But a growing population, increasing per-person water usage and changing weather patterns mean that, even without a drought, the situation is unsustainable. In the southeast and east of England, almost every month for the past two years has seen below average rainfall. And England’s population will increase by ten million by 2035.
As water supplies continue to be threatened by the lack of rain, with hosepipe bans under way and the entire southeast and east of England in drought, we must start managing our water supply better for the long term – not just building expensive infrastructure to meet increasing demand.
I’m pleased the Water White Paper recognises that water efficiency will have to be stepped up beyond areas currently defined as water-stressed, given the unpredictability and swiftly changing nature of supply and demand. When we founded Waterwise six and a half years ago, we were told by some that there would never be a need for water efficiency in the northwest of England or in Scotland. And yet, in 2010, these were the only two areas of the UK with a hosepipe ban or drought.
Water efficiency targets for water companies have ensured that discussions on water efficiency reach the boardroom. And water companies have a large amount of water efficiency activity under way now – far more than was the case during the last price review. But water efficiency spend is still peanuts when compared with supply-side measures. Over the PR09 period this comes to £18.5 million on water efficiency (under base level targets), or 0.08 per cent of the £22 billion the industry is spending on capex. If they were spending even 1 per cent, this would mean £220 million on water efficiency over the five years, which would make a measurable difference to the supply-demand balance.
Also frustrating is the fact that dealing with drought seems to have a considerable budget attached, while longer-term, larger-scale, strategic (and drought-easing) measures have to scrabble for funds all year round.
The Water White Paper committed the government to addressing the bias towards capex, and driving a different treatment of risk to reflect new pressures. It is essential that this, alongside a longer-term assessment of costs and benefits, plays a central role in the guidance due this year from Defra (to Ofwat, on the Water Resource Management Plans, and on social tariffs), and in Ofwat’s work for the 2014 price review.
Giving evidence recently to the Environment, Food and Rural Affairs select committee in the House of Commons, Ofwat chief executive Regina Finn said: “At times when we face what we are facing now – a drought over significant parts of the country – it does not matter how big your reservoir is; if it is empty, it is not going to be any use to you.”
I can’t think of a better argument for water efficiency to join the grown-up table in water companies, where the big investment decisions are made. Drought not only gives us the opportunity to engage with people over their water-using behaviour – it also gives us the opportunity to be bold with the regulatory framework for water to deliver a robust response to the future challenges we all agree on.
After the spectacular economic crash of recent years, discussions about how capital operates in the context of wider social and economic needs became far more radical. Prolonged and widespread drought gives us the opportunity to do this with the water sector.
Water efficiency must play a key part. It is not just an emergency measure. It doesn’t just help manage drought. It also helps avoid it.
Nicci Russell, policy director, Waterwise
This article first appeared in Utility Week’s print edition of 6 April 2012.
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