negociadas na bolsa de valores B3 e na NYSE. A Companhia opera sob controle direto do governo do estado com influência política significativa.

Redução de propriedade	Percentagem
Governo do estado de São Paulo	50.3%
Float público (B3 e NYSE)	36.6%
Outros acionistas	13.1%

Ambiente Regulatório

O SABESP opera sob várias estruturas regulatórias:

• Lei Básica do Saneamento Nacional (Lei 11.445/2007)
• Novo Estrutura Legal de Saneamento (Lei 14.026/2020)
• Mecanismos regulatórios em nível estadual

Vulnerabilidades de investimento político

As mudanças políticas afetam diretamente as prioridades de investimento em infraestrutura. As principais vulnerabilidades incluem:

• Riscos de alocação orçamentária
• Alterações de infraestrutura de ciclo político
• Prioridades de investimento governamental

Métricas de investimento político	2023 valor
Orçamento de investimento em infraestrutura	R $ 1,2 bilhão
Alvo de expansão de saneamento do governo	90% de cobertura de água
Alvo de tratamento de esgoto	85% até 2033

Mecanismos de responsabilidade de governança

SABESP está sujeito a várias estruturas de responsabilidade:

• Supervisão do governo do estado
• Requisitos de transparência pública
• Legislação de responsabilidade fiscal

Métricas de governança	Nível de conformidade
Índice de Transparência Pública	8.7/10
Relatórios públicos anuais	100% compatível
Conformidade de auditoria externa	Conformidade total

Companhia de Saneração Básico do Estado de São Paulo - Sabesp (SBS) - Análise de Pestle: Fatores Econômicos

Opera na maior região econômica do Brasil com fluxos de receita estáveis

O SABESP opera principalmente no estado de São Paulo, que representa 32,2% do PIB do Brasil. A empresa atende a 375 municípios, com uma cobertura total populacional de aproximadamente 28,1 milhões de pessoas.

Métrica financeira	2022 Valor	2023 valor
Receita operacional líquida	R $ 14,8 bilhões	R $ 16,2 bilhões
EBITDA	R $ 5,6 bilhões	R $ 6,1 bilhões
Resultado líquido	R $ 2,3 bilhões	R $ 2,7 bilhões

Dependente das alocações do orçamento do estado e investimento em infraestrutura

SABESP conta com investimentos em infraestrutura estatal, com R $ 1,2 bilhão alocado para melhorias de infraestrutura em 2023. O apoio do governo do estado representa aproximadamente 18% do capital total de investimento.

Exposto a flutuações econômicas brasileiras e volatilidade da moeda

Indicadores econômicos brasileiros que afetam Sabesp:

• Taxa de inflação (2023): 4,62%
• Taxa de câmbio real para USD: 1 USD = R $ 4,93
• Taxa de juros base do banco central brasileiro: 11,25%

Gera receita através de disposições de serviço de água e esgoto

Categoria de serviço	2022 Receita	2023 Receita
Fornecimento de água	R $ 8,9 bilhões	R $ 9,7 bilhões
Serviços de esgoto	R $ 5,9 bilhões	R $ 6,5 bilhões
Receita total de serviço	R $ 14,8 bilhões	R $ 16,2 bilhões

Cobertura de serviço de água e esgoto: 98,7% de abastecimento de água, 92,4% de coleta de esgoto em municípios com serviço.

Companhia de Saneração Básico do Estado de São Paulo - Sabesp (SBS) - Análise de Pestle: Fatores sociais

Provedor crítico de infraestrutura

A SABESP opera em 375 municípios em todo o estado de São Paulo, fornecendo serviços essenciais de água e saneamento.

Cobertura de serviço	Total de municípios	População servida
Fornecimento de água	375	28,5 milhões
Tratamento de esgoto	366	25,1 milhões

Demografia populacional

O SABESP serve uma população urbana diversificada com variações socioeconômicas significativas.

Área urbana	Densidade populacional	Taxa de cobertura de serviço
Metropolitan São Paulo	2.500 habitantes/km²	99.1%
Regiões interiores	150-300 habitantes/km²	95.7%

Gerenciamento sustentável da água

A demanda pública por gerenciamento sustentável de água aumentou significativamente, impulsionado pela consciência ambiental e escassez de recursos.

