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RWE/Thames WaterA Corporate Profile

a report by

Public Citizen

RWE/Thames WaterA Corporate Profile

Public Citizen, founded in 1971, is a non-profit research, lobbying and litigation organization based in Washington. D.C. Public Citizen advocates for consumer

protection and for government and corporate accountability, and is supported by over 150,000 members throughout the United States.

Graphic by Grafistas Associados do RS

A special report by Public Citizen’s Water for All program.

March 2003, Revised October 2005© 2003, 2005 Public Citizen. All rights reservedThis document can be viewed or downloaded

www.wateractivist.org

Water for All Campaign215 Pennsylvania Ave. S.EWashington, D.C. 20003tel: 202.588.1000fax: 202.547.7392cmep@citizen.orgwww.wateractivist.org

Introduction.........................................................................1RWE’s financial “Catch-22”.................................................2First in pollution, last in public protection..............................32004 - Still worst among poor performers..............................42003 - Holding onto the record.............................................42002 - Worst of the worst again? .........................................52001 - More ‘completely avoidable’ sewage...........................62000 - Residents get sick of it...............................................61999 - A ‘knowingly’ unique polluter....................................6American dreams – and consumer nightmares.......................7RWE’s U.S. operations: The public challenge to buy back theirwater…................................................................................8

MONTARA, CA.......................................................8STOCKTON, CA.....................................................9LEXINGTON, KY....................................................9FELTON, CA.........................................................10BUFFALO, NY......................................................11MONTEREY, CA...................................................11CHUALAR, CA......................................................12

The Northern Neighbor: American Water in Canada...........12

Pulling out of Latin America..............................................14Chilean assets..........................................................14Puerto Rico’s water hell...........................................15

Putting profit first – Thames’ mistakes in Asia....................16Australia: Something smells rotten down under.........16A Corporate Flagship in China?...............................16Staking it out in New Zealand – but for how much longer?............................................................17Thailand: Stuck with failure.....................................17Malaysia: Thames leaves its mark............................18Indonesia: Doing business with a dictator.................18Japan: Yearning to do business.................................19

European withdrawal.........................................................20Capping growth in Germany....................................20Spain and Italy: RWE’s garage sale continues...........20Hungary: Slipping in even when it’s not welcome.....20Turkey: On the back burner.....................................21

Middle Eastern risk taking..................................................21Conclusion.........................................................................21

INDEX

RWE/Thames Water. A Corporate Profile Page 1

RWE/Thames Water - A Corporate profile- England’s worst polluter and its debt-choked corporate parent make for a toxic combination

Liquid thinking? That’s what water giant RWE pridesitself on.1 The trouble is, if not properly contained,liquid tends to leak and make a big mess.

German-owned RWE AG made its name in the ener-gy sector, but through acquisitions, it’s now a leaderin the water industry. RWE is the parent company ofThames Water, a British water company, fully ownedsince 2000; RWE controls more than 600 sub-sidiaries, and Thames Water serves as the operationalmanager of RWE’s international water business,including the management of U.S. subsidiaryAmerican Water Works. Thames Water serves 70 mil-lion people across the world with water and wastewater services – customers who are increasingly opt-ing to confront the corporation and fight for publiccontrol of our most essential resource.2

RWE’s combined operations has earned a spot atnumber 78 on the Global Fortune 500 list, higherthan any of the other private water companies (thethree largest are RWE, Suez (number 79) andVeolia/Vivendi), symbolizing the tremendous influ-ence of the corporation yields. Fortune lists RWE’srevenue as $50.9 billion, with an annual profit of$2.657 billion.3 Or, in other words, a revenue equalto the combined gross national income of Armenia,Burundi, the Central African Republic, Chad, theRepublic of Congo, Croatia, Eritrea, Guinea, Haiti,People’s Republic of Lao, Kyrgyz Republic, Lesotho,Malawi, Mauritania, Moldova, Mongolia,Mozambique, Namibia, Nicaragua, Niger, Papua NewGuinea, Rwanda, Sierra Leone, Tajikistan and Togo!RWE’s annual revenue is equal to the combinedincome of the 153.2 million people in these coun-tries.

An RWE subsidiary, Thames Water, recently changedfocus to target four fairly secure primary markets:Germany, the U.K., Central Eastern Europe and theUnited States.4 The move is a reversal of previousstrategies which targeted the whole world, split into

four regions: the Americas; Asia Pacific; Europe,Middle East and Africa; and the United Kingdomand Ireland as a separate region. Clearly the worldhas shrunk for the corporation in the past few years!As it turns out, the privatization invasion begun inthe late 1990s hit a snag. The aspirations to replacepublic control of water with private control of waterfor profit, either through ownership or long-termoperation and management contracts, contains a fun-damental, and thus far largely insurmountable, prob-lem; a problem that the companies and their apolo-gists in the political ivory towers have failed to fullycomprehend and anticipate: It turns out people don’twant their water privatized.

Instead people embrace the notion of publicly-fundedwater and wastewater services. For instance, results ofa 2005 poll conducted by the Luntz ResearchCompanies found overwhelming support—86 per-cent—for legislation to create a public trust fund forsafe and clean water infrastructure.5

In the face of stiff community opposition—the corpo-rations that have been trying to privatize water andwastewater services over the last several years haverun into buzz saws of angry citizenry armed withtough questions and backed by popular support.

Whether in the hundreds of utilities that RWE nowowns, or in long-term monopoly lease concessionsthe corporation is pursuing, Thames Water, asRWE’s water management arm, is going to be undertremendous pressure to fatten a bottom line for itsdebt-choked corporate parent. That could be a recipefor public health risks, environmental damage, cor-ner-cutting and customer-gouging.

And there’s another reason that the companies havehad such a tough time achieving significant gains inthe push to privatize water, one the companies don’tcare to admit: In those towns where they’ve managedto get their foot in the door, they’ve failed to deliver

as promised – Thames Water’s failed recorddescribed on the following pages is proof of these fail-ures.

RWE’s financial “Catch-22”

During the company’s spending spree in the pastdecade, RWE racked up nearly $27 billion of debt.7

The frenzied acquisitions left the financial communi-ty wondering if RWE’s $7.6 billion deal for AmericanWater Works in January 2003 (three times the bookvalue)8 - the largest publicly held U.S.-based waterutility with 16 million customers in 29 states andthree Canadian provinces9 - wasn’t overpriced, and ifthe debt-loaded company wasn’t spread far too thin(American Water had previously purchased Enron-held Azurix in November 2001).10 Global WaterIntelligence reported that investors who bought intoRWE in 2001 “must feel now as if they had spent the lasttwo years in an acid bath.” A $100 investment in 2001spiraled down to $60 in two years.11 In 2002 aloneRWE stocks dropped 40%.12 RWE has all but admit-ted that it spent far too much for some of its acquisi-tions, including its purchase of the British energycompany Innogy. One of the main problems facingthe debt-loaded corporation was that it owns many ofthe water works and “cannot shy away from capitalexpenditure.”13 Recognizing that their acquisition strat-egy was failing, several large water companies, includ-ing RWE, reduced their fixed capital by turning awayfrom full asset sales, and instead focused on opera-tion and management contracts. Through sheddingacquisitions, RWE managed to reduce its debt to$15.3 billion (€12.4 billion) by December 2004.14

Meanwhile, RWE’s net income fell 9%.15

While Thames Water sought to use its U.K. and U.S.businesses as a cash cow due to the large rate increas-

es it has instituted in the past years – RWE’s interna-tional water interests are faced with harder prospects.In an internal row, RWE Chief Executive OfficerHarry Roels stated in February 2004 that RWE wasweighing whether to take Thames’ international divi-sion away from Thames management and BritishCEO Bill Alexander.16 Subsequently, all of the conti-nental Europe operations, Spain exempted, wereremoved from Thames management and are nowoperated under RWE Energy.17 The German newspa-per Berliner Zeitung recently reported that ThamesWater would need to adjust its net yield targets, astory confirmed by Roels.18 Facing internal pressureBill Alexander announced he would retire inNovember 2005. He is set to be replaced by JeremyPelczer, the chief executive of American Water.19

Pelczer is charged with finding buyers for the unsuc-cessful international assets – a garage sale which hasnot been going well.20

RWE acknowledges that it paid a “premium” forAmerican Water Works, shelling out more than theutilities’ book value. But in state after state whereRWE had to win regulatory approval, the companypromised that customers would not be stuck with thetab. Public Utilities Commissions made conditions,including that Thames Water could not take opera-tional contract of American Water without priorapproval, and that trade agreements cannotsupercede local legislation.21 California and Kentuckyheld out the longest, approving the merger in lateDecember 2004. RWE officials explained that thecompany would cover the cost of the premium andgrow future company revenues through expansion,not rate hikes to former American Water Works cus-tomers.

Page 2 RWE/Thames Water. A Corporate Profile

Corporate ‘blue’-wash – toying with aid policiesIn 2004, Thames Water launched ‘Water and Sanitation for the Urban Poor’ allegedly as a response tothe great needs of the poor. However, even the promotional material from the company states that“Companies can meet shareholder expectation and with the possibility of earning a return of up to10% on their work in the projects, there is a proper incentive to scale up their involvement.”6 Clearly,Thames Water hasn’t suddenly become involved in charity, but found another label for making profitoff the poor through lucrative consulting contracts. Whether the poor themselves pay or taxpayersfrom the North pick up the tab – the outrage ought to be the same.

At least, that’s what RWE officials told the CaliforniaPublic Utilities Commission in December 2002, asRWE was arguing that it should be allowed toacquire several water and wastewater utilities inCalifornia communities. “Let’s not worry about that,”said Thames Water Managing Director JamesMcGivern, referring to the premium. “That premium isfor the shareholders. It will never, ever be passed down tothe customers of California-American.”22

“This transaction is predicated on growth,” McGivernadded, proceeding to envision the corporate takeoverof water and wastewater systems throughout theUnited States.

But RWE made promises it could not keep. HowRWE would grow when it’s already spread so thin—and given the substantial and growing public opposi-tion to corporate control of water in the U.S. — wasanybody’s guess. In fact, RWE is in something of acatch-22. It couldn’t pay off its debt unless it grew,but it couldn’t grow because it couldn’t afford to takeon more debt.

The pressure to cut costs and pad revenues wasintense, and the corporation’s desperate struggle toclimb out of debt ended up a far higher priority than,for instance, spending money on water system main-tenance or holding steady on consumers’ water bills.The result: the corporate giant abandoned its earlypromises and asked the Public Utilities Commissionto force consumers to pay for the corporate spendingspree.

But the corporate giant was not only facing financialtrouble in the U.S. Its international business has alsofailed to deliver. In January 2005 it was reported thatThames Water’s international business was likely tobe broken up and sold. While an initial interest fromJapanese Mitsui was withdrawn, RWE’s Chileanassets are facing impending sale. And RWE is stillattempting to make a complete exit from Asia andthe Middle East,23 including the fast-growingChinese market where the company was forced outby new rules issued by the State Council inSeptember 2003 which reversed the right to the guar-antee of a 15% secure return. British media reports

even speculated that U.K. and U.S. assets were alsoup for sale. RWE has denied such rumors.24 Butindustry magazine Global Water Intelligence arguedthat the RWE’s American subsidiary, AmericanWater Works, wasn’t yielding the targeted 15% andthat a sale would improve the cash liquidity for thecorporate giant.25 But RWE is stubbornly bankingon positive results from rate increases fromAmerican, British and German consumers.Therefore, the corporation is continuing to pursueexceedingly familiar tactics by cutting corners, goug-ing customers and neglecting its responsibilities tothe communities it serves; all to pad the bottom linefor shareholders.

First in pollution, last in public protectionThames Water has topped the U.K. EnvironmentAgency list of the worst polluters for years. The com-pany’s dismal record for 2005 is headed the samedirection as previous years – top of the list. Datingback to 1999, Thames Water, the largest water andwastewater company in England, has repeatedly beenfound to have committed environmental and publichealth violations and paid over $1 million in fines.The fines are a result of Thames Water allowing rawsewage to flow into open waterways, over streets,onto people’s lawns and over children’s toys—evenflooding homes, damaging houses to the point thatfamilies could no longer live in them.

