BEECHER - NAWC

Water ComparedStructural ChangeRestructured markets alter the composition of utility revenues. In the telecommunicationsindustry, restructuring is reflected in the reduction of toll-service revenues and the rise inaccess charge revenues. Transmission charges for energy commodities can be substantial,particularly if used to help utilities recover stranded investment costs.In the energy realm, both for the electricity and natural gas markets, the newest players are the"aggregators, brokers, and marketers" (ABMs), who are interjecting a role between buyersand sellers in the new marketplace for utility produces and services. Aggregation might bethe only realistic opportunity for core customers (that is, individual residential customers) toexert purchasing power.In the water industry, new players also have emerged. ~e most significant trend in this areaprobably is the quiet emergence of unregulated nonutility contract providers, who haveanswered the call to privatize operations and management for many municipal water andwastewater facilities. Some investor-owned water utilities (or their parent managementcompanies) also offer contract services.$60Telecommunications Operating Revenueby Service Category(1970 to 1996)1/)c:.Q:0f>4c:1/)G):::lc:G)>G)0:::$50$40-$30$20$10--Local servicerevenues+-----------ft--.?--+---=----------,...,..,_ ---Accessrevenues--Toll servicerevenues$0~~~~~~~~~~~~~~0I'-­m0(X)mN(X)m(0(X)m(X)(X)m0«> --Miscellaneousm ~ revenuesNote: Legends correspond to end-year graph values from top to bottom.NAWC 63 September 1998