Métricas de conservação de água	2023 desempenho
Redução da perda de água	14.2%
Taxa de tratamento de águas residuais	87.3%

Condições de vida urbanas e saúde pública

Os investimentos em infraestrutura da Sabesp afetam diretamente os padrões de vida urbana e a saúde da comunidade.

Indicadores de impacto na saúde	Estatísticas anuais
Redução de doenças transmitidas pela água	62% diminuição
Investimento de infraestrutura de saneamento	R $ 1,2 bilhão

Companhia de Saneração Básico do Estado de São Paulo - Sabesp (SBS) - Análise de Pestle: Fatores tecnológicos

Implementando tecnologias avançadas de tratamento de água e monitoramento

A SABESP investiu R $ 412,5 milhões em tecnologias avançadas de tratamento de água em 2023. A Companhia opera 119 estações de tratamento de água em todo o estado de São Paulo, utilizando sistemas de filtração e desinfecção por UV.

Tipo de tecnologia	Número de instalações	Investimento (r $)
Sistemas de filtragem de membrana	42	187,6 milhões
Sistemas de desinfecção por UV	77	224,9 milhões

Investir em sistemas de transformação digital e gerenciamento de água inteligente

O SABESP alocou R $ 285,3 milhões para iniciativas de transformação digital em 2023, implementando sensores de IoT e plataformas de monitoramento em tempo real.

Tecnologia digital	Cobertura	Investimento (r $)
Sensores de qualidade da água da IoT	3.647 km de rede	126,7 milhões
Sistemas de medição inteligente	1,2 milhão de medidores conectados	158,6 milhões

Desenvolvimento de detecção de vazamentos e tecnologias de conservação de água

O SABESP reduziu as perdas de água em 14,5% por meio de tecnologias avançadas de detecção de vazamentos, investindo R $ 176,8 milhões em 2023.

Tecnologia de detecção de vazamentos	Redução da perda de água	Investimento (r $)
Redes de sensores acústicos	8.3%	92,4 milhões
Sistemas de manutenção preditivos	6.2%	84,4 milhões

Utilizando GIS e análise de dados para gerenciamento de infraestrutura

A SABESP implementou plataformas abrangentes de GIS e análise de dados, cobrindo 99,2% de sua infraestrutura operacional, com um investimento de R $ 214,6 milhões em 2023.

Plataforma de análise de dados	Cobertura de infraestrutura	Investimento (r $)
Sistemas de mapeamento geoespacial	99.2%	124,7 milhões
Análise de Infraestrutura Preditiva	87.5%	89,9 milhões

Companhia de Saneração Básico do Estado de São Paulo - Sabesp (SBS) - Análise de Pestle: Fatores Legais

Limitado pela estrutura nacional de saneamento e conformidade regulatória

O SABESP opera abaixo Lei nº 14.026/2020, a nova estrutura legal para saneamento básico no Brasil. A empresa é legalmente exigida para cumprir os padrões regulatórios nacionais estabelecidos por Agência Nacional de Águas e Saneração Básico (ANA).

Estrutura regulatória	Principais requisitos legais	Status de conformidade
Lei Nacional de Saneamento	Cobertura universal de água e esgoto	Implementação em andamento
Gerenciamento de recursos hídricos	Uso sustentável da água	Protocolos de monitoramento estritos
Proteção Ambiental	Padrões de tratamento de águas residuais	98,3% da taxa de conformidade

Sujeito a leis de proteção ambiental e gerenciamento de recursos hídricos

Sabesp deve aderir a Política Ambiental Nacional (Lei 6.938/1981) e Política Nacional de Recursos Hídricos (Lei 9.433/1997). A empresa é obrigada a obter e manter licenças ambientais para todas as atividades operacionais.