But not only is Thames Water known for its remark-able pollution record – it has missed its targets to fixwater leaks in London three years running.26 Morethan 250 million gallons of water are lost daily inThames Water’s operations in London –enough tosupply 500,000 homes.27 A £2 billion plan, ‘ThamesTideway,’ to fix the sewers owned by Thames Water,was scrapped in August 2004 – raising fears of return-ing to ‘the Great Stink’ – a not–so-memorable periodin 1858. The plan would have cost each householdan extra £40 per year.28 Instead, Thames Water initi-ated a hosepipe ban in London and warned of finesfor any household that violated it. Thames Water alsoreduced water pressure to avoid further pipe breaks,forcing homeowners to install pumps to use theirshowers.29

RWE/Thames Water. A Corporate Profile Page 3

Meanwhile, Thames Water recorded rising profits inits U.K. operations and awarded its directors bytripling bonuses.30 Thames Water also recorded thelargest rate increase for private companies operatingin the U.K. in 2005. The company increased rates byan annual £50, an average increase of 24%, althoughit fell far short of the 40% increase that ThamesWater’s corporate parent, RWE, had demanded.31

The increases are nothing new to U.K. consumers.According to an analysis by the Public ServicesInternational Research Unit, Thames Water hasinflicted enormous rate hikes on its customers inEngland. Water bills levied by the company rose by99% during the decade following the 1989 privatiza-tion of England’s water systems.32 In 1995, ThamesWater slashed investment in infrastructure by £350million, but the reduction in expenditures only bene-fited shareholders.33

Thames Water and parent RWE push infrastructurecosts on consumers instead of taking responsibilityfor repairing the leaking pipes with its massive prof-its. Thames Water’s true consumer interest is to suckas much money as possible into the corporation, toincrease its profits and to leave investments dormantas long as possible to record sky high profits. WhileThames was financially squeezing consumers andrefraining from fixing the leaks, Londoners were toldto conserve – London’s Mayor Livingstone askedLondoners to refrain from flushing if just taking ‘apee.’34

In June 2005 the Environment Agency released infor-mation that more than one million tons of sewagewent into the River Thames untreated35 – an estimat-ed 400,000 tons alone on June 28 after a thunder-storm that swamped the system. Thames Water subse-quently opened the gates at its pumping stations inChelsea, Hammersmith and Statford, but also report-edly in Magden in Twickenham and Crossness in eastLondon, causing raw sewage to flow directly into theThames River.36 Londoners who use the river for thepopular sport of rowing estimate that there are nowsuch 50 occurrences a year, each accompanied with awarning not to row for two weeks afterwards.37

Essentially, forget about rowing on River Thames -ever.

2004 – Still worst among poor performers

August 2004: 600,000 cubic meters of untreatedsewage leaked into River Thames after a rainstorm,leaving thousands of fish dead and rowers fallingill.38

April/May 2004: Untreated sewage from a ThamesWater pumping station in West Sussex flowed intoStanford Brook between April 27 and May 1, 2004.Fish deaths were estimated between 3,000 and 4,000;in particular, a large number of native brown troutwere harmed. Thames Water admitted that thepumping station had failed twice during April andpleaded guilty to the charges. The company was fined£15,000 plus £3,820 in costs.39

April 2004: Sewage flowed onto pavements and intothe road from a manhole. Children attending a near-by school paddled through the unseemly effluents toget across the street. An environment officer had pre-viously alerted Thames Water to the problem, butwas forced to call the company again when the seweroverflowed. The sewage made its way into the neigh-borhood of Stevenage Brook which later recordedammonia levels 15 times above normal and biochemi-cal levels were recorded nine times higher. ThamesWater failed to respond when the problem was firstnoticed and allowed the sewage to flow into a busyroad and harm the environment. The company wasfined £12,000 plus costs of the case Jan. 19, 2005,after pleading guilty to the offense.40

2003 – Holding onto the record

September 2003: A raw sewage spill polluted anOxfordshire brook. The spill was estimated to havecaused the death of 12,000 fish including pike,roach, bullheads and chub and more than 10,000sticklebacks. Thames Water failed to respond to fivealarms which notified its control center of a blockage.Rod Gould, Senior Enforcement Officer at theEnvironment Agency, stated: “Thames Water is a multi-million pound business and it has already been criticized forits priorities. Whilst an individual alarm may be of low pri-ority it does not take a genius to work out that five in quicksuccession from the same works indicating a storm even dur-ing one of the driest summers on record should merit animmediate response.” Thames Water pleaded guilty and

Page 4 RWE/Thames Water. A Corporate Profile

was fined £60,000 by the Environment Agency onApril 25, 2005.41

June 2003: A sewer overflow at Pipers Way, Swindon,overflowed and discharged raw sewer into the RiverRay for 16 hours on June 16, 2003. The offense wasreported by a passing jogger. When the EnvironmentAgency investigated the problem the sewer was stilldischarging effluents. Dissolved oxygen levelsdropped and an ammonia test found spiking levels,subsequently killing fish in the area. Thames Waterresponse was found to be inadequate because thecompany did not respond to the initial warning.Thames Water was fined £50,000 and paid £8,270 incosts.42

May 2003: Thames Water failed to alert theEnvironment Agency of a sewer spill into HendonBrook on May 9, 2003. Instead the company soughtto pump the spill from a nearby manhole. However,when an Environment Agency inspected the Brookhe found foul water and subsequent tests showed dis-solved oxygen levels leaving fish gasping for air.Thames Water pleaded guilty to the offense on Dec.6, 2004, and was fined £7,000 in addition to theEnvironment Agency’s cost in the case.43

2002 — Worst of the worst again?

Through August 2002, Thames Water had been pros-ecuted five times and fined a total of £132,000.44

For several years, people in Surrey communities hadbeen complaining about sewage gushing from man-holes every time it rained heavily. On at least threeoccasions between May 2000 and February 2001, resi-dents were disgusted with sewage several inches deepwashing up over their gardens and yards, coveringchildren’s toys and play equipment, and leaving aslimy smelly residue behind. The sewage also seepedinto heating ducts, stained carpets, and toilets andwashing machines couldn’t be used. Sewage came upinto one elderly couple’s shower. At least one smallbusiness owner suffered when sewage flooded thebusiness, damaging a computer and other equipment.“Residents’ complaints received little or no actionfrom Thames Water,” the Environment Agencyreported. “The company was reluctant to accept

responsibility for the flooding, saying that the pump-ing station seemed to be operating correctly. Howeverat times of heavy rainfall the capacity was clearly inad-equate.” And though residents had complained foryears to Thames Water about the overflows, “the areawas not high on its list of priorities…It is unaccept-able,” the Environment Agency concluded, “that anycitizen’s quality of life should be affected in this wayfor such a prolonged time.”45 Thames Water wasfined £65,000.

But the Environment Agency was wrong. Knowinglyallowing raw sewage to flow into streets, streams andeven homes apparently is not unacceptable at all—atleast not to Thames Water, as some of its other prose-cutions this year illustrate.

Due to inadequate maintenance at a pumping sta-tion, sewage was, on several occasions, flowing out ofmanhole covers and into surface waterways, blanket-ing stream beds with sludge and debris, including toi-let paper, sanitary towels and condoms. “The Agencymade repeated attempts to get Thames Water to outline ashort and long-term solution to this known problem,” theEnvironment Agency reported. “Thames Water couldhave avoided prosecution by taking this action before therun of incidents” that led to the company’s prosecu-tion, the agency said, adding, “Nearby residents havehad to suffer the ongoing degradation of their localenvironment from these ongoing incidents.” ThamesWater was fined £12,000 on Jan. 28.46

In April, Thames Water was fined £9,000 stemmingfrom incidents that occurred in the winter of 2001.Informed not once but twice in February 2001 thatsewage was flowing into a waterway, EnvironmentAgency officials traced the source themselves. Itturned out that Thames Water had contracted a com-pany to fix the problem, but the contractor clearedthe wrong sewer.47

In August, Thames Water was fined £19,000 for anincident that killed hundreds of fish the previousNovember, when sewage discharged into the RiverWey and subsequently into lakes in Hampshire.Thames Water’s contractors appear to have arrivedon the scene in a timely fashion. However, “Owing

RWE/Thames Water. A Corporate Profile Page 5

to…Thames Water contractors coming to the end of theirshift,” the blocked sewer that was the source of thedischarge was not cleared until the following day.Magistrates who heard the case were stunned “at theexceptional levels of incompetence and lack of communica-tion and liaison” that led to the pollution. “The pollu-tion would not have had such a big impact if ThamesWater had dealt with the blockage swiftly and efficiently,”according to the Environment Agency.48

2001 — More ‘completely avoidable’ sewage

Thames Water slipped from its perch atop the list ofmost-fined corporations in England and Wales in2001, though still managing to be fined £57,600.And while the amount the company was fined wasrelatively lower in 2001, the corporation’s total num-ber of significant pollution incidents climbed 20%from 2000 to 2001.49 While the fines appeared lowerin 2001, some fines carried over; for example, a seweroverflow which polluted Boundary Brook inTwickenham wasn’t resolved until January 2003when Thames Water pleaded guilty to the offenseand was fined £20,000.50

Moreover, the fines levied in 2001 suggest that thecompany is either incapable of learning from its mis-takes or, simply finds polluting, and paying fines forpollution, to be an acceptable business practice.

In admitting to polluting waterways in 2001 by let-ting sewage overflow from a manhole cover at apumping station, Thames Water was taken to task bythe Environment Agency for essentially ignoring theincident and allowing the pollution to continue. Thestation had a history of sewerage overflows, and regu-lators warned Thames Water that more frequentmaintenance was needed at the station—and thatanother overflow would result in prosecution. “Thiswas something that Thames Water Utilities had beenaware of for a number of years, and as such theincident…was completely avoidable,” said EnvironmentProtection Officer Tessa Vandenberghe.51 ThamesWater was fined £15,000.

2000 — Residents get sick of it

In 2000, Thames Water was fined £288,000, morethan any other company in the Environment Agency

reports and nearly twice as much as the chemicalcompany that came in second.52 The vast majority offines levied against Thames Water, £250,000,stemmed from a single case—a case that was so offen-sive, the first magistrates to hear Thames Water’sguilty plea felt the scope of their punitive authoritywas insufficient, and they kicked the case up to ahigher court.

Thanks to Thames Water committing what theEnvironment Agency characterizes as “a series oferrors” and operating “illegal” equipment at a pump-ing station in southeast London, raw sewage andtoxic industrial waste overflowed into a street andflooded nearby homes. Residents, including youngchildren, suffered headaches, nausea and vomiting,and many were treated in hospitals.53 Ten houseswere rendered uninhabitable, and Thames Waterended up purchasing most of them. Additionally, anestimated 22.5 million liters of raw sewage and indus-trial waste was pumped into the River Thames.54

As a result of the incident, Thames Water was fined£200,000 for disposing of controlled waste in a man-ner likely to cause harm to human health—the largestfine ever under the waste management law ThamesWater had violated. A second charge hit the compa-ny for polluting the river, and resulted in another£50,000 fine. The company paid an additional£13,000 in costs. The court harshly criticized thecompany for its “complete disregard for humanhealth and the environment.”55

1999 — A ‘knowingly’ unique polluter

While RWE was showing interest in Thames Waterthe company was already a known polluter. In 1999,Thames Water was prosecuted and convicted for envi-ronmental pollution eight times, the most of anycompany in England and Wales, and fined £79,000,the third-highest amount.56

One of the corporation’s more egregious violationsstemmed from sewage discharge into the River Crayin Dartford in 1998. Vandals apparently broke into alocked compound and tampered with a sewagevalve.57 A sewage trunk line to a treatment facilitywas shut down, resulting in sewage discharge to the

Page 6 RWE/Thames Water. A Corporate Profile

river. Within minutes of learning about the problem,Environment Agency staff showed up at the site.Thames Water, however, “failed to respond appropri-ately.” Over more than four hours, an estimated22,700 cubic meters of sewage made its way to theriver.

Thames Water’s failure to promptly contain the dis-charge, and the corporation’s subsequent convictionin court, was “an unusual case,” the EnvironmentAgency later reported, “as the defendant pleadedguilty of ‘knowingly permitting’ the discharge to theCray.” Thames Water ended up paying more than£40,000 in combined fines and costs, the highest sin-gle fine for a sewage pollution case up to that time.58

In case after case, regulators and magistrates foundthat Thames Water was aware of conditions that ledto raw sewage discharges and could have easily pre-vented the pollution. But instead, with a little helpfrom a profit-hungry corporation, namesake RiverThames, is simply put, the capital’s toilet.

Barbara Young, chief executive of the EnvironmentAgency for England and Wales, complained that themonetary punishment wasn’t large enough to act as adeterrent to the private water industry. The scale ofpenalties levied by the courts makes pollution—andprosecution—an acceptable risk and an acceptablebusiness expense.59 Thames Water is a case in point.The violations didn’t stop in 2003 despite the finesleveraged at the company. While Thames Water man-aged to decrease its spills in 2004, it remained theworst polluter with the most incidents cited by theEnvironment Agency. The fines for Thames Watertotaled £132,500 – outrunning Southern Water byover £40,000.60

As details of some of the incidents leading to convic-tions in recent years illustrate, Thames Water has askewed set of priorities and a dysfunctional corporateculture that tolerates harming the environment andthe public.

