Utility Week

UTILITY WEEK | JUNE 2022 | 9 Interview S upplying 160 million litres of water daily to people in the South East, SES Water is by no means the largest water company in the UK, but chief execu- tive Ian Cain has no doubts about its importance to its customers. Cain, who joined from Centrica in February 2020, has a vision for the company that puts the environment at the heart of every decision, from the boardroom down. This is something Cain wants to see happen without losing sight of mounting affordability issues hitting householders. "I want us to be a business people can trust, that fulfils its promises, and is known for its purpose." That purpose, Cain explains, is about looking a‡er custom- ers, communities and "showing love" for the environ- ment at every investment decision. The team has taken to heart the motto "we're at our best when nature is at its best", which Cain says will be the bedrock for the company's thinking feeding into its business plan for PR24 and beyond. He says all investment decisions will be framed through that purpose and he believes the "mood music" from both the Department for Environment, Food & Rural Affairs (Defra) and Ofwat for the upcoming price review is encouraging for an industry that has its sights set on the longer term. "The test will be how the Ofwat team in their PR24 methodology genuinely support this being a founda- tional step in a longer-term approach to resilience. It's possible that a short-termism might creep in because affordability issues have been heightened more than was anticipated earlier in the pandemic." He says not making the next price review different "ought to be seen as deeply unacceptable". "There's no doubt the industry recognises Ofwat's role to lead and to scrutinise but we'd all feel better knowing what they are scrutinising for, for the bigger goal rather than a short term one." The short term need is to support households strug- gling to pay bills, which clashes with the urgency of investing for resilience, but Cain sees room for both. "Affordability is something we must solve for those with affordability issues, as opposed to having an affordability focus dominating all we do." To this end, he supports the single social tariff proposed by CCW but recognises the complexities of achieving it. Eradicating water poverty in the region as well as enhancing the water environment is key to the board. Jeremy Pelczer, who recently stepped down as chair, echoes this sentiment and says the board is not complacent about those who have financial chal- lenges, but he does not believe a blanket affordability approach is appropriate. "We need a targeted one that helps those who need it most," he says. "At PR14 and PR19 the approach was too much about blanket afford- ability rather than asking more from customers better able to afford it. One way or another we have to pay for the future." Looking to the future, the board wants to consider not only what 2025-30 will look like, but the decades beyond. "These should be staging posts," Pelczer says, "because if we don't start doing some of these things now, how are we going to meet ambitions for 2050 with- out massive bill climbs at the end?" Facing affordability pressures, current chair Dave Shemmans wants to see more application of technology and innovation to address challenges in the networks. For instance, SES is exploring how to use smart net- works with artificial intelligence, metering and moni- tors to manage pressure and flows and avoid leaks by interventions in the networks. "That can't be the only solution, but it does buy us some time. One of the beauties of SES is we're small and agile. We can try things and move very quickly. We don't have the power and the might of some others, but we have speed and the guile that we can use to good effect." Cain is not the first to say the PR24 outlook, as out- lined in Defra's Strategic Policy Statement and by early indications from Ofwat, lacks specifics and does not say how the regulator itself will be held to account by Defra. But beyond that, Cain points to broader concerns: "I don't see enough around the cognisance of recognising ecosystems together: food cannot exist without water, water and energy come together strongly too. We need to consider how those ecosystems come together in partnership to solve our needs better. "The infrastructure that makes the country work – energy, water, transport – we need to better plan continued overleaf

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