122 delegates from a wide variety of backgrounds were registered to attend this annual meeting at the Royal Geographical Society headquarters in London. The meeting was opened by Neil Reynolds of CH2M HILL who observed that the water industry was facing twin challenges of both too little and too much water, with what was now the wettest drought on record! This necessitates a new model for the water environment in which less is spent but to better advantage. He noted that a current rates it would take 800 years to replace all the sewerage network.
There followed three short presentations on Perspectives of the Water White Paper (WWP)before an open discussion session. Alan Sutherland ( Water Industry Commission for Scotland), noted that the WWP focussed not on competition as an end in itself but in the interests of customers. The proposal to separate wholesale and retail activities was not relevant to Scotland where it already exists and works reasonably well. He thought a target of 2017 for implementation of the new Act was realistic. Ian Barker (Environment Agency) referred to the EA publication of “The case for change” which had concluded the the status quo was not suitable for a future in which there will less water, and in particular the current abstraction regime was too inflexible and needed changing. Sonia Phippard (Defra) summarised the key points of the Bill, which could save about £2 billion over the next 30 years. Unbundling the wholesale and retail elements of licences will allow new entrants to provide any part of the water service rather than the current licencing which outside of inset appointments requires provision of water treatment, distribution and supporting administrative services, . Allowing all businesses to switch suppliers of water or sewerage and freeing up entry for new entrants, limiting the need for consultation on mergers, and reformation of connection charges were key elements of the Bill. The Bill is open for comments before being finalised as an Act. Contributors from the floor noted the absence of reference in the Bill to the need for OFWAT to have regard to sustainable development
Colin Skellett (Chairman Wessex Water) gave an excellent and wide-ranging presentation in which he stressed the public health role of water supply, the need for infrastructure investment and that the industry was serviced by debt ultimately paid for by the customer. He stressed that customers want good service and stable bills. Challenges for the industry were climate change, increased customer expectations and the need to influence customer perceptions and increase their understanding. Same day fixing of visible leaks, reduction of abstractions in environmentally sensitive areas, and supporting river flows by pumping would all be good practice. A Wessex study has shown that metering can save up to 15% of consumption. It was instituting a project in Dorchester in which customers will get live information on computer etc. regarding their water consumption with suitable rewards for reductions in usage. He spoke of the need for more practical social tariffs as well as of the value of regulators, especially DWI, as independent advocates of the efforts and achievements of the water companies. He finally referred to the need for access to the lowest cost finance for the current £49billion debt which requires everything possible to be done to maintain investor confidence.
Mike Waite attended a workshop on Catchment Sensitive Farming (CSF) which considered the ways in which farming practices can impact on the water health in catchments, and the support available to farmers to help them minimise these impacts. Natural England in its CSF initiative has identified 65 priority catchments in England and Wales in which it has been offering free training and advice to farmers on such matters as manure management, nutrient management, soil condition and pesticide management. Measures deployed to protect water bodies include reducing pollution sources, breaking or slowing pathways for pollutants to reach watercourses, and protecting the receiving water from livestock access. These are supported by a capital grants scheme. CSF is now establishing 9 Catchment Partnerships in which a range of environmental organisations, water companies and local councils will work towards reducing diffuse water pollution from agriculture. It was concluded that farmers were in general receptive and cooperative when issues and impacts of their activities were explained to them.
The afternoon session started with a panel presentation and debate chaired by Tom Burke (E3G Director) from which Anne McIntosh (Chair Ho EFRA Select Committee) had had to withdraw as a result of the publication of the Water Bill. Tony Smith (Chief Executive CC Water) said that the customer wants affordable water and sewerage and the pacing of expenditure needs to be consistent with affordability. While greater competition might help it is not an end in itself. The regulatory regime needs to have customers on side and should put less emphasis on regulatory standards and more on customers wants.
Tony Kelly
(MD Yarra Water (Aus)) spoke of the recent drought in Australia when water ran out with no agricultural water in the Murray-Darling catchment. In consequence barriers between utilities had to be broken down. Having universal metering customers could be made aware of their usage and focussed on making savings to the extent that usage was reduced by 40%. Leakage is down to 8%! The implementation of a three tier tariff with higher charges for excessive or non-essential use was liked by customers. A new development of 100,000 properties will have dual supplies with recycled water for non-potable use. The State of Victoria has required water utilities to have joint planning of resources and has a water grid which avoids the need for desalination. Customers are kept informed regarding bursts and any reasons for apparent delays in repairs. Mark Powles (Chief Executive. Business Stream) said that 5 years ago the emphasis was on assets and no-one talked about customers but the White Paper and Water Bill takes more account of customers. The ability to change suppliers can bring about better prices even without actual change as has been found in Scotland where there is already a competitive market for both wholesale and retail services and customer satisfaction has increased and charges are the lowest in the UK.Mike Waite attended a workshop on Water Re-use - Public Perceptions and Opportunities. The consensus was that the public would instinctively be opposed to receiving recycled water no matter how safe it can be shown to be. While the use of river abstractions is accepted by the public, the direct input of fully treated effluent into a water treatment works would not be acceptable. There are over 1000 active re-use projects around the world and in the long term re-use and desalination will be the only solutions to tackle the likely global shortage of water. Education of children is the only way to eventually have knowledgeable adults capable of making rational and informed decisions about recycled water. Regina Finn (Ofwat) ended the meeting with a presentation on “The future of water regulation post the Water White Paper” She estimated the potential savings from the Bill as £2 billion with 1.2 million businesses able to move suppliers with a separation of wholesale or upstream controls and retail to allow competition for both. The Bill changes the culture from satisfying the regulator to satisfying the customer, with the regulatory emphasis moving from individual controls to specifying outcomes with companies free to achieve the outcomes in their own ways. Ofwat will treat Capex and Opex the same and expect companies to achieve results by the best means rather than just seek Capex solutions, for example controlling catchment inputs rather that building treatment plant. By introducing incentives for water trading companies can save up to £1 billion by cross-border trading.