The Complete Guide to Public Utilities and How They are Impacting The Real Estate Industry

By Michael Jumba

What is a Public Utility?

Public utilities are essential parts of a city. They provide people with electric, water, and gas services. A public utility is owned by the government and provides essential services to the public. Examples of these services are electric, water, and gas. Public utilities are important parts of a city because they provide the essential services to keep the city running smoothly. 

What is the Purpose of a Public Utility?

The purpose of a public utility is to provide a service that is essential to the community. They are also known as public service utilities. Examples include electricity, gas, water, and sewage treatment.Public utilities are usually regulated by the government and they provide the service at a set price.

How Do Public Utilities Work?

Public utilities work by providing essential services to the general public in a safe, reliable, and cost-effective manner. These utilities typically operate as regulated monopolies, meaning that they are the only providers of their specific services within a particular geographic region. This is because the cost of building and maintaining the necessary infrastructure for these services is often too high for multiple companies to compete effectively.Here are the key features of how public utilities work:

1. Regulation: Public utilities are typically regulated by government agencies to ensure that they provide reliable and affordable services to the public. These agencies may set rates, approve investments in infrastructure, and monitor service quality.
2. Infrastructure: Public utilities typically own and operate the infrastructure necessary for their specific services. This includes power plants, transmission lines, water treatment plants, pipelines, and telecommunication networks. The infrastructure must be maintained and upgraded over time to ensure that services are delivered safely and reliably.
3. Billing and Payment: Public utilities bill their customers based on usage, with rates typically approved by the regulatory agency. Customers pay for these services through their utility bills, which may include fixed charges and variable charges based on usage.
4. Customer Service: Public utilities are responsible for providing customer service to their customers. This includes responding to inquiries, resolving complaints, and providing information about service outages and other issues.
5. Planning and Investment: Public utilities must plan for future demand and make investments in infrastructure to meet this demand. This may include building new power plants, expanding transmission networks, or upgrading water treatment facilities. These investments are typically approved by the regulatory agency and paid for by the utility's customers.

In conclusion, public utilities work by providing essential services to the general public in a regulated, cost-effective, and reliable manner. They own and operate the necessary infrastructure, bill customers for their services, and make investments in infrastructure to meet future demand. The regulatory agency oversees their operations to ensure that they provide high-quality services at reasonable rates.

What are the Different Types of Public Utilities?

Public utilities are services that are provided to the public by the government or a private company. These services are crucial to the daily functioning of society and are typically provided by government agencies or private companies under government regulation.Utilities can be classified as either natural or artificial. 

Natural utilities, such as water and gas, are found in nature and they cannot be created by humans. Artificial utilities, such as electricity and telecommunication services, can be created by humans. 

 Here are the different types of public utilities:

1. Electricity: The provision of electrical power to homes and businesses is an essential service provided by public utilities. Electric utilities generate, transmit, and distribute electricity to homes, businesses, and industries. These utilities may be publicly or privately owned, depending on the country's laws and regulations.
2. Water and Sewage: Water and sewage utilities provide clean and safe drinking water to homes and businesses while also managing wastewater treatment and disposal. These utilities ensure that water is safe to drink, and wastewater is properly treated and disposed of to protect public health and the environment.
3. Natural Gas: Natural gas utilities provide gas for heating, cooking, and other purposes. These utilities typically own and operate pipelines that transport natural gas from production sites to homes, businesses, and industries.
4. Telecommunications: Telecommunications utilities provide telephone, internet, and cable television services to homes, businesses, and industries. These utilities operate and maintain the infrastructure necessary for communication and entertainment services, such as telephone lines, fiber optic cables, and satellite networks.
5. Transportation: Transportation utilities provide essential services for public transportation, such as buses, trains, and subways. These utilities are responsible for maintaining the infrastructure necessary for public transportation and ensuring that it operates efficiently and safely.
6. Waste Management: Waste management utilities are responsible for collecting and disposing of waste materials, such as garbage, recyclables, and hazardous waste. These utilities ensure that waste is properly collected, transported, and disposed of to protect public health and the environment.

