Does Privatizing Water Systems Make Sense?

Private financing of water systems goes at least as far back as ancient Rome. But as the number of people served by private water companies grows, some cities that have tasted privatization have found it lacking.

"Because water is so abundant—it rains from the sky, it collects in the earth—it feels like it should be free. The United Nations even recognized water as a human right in 2010," writes Renuka Rayasam. "But delivering safe water comes at a cost, and the fight over who should bear that cost has transformed water—and the merits and shortcomings of privatizing it—into an ideological battleground."

After experimenting with partial water privatization for fourteen years, residents of Berlin paid more than a billion euros to buy out the two private companies who were responsible for day-to-day management of its water system.

"Privatizing water systems can sometimes make sense, though, Richard G. Little, an infrastructure-policy consultant, told me....Private companies can provide more professional management, bring new investment into neglected public water systems, and provide funds for research."



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