American dreams – and consumer nightmaresThames Water’s acquisition plans for AmericanWater Works was announced in 2001. In order totransfer ownership, state public utilities commissionshad to approve the merger in California, Illinois,Kentucky, Maryland, New Jersey, New Mexico, NewYork, Pennsylvania, Virginia and West Virginia.Commissions in Arizona, Hawaii, Iowa, Ohio,Tennessee and Texas require notifications, while nospecial requirement was required in Georgia,Indiana, Michigan and Missouri. No regulatoryreview took place in Connecticut, Massachusetts andNew Hampshire since American Water was divestingfrom its interests.61 And not all public commissionsin the 29 states under American Water Works werewillingly transferring assets. State Attorney Generaloffices investigated, and residents in Charleston,West Virginia and Thousand Oaks, California,employed strategies to reverse the deal62 – other com-munities have gone even further. In the end ThamesWater prevailed and the acquisition was announcedin January 2003.

RWE’s annoyance with the U.S. regulatory systembecame quite apparent through the manner in whichit sought influence on the European Union’s posi-tion on water in World Trade Organization’s (WTO)General Agreement on Trade in Services (GATS)negotiations. RWE sought the European Union’sassistance in addressing what RWE saw as restrictiveU.S. state policies which “will undoubtedly weaken theEU’s negotiating position.” 63 While the controversialGATS agreement is still under negotiations in theWTO, the letter shows how corporations maneuverto avoid local democratic rules that protect local con-sumers.

As the largest private water provider in the U.S.,American Water Works serves approximately 15 mil-lion customers in 29 states and in three Canadianprovinces. American Water also oversees investmentsin Central and Latin America, notably Puerto Ricoand Chile, both areas which the corporation is tryingto shed.64 American Water runs American WaterServices, a separate company dealing mostly in engi-neering projects and consultations for municipal, mil-itary and industrial users.65 Through a 1992 acquisi-

RWE/Thames Water. A Corporate Profile Page 7

tion, Thames Water also owns Ashbrook, a companyspecialized in engineered components for the waterindustry.66

But Thames Water’s grandiose plans for the U.S. areseen by many as a failed business model. A PublicWorks Financing article by Debra Coy, arguably theleading market analyst tracking water industry stocks,contended that the profitable investments in thewater industry are in the areas of technology andequipment sales rather than ownership of theresource or management of water systems. In theUnited States, “the bubbles seem to have gone flat for theglobal utility firms Veolia, Suez, RWE, and Kelda, whohad appeared poised to dominate the U.S. water business afew years ago,” Coy wrote. “We would not be surprised tosee some European utility owners and operators startpulling out of the U.S. in 2005, as politics and poor profitscontinue to depress their interest in this market.”67 WhileThames Water is staying for now, the corporation isfaced with an increasing number of failures andresistance from every community they enter.

Thames Water has claimed to be unwilling to operatein communities where they are not welcome. Theypulled a bid on a contract in Ghana – a move whichappears to be indicative only of their withdrawalfrom Asia, Africa and Latin-America. The rhetoricrings hollow in the U.S. where Thames Water isaggressively holding onto contracts as well as pushingnew contracts that would make it impossible for localgovernments to buy back in the future. In bothLexington, Kentucky, and Felton, California, ThamesWater is challenging local ballot initiatives to takeback water under public control – and saying hell no,we won’t sell. And in Monterey, California, the cor-poration is resisting the Peninsula WaterManagement District’s ballot measure which wouldallow public expenditure of $500,000 to study a pub-lic take over scenario.68

Thames Water has to remain aggressive in the U.S.According to a leading industry magazine GlobalWater Intelligence, the corporation must grow at 12%annually to cover its capital costs.69 And both legaland popular challenges don’t look good to sharehold-ers. Global Water Intelligence has gone as far as to call

Thames Water’s confidence in the U.S. misplaced.70

Corporations are in business to make money. In theU.S. that has resulted in numerous rate increaseswith no accountability. As Thames Water swept in onthe U.S., it brought along a relentless pursuit of prof-its that overrides any regard for public health and theenvironment. Citizens must be joined by civic leadersand elected officials at all levels of government tohelp keep this price-gouging reckless polluter fromgaining control of a community’s most preciousresource, its water.

RWE’s U.S. operations: The public challenge to buy back their water…

While the U.S. is one of RWE’s four key areas forprojected growth, the company is focused on “noproblem zones.”71 RWE has already experiencedplenty of problems and opposition to its acquisitionstrategy.

Thames Water has gained yet more control of U.S.water and wastewater services by entering into anagreement with Operations ManagementInternational (OMI), a Denver, CO-based firm, topursue long-term operation and maintenance con-tracts with municipalities across the nation.72 But it’sbeen a rocky road for Thames Water in the U.S. asmore people question its water management.

MONTARA, CA – The 2002 public victory to takeback the water utility in Montara provided inspira-tion and fuel for other ongoing struggles againstThames Water’s takeover of American Water Works.

Average bills already towered at $91.25/month73 andwater pressure was low. Jim Montalbano a resident inMontara explained to the Associated Press: “If the guydown the street flushes his toilet, I have to wait for a whileor I can’t get any water.” Residents received a 43% rateincrease after the impending takeover was announcedin 2001 – and an additional 20% increase was pend-ing. So instead, town residents voted – with 80% infavor - on a public referendum to approve a $19 mil-lion bond to take back the water utility to publicmanagement. In December 2002 the California

Page 8 RWE/Thames Water. A Corporate Profile

Public Utilities Commission ordered RWE to sell thesystem back to residents.74

Scott Boyd, serving on the new Public Sanitation andWater district board, commented to Yes! Magazine in2004: “If we were the first domino, then good!”75 Itappears to be the case as several public referendumsare under way.

STOCKTON, CA — Stockton’s privatizationscheme was foisted on a reluctant public by politi-cians who refused to listen to the voices of their con-stituents and circumvented a referendum require-ment through legal and administrative slight of hand.In December 2004, the Concerned CitizensCoalition of Stockton released to the public the firstAnnual Service Contract Compliance Review cover-ing the first phase of OMI-Thames Water 20-year,$600 million water privatization contract. TheReview details changes to the contract that benefitOMI-Thames Water: water rates for Stockton resi-dents have risen two years in a row; customer servicerequirements have been unfulfilled; a number ofstaffing positions are filled with temporary or interimemployees; unaccounted for water has risen fromaround 3.5% under municipal operation to nearly7.5% under private operation; maintenance tasks arebacklogged; and finally, OMI-Thames made an unau-thorized dump of chlorinated water into an irrigationcanal that resulted in a $125,000 fine from the StateWater Resources Control Board. Perhaps this is whythe champion of this privatization, former mayor ofStockton Gary Podesto, failed in his bid to win astate Senate seat. A Concerned Citizens’ lawsuitchallenging the privatization deal is still pendingbefore the state appeals court. And CaliforniaAttorney General Bill Lockyer filed an amicus briefin support of the Citizens claims that the City ofStockton violated the California EnvironmentalQuality Act by not conducting the environmentalreview required by state law prior to privatization.76

LEXINGTON, KY — On June 9, 2005, Let Us VoteLexington, a local resident-driven group delivered23,000+ signatures to the Lexington Urban CountyCouncil to push a November ballot to bring theRWE-owned water system, managed by Kentucky

American, back under public control (only 18,000were needed to place the issue on the special ballot,more than 26,000 were collected). Kentucky-American lawyers argued that the November referen-dum is based on a state law repealed in 1980 andthat citizens have no right to have an unscheduledelection, petition drive or not. Lawyers for Let UsVote argued that while the statute was repealed, itstill applied to the Urban County.77 Ruling in favorof Let US Vote, Fayette Circuit Judge Thomas Clark,wrote on Aug. 26, 2005, that the referendum is legaland can be voted on in a special November election.Furthermore, the judge reasoned, the state law whichwas repealed in 1980 still stands because the provi-sion of that law is still incorporated into theLexington Urban Country government charter. 78

Kentucky-American vowed to appeal to prevent theCounty Clerk from spending money on the election.Both Clark and the Court of Appeals denied theinjunction. RWE hence appealed to the StateSupreme Court which, as of October 1, 2005, has yetto rule.79

Sparked in part by RWE’s acquisition of AmericanWater Works and its Kentucky subsidiary, Lexingtoncitizens have long been concerned about local con-trol, accountability, rate hikes and other issues. Aftera lost fight in the Public Service Commission toblock the RWE take over in 2002, residents, organ-ized as Bluegrass Flow, convinced the Lexington-Fayette Urban County Council in 2003 to vote toseek control of the water company through eminentdomain, the power of the federal or state governmentto take private property for a public purpose.

Studies, audits, appraisals, regulatory approvals,appeals, lawsuits and an expensive company publicrelations campaign ensued. As did, unfortunately, aneffort by the company to support candidates for theUrban County Council who would oppose condem-nation - -the water company’s candidates outspenttheir opponents by more than 60 percent, and pro-company candidates won a majority in the council inthe November 2004 elections.80 The council prompt-ly voted to settle outstanding issues between the com-pany and the city and cancel the condemnation pro-ceedings. Mayor Teresa Isaacs vetoed the action, buther veto was overridden in 2005.

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Kentucky American didn’t wait long to rebound.With a new Council in its hands, Kentucky waterconsumers woke up to an unapproved rate increaseof 15% on Dec. 1, 2004. Kentucky American haddecided to go ahead and raise the rates taking advan-tage of the new ‘business’ climate in town. But thePublic Service Commission didn’t agree to the corpo-rate strong handling. On Feb. 28, 2005, the PSCruled that Kentucky American would have to refundusers and that Kentucky American could only justifyan 8.5% increase in rates. Furthermore, the PSCdenied the request to increase the profits to 11.2% -and ruled that 10% was more than enough. It alsodenied a request to allocate costs of AmericanWater’s headquarters onto Lexington consumers, payfor increased incentive packages for AmericanWater’s professional staff, denying increases leveragedto allow American Water to make new acquisitions,and denying increased ‘business development’ costs,finding the claims baseless.81 But Kentucky Americanwasn’t ready to accept defeat. It requested a review atthe Public Service Commission – but after the PublicService Commission refused again on March 30,Kentucky American turned around and sued to getthe increase.82

Meantime, the customer service center is managedfrom Charlestown, West Virginia, and the billing cen-ter is operated from Alton, Illinois.83

The ongoing struggle in Lexington serves as a starklesson for any community that is considering handingits water over to a private company: The company willdig deep into its pockets and fight tooth and nail tohold on to the revenue stream represented by waterbills. Privatization can be very, very hard to reverse.

FELTON, CA - Cal-Am’s takeover by RWE sparkedcustomers in Felton, California, to action. Out ofconcern over huge rate hikes and inadequate cus-tomer service, residents voted in July 2005 forMeasure W, an $11 million bond that would financethe public buyout of the Felton waterworks from Cal-Am. The average homeowner will pay $598 a year forup to 30 years. 84 Despite the tax, the measure passedwith 75% of the vote. Cal-Am says the system is notfor sale and a legal battle may be in the future.

On average, customers of Cal-Am in Felton have paidwater rates that are 36% higher than five out of sixnearby public water agencies in northern and centralSanta Cruz County. 85 And this disparity is set toincrease even further. The current rate applicationfiled by Cal-Am would more than double rates overthe next three years.86 Currently Felton rate payersare charged $2.9 per 100 cubic meters along a $16.40monthly service charge and a $11.50 monthly sur-charge.87

Since its inception in 2002, members of the grass-roots group Felton FLOW – ˜Friends of LocallyOwned Water˜ - have been instrumental in thiseffort by organizing town meetings and fundraisingevents, testifying in front of the California PublicUtilities Commission on behalf of their community,and working with Santa Cruz County to establish aCommunity Facilities District – a special tax districtthat is necessary to raise the bond for purchasing theFelton water system from Cal-Am.

