Privatized Water: All About the Profit


Food and Water Watch has just published a report: The State of Public Water in the United States. It is an excellent read, filled with history of public water utilities and useful data about the cost of water across the country, from both public and private, for-profit providers. It’s also long, so here are some useful talking points gleaned from the 15-page report:

  1. Until the beginning of the 20th century, many water utilities were private entities. The move towards consolidating water utilities under public municipal management was to make water safer and more available. Deadly cholera and typhoid outbreaks, industrial and urban pollution, and inadequate water supply for fire-fighting were common reasons for municipalities to make the shift from private to public. Once municipalities controlled their water supply, they could clean it up, ensure adequate supply, and, equally importantly, extend service to low-income communities that private companies would not serve. These public utilities were not only safer and more equitable, they were less expensive.
  2. Public water utilities are “a good deal.” They continue to be less expensive, more equitable, and safer than private, for-profit water companies. Because water service is a monopoly, dissatisfied customers cannot take their business to another company: they have one choice for their water utility. Public utilities are accountable to their customers – the voters and taxpayers. Private, for-profit companies are not accountable to the local people, and are not responsible for promoting the health and well-being of the community. They look towards their investors – not customers – for policy decisions because those impact profitability.
  3. Water rates vary quite a bit across the US. However, private, for-profit water utilities are significantly more expensive than public water utilities. A 2010 survey of utilities in the Great Lakes region found that private water utilities charged more than twice as much as public water utilities. Selling off water rights is NOT a bargain. It is a terrible investment!
  4. Public utilities have incentives to conserve water, promote equitable service to the community, protect the watershed, and work to promote sustainable growth in the community. Private, for-profit utilities have no incentives of any kind other than making a profit and are not intrinsically involved in the well-being of the community as a whole.

Average household water bills from 2015 (Midwest) from Food and Water Watch. Wisconsin is amongst the least expensive.

In 2015, Wisconsin’s citizens’ average annual water bill was amongst the lowest in the region, and water utilities in the state are publicly owned. In our neighboring states of Illinois and Iowa – where some water utilities have been privatized – the rates for private water companies are vastly more expensive compared to their public counterparts. In Illinois, the increase in cost between public and private is a whopping 95%!

Aqua America: the eighth most expensive water provider, from Food and Water Watch

Enter Aqua America: the eighth most expensive water provider. This is the company that has lobbied for the current Water Privatization Bill (SB432 and AB554) before the Wisconsin State Senate. It’s pretty easy to see why they are interested in Wisconsin. Our water utilities are public and the bills are low. There is a lot of profit to be had, and the citizens will be paying for it.

Keep up the pressure on your legislators! The Water Privatization Bill has been removed from the current session, but could easily reappear this spring. Be sure to share this Food and Water Watch information with your State Senator, and your friends and family.

Stay informed on the issues! Food and Water Watch has some excellent reports on the issues of water privatization.
From 2013: Borrowing Trouble: Water Privatization Is a False Solution for Municipal Budget Shortfalls
From 2014: Aqua America: A Corporate Profile