Regulation models for the public water supply and their competitive effects

Faced with liberalisation proposals and an increasing internationalisation of water resource management, the question arises as to how a change of the regulatory framework in Germany would affect the market structure and the supply conditions in this area. The water-supply companies in Germany have invested ca. €2.5 billion annually to achieve a high technical standard, which has resulted in high cost increases and price hikes. It is thus presumed that there is a high rationalisation potential for the municipal water suppliers. The question of economic efficiency and the participation of private providers in the water supply has increasingly gained importance. In this article, the organisation of water resource management is described for different European countries and the effects to be expected from a liberalisation of the water supply on the competitive situation in Germany is discussed.