16 Jan 2015

Power, autonomy or desperation?

About a year ago, I was working working with a company that wanted to sell "WaterSavr" (a product that reduces reservoir evaporation) to managers in California.

Just yesterday, I got an update on the product's success ("saving" water at a cost of about $200/af, details to come) in Texas and Turkey. How is it, I thought, that those places have put this product into use while California managers seems to be paralyzed in the face of the developing disaster?

Assuming they want to act, I came up with three scenarios in which they can take action:
  • Power: water managers in some places can just get stuff done because they can overcome interest groups trying to block or control change ("a tragedy of anti-commons"). I'd put managers at Metropolitan or Westlands in this category.
  • Autonomy: water managers only answer to themselves, so they can do what they want because their actions do not affect others. I'd put managers in many small utilities in this category.*
  • Desperation: water managers facing service cuts can basically scare overseers and stakeholders into action. This is how Santa Barbara managers raised prices to $27/ccf (and saw a 50 percent fall in use) during the last big drought.
These reasons are necessary for action, but they are not sufficient. It's also necessary to have a water manager who's willing to change policies. Not many of them are up for this, as the industry is extremely conservative and the penalty for a failed action (bad press, complaints) is far greater than the penalty for inaction. The manager can claim that he's "going by the book" as customers experience higher costs and greater harm than they would have under a better (but "new") policy.**

Bottom Line: Water managers don't just need freedom of action to protect customers from service failures. They need to be brave enough to lead everyone away from old, failed policies.

* They tend NOT to act because they often lack the expertise to study options or desire to get ahead (sometimes too far ahead) of the big guys.
** You know, like raising prices to get people to use less water instead of building a desalination plant in the hope that new supplies would be sufficient to meet "out of control" demand.