Yes and: Profitability is predetermined. Converting public goods and services into securities. Ideally. So a public utility issues bonds, instead of stocks.
Not sure what you mean, bonds and stocks are different liabilities and a state utility by definition cannot issue equity or the state would lose ownership. It means they must pay their bond coupons and therefore are very risk adverse and change resistant.
A security-emitting entity doesnt need to pay back the debt too much (it should but doesnt have to, via dividend) and therefore can afford to try things to raise returns for both shareholders and management and absorb failure.
The worst situation is when a state utility tries to innovate and fails: this leads to privatization which actually transforms it in a public companies (the words are weird: state companies are not directly publicly owned by the citizens, private companies on the public market can be). If a public market private company fails to innovate and just produces riskless cashflow forever, it becomes a good candidate for state private ownership.
