American Water Leaks: German Utility Dumps Bad Investment

The vast majority of Americans, 86% of us, get our water from a local, public utility. Despite the fact that the United States has some of the best water systems in the world, private water companies continue to try and wrest control of this essential resource away from the public. These corporations often argue that they can do the job better and cheaper. But the private water industry undermined its own argument last week when Food & Water Watch released

the sealed minutes from a board meeting of one of the world’s largest private water companies, Germany-based RWE. (It’s a fun read . . .  Ok, it’s at least an interesting read.)The documents cite

“considerable political resistance to privatization of the water sector”

and

“performance problems and weak growth at American Water”

as reasons for the German utility’s quick exit from the water business. RWE is planning to sell American Water, the largest private water company in the United States, later this year, after owning it for fewer than 5 years.

The minutes also cite outdated infrastructure, increasing regulatory requirements, and opposition to rate increases as challenges to profitability in the American Water division.

“These minutes demonstrate that RWE doesn’t believe that private water companies in the United States are a good investment. The company is dumping their bad investment on Wall Street investors and American ratepayers,” Wenonah Hauter, our executive director, told U.S. News & World Report which picked up the story.

Instead of looking to privatization, our government should protect current and future generations of Americans by dedicating a funding stream for water – a trust fund to keep our water clean and safe.

• This story and more is available in the May issue of the Water for All Newsletter. Download your copy of Currents here.