Chapter 13: Public utility governance
Governance is the process of managing the operations of organizations and their relationships with their internal and external stakeholders. In most industries strategy is decided by directors and senior officers, while the responsibility for carrying out operations is delegated to managers and supervisors. In rural areas, utilities are often owned and governed by consumer cooperatives, local utility districts, or by a public utility district (PUD). In urban areas, utilities are either governed by an elected governance body, by managers appointed by elected city officials. Oversight of both public and investor-owned electric and gas utilities is most often exercised through state and local regulatory authorities. Ownership of water and wastewater utilities has followed a municipal or mutual model. However, more of these systems are being sold or leased to private operators, while in others a number of traditional utility services are now contracted out to the public sector—the practice of outsourcing.
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