Utility Week

UTILITY WEEK | 7TH - 13TH SEPTEMBER 2018 | 13 Policy & Regulation It's the right thing to do "As well as a collective approach, there is much we can do individually as retailers and wholesalers to help customers reduce their water use." Chief executive's view Johanna Dow, Business Stream I mproving water efficiency was one of the desired outcomes on Ofwat's list of success factors for the opening of the retail water market and this is argu- ably more important now than ever, given the recent weather conditions. While everyone has a role to play in reducing water use, it will take a strong commitment from those in the industry to help ensure this objective is achieved. Ofwat's review of the first year of the retail water mar- ket estimated that business customers who had switched or renegotiated a better deal with their current supplier will have cut their water consumption by between 270 and 540 megalitres (ML) – the equivalent of between 100 and 200 Olympic-sized swimming pools – and that those same customers will go on to save between 380ML and 740ML annually. This is a great start, but we should be striving to achieve so much more. Although water efficiency is oen touted as one of the benefits that the retail water market will deliver, it will take more than the creation of an open market to realise its full potential. A key factor will be raising awareness to ensure customers truly understand the benefits and how using less water oen has a positive impact on energy efficiency too. Take-up of services designed to help reduce water use has been low; Ofwat reported that while interest in water efficiency is high, only 0.2 per cent of those who switched or renegotiated in the first year of the market referenced water efficiency and leak reduction services as a benefit of switch- ing. Yet the case for reducing water use has never been more compelling. Customers can achieve significant cost sav- ings by reducing the amount of water they use; that has to be a key selling point in a new market where there is switching inertia among SME and mid-market customers in particular. The low margins limit the level of discounts available and therefore reduc- ing water usage becomes a key way in which customers can deliver sustaina- ble reductions in their water costs. In addition to the cost savings, a focus on water efficiency will also help to generate greater environmental efficiencies, either to contribute towards customers' own sustainability targets or those set by government. We need only look at the extreme weather conditions experienced this year to understand the need to address this issue. Problems such as water shortages during periods of drought are likely to continue to recur, but by working together we can help to reduce the demand for water by encouraging customers to use water wisely. While it will take a commitment from everyone – retailers, wholesalers, customers, regulators and government – to deliver tangible improvements in water efficiency, I believe that we in the industry can play a key role in promoting its importance. This is something the Waterwise Retailers Leadership Group has been set up to encourage. The group provides an opportunity for retailers to work together to share ideas and best practice, as well as to promote more ambitious water- saving targets for customers. The first meeting took place Customers can achieve significant cost savings by reducing the amount of water they use; that has to be a key selling point in a new market at the end of June and plans are under way to establish a work programme and priorities for the year ahead. As well as a collective approach, there is much we can do individually as retailers, and indeed wholesal- ers, to help customers reduce their water use – because aside from the customer benefits, it's simply the right thing to do. At Business Stream we recently pledged to help our customers cut their water usage by 20 per cent. To deliver on this pledge, we will be working with our customers – in particular those who haven't adopted water efficiency measures to date – to identify and deliver water efficiency solutions that suit their needs. We have also launched a campaign to raise awareness of the importance of water efficiency and to promote the steps customers can take to make a difference. We all have a role to play to ensure we use only the water that we need. Regardless of a customer's main incentive, be it to cut costs, to generate efficiencies, or to tackle current or future environmental challenges – a greater focus on water efficiency will have a significant impact. It really is that simple. Johanna Dow will be speaking at the Utility Week Congress 2018. For more information visit: utilityweek.net/uwcongress

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