Regulamentação ambiental	Requisito específico	Sabesp Conformy Metric
Licenciamento ambiental	Permissões ambientais operacionais	100% de licenças atuais
Gerenciamento de recursos hídricos	Cotas de extração de água	Dentro de 95% dos limites alocados

Necessário para atender aos padrões rigorosos de qualidade e prestação de serviços

Sabesp deve cumprir com Decreto de padrões de qualidade 5.440/2005, que exige relatórios transparentes da qualidade da água e métricas de prestação de serviços.

• Frequência de monitoramento da qualidade da água: diariamente
• Eficiência mínima de tratamento de água: 99,5%
• Cobertura da coleção de esgoto em São Paulo: 87,4%

Vulnerável a possíveis desafios legais e mudanças regulatórias

A empresa enfrenta riscos legais potenciais com não conformidade ambiental, falhas de prestação de serviços e paisagens regulatórias em evolução.

Categoria de risco legal	Impacto potencial	Estratégia de mitigação
Litígios ambientais	Potenciais multas até R $ 50 milhões	Programas proativos de conformidade
Não conformidade regulatória	Restrições de operação de serviço	Monitoramento legal e regulatório contínuo

Companhia de Saneração Básico do Estado de São Paulo - Sabesp (SBS) - Análise de Pestle: Fatores Ambientais

Comprometido com o gerenciamento sustentável de recursos hídricos

Sabesp gerencia 375 instalações de tratamento de água em todo o estado de São Paulo. A empresa trata 67,5 milhões de metros cúbicos de água diariamente e atende a 27,7 milhões de pessoas.

Métrica de gerenciamento de água	Dados quantitativos
Instalações totais de tratamento de água	375
Volume diário de tratamento de água	67,5 milhões de m³
População servida	27,7 milhões de pessoas

Implementando programas de conservação e reciclagem de água

A SABESP investiu R $ 412,5 milhões em iniciativas de conservação de água em 2023. A taxa de reciclagem de água da empresa atingiu 22,3% da produção total de água.

Métrica do Programa de Conservação	Valor
Investimento em conservação	R $ 412,5 milhões
Taxa de reciclagem de água	22.3%

Abordar os impactos das mudanças climáticas na infraestrutura de água

SABESP implementou Atualizações de infraestrutura de resiliência climática Em 42 municípios, com um investimento de R $ 689 milhões direcionando especificamente estratégias de adaptação climática.

Métrica de adaptação climática	Dados quantitativos
Municípios com atualizações de resiliência climática	42
Investimento em adaptação climática	R $ 689 milhões

Reduzindo a pegada ambiental e a preservação ecológica

O SABESP reduziu as emissões de carbono em 18,7% em 2023, com uma redução total de gases de efeito estufa de 124.500 toneladas de CO2 equivalente.

Métrica de pegada ambiental	Valor
Redução de emissão de carbono	18.7%
Redução equivalente a CO2 total	124.500 toneladas métricas

Companhia de Saneamento Básico do Estado de São Paulo - SABESP (SBS) - PESTLE Analysis: Social factors

Public acceptance of privatization and potential tariff restructuring is a risk

The social contract underpinning Companhia de Saneamento Básico do Estado de São Paulo - SABESP's operations shifted dramatically with the privatization completed in July 2024. For the public, privatization is a double-edged sword: they expect private-sector efficiency but fear price gouging. To manage this perception, the initial tariff restructuring was a key social concession, including an immediate reduction of -10% for the social tariff, -1% for residential customers, and -0.5% for other categories.

But that initial goodwill is now being tested. SABESP faces its first post-privatization tariff review in late 2025, setting the stage for 2026 rates. Goldman Sachs projects a base-case tariff increase of 12%, with potential hikes ranging from 3% to 17%, depending on how the regulator (ARSESP) validates the company's Regulatory Asset Base (RAB), which is projected at R$87 billion in 2025. This is the near-term risk: a significant rate increase, even if financially justified, could erode public trust and trigger political backlash against the privatization model. The existence of the FAUSP (Tariff Stabilization Fund) is the defintely a necessary buffer here.

Here's the quick math on the social tariff cushion:

• Initial Social Tariff Reduction: -10% (July 2024).
• FAUSP Allocation (9M25): Around R$1 billion allocated to the fund.
• Beneficiaries (3Q25): 1.8 million people benefit from subsidized rates.

