Water & Wastewater Treatment Magazine
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www.wwtonline.co.uk | WWT | XXXX 20XX | 11 In Focus W hen Ofwat announced its dra determination decisions for PR19 in July, it said it expected bills to fall by 12 per cent before inflation over the course of AMP7. With the sector facing significant po- litical pressure in addition to the concerns over the impact of water debt, reducing the amount customers pay seems a logical solution. Yet climate change and population growth mean companies are now facing up to the need to not only spend out on greater levels of resilience but to encour- age the public to place greater value on water, and many in their supply chains are already struggling with low margins. Faced with such significant challenges, is it realistic to believe low prices are sustainable in the long term? Rising costs At a time when the privatised water indus- try faces a battle to justify its existence, lowering bills is an obvious means of win- ning public support, but the move comes at a challenging time. Water companies are under heavy pressure to boost resilience, including cutting leakage by an average 17 per cent in AMP7 as well as potentially making substantial investments in major infra- structure such as reservoirs, desalination plants, water grids and drainage systems. Last year, the Institution of Mechani- cal Engineers (IMechE) issued the 'Water: Drought and Flood' report, looking at how climate change may impact on the UK water industry. It suggested consumers may ultimately have to pay more for their water bills due to the spending required not only on new assets but also on treat- ing and managing water supplies. "One of the things you find in periods of drought is that people actually use more water," IMechE head of engineering Jenifer Baxter says. "They want to water their gardens more and they shower more because it's hotter. "That means you have to deliver more water to homes, and to do that you're having to deliver it from reservoirs and water storage areas that have less water in them. You have to push more water down pipes faster, which requires greater use of pumps and more compression, which also requires you to use more power. The increased water flow also means you need more chemicals to clean the water faster at the plants. "That all increases the cost of what you're doing. In addition to that, there's the expense of the ongoing repairing of pipes in the system." Baxter suggests more could be done to mitigate the impact of climate-related issues, such as installing more greywater recycling systems in domestic properties and adopting more co-ordinated ap- proaches to flood prevention, including widespread use of nature-based solutions. Even if those actions are taken, though, bill increases may be unavoidable given the extent of the investment that may be required. "You would hope that bills wouldn't need to rise if companies take the right approach, but price rises are based on a whole ra of different issues," she says. "In the South East of England, for exam- ple, water companies have to work much harder to manage water supplies and that is likely to increase the cost in the future." Valuing water There is also an argument to suggest that lowering bills could work against efforts to drive down per capita con- sumption (PCC). www.wwtonline.co.uk | WWT | OCTOBER 2019 | 11 Splashing out As part of our Utility of the Future campaign, Robin Hackett looks at whether low water bills can be maintained long term