Study Reveals Positive Impacts of Water Utility Privatization

A recent study conducted by Charles River Associates sheds light on the significant economic, consumer, and environmental benefits of water utility privatization and consolidation in Pennsylvania, particularly focusing on the contributions of National Association of Water Companies (NAWC) member-owned systems.

The study reveals that NAWC member companies make a substantial economic impact, contributing over $1 billion annually to Pennsylvania’s economy. With over 2,000 well-paying employees with an average annual compensation of nearly $100,000, and more than 13,000 jobs supported, , these companies play a crucial role in Pennsylvania’s workforce. This economic impact extends across several industries, including contracting, manufacturing, facilities maintenance, waste management, professional services, and engineering.

Additionally, the study outlines the tax contributions made by NAWC member companies, totaling $281 million in 2022. Of this sum, $94 million directly contributed to state and local taxes, supporting essential public services.

Consumer Benefits: High-Quality Drinking Water

One of the study’s key findings is the superior quality and reliability of drinking water provided by NAWC member companies. The analysis of Safe Drinking Water Act violations from 2013-2023 reveals significantly lower violation rates — ranging from 10 to nearly 100 times lower — compared to other water systems in the Commonwealth. This underscores the positive impact of privatization and consolidation on maintaining high standards of water quality.

Environmental Compliance and Oversight

The study also highlights the environmental stewardship of NAWC member systems, noting a much lower rate of federal wastewater regulation violations compared to other types of wastewater systems. An analysis of Clean Water Act violations from 2013-2023 consistently shows lower average violation rates for NAWC member systems compared to systems owned by other entities.

Addressing Challenges and Recommendations

In addition to presenting positive outcomes, the study outlines challenges faced by public water systems nationwide, such as unsustainable water use, water quality concerns, and affordability issues. The report emphasizes the need for close coordination among regulators, policymakers, water consumers, and utility companies to address these challenges effectively.

The study suggests that privatization and consolidation can provide necessary investments in critical water infrastructure. The benefits identified include increased access to capital for infrastructure development, economies of scale, stringent regulatory oversight, enhanced reliability, and improved employee safety.

Implications for Water Policy in PA

As the Commonwealth grapples with evolving water-related challenges, the findings of this study suggest that policies supporting privatization remain part of a strategic approach to ensuring economic growth, job creation, and the delivery of high-quality water services to Pennsylvania residents. The study calls on stakeholders to collaborate in navigating these challenges and capitalize on the proven benefits of privatization in the water sector.




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