Cal-Am fought back, spending money on mailers,radio and print ads, picking up the $37,000 legal billfor a lawsuit challenging the Yes on W ballot argu-ment.88 Cal-Am also used a political consulting firm,The Moriah Group of Chattanooga, Tennessee, thatCal-Am’s parent company, American Water, had usedin fighting citizen groups in Chattanooga, Peoria,Illinois, and Lexington, Kentucky. 89

The ultimate goal is to put the water system backunder local control by merging with the neighboringSan Lorenzo Valley Water District (SLVWD). TheSLVWD is a public agency that has been providingwater to San Lorenzo Valley residents since 1941.Felton residents are prepared to pay Cal-Am a fairprice for the system and go their separate ways. In themean time, FLOW organizers are preparing a train-ing guide to help other small communities effectivelyorganize and challenge a global water company withnearly $60 billion in annual revenues.90

BUFFALO, NY - Two years after a five-year contractwas signed between the city and RWE subsidiaryAmerican Water Services, the shamelessly pro-privati-zation U.S. Conference of Mayors bestowed one of

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their shiny Outstanding Achievement awards to the“innovative…partnership.”91 When the contract was upfor renewal, RWE thought they’d up the ante, and gofor a ten-year contract. Alas, RWE also brought esti-mated double-digit rate increases, so the city saidthanks but no thanks, and the council voted unani-mously to bring the system under public control. Cityofficials determined that by putting the troubledwater system under public control, rate hikes couldbe held to 4 percent, instead of the 12 percent hikeRWE proposed.92 The city ultimately began negotia-tions with the Erie County Water Authority toassume control of the system.93

MONTEREY, CA - Frustrated by Cal-Am’s illegaloverdraft and continued inefficiencies, citizens of theMonterey Peninsula are taking steps towards bringingpublic accountability to their water service.94 OnNovember 8, 2005, Monterey Peninsula voters willdecide whether or not to fund an independent studyof options for public acquisition of Cal-Am’s waterdistribution system. Supported by local business lead-ers, property owners, elected officials, consumers andenvironmentalists, the Monterey FLOW Coalition isorganizing to bring local oversight and control toMonterey’s water. If Measure W passes, ratepayerswould pay an average one-time cost of only $14 perconnection to fund the independent study—a movethat could save them far more money in the longrun.

Cal-Am’s management of the Monterey Peninsula’sscarce water resources has caused citizens to move for-ward to explore possibilities of local control. For thepast 10 years, Cal-Am has illegally pumped 10,730acre-feet a year from the Carmel River.95 The manyyears of Cal-Am’s illegal overdraw threatens the red-legged frog and steelhead trout under theEndangered Species Act.96 In addition, residentshave complained about poor customer service andunacceptable water leakages.97

Sensing ratepayers’ growing dissatisfaction, Cal-Amhas mounted an opposition campaign. The executivedirector of the Pacific Grove Chamber of Commerce,which voted to oppose the measure before it hadbeen approved for the ballot by the county elections

office, admitted that they joined the opposition afteraccepting $6,000 from RWE for Good Old Days, afestival sponsored annually by the chamber.98

The Monterey FLOW coalition is hoping thatMonterey, following Montara and Felton, will be thenext California victory for public water, to the dismayof RWE.

If owning the water wasn’t enough, RWE is lookingto become a major provider of desalinated oceanwater along the coast of California. Cal-Am has pro-posed an ocean desalination plant near Monterey Bayat Moss Landing. This plant would produce drinkingwater through reverse osmosis to replace the 10,730acre-feet a year of water that Cal-Am has been pump-ing illegally from the Carmel River as required byState Water Resources Control Board Order 95-10.99

Water from this plant has a projected cost of $1,600to $1,800 per acre-foot. The potential for greaterdevelopment and growth rather than returning riverflows is of concern.

The proposed plant would use water from the cool-ing system of a nearby Duke Energy power plant. Thewater, taken directly from the ocean, is used in aonce-through cooling process that does not reuse thewater before discharging it. Through this coolingprocess, all of the marine life in the water is killedand the heated water at the end of the process canharm species near the discharge area.100

While they do not currently have a lease for the MossLanding site or a public partner as required byMonterey County, Cal-Am has completed initial envi-ronmental studies and has applied for a pilotproject.101 Another issue with this plant is the possi-bility of Cal-Am receiving funds through Proposition50 for construction. Proposition 50 is an initiativevoted for by California residents for public bondfunding to support clean drinking water. Once com-pleted with the help of public state funds, Cal-Amwould own and run the plant for 35 years to makeback costs before turning the plant over to publicownership.102 This proposal is before the CaliforniaPublic Utilities Commission and includes a rateincrease to subsidize this speculative project.103

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CHUALAR, CA - In the early fall of 2004, farm-working families in the fertile Salinas Valley ofMonterey County found an unwelcome surprise inthe mail. From one month to the next their waterbills had shot up by more than 1,500 percent.RWE’s Cal-Am had purchased their water system anddid not send out notices warning of the rate increase.They did not hold community meetings.

Cal-Am has been on a buying spree in California,purchasing rural and urban water systems from brokecounty and city governments. The company boughtthe Ralph Lane and Chualar water systems in 2002and mixed their rate structure in with Hidden Hills,an exclusive hillside community that is 89 percentwhite with an average household income of morethan $200,000 dollars a year, according to the 2000Census. Chualar, in contrast, is 93 percent Hispanicor Latino, with an average household income of$43,000 a year.

Residents in Chualar were shocked by Cal-Am’s ratehikes, which the company said were meant to “pro-mote conservation.” Water bills jumped from a $21-a-month flat fee to bills ranging from $100 to over$300. Cal-Am even threatened to shut off theschool’s water supply when their bill shot up to$2000. Rather than suffering water cut offs or takingout loans to pay their water bills, Chualar residentscalled meetings in the school cafeteria and successful-ly challenged the rates before the California PublicUtilities Commission, forcing Cal-Am to restore theflat fee.

Communities of color across the state—and thenation—are particularly vulnerable to the vagaries ofwater privatization. Local governments unable tomake repairs, improvements and expansions on theaging plumbing and treatment plants that keep thewater clean and running through the tap have beenlong excluded from the benefits of California’s multi-billion dollar investments in water projects.

“I called the company to see if I could pay the bill in phasesand they said no,” said Rebecca Trujillo, a farm workerand Chualar resident who was active in the protestsagainst Cal-Am. “So I said: ‘I pay your bill and then not

eat? Am I not going to buy food this week?’ Somebody in anoffice in Illinois, I think, said: ‘The only thing I can tellyou are the rules of the company,’” Trujillo said. “They’reselling us a gallon of water for more than a gallon of milk.Would it be better then for us to bathe with milk? Can youbelieve it?”

“We are all field workers,” Trujillo told the public utili-ties commissioners at a hearing in San Francisco. “Ifwe have to pay a water bill of $280, well, that’s a weekduring which we can’t eat.” For her the rates were amatter of justice not conservation. “It’s six miles fromChualar to Gonzales,” she continued, “where they paytrash, water and sewage together, and they pay about $70for all three services.” In Chualar, residents pay trashand sewage separately, but now faced water billsreaching into the hundreds of dollars. “We say: this isdiscrimination.”

After the Public Utilities Commission hearing Cal-Am officials admitted to having made a mistake byblending Chualar’s rates with distant and affluentHidden Hills and promised to restore the flat rateand work with the community and the PublicUtilities Commission to establish a new rate struc-ture.104

The Northern Neighbor: American Water in CanadaPrivatization of water in Canada is often linked tothe privatization of testing in Walkerton (run by twobrothers who entered guilty pleas in 2004)105 - thepublic health disaster that killed seven people andsickened 2,500 in 2000.106 A subsequent inquiry rec-ommended that American Water’s Hamilton conces-sion return to public hands. But it would take fouryears to realize this proposal.

American Water, Canada, is headquartered in NewJersey, U.S. with operations currently in Ontario,Alberta, British Columbia and Manitoba provinces.In Toronto, Ontario, American Water holds a con-tract to produce biosolids from human wastewaterwhich is then spread on farmland. Environmentalistshave been up in arms for years to prevent contamina-tion to no avail.107

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But American Water met stiff opposition inHamilton when it sought to renew the operationscontract in 2004.

Hamilton was the first municipality to privatize waterand wastewater services in Canada. It was intendedto serve as a showcase for privatized operations inCanada. But instead it became a showcase of the fail-ure of privatized water.

As in most privatizations in North America, thecouncil wanted to use the cash flow to reduce taxes.But instead the city ended up with broken mains andraw sewer flooding residential areas, Lake Ontarioand the Hamilton harbor; even the basement of alocal hospital overflowed with untreated sewage. 108

The 10-year contract with Philips Utilities worthCAN$180 million (US$115 million) in December1994 was signed in a non-bid process. The contractincluded operation and management of three waste-water plants and a water treatment plant as well as afour-year renewable contract for 60 pumpingstations.109 In 1994, Philips was a significant donorfor 12 candidates running for council.110 Soon afterin 1995, it halved its labor force, cutting 60 of 128employees.111 Shortly after, operational problemsbecame quite apparent to the residents with sewagespills invading homes and businesses. The worst spill,in 1996, released 48 million gallons of untreatedsewer into basements, the harbor and the lake – andfor years the utility left the fines and compensationunpaid while water tariffs kept increasing.112

Meanwhile, the city paid for the damages.113 Thespills of 1996 alone totaled 1.14 billion gallons of rawsewage – and they continued.114

Both residents and local councilors were sidelined ina series of corporate reshuffling. The initial PhilipsUtilities contract was investigated for fraud related tocopper trading and with a debt of US$1.1 billionsold its Hamilton Operations to Azurix, Enron’swater affiliate, for CAN$70 million (US$44.8 mil-lion).115 In 2001 Enron got embroiled in its own cor-porate scandal and sold Azurix to American Waterfor CAN$141.5 million (Enron is still on trial for oneof the largest cases of corporate fraud in the U.S.)116

The council approved the sale in the face of a poten-tial lawsuit. However, the sale sparked debate as coun-cilors did not endorse the initial contract signed withPhilips.117

But the corporate reshuffling didn’t keep troubleaway. Union representatives received incompleteterms on contracts, audits were kept secret and theannual performance review was only done once, in1995.118

As the contract came up for renewal at the end of2004, an overconfident American Water stated “Wewill bid, and we will win.”119 But while bids fromVeolia Water and CH2M Hill-OMI emerged theywere both disqualified,120 only American Water sub-mitted an acceptable bid. However, the corporationrequested twice the amount it had previously man-aged the system for (previously CAN$24.8million/annually – the new bid was in excess ofCAN$50 million/annually – an alternative bid forCAN$13.2 million was rejected)121.122 While thelocal group Water Watch stepped up opposition toprivate contracting and argued that the privatizationhad never made any sense,123 the city decided againstlaunch of a second round of bids, and returned thesystem to public management. American Water shotback and sought an injunction to stop the city, chal-lenging inconsistencies in the bidding process.Councilor Sam Merulla called the move ‘uncon-scionable’ and ‘unacceptable.’124 On Sept. 15, 2004,the injunction was blocked by the Ontario SuperiorCourt and by the Council’s corporate administrativecommittee.125

As the system went public it hired an additional 10workers to run the system and set higher standardsfor operation, including the troubling wastewater dis-charges. As a first priority the new public caretakershave set out to clean up the harbor from years of pol-lution.126 The Environment Ministry has since filedcharges related to a 1999 spill against the City ofHamilton and Jeff McIntyre, a former water managerand current director of Canadian operations forAmerican Water.127

RWE/Thames Water. A Corporate Profile Page 13

But Hamilton is not the only Canadian upset. InToronto, American Water was also met with resist-ance. After significant opposition and massive townhall meetings,128 the city pulled the plug on a moveto find private partners for the public system inNovember 2002. Instead a new council committee isnow overseeing water and wastewater operations.129

Pulling out of Latin AmericaThames Water has mostly kept to the NorthAmerican sphere. The major exception can be foundin Chile, often hailed as the Latin American modelof neo-liberal policies. But even here, AmericanWater, the overseer of water investments in theregion is in the process of leaving.

Beginning in 2005, there have been several reports inthe business press that Thames Water is exploring thepossibility of selling off some of its Chilean assets.130

Southern Cross is the likely buyer of Thames 51%stake in Essbio and the 99% state in Aguas NuevoSur Maule. The sale is expected to bring $300 mil-lion.131 Thus it appears that Latin America will shiftfarther to the background in the Thames Water glob-al water strategy as Europe and the United Statesbecome central to the growth strategy.

Chilean assetsModeling its economic policies after those of formerBritish Prime Minister Margaret Thatcher, Chilebegan to de-regulate and privatize its water sector inthe late 1990s. The administration of Chilean waterservices is organized into 12 separate geographicalregions, each supplied by a separate water company.Thames Water became a major actor in the privatiza-tion process winning concession contracts for threeof these water companies. Thames Water now ranksitself as the second-largest water supplier in Chileserving some 2.2 million people.

