Utilities Reform Path Selection

Public utility is the key content of urban infrastructure and social work. Compared with other industries, public utility is characteristic of community, natural monopoly, basic, regional and externality as well as quasi-public goods, thus possibility of market supply exists. However for a long time, construction of public utility in China was directly invested and administered by the government with little private capital intervention. With the further deepening of China's market economy as well as reform and opening up, the disadvantage of such single capital supply channel has appeared. Public utility privatization opens up new investment direction to huge private capital. While from the government's point of view, public utility privatization is also a big opportunity, which means quality of public utility can be improved by attracting private capital, meanwhile, the financial strain of local government can be relieved and the fixed resources are able to be better allocated.After almost a decade of exploration and practice, market oriented reform of public utility in China has gained certain achievements, but also accompanied with lots of problems and conflicts. Public utility in some cities even retrogressed. Therefore in this stage, to summarize local public utility reform, abstract route selection, analyze gains and losses therein, and to seriously position government's function is of important meaning theoretically and practically.From the view of route selection of public utility, this thesis aims at enhancing effective competition, improving efficiency and benefiting public welfare by drawing on experiences of reforms abroad and summarizing differences of various reform routes. This paper follows the way from collectivity to individuality, from abstract to specification, from specialty to common, from overseas to domestic, from theory to practice to analyze and sum up reform routes suitable for our country's circumstances. And on this basis, research how to deepen further reform in order to accelerate sustainable development of public utility. After the foreword, this paper first generalizes definition of public utility, analyzes its notable characteristics, and then introduces basic supply modes of public utility. It follows by summarizing theory of public utility privatization and inducing other countries'experience as well as difficulties existing in current situation. Finally it ends up with analyzing difficulties of market oriented reform in Zhengzhou Water utilizes and providing some suggestions.Grounded on researches, main conclusions are:(1) Among different supply modes of public utility, mixed supply mode which is cooperation of market and government is the most suitable for development of public utility in our country. On one hand, for unnatural monopolized field, it enhances supply efficiency of public goods by competitive advantage of market economy; on the other for public utility infrastructure of natural monopolized field, where private has no right or motivity to enter, it focuses on playing government's pushing and guiding function to produce and manage public goods as market's effective reinforce.(2) During the introduction of routes selection of other countries, emphasize on privatization of the U.K., franchise in France as well as loose regulation and civic bond in the United States to point out enhancement of competition in the U.K. and franchise in France specially suit our circumstances, while civic bond of the United States can serve as reference of financing means for local government.(3) In the case of Zhengzhou Water utilities, statistics clearly shows that water rate significantly influences water usage per capita, thus Zhengzhou Water utilities should accomplish the project of "one meter per door" as soon as possible to establish perfect stage-wise water rate instead of simply increasing the rate.(4) Government regulation is the key aspect of healthy development of public utility. Government should adopt different policies to different field of public utility respectively and encourage sufficient competition of private corporations to improve efficiency and to save costs.In conclusion, public utility is a complicated industry which relates to national economy and the people's livelihood rather than simply complete economic issue. The reform of public utility must grasp the inside and outside conflicts of public utility and based on other countries' experience find our own specific plan other than fully copying the way of other industries.