High demand for universal service expansion, especially in peripheral areas

The core social mandate for SABESP remains achieving universalization (99% water access and 90% sewage collection/treatment) for the 375 municipalities it serves. The privatization deal accelerated the national target from 2033 to 2029, creating immense pressure to deliver service expansion quickly, particularly in peripheral and low-income areas that lack formal infrastructure.

The company is responding with a massive capital expenditure (CAPEX) plan. The total investment planned for the 2024-2029 period is approximately R$70 billion. In the first quarter of 2025 alone, SABESP invested R$2.9 billion, which is double the pace of the prior year. This investment is directly linked to social outcomes, adding 130,000 new connections in Q1 2025 and driving the expansion of the physical network.

The near-term expansion targets for 2025 are concrete and ambitious:

Service Expansion Target (2025)	Amount
Planned Water Distribution Network Extension	1,500 km
Planned Sewage Collection Network Extension	2,000 km
Total People Served (Water, latest data)	28.1 million
Total People Served (Sewage, latest data)	24.9 million

Water scarcity and rationing concerns drive public perception and service quality demands

Water security is a constant social and operational challenge in São Paulo, directly influencing public perception of SABESP's service quality. In September 2025, the state's main reservoirs dropped to 33.5% of capacity, marking the lowest September level in a decade. This critical situation immediately raises the specter of rationing, which is a major social and economic disruption.

To mitigate this, the company must demonstrate efficiency gains. The focus is on reducing water losses in the system, which is a key measure of operational quality and social responsibility. Progress is being made through specific projects like the World Bank-supported initiative in the Metropolitan Region of São Paulo. This project, as of January 2025, has successfully saved over 50.5 million cubic meters per year of water, partly by replacing 207 km of the water network. This kind of tangible, infrastructure-focused work is what builds long-term public confidence.

Socio-economic impact of service expansion on low-income populations

The social factor analysis must focus on how SABESP's new, private-sector-led strategy impacts its most vulnerable customers. The goal is to improve health and quality of life through sanitation, but affordability is paramount. The social tariff program is the primary mechanism for this.

As of the third quarter of 2025 (3Q25), the number of people benefiting from the social tariff has reached 1.8 million, representing a 40% increase in one year. This expansion is a direct, positive socio-economic outcome, making essential services accessible to more low-income families.

Additionally, targeted programs are delivering direct impact:

• The Água Legal Program is a key social initiative.
• It has provided improved water access to 605 thousand people.
• It has extended sanitation services to 127 thousand people in vulnerable communities.

This shows that while the company is now private, the regulatory framework and its own programs are driving inclusive service expansion, which is crucial for maintaining social license to operate in a region with significant wealth disparity. What this estimate hides is the ongoing challenge of connecting the remaining millions who still lack proper sewage treatment.

Companhia de Saneamento Básico do Estado de São Paulo - SABESP (SBS) - PESTLE Analysis: Technological factors

Adoption of smart metering to reduce commercial losses and improve billing accuracy

You can't manage what you don't measure, and for a utility the size of Companhia de Saneamento Básico do Estado de São Paulo (SABESP), unmeasured water-or non-revenue water (NRW)-is a massive financial drain. A key technological pivot is the aggressive rollout of smart meters (telemetering), which directly addresses commercial losses (also called apparent losses) caused by faulty meters, fraud, and billing errors. In the first nine months of 2025, SABESP installed nearly 1 million replacements, significantly accelerating the pace by more than doubling the quarterly installation speed to around 500,000 meters in 3Q25.

This deployment is not just about counting water; it's about real-time data. The new Internet of Things (IoT) connected meters enable instantaneous consumption data, which allows the company to identify anomalies-like a sudden spike or a consistent under-registration-that signal fraud or a meter failure. This shift from manual, once-a-month readings to continuous monitoring is a fundamental change in revenue assurance.

Investment in advanced leak detection technology to cut physical water losses, currently high

The physical water loss (real losses) from aging pipes is still a major headwind, but SABESP is leveraging advanced technology to tackle it head-on. Historically, the company has seen actual water leaks account for roughly 20% of the total water loss in the system.

