Monthly Archives: April 2013

Keeping Jordan’s Privatized Water Sector Afloat

Photo by Magh

Photo by Magh

Water is in short supply in Jordan. To meet the needs of an increasingly modern country, the nation’s leaders must be judicious in how they allocate their water resources for various uses. Due to international pressure, the Jordanian government has trended lately towards corporatization in the water services sector, and it has given private partners substantial responsibility in managing its water supply. But with the great difficulty of regulating a newly liberalized sector, how have Jordan’s water resources fared?

In her dissertation, Nancy Odeh (PhD ‘09) looked at various manifestations of public-private partnerships in the Jordanian water

sector. She found that the effectiveness of private firms—measured both by the quality, sustainability, and efficiency of the water supply as well as the affordability of the new contractual arrangements—was a direct result of the configuration of the organizational and legal context in which the partnership was formed.

Nancy found that Jordanian authorities had erred in several ways when decentralizing their water management system. For example, while contracts tended to be rigid and stifling in urban areas, rural partners were given too much discretion and weren’t held accountable to performance standards. The difficulty in determining an appropriate method of regulation was enhanced by an entrenched system of patronage within Jordanian government.

Nancy suggested best practices for the country to adopt in managing its water supply. These include forming contracts that clearly define targets for private partners, consistently including partners in decision-making and information-sharing processes, and fortifying the legal structures that hold private water suppliers accountable to consumers. To effectively liberalize its water sector, Jordan must build a regulatory system that motivates private actors to work in the public interest. Read more about Nancy’s work and her recommendations in her dissertation.

How the Anti-Regulation Movement Threatens Environmentalism

In the 1970s, an environmental awakening spread through American society and resulted in much 9780262018272of the landmark legislation – the National Environmental Policy Act, the Clean Air Act, and many others – that define our current system of environmental regulation. While additional protections have been added, much of environmentalists’ struggle in the decades since has been focused on maintaining this high-water mark and ensuring that regulations are implemented in an environmentally protective fashion. But as Professor Layzer details in her book, Open for Business: Conservatives’ Opposition to Environmental Regulations, American environmental protections have been the target of a decades-long assault that threatens to drastically reduce their effectiveness.

A conservative, anti-regulatory movement has grown dramatically in response to the implementation of environmental laws. Opponents of environmentalism, fearing the effect of regulation on business and the economy, and distrusting the Federal government, have slowly build a case against environmental protection. While they have not overturned any major pieces of environmental legislation, they have been very effective in influencing the way regulators exercise discretion in implementing environmental rules. Perhaps more significantly, they have made environmentalism a controversial issue and shifted the popular image of the Federal government from one of protector against industrial excesses to a heavy-handed opponent of private enterprise.

Professor Layzer’s book details the growth of the conservative anti-regulator movement over the course of the past few decades, and illustrates many of the tactics and actors involved in provoking the backlash against environmentalism, both at the elite and grassroots level. Open for Business is available through the MIT Press.

Using Utility-Community Partnerships to Enable Deeper Energy Savings

2009’s American Recovery and Reinvestment Act was a major boon for local energy efficiency programs. With ample federal funding, municipalities were able to achieve substantial energy electric_metersavings. But as ARRA wound down, many important local efficiency programs were in danger of being left unfunded. How can communities continue to make progress on energy efficiency in the absence of federal funding?

In 2011, Professor Harvey Michaels and a group of graduate students in MIT’s Energy Efficiency Strategy Project (EESP) examined this issue and developed a strategy for utility-community partnerships for energy efficiency. Energy utilities—tasked in many states with providing ambitious energy savings—are in a position to offer substantial funding to help underwrite efficiency programs. Local governments and community groups—with their substantial property assets, regulatory authority, and social networks—can provide access to the hard-to-reach energy savings that have historically eluded utility-funded programs.

EESP proposes a model of a mutually beneficial energy efficiency utility-community partnership. The group focuses specifically on delivering savings in public buildings, involving utilities in the development of more stringent energy codes and benchmarking efforts, and conducting better program marketing through existing community organizations. They also demonstrate how a local revolving loan fund could be established to provide continual benefits to utilities, program partners, and local communities. Read more about the group’s suggestion in EESP’s white paper.

Stuck in Traffic: The Failure of New York City Congestion Pricing

By Dom Dada

By Dom Dada

As is apparent even to the tourists in Times Square, Manhattan’s traffic jams are a consistent source of delays, aggravation, and air pollution. As part of 2007’s PlaNYC, the New York City government’s comprehensive vision for the future, the city proposed implementing a congestion pricing system similar to those in place in London and Singapore. The goal was to ease the flow of traffic, encourage the use of public transportation, and nudge residents towards more sustainable patterns of everyday life.

As Patrick Lynch (MCP ’10) shows in his thesis, the city’s congestion pricing plans were initially promising. Proponents had strong support from residents, state politicians, and the federal government. However, implementation died in the New York State Assembly, which refused to even vote on the measure. Patrick notes several reasons for this, including a byzantine program approval process and disagreement over how revenues should be spent.

The biggest problem with congestion pricing, however, was the conflict between winners and losers. While the measure enjoyed the support of local politicians in Manhattan and the Bronx, representatives of the city’s other boroughs felt that their constituents were being unjustly targeted. Proponents did little to address these concerns, and they did a poor job of building a supportive coalition to counter their opponents. Ultimately, opposition from a politically important and geographically concentrated bloc created a hostile political climate and doomed efforts for congestion pricing in the city.

Read Patrick’s conclusions about New York City’s failure to implement congestion pricing and his thoughts on implementation of related schemes elsewhere in his thesis.