January 07, 2025

Why Privately Held English Water Utilities Are Struggling (and Nationalization Isn’t the Answer) with Branko Terzic

38 minutes

Recently, there has been talk in England about nationalizing England’s private water utilities. Former Wisconsin PSC Commissioner and FERC Commissioner, Branko Terzic, makes the case that England’s water utilities are not struggling because they are private, but rather because of a regulatory failure. Plus, Branko delves into how and why the U.S. system of utility regulation developed and much more.

In this session, you’ll learn about:

Branko’s background as a utility engineer, appraiser, consultant, regulator and executive

How and why England privatized its water utilities

Economist Stephen C. Littlechild’s role in English water privatization

Why England’s water rates skyrocketed after privatization but electric, gas and telephone utilities all fell

Why the United States has a predominantly publicly owned system of water utilities (in contrast to predominantly privately owned electric, gas and telephone utilities)

Why English regulation of water utilities has struggled

Why high leveraging and capital structure of English water utilities created problems

How poor regulation created capital structure problems and low water quality problems

Typical capital structure of U.S. utilities

Why most U.S. utilities capital structure typically has 40-50% equity despite debt being the cheaper capital

Why interest rates for debt and equity capital increase as debt’s share of the capital structure increases

What ringfencing is

Branko’s thoughts on fixing the English regulatory scheme

An overview of how water concessions work

A brief history of Enron’s foray into private water

Why market fragmentation is holding U.S. water systems back

Resources and links mentioned in or relevant to this session include:

Branko’s LinkedIn profile

Branko’s website

Thank You!

Thanks to each of you for listening and spreading the word about The Water Values Podcast! Keep the emails coming and please rate, review and subscribe to The Water Values Podcast on Apple Podcasts if you haven’t done so already. And don’t forget to tell your friends about the podcast and whatever you do, don’t forget to join The Water Values mailing list!

...more

View all episodes

By Dave McGimpsey

4.9

189189 ratings