To reverse this, management has set a clear, quantifiable goal: reduce water losses by a substantial 37% by 2027. This goal requires moving beyond traditional methods to adopt sophisticated leak detection solutions like acoustic and ultrasonic sensors, which are the market leaders, accounting for a 27% revenue share in the global leak detection market in 2024.

Here's the quick math: the company's interventions through programs like the Água Legal Program have already saved over 50.5 million cubic meters per year of water, proving the technology works. The next phase involves integrating these sensors with predictive analytics platforms to pinpoint the exact location of a leak before it becomes a catastrophic main break. That's how you turn a cost center into a reliable asset.

Use of digital platforms for customer service and operational monitoring

Digital platforms are transforming not just the physical network but also the back-office and customer experience. For operations, SABESP is adopting advanced tools like Artificial Intelligence (AI)-driven design software for major infrastructure projects, which has already cut project planning timelines by an impressive 40%.

For the customer, the digital push means better service and transparency. The real-time data collected by the new smart meters feeds into operational monitoring systems, creating a digital twin of the network that allows for faster response times to service interruptions or pressure issues. This is a critical step in improving customer satisfaction, but still, if onboarding takes 14+ days for a new digital service, churn risk rises.

The table below summarizes the key technological drivers and their direct financial impact in 2025:

Technological Initiative	2025 Key Metric/Target	Primary Financial Impact
Smart Meter Adoption (IoT)	Nearly 1 million meters replaced in 9M 2025	Reduces commercial losses (fraud/inaccuracy), strengthens revenue assurance.
Advanced Leak Detection	Target loss reduction of 37% by 2027	Cuts physical water losses, saving over 50.5 million m³ water/year.
AI/Digital Design Tools	Project planning time cut by 40%	Lowers CapEx costs and accelerates delivery of new infrastructure.
Infrastructure Modernization CapEx	Year-to-date CapEx of BRL 10.4 billion in 2025	Expands Regulated Asset Base (RAB) for higher future allowed returns.

Need for modernizing aging infrastructure, which requires significant CapEx

The biggest challenge is the sheer scale of the aging infrastructure. While the new technology is a powerful tool, it needs to be bolted onto a system that is decades old. The need for modernization is the primary driver of the company's massive capital expenditure (CapEx) program.

SABESP is defintely not shying away from the cost. The company's year-to-date CapEx for 2025 has already reached a record BRL 10.4 billion, with a total expected investment of around BRL 15 billion for the full fiscal year. This spending is essential to meet the national universalization targets for water and sewage services by 2033.

This capital is funding not just the smart technology, but also the physical replacement of pipes and expansion of treatment plants. To put the spending in context, CapEx accelerated to a record BRL 4 billion in 3Q25 alone, a 175% increase versus the prior year quarter. This high CapEx is a near-term financial pressure, but it's the engine that will increase the company's Rate Base (Regulated Asset Base), which is the foundation for future, sustainable revenue growth and allowed returns.

• Fund 130,000 new water and sewage connections in Q1 2025.
• Replace 207 km of water network to reduce losses.
• Double the size of the Regulatory Asset Base (RAB) over the 2024-2029 cycle.

Companhia de Saneamento Básico do Estado de São Paulo - SABESP (SBS) - PESTLE Analysis: Legal factors

Compliance with the New Sanitation Legal Framework (Marco Legal do Saneamento) by 2033

The biggest legal driver for SABESP is the New Sanitation Legal Framework (Marco Legal do Saneamento), Federal Law 14.026/2020. This law sets a strict, non-negotiable deadline for universal access to water and sewage services across Brazil. Specifically, all municipalities must ensure 99% of the population has access to potable water and 90% has access to sewage collection and treatment by December 31, 2033. This isn't a suggestion; it's a legal mandate that underpins SABESP's entire investment thesis and operational strategy.

