Core Values,
Sustainability, and the
Privatization of Water
Joseph W. Dellapenna
Professor of Law, Villanova University
www.dellapen@law.villanova.edu
Rapporteur, Berlin Rules on Water
Resources
Director, Model Water Code Project,
American Society of Civil Engineers
© 2013-Joseph W. Dellapenna
Water Law at all Levels Is
under Stress
Growing demand shaped by
Burgeoning populations
Changing patterns of use
Efficiency promoted by rising costs
Local, national, and regional management
systems, and their governing laws, are already
under stress
Global climate disruption is adding further
stress
© 2013-Joseph W. Dellapenna
Water Stressed Regions
© 2013-Joseph W. Dellapenna
Changing Population Density
around Lake Victoria
© 2013-Joseph W. Dellapenna
Getting from Potential Conflict to
Potential Cooperation
Disagreements and disputes are inevitable
What mechanisms might be used to resolve these
problems?
Violence
Ethics
Markets
Law
What techniques do we use in ordinary civil
society to preclude resort to violence?
© 2013-Joseph W. Dellapenna
A Discussion about Water
Rights (from duckboy.com)
© 2013-Joseph W. Dellapenna
Public Goods
Basic characteristics
Indivisible (“non-excludable”)
Shared freely among a relevant population
(“open access”)
Consequences of treating something as a
public good
Funding is difficult
Markets fail
The “tragedy of the commons” is a risk
© 2013-Joseph W. Dellapenna
The Hydrologic Cycle
© 2013-Joseph W. Dellapenna
Raw Water as the Paradigm
Public Good
Transaction costs are too high for markets
“Equity” precludes excluding people (and
others) who cannot afford to buy water
Common metaphors—used even by market
fundamentalists—recognize that water is the
paradigm public good
“Common pool resource”
“Spill over effect”
© 2013-Joseph W. Dellapenna
Can Ethical Appeals Prevent the
Tragedy of the Commons?
What happens if some heed ethical appeals to
behave responsibly?
Consider the Canadian lobster (or the North Atlantic
cod, or any of many other examples)
What about “commons” that have functioned
successfully for centuries?
Ethical appeals can mobilize political will, but
that will must be expressed in law to be effective
That water is to some extent an economic good
suggests that a sound system of ethics would
incorporate economic incentives (not necessarily
markets as such) as management tools
© 2013-Joseph W. Dellapenna
Ethics Applied to Water
 Three possible systems of property rights for water
resources:
 Common property
 Private property
 Public (or collective) property
 Is one ethically superior?
 Common property systems
 They lead to the “tragedy of the commons”
 We see many overexploited water sources as a result
 Private property systems
 They also can lead to the “tragedy of the commons”
 Prioritized systems can freeze patterns of use because of
problems with markets
 Public (or collective) property systems
 They create at least a possibility of avoiding these problems
 They carry all the risks inherent in bureaucratic management
© 2013-Joseph W. Dellapenna
Basic Premises of Sound Water Law
 Sound water law must reflect the basic characteristics of
water as a resource:
 Water is a public good
 Water moves
 Water must be conjunctively managed
 Water management must be integrated with the management of
related resources
 Water is subject to economic incentives
 Reflected (more or less) in most traditional bodies of water
law:
 Water generally subjected only to “usufructuary” rights
 Derived from Roman law concepts:
 Usus
 Fructus
 but not Abusus
© 2013-Joseph W. Dellapenna
Is Sustainability a Legal
Requirement?
 The “cowboy economy” vs. “spaceship earth” (Kenneth
Boulding 1966)
 The Stockholm Declaration (1972)
 Principle 5: The non-renewable resources of the earth must be
employed in such a way as to guard against the danger of their
future exhaustion and to ensure that benefits from such
employment are shared by all mankind.
 Pervades other principles
 Now found in numerous “hard law” international
instruments—even in the Preamble to the World Trade
Organization Agreement (1994)
 Embraced by the International Court of Justice in The
Gabçíkovo-Nagymoros Case (Hungary/Slovakia) (1997),
as well as some national courts
 Is this just a procedural mandate?
© 2013-Joseph W. Dellapenna
Applying Sustainability to Water
Definition (from the Berlin Rules, art. 2(19):
 [T]he integrated management of resources to ensure
efficient use of and equitable access to waters for the
benefit of current and future generations while
preserving renewable resources and maintaining
non-renewable resources to the maximum extent
reasonably possible
 Numerous similar definitions
Is this a slogan, or a rule of law?
