Ofwat has expressed in no uncertiain terms that it requires the water industry to be more innovative.
It focus on this requirement began in earnest in PR14 when began tracking company outputs and emphatically asked companies to show that they were ready to innovate to deliver imporved customer value. In PR19, this pressure will only increase.
Notwithstanding this, Ofwat has steered well clear of suppling the innovation funds and mechanisms which water companies’ peers in the energy sector enjoy. And for a variety of other reasons, the sector has historically found it difficult to demonstrate to critics that water companies can really be ambitious ideas generators. It’s certainly true to say that investment in research and development is low in the sector when compared to techy game changers in other industries.
But the word “innovation” is littered throughout Ofwat’s PR19 draft methodology, Indeed it is one of four core themes which tie the proposed framework for the price control together. Across the sector, it is increasinly apparent that companies are mobilising to repsond to this emphasis on innovation, working closely with third parties, investing in tools and technologies to support their ambitions and hosting events which bring together a variety of perspectives on key challenges where innovation is needed.
Northumbrian Water’s week-long innovation festival, run in early July is a case in point. The event brought together industry figures, regulator representatives and members of the public to address some of the major challenges which face the water industry, in order to generate potential novel solutions.
Five challenges were chosen for a series of coordinated design sprints: flooding, leakage, future-proofing infrastructure, improving the environment, and managing mobile workforces. Delegates brainstormed ideas for solutions to these issues and a shortlist was selected for further development throughout the week.
Technology, such as fibre optics and artificial intelligence, was found to have great potential to improve infrastructure and allow for bespoke communication, thus improving customer service. And sharing of information and infrastructure was discussed as a way of preparing for future challenges such as the effects of climate change and increased demand on resources.
A two-day data analysis operation, led by Microsoft, ran alongside the design sprints. The ‘hackathon’ sought to find new ways of identifying and mitigating existing problems in a more cost-effective way. A team of 60 data scientists spent three days crunching 4.5GB of data from sources, including existing leakage information, road traffic statistics and Second World War bombing records – the number of unexploded devices still littering the UK is a common challenge for Water networks.
Using analysts with no attachment to the water industry, meant Northumbrian benefitted from a genuinely new perspective on its operational and strategic challenges and was able to look dispassionately at the data without preconceived ideas of why certain patterns may or may not appear.
“There is definitely something about collaboration that is really important to doing innovation well. We have talked quite a bit recently about the importance of collaboration both within and beyond the industry,” said Ofwat director of strategy and policy Carl Pheasey, who attended the event.
“The really good innovative ideas come out when you get people from very different backgrounds and frames of reference coming together and trying to take a fresh look at how to solve long-standing problems. So, getting people from lots of different sectors together to think about things afresh is really great,” he added.
Below, Utility Week reviews two key challenges areas and outputs from Northumbrian Water’s innovation festival.
Case Study: leakage
The challenge
The water industry reduced leakage considerably in the late 1990s. However, since 2000, leakage levels have declined at a much slower rate in Wales and have stabilised in England.
Nationally more than 20 per cent of all portable water produced is lost and wasted during distribution—Leakage is therefore a major issue facing the industry today.
As such, Ofwat has vowed to take a much tougher line on leakage in PR19, and expects companies to “look much harder” at how they can reduce it.
Whilst surface leaks are simple to identify and repair as they are visible to the naked eye, it is those leaks below the surface that pose the biggest challenge.
The overall focus of a sprint at Northumbrian Water’s innovation festival was to create a practical application of new or revised analytics and intelligence systems then consider how these could augment existing leakage detection systems.
Delegates were tasked with finding new methods for supporting more effective leakage detection, improving and extending existing leak detection methods, and collaborating on new system and hardware ideas.
The design sprint ran in tandem with a large-scale data analysis project, in which multiple streams of data were scrutinised by experts from Microsoft.
Speaking at the festival, Northumbrian Water performance and information team leader Michael Hall said: “There’s a great need for more data analytics—understanding more about our water network, understanding more about how we can drive down the cost of repairing small leaks in the ground, and changing leakage economics.”
“We also want to more accurately locate leakage, so it’s about prediction and understanding the parts of the network that have got the highest propensity to leak.”
The solution
The sprint produced several ideas which could provide viable improvements to the detection and mitigation of leaks.
Technology was very much in the spotlight throughout, as delegates discussed the possibility of a dedicated mobile app to allow the public to report leaks with greater accuracy, by using geolocation settings.
Another suggested application of technology was to develop an intelligent system that allowed water companies to more effectively monitor its infrastructure, highlighting deterioration before leaks occur.
Participants also outlined how a tool could be developed to allow companies to focus their efforts on areas where the biggest impact on leakage reduction can be made.
One of the major findings of the data analysis showed that by focusing on specific district metered areas, companies could identify ways to reduce overall leakage.
Northumbrian Water network services regional manager (South) Ian Cleaver said: “Some of the ideas that came from the sprint have the potential to reduce the amount of water lost, such as using mobile apps that can allow our customers to become active participants in our leak finding activities, enabling us to react faster and better pinpoint, even if they are in the middle of a field or wood.
“We also came up with ideas that would allow us to more closely monitor the physical performance of our network, so that we can see where there is the potential for leakage to occur as a result of deterioration of our network of underground pipes, and deal with it before a leak occurs.”
Case study: flooding
The challenge
Flooding is an ongoing issue that water companies must address if they are to meet long-term resilience and environmental commitments.
Sewage leakage as a result of flooding can cause damage to properties, disrupt traffic, and cause pollution, all of which can incur fines or compensation pay-outs. Taken together, it can be a costly problem for water companies if not addressed quickly and effectively.
Such flooding can be caused by blockages, faulty equipment or it can be caused by acts of nature such as excess rainwater or overflowing rivers. Whilst some of these causes are largely unavoidable, being able to identify high risk areas and better mitigate incidents will minimise their impact.
One major difficulty in dealing with flooding is that the cause of the problem is not always nearby to where the flooding occurs.
An IBM led design sprint sought ways to reduce the frequency and impact of flooding. Attendees looked at how lessons could be learnt from past flooding incidents, how they are handled now, and ways in which they can be dealt with more effectively.
IBM Global Business Services Executive Partner in the UK, Darren Bentham, said: “Flooding is a complex issue which has a profound impact on people and communities. It is exactly the type of social and environmental challenge IBM loves to tackle. We are excited by the prospect of working with NWG and the team in our sprint to find pragmatic solutions to both predict and mitigate the impact of flooding.”
The solution
Overall, collaboration was highlighted as being key to identifying flood risks and improving how they are dealt with.
Communication was seen as being the main factor in limiting damage—it was suggested that an agency could be created to liaise directly with customers and give and receive bespoke information on flooding, helping to reduce flood risk.
It was also suggested that members of the public could work closely with relevant agencies and help to keep communities informed, to help reduce flood risk and enable people to be better supported when they are affected
“I think it has been easy to become quite siloed in how we’ve dealt with flooding. Sewer flooding has previously been seen as problem, river flooding is something the Environment Agency has been responsible for. there’s a lot of mileage in being more collaborative and understanding the whole system,” said Northumbrian Water research and development manager Chris Jones, who took part in the sprint.