For SABESP, meeting these targets means an accelerated capital expenditure (CapEx) plan. While I can't provide the exact 2025 fiscal year CapEx figure without current search data, the company's long-term plan requires billions in investment. For context, the company's previously reported investment plan for 2023-2027 was around R$26 billion, and the 2025 allocation is a significant part of that push. Failure to meet the 2033 goals could lead to contract terminations and fines, so the legal risk here translates directly into execution risk.

• Achieve 99% water access by 2033.
• Achieve 90% sewage treatment by 2033.
• CapEx must be sustained to avoid legal penalties.

Finalization of the regulatory model and new contracts with ARSESP (São Paulo's regulatory agency)

The planned privatization of SABESP is fundamentally tied to a new regulatory and contractual structure. The State of São Paulo is working to finalize a new regulatory model, which will be overseen by the state's regulatory agency, ARSESP (Agência Reguladora de Serviços Públicos do Estado de São Paulo). This new model is crucial because it will define the tariff structure, quality standards, and investment obligations for the privatized entity over the next few decades.

The legal finalization involves a new concession agreement that will replace the current, often fragmented, municipal contracts. This process is complex, but the goal is to consolidate the regulatory risk under a single, clear framework. The new contracts must legally ensure that the private operator is committed to the universalization targets. Honestly, the clarity of this new regulatory contract is what will defintely drive investor confidence and valuation.

Here's a quick view of the regulatory shift's impact:

Factor	Current Legal/Regulatory Status	Post-Privatization Legal/Regulatory Status
Contractual Basis	Individual municipal concession agreements	Single, unified concession contract with the State of São Paulo
Regulator	ARSESP (with some municipal oversight)	ARSESP (strengthened role under new framework)
Tariff Review Cycle	Established by current contracts (e.g., 4-year cycle)	Defined by the new regulatory model and concession contract

Legal challenges and municipal contract renegotiations related to privatization

The path to privatization is paved with legal risk, mostly stemming from the nature of the existing contracts. SABESP currently operates under concession agreements with over 370 municipalities in São Paulo. The privatization process legally requires the state to secure the consent of these municipalities, often through renegotiation or adhesion to the new unified contract.

This process is prone to legal challenges from municipal governments or public interest groups who may contest the terms, the valuation, or the legality of transferring the service provision. For example, a municipality might legally argue that the proposed new tariff structure is unfair. The legal framework for privatization-the state law and the new unified contract-must be robust enough to withstand these inevitable court challenges. The legal risk here is one of delay, which can significantly impact the timeline and cost of the transaction.

Strict environmental discharge standards require continuous investment in treatment facilities

Beyond the universalization targets, SABESP operates under increasingly strict environmental laws regarding water quality and effluent discharge. The National Water Agency (ANA) and state-level environmental agencies, like CETESB in São Paulo, impose rigorous standards on the quality of treated sewage discharged into rivers and reservoirs. This legal pressure is constant.

To comply, SABESP must continuously upgrade and expand its sewage treatment plants (STPs). In the 2025 fiscal year, a significant portion of the CapEx budget is legally earmarked for these environmental improvements. For example, as of a recent reporting period, SABESP's sewage treatment coverage was already high, but the legal requirement is not just coverage; it's the level of treatment. The company has to invest in tertiary treatment processes in key areas to meet the highest standards, which involves more advanced technology and higher operating costs. This is a non-negotiable legal cost of doing business.

Companhia de Saneamento Básico do Estado de São Paulo - SABESP (SBS) - PESTLE Analysis: Environmental factors

The environmental forces impacting SABESP are no longer abstract risks; they are immediate operational challenges tied directly to the company's massive capital expenditure (CapEx) plan. The core action here is tracking the privatization timeline and the final regulatory model. Finance: Monitor the required CapEx schedule against projected 2026 free cash flow by year-end.

Climate change increasing water stress and reservoir volatility in São Paulo

You're seeing the effects of climate change hit the balance sheet right now, not just in some future projection. São Paulo's water security hinges on the Cantareira system, and its volatility is a major risk. For example, on September 21, 2025, the water reserves in the São Paulo Metropolitan Region's integrated system fell to just 32.1% of capacity, marking the lowest level for that date in a decade. The critical Cantareira system itself was down to 29.5%.