Chronology of Thames Water role in Chilean waterprivatization:132

In 1999, Thames Water along with Electricidade dePortugal purchased a 45% stake in the Chilean watercompany Empresa de Servicios Sanitarios delLiberatador, S.A. (ESSEL). In December 2001

Thames Water bought an extra 25.5% share inESSEL from Electricidade de Portugal, giving ThamesWater the majority stake in the company.In November 2001, Thames Water was the sole bid-der for a concession contract to run the Chileanwater company ESSAM. ESSAM provides drinking water

to a region of southern Chile, representing 4.4% of potable

water clients in Chile.

In December 2000, Thames Water won the conces-sion contract for the Empresa de Servicios Sanitariosdel Bio Bío (ESSBIO), located in the city ofConcepción. ESSBIO provides water and wastewaterservices to more than 1.5 million people in andaround Concepción

In November 2001, Thames Water was awarded the30-year concession contract for Empresa deServicions Sanitarios del Maule, now Aguas NuevoSur Maule (ANSM). ANSM is strategically posi-tioned between ESSEL in Rancagua and ESSEBIO inConcepcion.In June 2002, Thames Water Chile merged two of itsthree operating units in Chile – ESSEL (Region VI)and ESSBIO (Region VIII).

As is often the case, a significant amount of corpo-rate welfare from governments and the internationalfinancial institutions is necessary in order to ensurethe functioning of the private water companies. TheWorld Bank’s corporate funding arm, theInternational Finance Corporation (IFC), providedThames Water $66 million in loans for the conces-sion Aguas Nuevo Sur Maule (ANSM).133

There has been significant political opposition towater privatization in Chile, especially among tradeunions and consumer groups. Some political partiesalso opposed the sale of the regional water companieswhich were considered, even by the World Bank, tobe models of efficiently-run public companies, provid-ing income to the Chilean state. The ChristianDemocratic Party opposed the sale, saying it wouldexpose the regional water companies to the vagariesof the market. “The privatization of EMOS does notserve public welfare but in fact, on the contrary, exposesthe public to the vagaries of the market and the voracious-ness of huge private interests and transnational corpora-tions,” said Christian Democratic representative Luis

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Pareto.134 Lobbying efforts by top officials of thegoverning Coalition of Parties for Democracy failedto persuade President Eduardo Frei to block or evendelay the transaction.135

There were numerous strikes by the trade unions try-ing to stop the water privatizations, led by the tradeunion federation CUT. Workers from many of theregional water companies went on strike to challengethe terms and conditions offered during the privatiza-tion process. The settlement agreed on in August1999 was based on a mixture of employee share pur-chases and compensation. In all the privatizations,10% of shares are reserved for employees.136

There has also been substantial local political opposi-tion to the privatizations of the regional water compa-nies. In the region of Bio Bío, where Thames Waterruns the water company ESSBIO, the citizens haveprotested the serious problems that have emergedsince the privatization. According to the local citi-zens group el Movimiento por la Consulta y losDerechos Ciudadanos (Movement for Consultationand Citizens Rights) there has been a large, unsub-stantiated increase in tariffs. One in three peoplecan no longer afford to access potable water services..Meanwhile, the community is still waiting for thenew water treatment plants that were promised bythe government as part of the privatization package.Other new projects, water extensions and expansionshave failed to appear and in some communities eventhe fire hydrants lack water. According to citizenreports, fire fighters were unable to fight a blaze inthe city of Concepcion due to the lack of water.137

These situations led the citizen group, Movement forConsultation and Citizens Rights, to decide to organ-ize a poll. The question asked was: “Do you thinkwater and sanitation services should return to public con-trol?” 136,783 people participated in the poll in 22different communities. 99.1% of the people voted“yes”.138

While Thames CEO maintained in October 2004that it would hold on to Chilean interest he movedto appoint Goldman Sachs to lead the sale of its twomain Chilean water assets, ESSBIO and ANSM in

January 2005.139 The short list included a range ofprivate investors such as Grupo Solari, ConsorcioFinanciero and Southern Cross, but Southern Crossappears to be the likely buyer.140 While Thames isseeking to sell, the Chilean tax agency is investigatingESSBIO’s financial irregularities related to the com-pany’s former general manager, Juan Diéguez for dou-ble dealing while heading ESSBIO. 141

Puerto Rico’s water hellClaimed to be the largest water project ever undertak-en in Puerto Rico, the construction of theSuperaqueduct began as a $345 million contractawarded to the Thames Water-Dick SuperaqueductPartners on a design-build-operate (DBO) basis. Anadditional $12.6 million annual contract covers oper-ating and managing the project facilities, which runsuntil September 2005, with an option to renew.Thames Water-Dick Superaqueduct Partners (TDSP)is a joint venture consortium of Thames Water andthe Dick Corporation, which was purposely formedto bid for the contract for the Puerto Rico Aqueductand Sewer Authority (PRASA). Construction wascompleted in April 2000 and the system was formallyinaugurated on Sept. 6, 2000. A sixth interconnec-tion was constructed in 2003 to bring additionalcommunities within the project’s coverage.142

The plan was initiated following a severe drought inPuerto Rico in 1994 that caused major water short-falls in the metropolitan areas and contributed to aneconomic downturn on the island. Environmentalgroups opposed the project due to its impact on theArecibo River (Río Grande de Arecibo). One hun-dred million gallons of water were to be withdrawnfrom the river daily. Nevertheless, after months ofevaluation the Department of Natural Resources andEnvironment (Departamento de Recursos Naturales yAmbientales-DRNA) concluded that the projectwould not have a negative impact on the river.143

Environmental groups challenged this conclusionand successfully used the courts system to paralyzethe project for five months. However, it eventuallymoved forward.Several legal and financial scandals plagued the con-struction of the Superacqueduct as well. In 1999, twosections of pipe broke during a test in El Dorado andlater in Manati causing major flooding and property

RWE/Thames Water. A Corporate Profile Page 15

destruction. A four-month long investigation ensuedand TDSP was fined $30,000 a day.144 Later TDSPtook the pipe manufacturers to court claiming thatthey were responsible for the problem and should paythe damages and fines.145

There were also financial scandals and allegations ofbribery linked to the Superacqueduct project. AGrand Jury was convened to investigate the allega-tions that TDSP paid $2.4 million to leaders of theNew Progressive Party (Partido Nuevo Progresista),René Vázquez Botet and Marcos Morell, in order toensure that they would win the contract.146 Theindictments were launched April 2004 in a casewhich is likely to drag out for years.147 René VázquezBotet is a George Bush ‘pioneer’ (an honorable titlefor the Bush elite campaign fundraisers who raisemore than $100,000).148 René Vázquez Botet andMarcos Morell have maintained their innocence, butformer NNP representative Jose Granados Navedohas pleaded guilty and is cooperating with the investi-gation. This scandal had major implications for thepolitical ambitions of leaders of the New ProgressiveParty. All three men face 13 counts of conspiracy,extortion and fraud. If convicted on all charges Botetface 100 years in prison and $2million in fines,Morell faces 110 years and $2.5 million in fines.Navedo face only 5 years and $250,000 in fines aftercooperating with authorities.149

Putting profit first – Thames’ mistakes in AsiaThames announced in March 2004 that it was with-drawing its presence in Asia and closed offices inKorea, Japan, Malaysia and Hong Kong.150 Its with-drawal comes after a number of mishaps in theregion – but sellers are not queuing to buy the trou-bled systems.

Australia: Something smells rotten down under

In Australia Thames Water has been busy repeatingits foul U.K. environmental record. Thames Water’ssubsidiary in Australia and New Zealand, UnitedWater, is a regional joint venture with Vivendi(47.5%) and Kinhill Engineers (5%). United Waterholds a US$1.5 billion wastewater contract inAdelaide. As part of a consortium operating a waterand sewer system in South Australia in the mid

1990s, Thames Water was involved in slashing main-tenance expenditures, leading to the failure of a pri-mary sewage treatment plant in April 1997. For thenext three months, the entire Adelaide metropolitanarea was subject to, as the media dubbed it, the ‘BigPong,’ a rotten stench that created “universal annoy-ance and widespread health problems.”151 A subsequentaudit commissioned by the government of SouthAustralia laid the blame clearly at the feet of the pri-vate consortium’s efforts to reduce costs. The stenchoccurred due to inadequate monitoring and equip-ment failure which allowed sewerage overflow to rundirectly to settling lagoons. Taxpayers subsequentlyfunded a US$43.8 million upgrade.152

United Water has won the secret contracts after sub-mitting the bids late, apparently dropping its price atthe last minute to beat North West Water.153 Whilegeneral inflation remained at 11% United Watermanaged to increase water tariffs by 59% in sevenyears. Meanwhile the company has shed almost 1,000jobs.154 As it shed its assets across the world, UnitedWater reached an agreement with Australian’s UnitedGroup to purchase Thames Water assets in Australia,Singapore and Malaysia for $11 million.155

A Corporate Flagship in China?

While both Veolia and Suez are pursuing valuableChinese contracts, Thames Water has been forced todivest and keep China a low priority.156 With lack oftransparency and consumer oversight Chinese invest-ments are frenzied – with 74 privatizations in the pastfew years.157 Thames collaborates with China WaterCompany, with a 48.8% interest in the companysince 2002.158 But China Water Company suffersfrom major changes in investors and with Thames’interest in China hanging by a thread, the companybacking is weak.159

Thames Water was awarded the first privately fundedcontract for a water treatment plant in Da Chang in1995. But it withdrew from the $73 million invest-ment after the Chinese government struck down itsguaranteed 15% rate of return, declaring themillegal.160 Thames also withdrew from negotiations inShanghai’s Waterworks Shibei Co.161 But RWE part-ner, Berlinwasser, has also been in trouble in the

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tumultuous Chinese market. It lost its Xian Xian con-tract in 2002.162

While Thames Water retains a stake in China WaterCompany163, it appointed Goldman Sachs to line upprospective buyers in January 2005 after denying anexit strategy for months. Global Water Intelligencereported that a sale would be difficult as the companyis not seen to be profitable.164

Staking it out in New Zealand – but for how muchlonger?

In 1997, United Water won a 30-year franchise con-tract (with a 20-year optional extension) to providewater and wastewater services in Papakura, a districtwith 40,000 users.165 At the time it was claimed thatwater users would receive a 27% savings on their pre-vious rates. The city council put the controversialfranchise idea out for public comment over theChristmas 1996 holiday period, for the legally mini-mum time required.166 Despite strong public opposi-tion, the Council moved forward in April 1997. Also,testimony to the high court in 2001 revealed that abid for the Papakura water franchise, nearly NZ$1million higher than United Water’s, had beenignored by the former mayor.167

At the time of the privatization, a poll showed thatnearly 97% of the residents opposed the franchise,which has since increased water rates to an unafford-able level. Customers who are unable to pay theirwater rates have their water supply cut off; they haveresponded by learning how to reconnect the pipesthemselves.168 The Papakura city council has alsooutsourced services, from water supply to aquatic cen-ters, following the government’s privatization bingein the 1990s (subsequent councils have taken backsome services after predicted improvements failed tomaterialize). The council has faced an ordeal in han-dling public discontent. In November 2004, thenewly elected mayor condemned the financial prac-tices used by previous councils which were designedto keep rates down artificially and unsustainably.

Water and wastewater services in Papakura are pro-vided through two bodies: Publicly-owned Watercaresupplies bulk drinking water to and receives/treats

waste water from the privately-owned retailer UnitedWater. From 1998 to 2004, Watercare’s rates haveincreased by about 21%, whereas United Water’srates have increased by a whopping 144%.169 Theaverage water bill increased 11.3% in 1999 alone.170

Adding insult to injury, the Papakura mayor and hisdirector of public works, who together were instru-mental in ramming through the privatization ofPapakura’s water services, are now both employed byWatercare. There is great concern that despite publicopposition, stealthy privatization efforts are still goingon. Audits done in 1998 and 2001 have both criti-cized the lack of performance monitoring by the citycouncil.171 Although the city council that brought inprivatization was voted out in the election in 1998,Papakura is still sorting out the mess left behind.

