Utility Week

18 | APRIL 2023 | UTILITY WEEK Water Pushing an urgent message to the regu- lator, this attendee stated: "At the moment no pilot in this space could actually end up being a real tari unless Ofwat changes its position." Getting into the speci• cs of what regulation needs to change as a priority, this participant pointed to the constraints of "Condition E" in water company licences, a clause that prohibits the use of pricing which might be seen to create space for "undue preference" or discrimination for di erent customer segments. This attendee's complaints drew nods of understanding and empathy from around the table, but also prompted a serious dis- cussion about the implications of tari inno- vation for customer vulnerability – a topic that felt especially sensitive in the context of the a ordability crisis. "The reality is that when you look at the evidence around engagement with water eƒ ciency drives that we've done in the past, 95% of the time the people that get involved are a‡ uent," said one attendee. By exten- sion of logic, they suggested: "Solutions on dynamic pricing always bene• t those that are actually able to Š ex. They never bene• t the most vulnerable." This point was widely acknowledged around the table, with many drawing com- parison to the energy sector where experi- ments with dynamic pricing and energy Š exibility are throwing up major challenges around equality of access to market and consumer detriment considerations. One participant simply argued: "These [dynamic] markets just don't really work for the vulner- able and you've got to do something di erent for them." While others at the table didn't necessar- ily share this sentiment, there was consensus that pricing innovation will need to be sup- ported with better customer segmentation so that o ers can be targeted appropriately. And again, this is easier said than done, according to our credit risk leader. "It takes us back to data quality and knowing the property base a lot better than we do today," they said. "The issue is that we are talking about literally mil- lions of properties. And on the edges of the supply area there is even cross-billing going on because it's o" en so diƒ cult to keep track of who is my customer or your customer." Summing up the starting point for any aspiration to support customers through the current period of economic turbulence as well as the longer running climate crisis, they emphasised: "Data quality is a pre-req- uisite to all of this." Jane Gray, content director Event continued from previous page Opinion Adrian Alexandru Sales director, Gentrack I t was a privilege to attend the recent roundtable event and discuss key challenges with leading water industry • gures. The encouraging sign, though, was the potential for technology to address these challenges and provide better experiences for water customers. Gentrack plays a pivotal role in delivering the services behind two of the world's most precious resources:–energy and water, and it is a role we take very seriously. The water sector has an ambitious set of long-term targets to meet ranging from zero serious pollution incidents to cutting leakage by half and delivering net-zero emissions. The most recent planning period, commonly known as PR24, places an unprecedented focus on adaptive planning, with Ofwat expecting water companies to be eƒ cient and innovative – driving the frontier forward on service and cost eƒ ciency. This can be achieved by e ective use of technology in at least two main areas: • driving operational eƒ ciencies. • better engaging with the customer. While the perception of utilities has historically been that they have failed to e ectively engage with their customers, the good news is that turning this trend around does not require a massive overhaul; it takes clarity of vision – and adoption of the right tools and technology. To start with, analysing consumer data provides critical insights into usage patterns, peak demand, and customer behaviour; thus helping water companies to optimise the network and incentivise customer behavioural change in water consumption. As with the energy industry, I believe that the more smart meters can be implemented, the more data can be analysed, and the more bene• ts will be achieved. For example, smart meter data could be used to feed advanced models to forecast demand, and would go a long way to addressing at least a couple of challenges: • design the network for the actual need, instead of "always at peak"; • identify areas where customers are using excessive amounts of water – and target those areas with educational campaigns to encourage more responsible water use. Second, digitalisation of customer service is long overdue. The past few years have seen a shi" in customers' expectations – fuelled by the rise of brands like Amazon and Uber. Water companies cannot a ord to ignore this trend; indeed, interacting with customers via their (multi) channel of choice reaps many bene• ts such as: alleviating pressure on their customer service units; fewer customer complaints; and overall, increase customer satisfaction. Last but not least, automation of customer journeys has the potential to free up precious (human) resource from mundane, repetitive tasks – and boost the capacity in areas at the forefront of innovation. "Technology can provide some smart solutions"

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