Experience with private sector participation in Grenoble, France, and lessons on strengthening public water operations

This article looks at the experience with water supply reform in Grenoble, France, where, starting from 1989, different forms of private sector participation were introduced until the decision was made to revert to municipal operations. Identified risks of private operations include interest-seeking practices and a distribution of resources favourable to service providers, together with the high cost for local communities of exiting unsatisfactory deals. The new municipal operator has been able to improve performance in terms of contained pricing and enhanced investment. This can be explained in relation to the strengthening of accountability networks through advanced public participation and transparency.