17 Jan 2012

Good performance or poor oversight?

Jack Moss of Aquafed (the International Federation of Private Water Operators) showed this slide during a presentation in which he discussed the "unlevel playing field" that private operators (investor owned utilities and contract operators) face.

His point is that the lights of contracts (open-tendered with clear targets and published), regulation (reporting, hearings and outside oversight), academic studies (on regulatory data), and competition (for contracts) on private operators are capable of showing good and bad performance -- as well as attracting the attention of citizens, activists, the media and politicians.

But that's obvious. What's NOT so obvious -- and yet so important -- is the LACK of lights shining on public (or municipal) water operators. The Los Angeles Department of Water and Power does not have to compete for its service area. It does not have a fixed-term performance contract. LADWP is regulated by the LA city council, which does not specialize in water regulation, spend all its time on water regulation, compare LADWP to other operators, or have an arm's length relationship to LADWP (they share a budget, for example).

All of these factors make it more difficult to know what LADWP is up to, hold LADWP to a performance standard or punish LADWP for failure (remember the burst pipes that resulted when LADWP screwed up watering restrictions)?

But LADWP is not alone -- at least 80 percent of Americans (and perhaps a similar share of world citizens) get their water from public utilities that are not under the spot light.

Bottom Line: What gets measured gets managed, and we surely need to know what ALL water utilities are doing in their quest to deliver clean affordable water to customers.