KfW Research: Investment backlog in public swimming pools is falling, but energy prices are creating cost pressures

• Municipalities estimate backlog in 2021 at EUR 8.5 billion
• Rising energy prices are making ongoing operations difficult
• Prices need to be raised, pools may need to be closed

It’s summer – time to unwind and relax at the pool! Year after year, people young and old enjoy spending the hot days in and around cool waters. Swimming pools are among the most popular but most cost-intensive municipal sporting facilities. The supply of swimming pools differs greatly across Germany's regions, but operating costs and investment requirements pose challenges for public operators almost everywhere. A special analysis conducted by the KfW Municipal Panel revealed that the investment backlog dropped last year to EUR 8.5 billion nationwide (EUR 9.2 billion in 2020), but higher prices for energy and water are creating new and considerable financial pressure.

In the survey commissioned by KfW Research in April 2022, approx. 30% of the cities, districts and communities in Germany reported having to raise the prices of energy-intensive services such as swimming pools, and more than one in ten even fear they will have to make cuts to these services. That percentage is even higher among municipalities that experience high energy prices as a heavy burden on their budget. One in five expect to be forced to reduce swimming pool operation and around 45% plan to raise prices.

However, it is not just operating pools that poses a challenge for local governments. They are also investment-intensive. On average, sporting facilities and swimming pools accounted for around 5% of total municipal investment last year. In 2021 this was just under EUR 2 billion, and municipalities are actually planning more than EUR 2 billion for 2022 (out of EUR 40.6 billion in overall municipal investment). But the investment backlog remains high. Sporting facilities and swimming pools are not obligatory but discretionary municipal services. As a result of the precarious budget situation associated with the coronavirus pandemic, 20% of cities, districts and communities reduced, deferred or cancelled services and investments in these facilities. Thirty per cent of municipalities expect to be able to invest more in sporting facilities and swimming pools again this year, while a good one third believe investment expenditure will remain the same or drop further.

“Swimming pools and municipal sporting facilities are very important for many people, young and old, as they stand for quality of life and make their place of domicile attractive. Cities, districts and communities in Germany must develop sustainable solutions to the investment requirements and costs of ongoing operation so that they can continue to offer these services on a permanent basis in the future as well. Improving the energy efficiency of swimming pools, for example, can contribute to this. It helps protect against rising energy prices in the long term while protecting the climate”, said Dr Fritzi Köhler-Geib, Chief Economist of KfW.

The dataset:
The KfW Municipal Panel is based on a representative annual survey of treasuries of cities and municipalities with more than 2,000 inhabitants and of all rural districts that is carried out annually by the German Institute for Urban Affairs (Difu). The KfW Municipal Panel 2022 was published in May and is available in German free of charge at
www.kfw.de/kommunalpanel