Utility Week

8 | 18TH - 24TH MAY 2018 | UTILITY WEEK Policy & Regulation "The NIC sets out an aim to provide 34 per cent of resilience through efficiency – but it is also about shifting society to value water" Opinion Aaron Burton and Ben Earl W ithout further action, there is a one in four chance over the next 30 years that large num- bers of households will have their water supply cut off for an extended period because of severe drought. This is the finding of the National Infrastructure Commis- sion (NIC) report Preparing for a drier future, released last month. Waterwise is working with supporters, including Southern Water, to develop actions to improve resilience through water efficiency and we welcome the NIC report. The NIC report sets out an aim to provide 34 per cent of the recommended level of resilience we need through water efficiency. This includes reducing demand from 141 to 118 litres per person per day by 2050. We can be even more ambitious – for example, Southern Water is setting a demand reduction target to reduce consumption to 100 litres per person per day across its region by 2040. Target 100 is not just about reducing water consumption; it is about shiing society to value water. A recent report for Ofwat suggests levels of between 50 and 70 litres per person per day by 2065 are possible. A key recommendation is for the Department for Envi- ronment, Food and Rural Affairs to "enable water com- panies to implement compulsory metering by the 2030s beyond water stressed areas, by amending regulations before the end of 2019 and requiring all companies to consider systematic rollout of smart meters in a first step in a concentrated campaign to improve water efficiency". We fully support this recommendation, which was also in our Water Efficiency Strategy for the UK. The NIC calcu- lated that bringing forward metering could achieve a 400 megalitres (Ml)/day reduction in demand before 2050. The Southern Water Universal Metering Campaign was an important intervention carried out across its region. With 88 per cent of its customer base now on metered charges, the resulting 16 per cent reduction in water use has had a dramatic impact. Southern now wants to go much further to provide an ongoing bespoke programme of products, advice, services and incentives to help every customer connect with its campaign. The NIC also highlighted the importance of customer engagement. The recent freeze/thaw incident highlighted the continuing gaps in customer engagement that limit how we can respond to resilience events. Many of the recommendations following the 2012 drought have not been addressed, but Southern and Waterwise have been working as part of a regional initiative, Save Water South East, on longer term water efficiency communications. Businesses and households say they would like better communication in the run-up to a drought, with a higher background level of demand-side knowledge among the public. This chimes with lessons from Australia, where clear, credible communication about the drought situa- tion and response is paramount to public participation and support. A national communications platform, sup- ported by a coalition of stakeholders, could help address these issues. Customers also need to feel more connected with how much water they are using. Southern is build- ing on its metering project by testing a simple "water bit" clip-on device, to enable customers to see real-time displays linked to consumption data and incentives. Water efficiency labelling was also highlighted by the NIC to enable consumers to make informed decisions. Waterwise is leading an independent review into effi- ciency labelling options and Southern has been promot- ing efforts in the UK. This builds on findings from Aus- tralia, where a 20 per cent cut in water use was achieved over ten years; this approach is now being used as the basis to develop an ISO standard for labelling. Incentives can play an important role in changing customer behaviour. A strong label and economic incen- tives (e.g. rebates on efficient devices) are comparable with other recent environmental policies around charg- ing for plastic bags, discounts for using your own coffee cup, and pushing for a move away from plastics in gen- eral. Southern has demonstrated incentives can work, through a "community incentive" to share the proceeds of water savings in Hampshire. The project has saved between 5 and 7 per cent and is now part of a scheme to roll out incentives to 1.6 million customers in AMP 7. The NIC report makes a valuable contribution through its approach to the economics of drought resilience. Water efficiency initiatives, including metering, are oen considered less economic as water companies are planning to cut off supplies during a more serious and prolonged drought. The NIC believes this is unlikely to happen as the government and water firms would likely take emergency measures with high financial and envi- ronmental costs to ensure household water supplies. When these costs are taken into account, greater water efficiency and metering become much more cost-effective. Initiatives such as Southern's Target 100 will need more support from the government. We also need to see more partnership working with retailers to accurately forecast non-household demand and to implement water efficiency programmes jointly. Waterwise is hosting a Southern Water sponsored Leadership Group with retail- ers to support this. A strong water efficiency label and a national communications approach on water efficiency could help us achieve similar changes in behaviour to what we are seeing on food waste, plastic bags and use of disposable coffee cups. Aaron Burton, director of policy and innovation, Waterwise, and Ben Earl, water efficiency manager, Southern Water

• Cover