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Re: Enron & Privitzing US Water Supplies
This story should be read within the broader context of what is
happening both in this country and worldwide. Over the past several
years, Philadelphia Suburban and American Water Works (to name only 2
examples) have been buying small systems around the US. PSC is in turn,
owned in part by France-based Vivendi, formerly known as Societe
Generale des Eaux. AWK, in its turn has been recently bought out by the
German firm, RWE, which also recently bought out a huge British water
company. A year or so back, the New York Society of Securities Analysts
held a seminar to look at this phenomenon. While I do not know
precisely what is driving it worldwide, in this country, the primary
driver is the CWA and the SDWA. More regulation in this area has tended
to mean higher costs, which often times exceed the ability of smaller
systems to pay---hence their salvation is selling out to a private
company. These same rural and small-town systems were behind much of
the hoo-ha that surrounded the arsenic standard for drinking water.
Finally, to give you some notion of how far this privatization
trend has gone, there is now a European mutual fund that focuses on
private drinking and wastewater infrastructure firms. None of this is
to say, however, that regulation (relating to rates) will totally
disappear from this sector. We are talking about a substance that is
literally vital to life, after all---and that's not me talking. I heard
this line from a big-time financier type at a conference nearly 10 years
ago in NYC that was also devoted to this issue.
Ed Weiler, Economist
USEPA, Office of Pollution Prevention
and Toxics
Washington, DC 20460
Ph: 202.564.8836; Fax: 202.564.8901
Donald Sutherland
<donaldsutherland-iso14000@worldne To: p2tech@great-lakes.net
t.att.net> cc: rp-cinet@igc.topica.com, ep@csf.colorado.edu
Sent by: Subject: Enron & Privitzing US Water Supplies
owner-p2tech@great-lakes.net
03/25/2002 02:57 PM
Please respond to Donald
Sutherland
I thought the listservice might be interested in
developments to privitize public drinking water supplies
in Florida.
Do you know of other examples in other states?
Cheers,
Donald Sutherland
Member of the Society of Environmental Journalists
donaldsutherland-iso14000@worldnet.att.net
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Perspective front | Perspective archive | help
Editorial: Enron subsidiary
Azurix's failed attempt at Florida's water rights sends
warning message
Sunday, March 24, 2002
The Naples Daily News
Little did most of us know that when Enron collapsed, it
was due in large measure to an ill-fated campaign for
control of Florida's drinking water.
The name of the Enron water subsidiary is Azurix.
Thanks to Florida's open records laws and investigative
reporters, we see how close our state in general and
Southwest Florida in particular came to being ensnared
beyond our friends and neighbors losing their Enron
investments.
Stories originated by the Sarasota Herald-Tribune and
republished by this newspaper last Sunday show how
Azurix lost nearly $1 billion trying to win long-term
leases to withdraw water from the ground and relax state
laws on aquifer storage and recovery (ASR) wells for
stormwater runoff and treated sewage effluent. Azurix
even offered to help pay for Everglades restoration, in
hopes of repayment from the $8 billion state and federal
commitment to the project, in return for the exclusive
rights to sell the project's newly protected resource.
Azurix hired key lobbyists. They include at least one
former board member of the South Florida Water
Management District ? James Garner of Fort Myers, who
tried in vain to win Lee County's water utilities
contract for Azurix ? and at least one former district
executive director, John Wodraska. The water district
includes Collier and Lee counties.
Azurix enjoyed enthusiastic support from David Struhs,
Gov. Jeb Bush's chief of the Department of Environmental
Protection. Struhs, who worked with Enron CEO Kenneth
Lay in the administration of President George W. Bush's
father, championed water privatization at a Florida
Chamber of Commerce seminar on Marco Island in July
2000.
In hindsight, comments made by Struhs, Garner and
Wodraska at that meeting are ominous:
Struhs: "Start with the idea water is a public resource.
Given that, can we still harness the power of the
marketplace? I believe the answer is yes."
Wodraska: "There are going to be major capital
expenditures, so bring in efficient private enterprise."
Garner: "It's probably the most efficient way to solve
the problems looming on the way and do it without
bankrupting the public coffers."
Further, Struhs made a special trip to Naples as late as
last spring to lobby this newspaper on ASR-friendly
legislation. Shortly thereafter, about the same time
Enron started to collapse, his support for ASR
dissipated, citing environmental concerns.
The ties between Gov. Bush ? whose brother's Pentagon
employs at least one ex-Enron executive, who is building
a home in Naples ? and Struhs and Enron are striking.
Yet, instead of prompting calls for investigations, the
Florida Azurix story struggles for a groundwork of
public awareness.
Two points register sharply:
n Water must be kept as public property in the public
sector. Though that means management by a huge, non-
elected bureaucracy, it is easier to track than if it
were in private hands, where the potential for
exploitation is boundless even by Enron standards.
n Though Enron and Azurix failed, someone else is likely
to try to get the privatization job done. The money and
power at stake are irresistible. We have to be on the
alert for ourselves, because our state regulators were
on the wrong side, that of the manipulators, the first
time around.
From now on when water and ASR and long-term leases are
brought up, watchdogs will perk up.
http://www.naplesnews.com/02/03/perspective/d738560a.htm
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