In 2001, United Water and the city council won thespecial “Egg On Face” award, part of the RogerAward for the Worst Transnational Corporation,sponsored by New Zealand-based Campaign AgainstForeign Control of Aotearoa (CAFCA) and GATTWatchdog. The award was won after United Waterinterfered with Papakura council affairs and managedto pressure the city council to reverse a NZ$500 grantto a pressure group opposing the franchise. 172

Water pressure groups, comprised of vigilant anddedicated citizens, have faced serious opposition fromthose in power and some of its members have facedarrest several times. Despite this, they continue theirwork to expose rate hikes and backroom deals. Withtheir very own fire engine they prevent cut-offs andstand up to authorities to stem privatization woes.173

Thailand: Stuck with failure

Thames Water is involved in two contracts inThailand. A 33-year concession in Bangkok (throughThai Tap Water Supply) and a 25-year build-operate-transfer contract of the Pathum Thani Water filtra-tion plant.174

The World Bank provided funds for a privatizationmasterplan for the country. The plan, written byTasman Asia was rejected by the government – andfurther privatization attempts have been met withfierce resistance from workers.175

RWE/Thames Water. A Corporate Profile Page 17

On April 28, 2005, CH Karnchang, a giant Thai con-struction firm, approved the purchase of ThamesWater shares in Thai Tap (shares held by ThamesInternational and Thames Thailand) whereby CHKarnchang took full ownership of the previouslyjointly-owned company.176

The Pathum Thani plant, also operated with CHKarnchang, ran into some trouble. In 2001 it wasreported that the plant only supplied half of theagreed amount of water.177

Malaysia: Thames leaves its markWhile Malaysia naively opened the door to water pri-vatization in 2004 to help pay for water infrastructureimprovements, Thames is now exiting the country.The federal government has worked on legislationwhich would regulate water privatization. Lim KengYaik, Minister of energy water and communications,wants the private sector to “deliver to consumers at first-rate service at reasonable rates.”178 Malaysians should bethankful that Thames is headed in the opposite direc-tion as it’s never been known to deliver on eitherpromise.

But, in fact, corporate interest had already been pres-ent in the country. Thames Water has been involvedin two contracts; a 30-year management contract inthe state of Johor179 and a 25-year concession inKelantan. However, in 1999 Thames Water wasforced to sell its 70% stake for RM50 million to thestate. Despite profitability for the concession holders,consumers experienced low water pressure, disrup-tions and dirty water. 180

Indonesia: Doing business with a dictatorIn 2004 Thames Water announced that its strategy inIndonesia was to “negotiate a better deal or walkaway,”181 demanding a better tariff deal to keep thecompany involved.182 Thames Water’s engagement inIndonesia has been less than stellar.Thames Water’s commitment to putting profit beforepeople is not confined strictly to concerns of theirmanagement, environmental violations and excessiverate increases. Thames Water is also criticized forstriking deals with the regime of President Suharto inIndonesia, a reign which was marked by human

rights abuses. Under Suharto’s dictatorship, doingbusiness in Indonesia meant partnering with a localfirm. And, most major business corporations werecontrolled by the Suharto family. Thames Waterformed an alliance with the Sigit Group, controlledby Suharto’s eldest son, Sugit Harjojudanto. Therewas no open and transparent bidding process,although the World Bank and the AsianDevelopment Bank claim they promote “good gover-nance” and transparent privatization transactions.Instead, in 1997, after protracted private negotia-tions, the contracts were simply awarded to the twonew entities.

Thames Water’s partnership with Sigit Group wascalled PT Kekar Pola Airindo. The fact that nationallaw and local regulation prohibited foreign invest-ment in drinking water delivery and precluded pri-vate sector involvement in community drinking watersupply was, apparently, irrelevant.183 Indonesian lawonly recently opened the door to foreign investmentin the water sector. The new 25-year contracts withPAM Jaya, the municipal water supplier, were expect-ed to be lucrative for both the international and localpartners. One prediction set Thames Water’s pre-taxprofits at $25 million by the tenth year of the con-tract.184 The new companies immediately movedinto posh new offices in Jakarta’s business districtrather than using the older office space where PAMJaya had operated. The salaries paid to the foreignexecutives, who lived in the wealthiest neighbor-hoods, were much higher than those paid to PAMJaya officials, causing much resentment among theemployees. The contracts required the new compa-nies to not only manage the system, but in the firstfive years to expand the existing pipeline, invest $318million, add 1.5 million customers, service 70% ofthe population, increase water supply, and reduce“unaccounted-for” water.185 PAM Jaya agreed toforce businesses and private homes to shut down pri-vate wells and buy their water from the companies.(In 1997, about 70% of water used in Jakarta camefrom private wells.)

Payment to the companies was not linked to revenuecollected, but paid as a fee by PAM Jaya based onwater supplied. In this way, Thames Water de-linked

Page 18 RWE/Thames Water. A Corporate Profile

its profits from the risks and problems of poor peo-ple’s inability to pay increased rates. Initially, thecompanies demanded to be paid in dollars, but whenthe governor of Jakarta threatened to resign over theissue, Thames Water agreed to accept Indonesia’s cur-rency, the rupiah. However, they insisted that pay-ments in local currency be pegged to the U.S. dollarto protect them against currency devaluation, stillwinning the argument. There was no formal regula-tory or oversight mechanism. PAM Jaya had no rightto see financial reports of the companies and therewas no clear sanction for non-compliance with per-formance targets.

In 1998, the Asian financial crisis and the downfallof Suharto changed the political landscape. Fearfulof protest in the streets, major company executivesfrom Thames Water fled to the safety of Singapore.Faced with an immediate water crisis, Jakarta’s newgovernor ordered PAM Jaya to take back the opera-tion. After intensive lobbying, including interven-tion by British diplomatic officials, and a statementfrom the British Embassy that “breaching of the contractwould weaken confidence in Indonesia as a place toinvest,” the agreement was made to let Thames Waterreturn, but the contract would need to be re-negotiat-ed.186 Since Suharto had fled, and the former presi-dent’s family and business partners were targets ofpublic anger, Thames Water agreed to buy the localshares of their business operations in order to removethe tarnish of the Suharto family connections.

Once Thames Water was back in charge, there wassubstantial foot-dragging on the contract re-negotia-tion. The financial crisis brought dramatic devalua-tion of the rupiah, which meant that revenues fromcustomers fell while the payments (pegged to the dol-lar) forced PAM Jaya into ever-deeper debt. Giventhe tense political situation in Indonesia, consumerrate increases were repeatedly delayed. Eventually anagreement was reached which provided for the estab-lishment of a regulatory body and enabled PAM Jayato have access to company financial records.

As might be imagined, investment and expansion tar-gets were never met, but there was also no reliablemechanism for verification of company reports.

Water services in Jakarta’s rich, middle-class andindustrial areas improved. However, most poor com-munities remain without piped water due to unaf-fordable connection charges, informal tenure arrange-ments, and lack of incentives for PAM Jaya or thecompanies to service these areas. Customers muststill boil their water to ensure its safety for drinking.

According to PAM Jaya engineer Feri Watna, “thecompanies…just came in and robbed everything that wehad. We already had the distribution networks, all thosepipes, the water installations, the consumers and everythingelse.”187

Thames Water’s Indonesian operations have beenmarked by repeated strikes by Jakarta water workers,and court cases alleging excess profiteering and con-tracts obtained through corruption.188

Japan: Yearning to do business

Thames Water has long thought that Japan wouldopen the water sector up to private participation. Butwhile on retreat in the Asian region it remainsunclear whether Thames can sustain an office inTokyo developing “relationships with local water andwastewater authorities in Japan.”189 Thames has severalworking partnerships with Japanese Mitsui, but latelyseems mostly to rely on the Japanese giant to put upbids for Thames’ failed investments. Japan would bea tough market as public utilities are known for theirexcellent service internationally. Still the Japanesegovernment has passed legislation which opens up forprivate operation.190

European withdrawalWhile Thames Water operated through acquisitionsand expansion in 2001 it quickly learned that anunsuccessful company can only be powerful for solong. Thames has closed its offices in Paris, Milanand Rome – and is in the process of selling itsSpanish interests.191 The corporation claims itintends to go back to its core business – but financialpitfalls have forced this withdrawal strategy. The cor-poration is simply not performing.

Also, Thames’ business prospects took another hitwhen the European Parliament voted in April 2004

RWE/Thames Water. A Corporate Profile Page 19

against including water services in the EuropeanInternal Market.192

Capping growth in Germany

RWE has held a 24.95% stake in the German watercompany Berlinwasser since 1999. French multina-tional Veolia holds an equivalent 24.95% of shares.Berlinwasser, the private provider of water services inBerlin, has been met by consumer protests in pastyears for its failure to deliver contract commitments.In 2004, Berlinwasser pushed through a rate hike of15% – an increase which would have been 30% hadthe Berlin senate not, once again, waived the conces-sion levy.193 The Green Party has criticized the con-sortium’s 15% guaranteed profits, regardless of meas-urable success rates.194 But Berlinwasser could alsoincrease profits through cost-savings. However, theConstitutional Court ruled the deal illegal “as costsavings through efficiency improvements must be sharedwith customers.” The German parliament scrambled tobring national law in compliance with the ruling.195

Meanwhile the company turns ‘a healthy profit.’196

The German public model provides stiff competitionto RWE’s interests in the local water market. In 2003RWE withdrew from its attempt to purchaseGelsenwasser from rival Eon. RWE regarded theprice to be too high – but perhaps RWE’s powerfulCEO Harry Roels could simply no longer afford tocontinue the company’s acquisition strategy.197

Instead Gelsenwasser went back to public ownershipafter Eon sold to Dortmund and BochumStadtwerke.198 But it’s not just price that’s a problemfor the troubled RWE in its home market. In 2003Germany’s federal cartel offices barred RWE frominvesting in ‘stadtwerke’ (public utilities) withoutshedding other interests. The cartel office is trying toprevent concentration on the market leading to a risein consumer prices.199

Berlinwasser holds interests in Albania and China,too.200 A 30-year concession was signed in Albania inApril 2002,201 but the country has proven to be anunstable investment with water losses initially at90%, due to widespread leaking (unaccounted forwater), and has experienced significant billing prob-lems. As a result, Berlinwasser got a bail-out from the

government when it changed the national legislationto accommodate Berlinwasser’s needs.

Spain and Italy: RWE’s garage sale continues

Speculation in industry circles questioned whetherThames would hold on to its 2002 acquisitions ofSpanish Pridesa (a company specialized in desalina-tion, actively vying for Californian contracts) andOndagua after the company changed its strategy inEurope by focusing on Germany, U.K. and EasternEurope. Thames squandered €94.5 million for a 75%interest in Pridesa in 2002 – and bought the remain-ing 25% in 2004.202 But Pridesa lost market sharesto local rivals.203 According to Global WaterIntelligence, Pridesa came across, at the WaterExecutive Forum, as a weak company and little inter-est appeared after Goldman Sachs was appointed tofind a buyer in January 2005.

While RWE/Thames Water’s website boasts of itsoffice in Milan (as of August 2005) Global WaterIntelligence reported the offices closed in 2004.204

The interests in Italy are tied to Pridesa and with apending sale, RWE/ Thames will exit the country.

Hungary: Slipping in even when it’s not welcomeDespite a public campaign against water privatizationby many Hungarians in 1993,205 Thames Water stillmanaged to get a piece of the joint venture, BudapestWaterworks. Awarded in 1997, it has since becomean oligopolistic water supplier, the largest in thecountry, supplying 2 million people in the capitalcity. Thames Water and Suez jointly own a 25%share in Budapest Waterworks. In addition to water,RWE Energy also supplies gas and electricity inBudapest206 forming a truly frightening corporatemonopoly on vital energy and water services in thecountry. In June 1999 the Budapest City Councilrefused to approve a business plan for the city. Theissue of contention centered on the high salaries paidto the directors of Budapest Waterworks. The CityCouncil was upset because the large salaries weretreated as profits and caused the city to incur heavytax liabilities. In 2000, consumer water billsincreased 18.3%.207

Page 20 RWE/Thames Water. A Corporate Profile

Turkey: On the back burner

Turkey is no longer featured on Thames Water’s pro-motional material. But the corporation is previouslyknown for its construction of the 110-meter-highYuvacik dam, water treatment work near Izmit, and a90-kilometer pipeline running to west Istanbul. A 15-year concession was signed in 1995 by Izmit Su A.S.involving the Municipality of Izmit (23 %), ThamesWater (35%) and Japanese Mitsui in collaborationwith Sumitomo, Gama, Guris, Klockner and INA.The financing was based on a take-or-pay schemeensuring the partners a high return for at least 492million cubic meters of water per year. However, theproject resulted in high water rates leading to lowdemand from users.208 This has led to disputesbetween different shareholders, in particular theMunicipality of Izmit, which doesn’t want to see fur-ther price gouging of local users.209

Middle Eastern risk takingIn a region where water is scarce, private water com-panies have flocked like vultures to a dead beast.Thames has announced that it’s no longer commit-ted to the region, but it’s still willing to get involvedif the price is right. In Iraq Thames Water was hiredby UNICEF to establish a mobile treatment plantafter the American and British forces had destroyedmuch of the supply network.210 It’s unclear whetherthe construction succeeded and to what extent theunit enabled supply to the civil population. Bechtel’scontracts with the U.S. government are years behindand most Iraqis rely on unsafe water sources.211

Meanwhile, Thames did not submit a bid for the Disiplant, which would supply water to Amman, Jordan,due to “group reasons.”212

ConclusionDespite a documented history of doing more damagethan good for the communities it serves, RWE-Thames Water-American Water still hopes to buildan American empire. For now, having lost too manybattles on water, it is focused instead on waste water.But the company is losing popularity quickly acrossthe United States as mayors are questioning the rea-sons for privatization and some cities, such asLexington, are attempting to buy out the corporation

after discovering that privatization was not a solutionto their woes.213

While water privatization is easier to prevent than toturn back, citizens and local decision makers acrossthe world have proven that they can succeed in buy-ing back their local waterworks, albeit with a longstruggle, even when they’re up against corporate bankaccounts, aggressive media campaigns, donations tolocal candidates, and litigation strategies.

