The majority of water companies have admitted that they are likely to miss targets set at PR19 to reduce water consumption levels.
Affinity, Bristol, Hafren Dyfrdwy, Northumbrian, Portsmouth, Severn Trent, South Staffs, Southern, Welsh, Wessex and Yorkshire are all expecting to miss the PR19 per capita consumption (PCC) targets, and in some cases an increase in consumption is forecast by the end of AMP7.
In its initial response to companies’ water resource management plans, Ofwat said that the sector needs to go further and faster on reducing water consumption.
Of the companies critiqued by Ofwat so far, only South East and SES have said that they expect to meet PCC targets.
Anglian, Cambridge, Essex & Suffolk, South West, Thames and United Utilities are yet to submit their plans because their respective consultation periods are still open.
The regulator called on companies to make up the PCC shortfall during the current asset management period (AMP7) and warned additional spending would not be permitted in AMP8 for targets missed during the current period.
Ofwat added that water companies need to be more creative and come up with innovative ideas to deliver maximum benefits for customers.
WRMPs are produced every five years to set long-term planning for infrastructure investment needs.
Ahead of final plans being submitted to Ofwat in the autumn, the regulator fed back to the government on areas the WRMPs met expectations and where more attention is required.
Performance was significantly impacted by the pandemic that saw people spending much more times at home during lockdowns as well as a continued working from home culture that meant a shift from consumption at workplaces or schools to home usage during daytimes.
In its assessments of company plans, Ofwat praised levels of stakeholder engagement, the range of options considered and for setting out the drivers behind challenges.
Its responses also highlighted the need for continuity from current plans to the next five year period. It also asked for more detail on costs of proposed aspects of the plans to justify choices around efficiency, metering and leakage.
Ofwat said plans needed greater attention on business demand reduction and the role non-household water consumption must play in reaching overall reduction targets. It asked companies to set out and clearly justify ambitious strategies for non-household demand in final WRMPs to inform PR14 business plans.
“Our assessment of draft plans shows that companies have more work to do to develop their proposals to meet future challenges. Companies must take the opportunity to revisit and strengthen their plans,” David Black, Ofwat chief executive said.
“However, we were encouraged by the level of collaboration companies have shown in delivering a first set of regional plans, in addition to their area-specific plans and look for more of this as they develop their final proposals.”
The complex plans forecast future water needs in light of population growth and the anticipated impacts of the changing climate. These are balanced against available resources, which are also impacted by climate change.
At sensitive water bodies such as chalk streams, Defra challenged companies to find alternative sources to reduce abstraction in order to preserve the rivers and streams as well as the ecosystems that rely upon them.
For the first time regional plans have been created to coordinate the needs of five broader regions in England – south west, south east, east, central and the north. These weigh up requirements and highlight opportunities to share resources from areas with surplus water to those facing deficits. The five regional groups’ plans must work together to meet the collective national need.