Self-Supply Users Forum: Reflections and opportunities

Written By
Posted On

On 7th December, Waterscan hosted a meeting for Self-Supply companies to reflect on developments across the market over the past year and look ahead to how the sector plans to develop its approach in 2024.

It’s certainly an interesting time for the water industry which – due to increased climate-related challenges, unprecedented levels of public scrutiny and ongoing economic constraints – is under more pressure than ever before. Across the country, water companies need to ramp up their efforts on all fronts if they are to restore stakeholder trust in their day-to-day capabilities and demonstrate how they intend to optimise resources to achieve a long-term sustainable supply. All this, at a time when non-household customers are set to see bill increases of up to 13% from next April.

The Self-Supply community was therefore pleased to receive first-hand updates from market operator MOSL and regulator Ofwat on how they see the market guiding these programmes of work.

MOSL’s representative reviewed the market operator’s track record on its commitments to 2024, before presenting its new strategy and business plan for the next three years, which will be open for consultation in January.

Ofwat updated the group on its approach to scrutinising water companies’ submissions under the PR24 price control process. In the context of customer expectations, affordability challenges and climate change, Ofwat wants to improve water efficiency through demand reduction, improving market data flows, and by stringent performance commitments and incentives.

Most Self-Supply companies are ahead of the curve on these fronts: having benefited from market-leading levels of data-driven insight for some years, they are already taking great strides to improve their water efficiency and mitigate their operational and financial risks around long-term supply. As meeting chair Neil Pendle noted:

“At this time of year, there tends to be a focus on the operation of the market. Our engagement in these processes is important in ensuring that customers are represented and that they realise optimal outcomes. Even so, we mustn’t be distracted from the bigger picture; that is, to find ways to drive down consumption for long-term water security.”

In this vein, news of a behaviour change project was welcomed. Stemming from ideas generated at the Water Matters Conference earlier in the year, this initiative aims to understand how to alter established corporate practices to reduce water waste. If funding is awarded through Ofwat’s Innovation Fund, six Self-Supply businesses and five wholesale companies will partner to work on this two-year project. Consumption savings of up to 5% across 2,100 trial sites are predicted. More importantly, it is hoped that learnings will result in a set of principles that can be rolled out across all non-household settings to unlock systemic change in attitudes and behaviour towards water use.

The meeting finished with a panel comprising representatives from Ofwat, MOSL, the Strategic Panel and the Water Report reflecting on market progress in 2023 and residual challenges as well as opportunities arising for the year ahead. Panellists agreed that there had been some positive indicators over the year relating to setting direction and priorities focused on water resource management and in shifting attitudes towards smart metering. This progress was, however, balanced by upweighted challenges around customer confidence in water companies, inflationary impacts and investment challenges for remedial and proactive work.

Concluding the meeting, Neil Pendle noted, “It’s important that the industry isn’t inward-looking but approach the challenges ahead from a customer perspective. Self-Supply organisations are protected from many market challenges, but a functioning market is essential for long term water sustainability for all.”

A meeting report can be found here.

Blog image - Self-Supply Users Forum Winter 2023

Related Insights