Meanwhile we must all closely monitor what deci-sions our publicly elected officials are making. Weshould monitor corporations that are seeking toinfluence decision making and ask critical questionsabout any hidden agenda. We’ve seen that privatiza-tion has not worked for communities across theworld and we need to do more than fight it off defen-sively. We should also work to promote pro-publiclegislation at the local level that emphasizes the pub-lic right to water. On a national level, we should sup-port redistribution of resources and the concept oftrust funds in order to share the burden of improvedaccess and affordability to water.

In the end, a resource so essential to life should notbe controlled by multinational corporations, but safe-guarded by the public with strong local oversight andaccountability measures. Water is not a commodityand must not be left to the whims of the marketbecause no person or entity has the right to profitfrom it. Water should not be privatized, nor tradedor exported for commercial gain.

Every human being has the right to clean and afford-able water – that right should not be intercepted bylarge corporations such as RWE-Thames Water. Thecost of providing water should not be tied to a com-pany’s share price; rather, the bottom line should betied to protecting the public by providing a safe andreliable service to all citizens.

RWE/Thames Water. A Corporate Profile Page 21

Endnotes

1 “What we do” RWE-Thames Water, www.rwethameswater.com.2 The RWE Group, www.rwethameswater.com.3 “THE 2005 GLOBAL 500,” Fortune, Aug. 14, 2005. 4 RWE’s Strategy – Stability and Growth: The Right Mix for Adding Value. RWE- Facts & Figures www.rwe.com and “Thames’ own-

ership vision,” interview with Thames Water CEO Bill Alexander, Global Water Intelligence, October 2004, p9.5 “New poll: Americans overwhelmingly support federal trust fund to guarantee clean and safe water,” Luntz Research Companies,

March 3, 2005.6 “Water and Sanitation for the Urban Poor (WSUP) flyer.7 “RWE issues warning on net profits for 2003,” Financial Times. Dec. 17, 2002. 8 “German giant taking over American water supply,” Associated Press, Feb. 8, 2003.9 “RWE AG reports that American Water Works shareholders approve RWE merger agreement,” RWE statement, Jan. 17, 2002. 10 “Is RWE paying too much in U.S. deal?” Wall Street Journal, Nov. 18, 2002. 11 “Come on in – the water’s lovely,” Global Water Intelligence, June 2003, p15.12 “Water stocks up 21%,”Global Water Intelligence, January 2005, p8.13 “Thames’ ownership vision,” interview with Thames Water CEO Bill Alexander, Global Water Intelligence, October 2004, p8.14 “RWE H1 opg up 5.3 pct on higher electricity prices across Europe UPDATE” Forbes, Aug. 11, 2005.15 “Need to know this month,” Global Water Intelligence, March 2004, p7.16 “The survivor in a squeeze,” Global Water Intelligence, October 2004, p9.17 “Thames’ ownership vision,” interview with Thames Water CEO Bill Alexander, Global Water Intelligence, October 2004, p9.18 “Baffling rumuors,” Global Water Intelligence, August 2004, p6-7.19 “German Utility RWE Names New CEO,” Associated Press, September 8, 2005.20 “Walking away,” Global Water Intelligence, September 2005, p6.21 “PSC approves holding company in Kentucky-American Water Co acquisition,” Public Service Commission, a press release Dec.

20, 2002.22 James McGivern statement to California Public Utilities Commission, Dec. 12, 2002.23 “Thames’ ownership vision,” interview with Thames Water CEO Bill Alexander, Global Water Intelligence, October 2004, p8.24 “Thames Water’s £1bn sale,” Mail on Sunday, Jan. 30, 2005. 25 “RWE Carve-up,” Global Water Intelligence, January 2005, p6.26 “Paying for Thames Water’s failings,” Evening Standard, July 18, 2005.27 Equal to 946 liters: “Water profits protest,” Evening Standard, June 30, 2005 and “Plugging water leaks could supply half a million

new homes,” press release Environment Agency.28 “£2bn London sewer rescue abandoned,” The Guardian, Aug. 5, 2004.29 “Water leaks could supply 11m homes,” Daily Mail, July 15, 2005. 30 “Water profits protest,” Evening Standard, June 30, 2005. 31 “Water bills to rise by 18%,” Evening Standard, Dec. 2, 2004.32 Lobina, Emanuele and David Hall. “U.K. Water Privatization – a briefing.” Public Service International Research Unit, University

of Greenwich, February 2001. 33 Ibid. 34 “Water profits protest,” Evening Standard, June 30, 2005. 35 “SEWAGE NATION” http://www.twrc.rowing.org.uk/slug/lower.htm36 “Water profits protest,” Evening Standard, June 30, 2005. 37 “SEWAGE NATION” http://www.twrc.rowing.org.uk/slug/lower.htm38 “Water profits protest,” Evening Standard, June 30, 2005.39 “Thames Water fined for fish kill,” press release Environment Agency, Oct. 19, 2004. 40 Thames Water fined for polluting brook,” press release Environment Agency, Jan. 20, 2005.

Page 22 RWE/Thames Water. A Corporate Profile

41 “Thames Water fined £60,000 for polluting Oxfordshire brook,” press release Environment Agency, Apr. 26, 2005. 42 “Thames Water caught short – fined £50,000,” press release Environment Agency, Feb. 18, 2005. 43 “Thames Water fined for polluting Hendon brook,” press release Environment Agency, Dec 7, 2004. 44 The amount of fines, and the 2002 dates the fines were announced in Environment Agency statements: £12,000, Jan. 28; £9,000,

April 26; £20,000, May 9; £65,000, July 3; £19,000, Aug. 20; £6,500, Nov. 25. 45 “Sewage in shower earns Thames Water a £65,000 fine,” Environment Agency, July 3, 2002. 46 “Thames Water fined £12,000 for pollution,” Environment Agency, Jan. 28, 2002. 47 “Thames Water fined £9,000 for pollution,” Environment Agency, April 26, 2002. 48 “Thames Water fined £19,000 for pollution in Hampshire”, Environment Agency, Aug. 20, 2002. 49 “Spotlight on business environmental performance,” Environment Agency, 2001. 50 “Spotlight on business: Environmental performance in 2003,” Environment Agency. 51 “Thames Water fined £15,000 for polluting River Wey,” Environment Agency, Dec. 4, 2001. 52 “Spotlight on business environmental performance,” Environment Agency, 2002. 53 “Water firm fined for flooding homes with sewage,” Daily Telegraph, Feb. 22, 2000. 54 “Pollution incidents in England and Wales 2000,” Report of the Environment Agency. 55 “UK Developments: Cases” BLG Pollution and Environmental Risk Digest, Barlow Lyde & Gilbert, Issue 35, Summer 2000, p4-5. 56 “Spotlight on business environmental performance,” Environment Agency, 1999. 57 “Thousands of fish die in sewage spill,” Daily Telegraph, Sept. 28, 1998, referenced in AnimalNet,

www.ansc.purdue.edu/courses/ansc481/animal_net. 58 “Water pollution incidents in England and Wales 1999,” Report of the Environment Agency. 59 “Spotlight on business: Environmental performance in 2003,” Environment Agency. 60 “Spotlight on business: Environmental performance in 2004,” Environment Agency, p29-3061 RWE Acquisition Update #12, http://www.uwua.org/rwe_acquisition_update.htm62 “German giant taking over American water supply,” Associated Press, Feb. 8, 2003.63 Letter from Thames Water Plc to Ms Ulrike Hauer, European Commission Directorate-General for Trade, European Commission.64 American Water, USA

http://www.rwethameswater.com/TW/division/en_gb/content/General/General_000272.jsp?SECT=General_000197 65 American Water Services, USA

http://www.rwethameswater.com/TW/division/en_gb/content/General/General_000413.jsp?SECT=General_00019766 Ashbrook, USA

http://www.rwethameswater.com/TW/division/en_gb/content/General/General_000645.jsp?SECT=General_00019767 “Riding the Wave: The Rise of New Leadership in the Water Industry,” Public Works Financing, March 2005, p7.68 “Even if bond measure passes, German’s say they won’t sell,” Mercury News, July 26, 2005.69 “Company news,” Global Water Intelligence, November 2003, p6.70 “Company news,” Global Water Intelligence, October 2004, p10.71 RWE’s Strategy – Stability and Growth: The Right Mix for Adding Value. RWE – Facts and Figures 2005.72 “OMI signs agreement to pursue selected new business opportunities in U.S. and Canada with Thames Water,” OMI statement,

March 21, 2000. 73 “Water a Hot Commodity: U.S. waterworks lure investors. Montara residents fight to seize system from overseas buyer,” San

Francisco Chronicle, Dec. 1, 2002.74 “German giant taking over American water supply,” Associated Press, Feb. 8, 2003.75 “Tapwater Takeover,” Yes! Magazine, Winter 2004 issue: Whose Water?76 Annual Service Contract Review; http://www.cccos.org/ 77 “Kentucky American sues to block vote,” Lexington Herald Leader, July 14, 2005.78 “Judge OKs water vote this fall. Rejects arguments by Kentucky American,” Lexington Herald-Leader, Aug. 27, 2005.79 “Fayette water vote upheld on appeal. NOV. 8 REFERENDUM ON CONDEMNATION MORE LIKELY; QUESTION OF

LEGALITY STILL PENDING,” Lexington Herald Leader, September 17, 2005.

RWE/Thames Water. A Corporate Profile Page 23

80 “Voters’ message: End condemnation: Water company wins big in election,” Lexington Herald Leader, Nov. 7, 2005. 81 “PSC rules on Kentucky-American water rate request. Amount is less than company sought; customers will receive refunds,”

Public Service Commission press release, Feb. 28, 2005.82 “American Water sub sues Kentucky for Rate Increase,” Lexington Herald Leader, April 29, 2005.83 “Seeking more money to send overseas: Water utility’s true colors show in recent rate request,” Lexington Herald-Leader, May 10,

2004. 84 “Supes OK water buyout ballot,” Santa Cruz Sentinel, April 29, 2005. 85 Review of proposed Felton amendment to San Lorenzo Valley Water District, July 2003, p45.86 “Residents protest water rate proposal,” Monterey Herald, May 13, 2005. 87 “Felton Tariff Area. GENERAL METERED SERVICE,” California-American Water Company,

http://www.illinoisamerican.com/awpr1/caaw/pdf/Rates_FE1.pdf.88 Future of Felton’s Water System, Valley Post, July 5, 2005.89 The Moriah Group registered Cal Am’s local website to fight the measure,

http://www.jgpr.com/Calam/notakeover/feltonwaterfactswhois.jpg and the Moriah Group’s 6 month strategic plan http://www.fel-

tonflow.org/downloads/plan.pdf.90 “Residents protest water rate proposal,” Monterey Herald, May 13, 2005. 91 ‘US Conference of Mayors recognizes public private partnerships of American Water Works Co. Inc. subsidiaries,” company press

statement, Feb. 2, 2000. 92 “City plans to take back control of waterworks,” Buffalo News, March 7, 2003. 93 “ECWA approves MOU for Buffalo water system,” Erie County Water Authority release, July 8, 2004. 94 “Cal Am shutoffs cause a stir. Residents not on company’s list say they weren’t warned,” Monterey Herald, Aug. 18, 2005.

95 “No alternative water source in 10 years?” The Monterey Herald, July 3, 2005, and “Deal reached on desal plant,” The Monterey

Herald, July 28, 2005. 96 “Study sets desal plant in motion,” Monterey Herald, July 15, 2005.97 “Cal-Am plan would increase water rates; Peninsula rates would rise, Felton’s would drop,” Monterey Herald, Sept. 4, 2004.

