erated by the local municipality (or private local operators) without the intervention of large operators. On the downside, the spread of such local systems might eventually put considerable strain on the frequency spectrum. In the case of water, a number of drivers such as environmental pressures (drought, floods, pollution), security concerns and mounting operating costs will create opportunities for recycling water and creating local loops. This model is likely to apply primarily to the urban and rural residential users as well as to industry. In the near term, developed countries could be the main users because the upfront investment will be borne by the end user and they need to have access to sophisticated technologies such as biotechnologies. As was seen in the case of recent privatisations, such moves may well create liability issues and the need to adapt regulatory oversight mechanisms. In the case of energy, the diversification of sources is already high on some countries' national policy agenda. Distributed generation technologies may offer a number of advantages. For example, they tend to reduce the need for investment in long distance high-tension transmission lines. In the case of land transportation, by contrast, there is no obvious link to smaller-scale operations, although it has been noted that ageing populations in developed countries might create slower growth in vehicle ownership rates, little or no growth in km per vehicle and declining rates of road capital stock. But they could also create more needs for specific services such as minibus taxis and small buses. The increasing shift from taxes to "user fees" could also lead to reduced appetite for mobility, but the jury is still out on this issue. An indirect impact of the emergence of smaller-scale systems may be to modify the industrial structure of the supply side. Instead of large systems built by the large engineering companies of this world (such as ABB, Alstom, Areva, GE, Siemens, Westinghouse in the case of energy) a share of the mar