Posts Tagged ‘Water supply’

California’s depleted underground aquifers

August 21, 2015

CMy1PeAUkAA1MiLSource: Reveal | Twitter

Hat tip to naked capitalism

This photo shows the huge subsidence of a tract of land in California because of the exhaustion of underground water reservoirs beneath.   It would be interesting to see how much more the land has subsided since this photo was taken.

In the current drought, Californians are increasing their draw on underground aquifers as a substitute for the water they are not getting from rivers fed by melting snow.  This cannot go on forever.

And, as Stein’s Law says, if something cannot go on forever, someday it will stop.

(more…)

Why would a city privatize its water supply?

November 28, 2014

Big BadNo community could survive without an adequate and dependable source of water.  I don’t see why any community, or any individual person, with any sense of self-preservation would willingly give up control over something they need to live.

I first read about privatization of water systems as something that was imposed on poor Third World countries by lenders.  The World Bank, for example, has a privatization requirement when it lends money to build water systems.

But I learned from my e-mail pen pal Bill Harvey, who lives in Baltimore, that water privatization is big in the United States, and that Baltimore itself is considering turning over its water system to a company called Veolia.  This would be a terrible idea.

Veolia is the world’s largest private water company.  Its headquarters is in Paris, France, and it has long managed water systems in France.  Recently, however, French municipal governments, including Paris itself, have decided they can get better service at lower cost by managing their own water systems.  So Veolia, in order to maintain its revenues and profits, has to expand business elsewhere.

Its track record doesn’t seem good.  Water rates are higher lower on average in public systems than in systems run by Veolia and Suez, the other big international water company, and there are complaints about not enough being spent on maintenance.  Private operators don’t necessarily follow the local government’s priorities for development.   The private company’s incentives may not align with the municipality’s priorities.

There are inherent problems with a private company that don’t exist with a public system.  Funds don’t have to be drawn off for profit and dividends.  And big companies have systems for charging subsidiaries for services, so that a subsidiary could be operating theoretically at a loss while the parent company makes a big profit.  There is an economic incentive to do that because the local water company can simply raise its rates to cover its loss.

And even if Veolia’s record is better than these articles indicate, no local government, unless it was very, very desperate, should surrender control of vital assets and services to solve a cash-flow problem.

(more…)

Money down the drain

June 28, 2010

The Democrat and Chronicle this morning had an excellent article on how the aging Rochester, N.Y., water distribution system allows 24 percent of the treated water to leak out before it reaches customers.  The corresponding figure for the Monroe County Water Authority, which serves the Rochester suburbs, is 15 percent. This range is not unusual for cities in the Northeast.

Wouldn’t this be a good time to start work on repairing these deteriorating stuctures?  Since this work is going to have to be done somehow sometime, why not now, when our country needs to create jobs to keep our recession from becoming a full-blown depression?

The financially strapped City of Rochester and Monroe County governments aren’t in a position now to start big infrastructure projects. The pressure on them is to do the reverse – to defer maintenance.  The American Recovery Act of 2009 did provide some funds for infrastructure improvements, mainly of roads and bridges, but there is much more to be done.

And, yes, since we’re in the middle of a recession, the federal government would have to borrow to provide funds to help repair municipal water systems. But we, the taxpayers, would get a return on this investment, in the form of a more efficient and less costly water supply.  And the longer the wait in making these repairs, the more costly they’ll be.