98 “Taking sides on Peninsula water issue,” Monterey Herald, August 23, 2005. 99 “No alternative water source in 10 years?” The Monterey Herald, July 3, 2005, and “Deal reached on desal plant,” The Monterey

Herald, July 28, 2005. 100 “Moss Landing power plant,” EarthJustice: Urgent Cases, www.earthjustice.org/urgent/display.html?ID=165. 101 “Partnership formed for Moss Landing water facility,” Contra Costa Times, Aug. 7, 2005.102 “Desalination plan advances Cal Am agrees count would own plant,” Water Industry News, Aug. 17, 2004.103 Proponent’s Environmental Assessment (PEA) for the proposed coastal water project, proceedings A.04-09-019.104 This section is drawn from “Water Woes,” ColorLines Magazine, Summer 2005.105 “Walkerton water bosses to plead guilty”, CBC News, October 18, 2004.106 “Five years after Walkerton, effort to protect drinking water still not over,” Canadian Press, May 22, 2005.107 “RWE corporate profile – updated August 2003.” Polaris Institute.108 “Hamilton’s Crown Jewel. The first municipality in Canada to privatize water,” CBC Radio, Feb. 5, 2003. 109 “2003 International Major Projects Survey” Public Works Financing October 2003,” Vol. 177, p46.110 “Hard Water: The Uphill Campaign to Privatize Canada’s Waterworks,” The Water Barons, Center for Public Integrity.111 Ibid.112 Ibid.113 “Report urges city to make waterworks public again,” Hamilton Spectator, Sept. 9, 2004.114 “Hard Water: The Uphill Campaign to Privatize Canada’s Waterworks,” The Water Barons, Center for Public Integrity.115 Ibid.116 “Water works gets new owner,” Hamilton Spectator, Nov. 9, 2001.117 “City OKs takeover of water, sewage,” Hamilton Spectator, Oct. 26, 2001, and “Azurix sale could place city in financial squeeze;

Councillor wants to explore civic operation of sewer and water services,” Hamilton Spectator, Oct. 20, 2001.

Page 24 RWE/Thames Water. A Corporate Profile

118 “Hard Water: The Uphill Campaign to Privatize Canada’s Waterworks,” The Water Barons, Center for Public Integrity.119 Ibid.120 “Why did water bid go down the tubes?” Hamilton Spectator, Sept. 10, 2004.121 “AWS seeks injunction to halt city’s water plan,” Hamilton Spectator, Sept. 15, 2004.122 “Report urges city to make waterworks public again,” Hamilton Spectator, Sept. 9, 2004, and “Why did water bid go down the

tubes?” Hamilton Spectator, Sept. 10, 2004.123 “The private system never made sense,” Hamilton Spectator, Sept. 2, 2004.124 “AWS seeks injunction to halt city’s water plan,” Hamilton Spectator, Sept. 15, 2004.125 “City to operate water system,” Hamilton Spectator, Sept. 16, 2004.126 “City takes back control of water,” Hamilton Spectator, Dec. 27, 2004.127 “City faces new trial over 1999 sewage spill,” Hamilton Spectator, Feb. 15, 2005. 128 Storm brewing over water board plan: Committee room is not big enough for this hearing,” National Post, Nov. 19, 2002.129 “Right water decision,” The Toronto Star, Nov. 22, 2002.130 “RWE Thames mulls selling international assets,” Business News Americas, Jan. 5, 2005.131 “Walking away,” Global Water Intelligence, September 2005, p6.132 Website of RWE Thames Water at: www.rwethameswater.com; Polaris Institute, “Corporate Profile: RWE,” Canada, June 2005.133 International Finance Corporation website:

http://ifcln001.worldbank.org/ifcext/spiwebsite1.nsf/0/3425eea653fe1d5b85256d0800734bd4?OpenDocument.134 “Chilean state water systems company partly privatized,” Agence France Presse, World Reporter (Q1:43), June 11, 1999. 135 Hall, David, Water Privatisation in Latin America.” Public Services International Research Unit, University of Greenwich, London,

September 1999, p11.136 “New leader seeks to reinvigorate the CUT: Moraga criticizes privatization and neoliberalism,” CHIPS World Reporter (Q1:93),

May 11, 1999; “EMOS Strike Moves into Third Day,” BUSINESS BRIEFS: CHIPS World Reporter (Q1:156), Aug. 8, 1999. 137 “Privatización del agua perjudica chilenos,” Union Internacional de Trabajadores de la Amimentacion www.rel-

uita.org/agricultura/ ambiente/agua/chile-privatizacion.htm.138 “Chilenos protestan contra privatización del agua,” www.adital.org.br/site/noticia.asp?lang=ES&cod=13065 - 57k.139 “RWE Carve-up,” Global Water Intelligence, January 2005, p6.140 “Consorcio y Solari se alian tras activos de Thames Water en Chile,” Aguamarket, April 6, 2005.141 Global Water Intelligence, April 2005, p6.142 RWE Thames Water, www.rwethameswater.com.143 David, Alex, “Temen se detenga proyecto en Salinas ante oposición de ambientalistas,” Primera Hora, Lunes , Oct. 6, 2003.

http://www.ceducapr.com/noticias/wmview.php?ArtID=2789.144 “Super Acqueduct Coming Online,” Caribbean Business, March 1, 2000.145 Bulletin of the International Lawyers Network, Vol. 2, Issue 2, Dec. 18, 2002. 146 “Federales se proponen radicar acusaciones sobre supertubo,” Associated Press, Feb. 3, 2004.147 “U.S. grand jury indicts Vazquez Botet, Granados and Morell,” Caribbean Business, April 15, 2004 and “Superaqueduct Case

Headed Back to Court,” Associated Press, January 21, 2005.148 “When Money Gets Messy,” WhiteHouseforSale,org, May 3, 2004. 149 “U.S. grand jury indicts Vazquez Botet, Granados and Morell,” Caribbean Business, April 15, 2004. 150 “Thames beats a retreat in China,” Global Water Intelligence, May 2004, p8.151 Quiggin, John, “Contracting out: promise and performance,” Australian National University, April 2002. 152 “The Big Pong Down Under,” The Water Barons, The Center for Public Integrity. 153 Ibid. 154 David Hall, Violeta Corral, Emanuele Lobina, and Robin de la Motte, “Water privatisation and restructuring in Asia-Pacific,”

Public Services International Research Unit, Dec 2004, p7. 155 “New entrants,” Global Water Intelligence, July 2004, p7.156 “Thames’ ownership vision,” interview with Thames Water CEO Bill Alexander, Global Water Intelligence, October 2004, p8.

RWE/Thames Water. A Corporate Profile Page 25

157 “David Lloyd Owen: The market in China becomes even more complex,” Global Water Intelligence, August 2004, p38.158“ CWC pushes ahead in China,” Global Water Intelligence, August 2004, p20.159 “The search for a reliable partner,” Global Water Intelligence, May 2004, p10.160 “Thames beats a retreat in China,” Global Water Intelligence, May 2004, p8.161 Ibid.162 “Water privatization and restructuring in Asia-Pacific,” Public Services International Research Unit , December 2004, p9.163 “Shareholders,” China Water, http://www.chinawater.com.hk/cwc-e_share.html.164 “RWE Carve-up,” Global Water Intelligence, January 2005, p6.165 “2003 International Major Projects Survey,” Public Works Financing, October 2003, Vol. 177, p127. 166 “How did United Water get into Papakura?” www.papakurawaterpressuregroup.pl.net/history/history.htm 167 Ibid.168 A practical exercise demonstrated at the World Water Forum in Kyoto, March 2003. 169 Mathyssen, Peter, “Papakura, New Zealand – Water Charge Increases from 1998 to 2004. Publicly owned Watercare compared

with privately owned United Water.” 170 April 1999 Decisions, http://canterbury.cyberplace.org.nz/community/CAFCA/cafca99/Apr99.html. 171 “How did United Water get into Papakura?” www.papakurawaterpressuregroup.pl.net/history/history.htm 172 “Roger Award 2001 Statement http://www.papakurawaterpressuregroup.pl.net/history/history.htm” Michael Gilchrist, Prue

Hyman, Glenn and Sukhi Turner, Feb. 25, 2002, http://www.arena.org.nz/roger04.htm. 173 “Action Update From Papakura Water Pressure Group,” Aug. 8, 2001,

Press Release: The Water Pressure Group www.scoop.co.nz/mason/stories/PO0108/S00035.htm. 174 “2003 International Major Projects Survey,” Public Works Financing, October 2003, Vol. 177, p171.175 “Water privatization and restructuring in Asia-Pacific,” Public Services International Research Unit, December 2004, p21.176 “Notice of Reso BOD purchase shares in Thai Tap. Closing Book,” CH. Karnchang, http://www.ch-

karnchang.co.th/eng/new_detail.php?id_news=74&type=gen.177 “Water privatization and restructuring in Asia-Pacific,” Public Services International Research Unit , December 2004, p10.178 “Malaysia looks for $12 billion,” Global Water Intelligence, August 2004, p20.179 “2003 International Major Projects Survey,” Public Works Financing, October 2003, Vol. 177, p115.180 “Water privatization and restructuring in Asia-Pacific,” Public Services International Research Unit , December 2004, p11.181 “Thames’ ownership vision,” interview with Thames Water CEO Bill Alexander, Global Water Intelligence, October 2004, p8.182 Ibid.183 Law No. 1/1967, Ministry of Home Affairs Decision No. 3/1990 cited in Argo and Firman, “To privatize or not to privatize,”

Built Environment 27(2). 184 Bakker, Karen, “Urban governance, urban services, and private sector partnerships: the case of water supply in Jakarta,” Dept. of

Geography, University of British Colombia, August 2002. 185 “Water and Politics in the Fall of Suharto,” International Center for Investigative Journalism, Feb. 10, 2003. 186 International Consortium for Investigative Journalism. According to ICIJ, the companies threatened to sue the government if

the contract was not honored.187 Ibid.188 Hall, David, “The Water Multinationals,” Public Service International Research Unit, University of Greenwich, September 1999. 189 Japan, RWE/Thames water website. 190 “Water privatization and restructuring in Asia-Pacific,” Public Services International Research Unit, December 2004 p17-18.191 “European Restructuring,” Global Water Intelligence, April 2004, p6.192 “German communalism,” Global Water Intelligence, April 2004, p7.193 “Berlin settles privatization dispute,” Global Water Intelligence, October 2003, p17. 194 Vivendi, anatomie de la pieuvre, Jean Phillipe Joseph in “Vivendi Universal” Polaris Institute, October 2002. 195 “Berlin settles privatization dispute,” Global Water Intelligence, October 2003, p17.196 “Price restructuring in Berlin after 15% hike,” Global Water Intelligence, July 2004, p20.

Page 26 RWE/Thames Water. A Corporate Profile

197 “Corporate,” Global Water Intelligence, July 2003, p6.198 “Gelsenwasser goes to municipal utilities,” Global Water Intelligence, August 2003, p20.199 “Cartel office bars RWE acquisitions,” Global Water Intelligence, December 2003, p21.200 “Thames’ ownership vision,” interview with Thames Water CEO Bill Alexander, Global Water Intelligence, October 2004, p8.201 “Berlinwasser pursues China strategy,” Global Water Intelligence, July 2004, p20.202 “European restructuring,” Global Water Intelligence, April 2004, p6, and “Sales Time,” Global Water Intelligence, April 2005, p6.203 “What price Pridesa?” Global Water Intelligence, January 2005, p19.204 “European restructuring,” Global Water Intelligence, April 2004, p6.205 “Debrecen, Hungary Campaign against Water Privatisation 1993-94,” Public Services International Research Unit.206 RWE/ Thames Water website, www.rwethameswater.com.207 “Water privatization and restructuring in central and eastern Europe, 2001,” Public Services International, University of

Greenwich, 2001, p10. 208 2003 International Major Projects Survey, Public Works Financing, October 2003, Vol. 177, p174.209 “Thames’ ownership vision,” interview with Thames Water CEO Bill Alexander, Global Water Intelligence, October 2004, p8.210 “Development aid,” Global Water Intelligence, August 2003, p7.211 “Iraq,” http://www.citizen.org/cmep/Water/cmep_Water/reports/iraq/.212 “Jordanians extend Disi deadline again,” Global Water Intelligence, June 2003, p28.213 “American targets wastewater,” Global Water Intelligence, October 2004, p10.

RWE/Thames Water. A Corporate Profile Page 27

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