The Deregulation of Drinking Water Supply in France and the New Role of Consumers

Special Report: Regulation and Users of Networks
By Christelle Pezon

In France, the state has taken the initiative of deregulating drinking water supply in order to rationalize the territorial planning of water networks and to promote budgetary balance in local services. This deregulation has occured through a slow and imperfect process. Slow, because it took one generation, from the end of the 1960s on, to convert water companies to market-oriented management. Imperfect, because the process failed to give the different modes of management equal chances of success within the competition context. Above all, it produced results different from the expected effects, which required the development of a new regulation process, in order to reorient competition onto services delivered to the consumers. The French Conseil d’État (the high administrative court) has to deal with new conflicts provoked by the new rules. The analysis of those conflicts allows to characterize the new regulation and to identify the ways of its possible improvement. In this case, administrative actions bring to light a new actor: the consumers, who are from now on the main financers of water services and, for this reason, are more demanding, notably vis-à-vis the municipalities that are supposed to defend their interest.

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