Balancing current and future needs
Ensuring equitable access to resources
Optimizing the use of non-renewable resources
Averting the exhaustion of renewable resources
Sustainable development or sustainable use?
© 2013-Joseph W. Dellapenna
Problems with Sustainable Use
How to know that a current use does not
compromise future need?
What about “fossil” waters?
How does the principle of sustainability relate
to the principle of “equitable utilization”?
© 2013-Joseph W. Dellapenna
Current vs. Future Needs
Sustainability requires ecosystem management
 Integrated and conjunctive management are essential
 No irreparable alteration of ecosystems
And a comprehensive evaluation of water and
its connections with other resources
 Now required by customary international law, Berlin
Rules (2004), Pulp Mills Case (Argentina/Uruguay
(International Court of Justice 2010)
 A highly fact-specific analysis
 Related to the precautionary principle
© 2013-Joseph W. Dellapenna
Ecocide at the Aral Sea
© 2013-Joseph W. Dellapenna
“Fossil” Waters
Certain waters (found in “uncoupled aquifers”)
recycle so slowly that for all practical purposes,
they are non-renewable
Like minerals, if such resources are used at all,
they are diminished and rendered unavailable
for future use
Development of such waters is sometimes
necessary, but there are no clear standards for
what constitutes “sustainable development”
© 2013-Joseph W. Dellapenna
Sustainability and Equitable Utilization
 The principle of equitable utilization governs the
allocation of water among States sharing a common
water source
 Traditionally, equitable uses did not need to be
sustainable
 The UN Convention (1997) and the Berlin Rules (2004)
require both equitable use and sustainability
 Should international law reward States for conserving
water?
 It is difficult to verify the amounts of water conserved
 Must allowance be made for States that lack the means to
undertake conservation (or sustainable use or
development)?
 Should more developed States be able to use water they
save for inessential purposes while less developed
neighbors cannot meet essential needs? What does this
say about the human right to water?
© 2013-Joseph W. Dellapenna
Markets
Markets are not a natural system, but a
creation of society, shaped by social
expectations and law
Markets are the best system if they work
Market fundamentalists insist that
markets are the answer for nearly every
problem
Markets do not work well for public
goods
By its nature, water is a public good and
is also an economic good
© 2013-Joseph W. Dellapenna
Water Withdrawal and Consumption
© 2013-Joseph W. Dellapenna
Recourse to Actual Markets for Water
Resources
Markets are rare in all societies
Markets are forbidden in some religious traditions
Even in private property systems (such as are found
in the western United States), markets rarely
function without heavy state intervention
Spontaneous markets have involved only small-scale
exchanges among nearby and similar users
Markets are difficult to arrange because a
large-scale transfer, particularly to a different
kind of use, is likely to affect many other users
who have not consented to the transaction
The Coors Beer case illustrates the problem
Any other result deprives other water users of their
property
© 2013-Joseph W. Dellapenna
Are There Examples of
Successful Markets for Water?
 Recent so-called markets
 The California Water Bank (1991-92)
 Only one lawful seller and only one lawful buyer
 No negotiation over prices
 The Imperial Valley Irrigation District “sale” to San Diego (2003)
 Rejected by the District’s board
 Imposed by the Secretary of the Interior
 The Chilean model (after 1980)
 Water redefined as strictly private property without regard to third party
rights
 Highly touted as proof that markets work
 In fact, almost no market activity except in one small valley and even
there it has mostly stopped because of popular resistance—Carl Bauer,
The Siren Song (Resources for the Future 2004)
 Regulatory intervention masquerading as a market
 The state chooses to ignore third-party effects for itself
 Results in a transfer of wealth from the poor to the rich
 Economic incentives are critically important, but should not be
confused with markets
© 2013-Joseph W. Dellapenna
Marketed Water
© 2013-Joseph W. Dellapenna
What Can Law Contribute?
Law is an intellectual or rhetorical system for
channeling and resolving problems that
otherwise would either not be dealt with or
would be dealt with by force
At the national level, law can:
Define property systems
Create incentives for responsible management
At the international level, law can:
Create mechanisms for allocating and managing
water across boundaries
Two governing principles:
Equitable use
Sustainability
© 2013-Joseph W. Dellapenna
Ric Masten, Stark Naked in
’69 and ’79 (1980)
To Nuke
or Not to
is it not disturbing to consider
that everything in and about
a nuclear power plant
will be furnished
by the lowest bidder
© 2013-Joseph W. Dellapenna