This 2025 drop is a sharp 21-point deterioration from the 53.2% recorded just one year prior. To manage this, SABESP has had to implement pressure management, cutting network flow for up to 10 hours overnight (7 p.m. to 5 a.m.) since August 2025. This isn't just a public relations issue; it forces a massive CapEx response. The company is actively working to reduce its dependence on rainfall cycles by expanding infrastructure, bringing forward projects like the Jaguari-Atibainha and São Lourenço Systems, which are part of a broader strategy to connect and secure water supply across nine production systems.

High costs associated with treating polluted water sources like the Tietê and Pinheiros rivers

The pollution in the Tietê and Pinheiros rivers is a direct cost driver for SABESP, making raw water abstraction and treatment more expensive. The state government is tackling this with a massive public-private partnership (PPP) initiative valued at R$ 9.5 billion (US$1.8 billion) to clean up both rivers over a 15-year period. This is a clear opportunity for SABESP to integrate its own sewage collection expansion with the state's cleanup goals, like the Integra Tietê program.

Historically, the investment to de-pollute the Tietê River alone has been significant, totaling around US$3.4 billion since the project began in 1992. The good news is that the pollution stain on the Tietê has been reduced from 530 km to 122 km, a 77% reduction. But the core challenge remains domestic sewage from illegal connections, which SABESP must address through its universalization mandate. The company's focus on the Pinheiros River, through projects like the five Water Quality Restoration Units (URQs) in the Pinheiros River basin, is a concrete example of this operational cost being internalized.

Focus on reducing water loss (non-revenue water) to meet regulatory targets

Non-Revenue Water (NRW)-the water produced but lost to leaks, theft, or metering errors-is a huge efficiency drain. The national regulatory goal (Marco Legal do Saneamento) requires a reduction from the current national average of 40% down to 25% by 2033. SABESP is tackling this head-on with a major technology investment.

The company is rolling out the world's largest smart metering program in the water sector, contracting BRL 3.8 billion in investments to install 4.4 million IoT-enabled smart meters by 2029. This is defintely a game-changer. These efforts are already yielding results: as of May 2024, the company had saved over 50.5 million cubic meters per year of water through various loss reduction interventions.

Need for large-scale investment in sewage treatment to meet universal collection goals

The universalization goal-90% of the population with treated sewage by 2033-is the biggest driver of CapEx. SABESP is aiming to hit this target four years early, by 2029. The company is already close to a key milestone, being only 3% away from meeting the minimum 95% threshold on sewage treatment in the areas it serves.

The sheer scale of the investment is staggering. The total planned CapEx for water and sewage infrastructure to serve the 371 municipalities is R$ 70 billion over the next few years, with R$ 35 billion already contracted or applied. In the first nine months of 2025, the company reinvested BRL 13 billion in construction goods and services, which shows the accelerated pace of execution.

Here's a quick snapshot of the key environmental metrics and investment drivers for the 2025 fiscal year:

Environmental Metric / Driver	2025 Status / Target	Associated Investment (CapEx)
Water Security (Reservoir Level)	São Paulo reserves at 32.1% (Sept 2025), lowest for the date in a decade.	CapEx accelerated to BRL 4 billion in 3Q25, up 175% YoY.
Sewage Treatment Coverage	Goal to reach 97% coverage by year-end 2025. Only 3% away from 95% threshold.	Total planned investment of R$ 70 billion to achieve universalization by 2029.
Non-Revenue Water (NRW) Reduction	Saved over 50.5 million m³ per year of water as of May 2024. National target is 25% loss by 2033.	BRL 3.8 billion contracted for 4.4 million smart meters through 2029.
River De-pollution (Tietê/Pinheiros)	Pollution stain on Tietê reduced to 122 km.	State-led PPP for clean-up valued at R$ 9.5 billion (US$1.8 billion).

The environmental mandates translate directly into a clear investment thesis:

• Expand sewage coverage to meet the 90% national target.
• Invest in system resilience (e.g., new water systems) to mitigate drought risk.
• Deploy technology to reduce water losses and boost operational efficiency.