Project: Exploratory Study „Privatisation of the Water Industry“

Project Head:
Thomas Kluge

Project Team:
Thomas Kluge
Alexandra
Lux
 

Funding:
Federal Ministry of Education and Research

Logo BMBF

Duration:
10/00 - 03/01

 

Field of research

Research Area:
area water

 

about the Institute

 

 

Within the framework of its newly established funding policy "Social Ecological Research" the Federal Ministry for Education and Research is having examined current problems, the current position of research and its potential including social ecological transformation and social innovation.

The aim of the exploratory projects e.g. to make changes of relation patterns between nature and society (transformation) accessible by scientific analysis will be illustrated with the example "Privatisation of the Water Industry". By doing so we are dealing with a very controversial topic: privatisation and extended competition. The opponents of privatisation are of the opinion that the standards, which have been developed by the public water supply companies in the past, might be endangered and that ecology, human health and society in general might get affected. Furthermore they are also warning against a loss of autonomy with respect to the municipal self-government because this would also mean a loss of democratic control in such sensitive areas as the water supply. On the other hand there is a group who are pointing out high costs, lack of efficiency and poor transparency with respect to transverse subsidising within municipal companies. This group thinks that a way to avoid these problems might be privatisation and more importantly the encouragement of more competition within the water industry. All this may explain why Germany is not represented in the global market.

The exploratory study will show the need for research with respect to the transformation, which is already happening, and concerning regulations for a sustainable development within the water industry. For this purpose we started cooperating intensively with scientists from the following areas: engineering, economy, environmental and social law, scientific space planning, social and political science. This constellation is making obvious what kinds of problems are hidden behind the general public discussion.

Emphasis has to be put on the process, which has to be dealt with before getting into the purely operational sphere e.g. the organisation of water supply and disposal. This concerns the planning of resources as a requirement to obtain a water permission as well as the process itself leading to the receipt of a water permission.

In our thesis we are saying that the ways of regulat-ing the allocation of resources which have been practised up to now are no longer sufficient for the changing water industry. This change is marked by the division of control and operational tasks: until now numerous public control measures and supervising duties have been delegated to municipal companies. When granting concessions (competition in the market) or dealing with other kinds of privatisation, independent control has to be guaranteed.

Furthermore we investigated the importance of water supply systems in connection with privatisation and extended competition. Is it possible to obtain liberalised market conditions by dividing waterworks and supply systems? What will be the specific features of water supply and disposal in case of a division? Which (long-term) consequences will there be in connection with the planning and development of infrastructural networks? The emphasis lies on the centralising and/or decentralising potentials, which will emerge as a consequence of the transformation procedure. Questions concerning the combination of water and electricity networks (telecommunication, internet, etc.) and thus the possibility to reshape the flow of information are also of particular interest.

These are two of the main areas of our research work the results of which can be found in:

Kluge, Thomas/Alexandra Lux (2001): Privatisierung in der Wasserwirtschaft. Sozial-ökologische Forschungsperspektiven. ISOE-DP 17. Frankfurt am Main, 31 S., DM 7.-

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