The current and future impacts of coronavirus on the water sector will be explored by a working group formed by Ofwat along with the industry.
It will assess the risks and opportunities the pandemic poses now and in the future for customers and the companies that serve them.
The regulator said learnings from the group will inform its regulatory response and the discussions it has with stakeholders, but it is not intended to be the basis for regulatory changes.
In April, Ofwat chief executive Rachel Fletcher told water companies regulatory adjustments would only be considered when the impacts of Covid-19 were fully understood and urged operators to focus on the well-being of staff and duty to billpayers.
Ofwat told Utility Week: “It is still too early for a rounded and balanced assessment across all of the issues, not least because there is still a lot of uncertainty about what will unfold over the coming months. When we do make this assessment, it will be informed by a range of sources of information, including the work that is currently underway with Water UK and companies.”
The working group will cover the domestic and non-household markets, with three workstreams to explore what changes have emerged during the pandemic and forecast how these could change.
The first stream will look at developing common economic, social and behavioural change scenarios that the sector could be facing to understand potential impacts. These will be used as a basis for comparison and for stress testing different impacts of the pandemic.
The second stream will identify which aspects of water companies have been either positively or negatively impacted in a significant way and examine ways companies have or will mitigate these. Any concern raised by Ofwat, Water UK or a participating company will be investigated.
It will also look at opportunities that emerged to improve or enhance performance and service.
The third workstream will estimate how companies could be affected by the different scenarios identified by the groups.
The work is anticipated to carry on until the autumn.