Water Efficiency Strategy for the UK: water companies and regulation

Waterwise UK Water Efficiency Strategy

Water Efficiency Strategy for the UK: what can water companies and regulation do?

A strategic approach to delivering more ambitious water efficiency is needed to help ensure enough water for people, the economy and the environment, now and in the future.

UK expert body Waterwise has launched its Water Efficiency Strategy for the UK. The strategy sets out an ambitious blueprint for a water-efficient UK - where water is used wisely, every day, everywhere, and this helps to tackle the very real challenges of climate change and environmental degradation we face now and in the future.

Waterwise is the leading UK authority on water efficiency and well-known in the sector for driving ambitious actions and innovative thinking on water efficiency. The strategy will help all of us aim high on water efficiency.  

So what can water companies and regulation do?

Governments and regulators across the UK have said they want to see more ambitious water efficiency, to meet the needs of people, the economy and the environment in the face of climate change, population growth and new ways of using water. The recent Water UK report also showed that there will be more frequent, longer and more acute droughts in future than had previously been thought – right across the UK.

Governments and regulators across the UK have said they want to see more ambitious water efficiency

Water companies

Water companies have stepped up their water efficiency activity with customers in recent years – with hundreds of thousands now receiving a free visit-and- fix to their homes and advice on how to use water efficiently. Some water companies are developing new approaches such as financially incentivising developers to build water-efficient homes, and offering cash rewards to whole communities which waste less water. But water efficiency activity remains a drop in the ocean in terms of overall water company investment.

water efficiency activity remains a drop in the ocean in terms of overall water company investment

We’d like to see water companies engaging with every single one of their customers on water efficiency. This ambition, combined with innovation, is not only a more sustainable and flexible approach – what if a big new desalination plant or reservoir which has taken decades to build ends up being in the wrong place?! – but is almost always the most cost-effective approach over the long-term. And it’s an urban myth that water-efficient fixtures and fittings for homes cost more than water-wasting ones – they don’t! And these days they’re usually equally whizzy and nice to look at!

Water companies also need to treat water efficiency as a strategic issue and not only one of supply and demand. For England and Wales, Ofwat has made it clear that water efficiency should be on every Board table. Waterwise’s Leadership Group on Water Efficiency and Customer Participation is working with all UK water companies at Chief Customer Officer level to ensure that water efficiency is seen and used as a strategic tool for customer participation, as well as for resilience.

Water companies .. need to treat water efficiency as a strategic issue and not only one of supply and demand

There is also wide variation in the level of water savings achieved in water company retrofitting programmes, in the quality of delivery and in the evaluation and planned use of resulting data. We can learn from the range of approaches and their level of uptake and water savings achieved to improve the impact of water efficiency programmes as they increase in scale.

Ambitious, innovative water efficiency is going to be essential as water companies improve the resilience of their services – and move to being a more customer-led sector.

Westminster Palace

Come on Ministers!

Governments shouldn’t be allowing homes to be built, or products to be sold and fitted, which waste water. When we look back in say 2050, we really will be kicking ourselves if we carry on as we are now. So our strategy calls on UK governments to use regulation to protect future water supplies for people, the economy and the environment – enforcing only water-efficient homes and products. We’d also like government to refer to the need for ambitious, innovative water efficiency publicly every now and again as a solution to many of the challenges we face – environmental degradation, water scarcity, water and energy bills, reliance on carbon, and others. Come on UK Ministers, where are you on this?!!!! Time to step up!

Smart metering

Metering is a key one in the toolkit we need for greater water efficiency. But only half of homes in England and Wales have a water meter (almost two thirds by 2020) and almost none in Scotland – with everyone else paying a set amount and using as much as they like.

Metering isn’t the be-all and end-all, that is certainly true, and it can’t do anything by itself. I take the view that all of us have feelings about water which we don’t have for other utilities. I don’t have an emotional attachment to the energy I use in my home, or my broadband – I just want them to work. But with water, civilisations have grown up around it, we take holidays around water, we enjoy invigorating showers and cool drinks of water. Not to mention swimming pool and paddling pool fun! Engagement with customers in Northern Ireland on water efficiency, where customers neither pay for their water nor are metered, has led to behaviour change.

