Experts in the field of natural resource economics have long known the methods of valuing water, but other analysts in the field of public utility economics have failed to incorporate this knowledge in the context of pricing water services.While many factors play into setting water utility rates, the differences between the cost of service and value of service are rarely known ¿ even by large water utilities.This book provides persuasive information to policymakers regarding how to value water and water utility services to various customer classes.The book is applicable to both investor-owned and publicly owned water utilities.

In the quest to reduce costs and improve the efficiency of water and wastewater services, many communities in the United States are exploring the potential advantages of privatization of those services. Unlike other utility services, local governments have generally assumed responsibility for providing water services. Privatization of such services can include the outright sale of system assets, or various forms of public-private partnershipsâ€"from the simple provision of supplies and services, to private design construction and operation of treatment plants and distribution systems. Many factors are contributing to the growing interest in the privatization of water services. Higher operating costs, more stringent federal water quality and waste effluent standards, greater customer demands for quality and reliability, and an aging water delivery and wastewater collection and treatment infrastructure are all challenging municipalities that may be short of funds or technical capabilities. For municipalities with limited capacities to meet these challenges, privatization can be a viable alternative. Privatization of Water Services evaluates the fiscal and policy implications of privatization, scenarios in which privatization works best, and the efficiencies that may be gained by contracting with private water utilities.