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"City council should answer the question ‘What is the core business of EPCOR?’ If the core purpose of EPCOR is to provide highly reliable electricity to Edmontonians at the lowest possible price, it may not be sensible that EPCOR is now handling the metering service of Mississauga, Ontario and the water treatment of Cochrane, Alberta. Is EPCOR a national or multinational corporation waiting to be built, or a local company intent on providing the best possible service at the lowest cost to the citizens of Edmonton?"

Kevin Taft and Myron Gordon in "Aftershock: The open and shut case against privatizing EPCOR," published by the Parkland Institute, University of Alberta

The problem with commercialization

A growing concern in the water sector is the commercialization of public services. By adopting the management goals and mimicking the behaviour of private corporations, public utilities can give short shrift to the public interest, paving the way for public private partnerships and outright privatization. Commercialization also blurs public lines of accountability and responsibility.

Aqualta, the water subsidiary of Edmonton’s publicly-owned power utility EPCOR, has been aggressively marketing its services to municipalities within Alberta and beyond. It recently won contracts in Port Hardy, BC and Cochrane, Alberta. Aqualta has since partnered with private American company Allied Water in a joint bid for the operation and maintenance of the water and wastewater systems in Canmore, Alberta. The town of Canmore, instead of attempting to address its water and wastewater needs internally or pressing for federal infrastructure dollars, is considering a quasi-public private partnership that threatens community control and accountability.

Commercialization can lead to privatization. Adapting a public service to commercial interests creates an entity ripe for private sector plucking. This was the case for EPCOR itself. Faced with electrical industry deregulation, Edmonton city council began to consider selling EPCOR. RBC Dominion Securities, advised the city that it would earn more from investing the sale proceeds than from ongoing dividends earned by retaining ownership of the company. Yet this private investment firm, which underwrites EPCOR bonds, would have been well placed to profit from EPCOR’s sale.

Edmonton citizens fought to protect EPCOR, fearing the consequences of a privately-owned utility. A University of Alberta study concluded that far from strengthening the city’s financial position, Edmonton would lose millions of dollars over the long term if it sold the utility. The Edmonton study also showed that over a 40-year period, the City-owned utility would more than double the profits generated by selling the utility and investing the money in stocks. In the end, city council voted against pursuing its privatization plans for at least one year.

But the threat still looms. After privatization was rejected, EPCOR’s president said the priority now would be to "carry on with its business plan to compete in a deregulated environment." A city councillor, commenting on EPCOR’s future, said that "council as a shareholder is going to be under tremendous pressure as we move through deregulation to allow the company the flexibility it is going to need to succeed." The community will need to ensure that EPCOR and Aqualta continue to provide high quality and affordable services to their local consumers rather than focusing on winning the next contract in the next community or next province.

Global privatization peddlers

The water giants use a dizzying array of international groups to advance their privatization agenda. The World Water Council, the Water Supply and Sanitation Collaborative Council and the Global Water Partnership are all well-financed lobby groups with prominent corporate partners. Executives from water corporations — in particular Suez Lyonnaise des Eaux — populate the boards of these groups, ensuring that water policy discussions reflect their interests. While many of these groups may have good intentions, the danger exists for those intentions to be hijacked in the name of profitable corporate partnerships.

The next major gathering is a World Water Council-sponsored forum scheduled for The Hague in March 2000. The forum brings together policy makers, government officials and corporations and includes a World Water Fair — the perfect venue to pitch further privatization. With the conference focus on municipal water systems, corporations will be out in full force, lobbying governments to privatize their water and wastewater services and pushing policy makers to carve up the world's water into marketing territories. Citizens and governments must act to ensure that the outcome of the conference, which is intended to shape the global agenda for water into the next century, reflects public needs.

The World Water Council is also behind a World Water Commission, which is to look into water issues over the next century. The commission chair is a vice president of the World Bank and chairs the Global Water Partnership. A commission report released in 1999 called water "liquid gold" and went on to recommend privatized water systems as the solution for the needs of developing countries. Corporations are eager to use meetings like this to cash in on the very real water crisis many countries are facing or will soon face.

Another key player in the global push to privatization is the World Bank. The bank promotes itself as a champion of economic development in the developing world — but when it comes to water, that ‘development’ comes in the form of public private partnerships. The bank often insists on privatization as a condition for loans — even when the companies are facing corruption charges — and forms partnerships with multinationals convicted of corruption and bribery.

Our water’s not for sale

Survey after survey shows the overwhelming majority of Canadians, wary of the disasters that have struck Britain, France and elsewhere around the globe, oppose water privatization. Recognizing the environmental benefits of system upgrades, Canadians overwhelmingly favour more public investment in water and wastewater systems.

The federal government, working in concert with the provinces and municipalities, has the ability and the capacity to save Canada’s water from privatization. Helping fund public construction and renovation of publicly owned water systems will fend off the water privateers well into the millennium, driving many away for good. The Chretien government must take action immediately to help Canadians retain control of one of life’s most precious resources.