In conclusion, public utilities play a critical role in providing essential services to the general public. The different types of public utilities ensure that people have access to safe and reliable electricity, water, natural gas, telecommunications, transportation, and waste management services. They are essential to the daily functioning of society and are typically regulated by government agencies to ensure that they provide reliable and affordable services to the public. 

How Public Utilities are Impacting the Real Estate Industry

Public utilities have a significant impact on the real estate industry, as they are essential for comfortable living and working environments. Access to reliable electricity, water, sewage, and other public services can increase the value of a property, while inadequate or poorly maintained public utilities can decrease it. Here are some examples of how public utilities impact the real estate industry globally:

1. Electric Power: In many parts of the world, access to reliable electricity is a key factor in property values. For example, in Nigeria, properties in areas with constant electricity supply command higher prices than those in areas without it. Similarly, in India, properties in areas with 24-hour electricity supply are in high demand and can sell for a premium.
2. Water and Sewage: Access to clean water and efficient sewage systems is crucial for healthy living environments. In the United States, properties located near polluted bodies of water or outdated sewage systems may experience a decline in property value due to health concerns. In contrast, in countries like Singapore, the government has invested heavily in advanced water management systems that ensure reliable and clean water supply, which has helped to drive up property values.
3. Broadband Internet: In the digital age, access to high-speed internet has become a critical factor in the real estate industry. Properties located in areas with fast and reliable broadband internet are in high demand and can command higher prices. For example, in South Korea, properties located in areas with ultra-fast broadband internet can sell for up to 30% more than those in areas without it.
4. Public Transportation: The availability of efficient public transportation can significantly impact the value of a property. Properties located near public transportation hubs, such as subway or bus stations, are often in high demand and can command premium prices. For example, in London, properties located near underground stations can sell for up to 50% more than those farther away.

In summary, public utilities have a significant impact on the real estate industry globally, and the availability of reliable and efficient public services can increase the value of a property. Conversely, inadequate or poorly maintained public utilities can decrease property values, highlighting the importance of investing in public infrastructure to support the real estate industry.

The Future of Public Utilities And Real Estate Industry

The public utilities and real estate industry is set to undergo a major transformation in the near future. With the increasing use of digital technologies, these industries are becoming more efficient and cost-effective. 

The use of AI and machine learning algorithms will help automate mundane tasks, reduce operational costs, and improve customer service. Additionally, new technologies such as blockchain will allow for more secure transactions and data storage. All of these advancements will lead to a more efficient industry that can better serve its customers.

References 

1. American Public Power Association. (2021). Public power benefits for communities and businesses. https://www.publicpower.org/public-power-benefits-communities-and-businesses
2. American Water Works Association. (2021). Water utility infrastructure: Essential for a healthy economy. https://www.awwa.org/AWWA-Articles/water-utility-infrastructure-essential-for-a-healthy-economy
3. Environmental Defense Fund. (2021). What is natural gas? https://www.edf.org/energy/natural-gas-101
4. Federal Communications Commission. (2021). Telecommunications services. https://www.fcc.gov/general/telecommunications-services
5. International Association of Public Transport. (2021). What is public transport? https://www.uitp.org/what-is-public-transport/
6. National Association of Regulatory Utility Commissioners. (2021). Understanding public utilities. https://www.naruc.org/commissions/understanding-public-utilities/
7. National Renewable Energy Laboratory. (2021). Renewable energy. https://www.nrel.gov/research/renewable-energy.html
8. Public Service Commission of Wisconsin. (2021). What is a public utility? https://psc.wi.gov/Pages/Utilities/PublicUtilities.aspx
9. United States Environmental Protection Agency. (2021). Municipal solid waste. https://www.epa.gov/rcra/municipal-solid-waste
10. U.S. Department of Energy. (2021). The role of energy in real estate. https://www.energy.gov/eere/buildings/role-energy-real-estate