But meters can really underpin water efficiency programmes – as Southern Water has shown with the 16% savings from its meter rollout to all customers. Smart meters can provide the information to customers which can drive behaviour change – including through gamification (competing, in other words) with neighbours, friends and other family members. Smart meters which can be quickly and frequently read, and can send information almost in real time to customers’ phones, are the way forward. These really should have been linked with the smart energy meter rollout in GB, but that boat has now sailed.

no company should be putting a dumb old meter in the ground 

In the strategy (and in the Blueprint for Water NGO coalition’s manifesto for PR19, which we’re part of), we say that water companies should be increasing the proportion of smart meters in their metering programmes. In truth, no company should be putting a dumb old meter in the ground these days – one that only be physically read by lifting the manhole, a couple of times a year. And we’re calling on the UK government to remove the regulatory barrier to metering all customers in England if a water company isn’t in an area of water stress right now, as designated several years. We need water efficiency to help ease future pressures and not just current ones!

Metering with appropriate tariff structures - such as a rising block tariff (where the unit charge rises for progressively higher volumes of water taken by customers), or a seasonally-varying or aridity-indexed tariff (where water costs more per unit when it is less plentiful) - has the potential to be a major incentive for water efficiency in the future. The strategy recommends a new round of tariff trials, linked to smart meters.

Economic regulators

Economic regulators across the UK need to ensure that their incentives frameworks, and those against which water companies are held to account for the commitments they’ve agreed with their customers have water efficiency at the core. Targeted, ambitious, quantified water efficiency should be an explicit part of regulatory frameworks – such as Ofwat’s PR19 for 2020-2025 - and of company investment plans.

Ofwat needs to build into its regulatory frameworks acceptance of innovation that fails

Ofwat should ensure that its analysis of English and Welsh company business plans for PR19 reflects its high ambition. For example, it needs to build into its regulatory frameworks acceptance of innovation that fails - that’s the nature (the point!) of innovation. Partnerships delivering multiple benefits need to be squared with a regulatory tendency to draw a straight line between what water customers pay for and the direct benefit it leads to. It’s important that Ofwat includes water efficiency expertise in its price review work - to enable it to establish whether plans really are ambitious and innovative. The same is true of the analysis of Water Resource Management Plans.

Water neutrality

The Blueprint for Water NGO coalition has called for a ‘water neutral’ PR19, where companies ensure there is no overall increase in the amount of water abstracted from rivers and groundwater despite increases in population and climate change. Water efficiency will play a major role in this. Governments national and local should also be routinely using water neutrality as a planning tool – requiring that the water resource needs of a new development (homes or business) are offset by retrofitting and other water efficiency savings in schools, hospitals, business and homes in the local area.


Research and capacity-building

The evidence base for water efficiency, developed by Waterwise and the industry, has been used in business plans, Water Resource Management Plans and the Water UK long term water resources planning framework report. However, there is a need to update figures, drawing on more recent schemes. This will help understand variation between companies and programmes.

We also need to continue to raise capacity and skills in delivering water efficiency through training and accreditation programmes. Waterwise’s training programme can do this - currently in-person (at a discount as we phase it out over the next few months, so contact us on svickerman@waterwise.org.uk if you’d like to book in), we’re soon moving it online. It trains (and certifies) teams and individuals in water efficiency retrofitting and behavioural advice.

being a gold, silver or bronze Waterwise supporter is a great way to show you’re taking water efficiency seriously

I’d also highly recommend becoming a Waterwise supporter – being a gold, silver or bronze Waterwise supporter is a great way to show you’re taking water efficiency seriously. We can help you to be ambitious and innovative on water efficiency in your own organisations. And it’s the supporter packages that fund our thought leadership work – constantly pushing the agenda forward, as we are doing here through our Water Efficiency Strategy for the UK! Contact me at nicci.russell@waterwise.org.uk if you’d like to become a Waterwise supporter.

Aim high!

There’s lots for all of us to do – and this blog focusses on how water companies and those with regulation in their gift can aim higher, for the sake of people, the economy and the environment.

It’s down to all of us to take action to drive more water efficiency - governments, regulators, water companies, manufacturers, businesses, workplaces, and all of us in our homes and gardens. It’s totally doable if we work together - and that’s what we’re going to do. We’re aiming high in water efficiency, together.

The Water Efficiency Strategy for the UK is a great opportunity to deliver more ambitious water efficiency in partnership - building on work to date.