Governance, business models and restructuring water supply utilities: recent developments in Ontario, Canada

Abstract

Many municipal governments are currently confronted with the need to restructure water supply systems. This paper examines how municipalities are restructuring water supply utility management in the province of Ontario (Canada), which has recently experienced significant and rapid legislative and regulatory reform in the water sector. The paper analyses restructuring in six different municipalities (Hamilton, Kingston, Peel, Peterborough, Toronto and York). It identifies six distinct business models adopted as an outcome of the restructuring process (delegated management to a private operator, corporatization of services provision, delegated management to a public operator, a municipal commission, a municipal ‘business unit’ and a municipal department) and examines the different approaches to governance adopted during the restructuring process. The case study is conceptualized through a discussion of the governance and restructuring challenges faced by municipalities. As municipalities are often confronted with a bewildering array of business models, governance frameworks and contract types when engaging in a review of restructuring options, the paper situates the analysis of the Ontario case within a general survey of business models for networked water supply. The paper concludes with a discussion of “lessons learnt” relevant to municipalities and higher orders of government when engaging in restructuring of networked water supply provision.