Water & Wastewater Treatment

22 | JULY 2015 | WWT | www.wwtonline.co.uk Industry Round Table: Totex optimisation, says Higham. This means preventative maintenance, rather than just "sending a person in a white van" out to an asset that has an alarm signal to establish what the problem is. He says that Siemens is currently collaborating with SAP to be able to offer a data services platform which can present monitoring data in the form of smartphone apps, facilitating a proactive approach. "You've still got far too great a number of assets being run in manual rather than automatic and that's just a symptom of some of the issues that are underlying," says Higham. And if asset decisions are complex, then an evidence-based approach becomes even more difficult where non-asset solutions such as catchment management are concerned, points out Neil Wilson, Head of Risk and Investment at Wessex Water. "It's very difficult to measure the incremental change that you make a decision based on, if it's not a 100% certain treatment solution," says Wilson. "You could take catchment management as being a Totex decision - by the first AMP, second AMP, that's all Opex cost. So, you've made a decision for the long term that hasn't got certainty. The regulators can't be clear about it other than to say that it continues to be an issue how to measure performance. As an example, that's the kind of challenge, but tenfold, we need to consider." Wilson says that AMP6 may end up being a transitional AMP, as the utilities get to grips with the choices offered by Totex at the same time as aspirational ODIs and tight cash constraints. He also feels that the five- year cycle for price determinations remains an obstacle. "We're trying to smooth the investment programme, and looking forward 10 years into AMP7, you can probably get a feel for what 70-80% of the programme is going to be. But the main thing you're still constrained by is what period the regulator wants to set the bills. And you obviously need to separate out those two things: the bill setting piece and your actual decision making about your assets. And until we do that, the owner, the finance director and the board more generally will struggle to commit to longer term decisions because they don't know that they'll definitely have the means to support them later." There is no doubt that Totex will require and enable different ways of working, but perhaps the biggest challenge that water companies face is bringing about a change in culture to make those ways of working happen. David Widdowson of Yorkshire Water says that it is only in the last 18 months that the company has carried out asset management as a 'joined up activity'; it has concluded that it needs to build more in-house engineering capability in order to understand its assets. But above all the shi˜ required is one of mindset. "We need to do more thinking at the front end about what the longer term solution is," says Widdowson. "Let's not just go back to the thing that we've historically always been funded to do, which is to build our RCV and to cut our Opex. That's the model that we've been financed to follow and that culturally we're familiar with. We have to fundamentally change the way we operate, and to my mind, this is just one step along the way." Paul Horton (le ), Chief Executive of the Future Water Association, chaired the discussion Keith Hayward, Hydro International "Has the water industry signed-up to Totex? A er WWT's excellent event, it's clear that delivering whole- life asset efficiency is enthusiastically-embraced as the right way to deliver greater consumer value in future. Procurement and contracting practices simply have to change to allow capex and opex investment to be evaluated together. Then, innovative technologies can be accepted based on delivering whole-life performance, rather than on the cheapest up-front costs." Nigel Earnshaw, Black & Veatch "Black & Veatch was delighted to be a partner for this round table discussion on Totex. The concept of Totex is that excellent customer value is achieved by taking into account both capital costs and operating costs; water companies are embracing the Totex environment in innovative and exciting ways. This roundtable event enabled senior figures in the water companies and their supply chain to meet to exchange views and best practice so that our customers benefit." Mark Higham, Siemens "We feel it is absolutely vital that we engage with the industry from a technology perspective as we enter what can only be described as a new era for the UK water industry. AMP6 will herald a new settlement for maximising efficiency and investment – but perhaps more critically competition will radically alter the water market landscape in the coming years. Siemens believes that technology holds the key to unlocking the successes our water companies need to thrive."

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