Driving down water consumption to meet stretching reduction targets has emerged as a key challenge for AMP8. Water company business plans published this week show the cost, via smart metering, could exceed £2 billion. Utility Week examines each company’s commitments to lower per capita consumption (PCC) and invest in smart technology.
Anglian plans to invest £137 million in smart metering as part of its efforts to lower PCC by 6% between 2025 and 2030. On top of this, the company plans to dedicate £22 million to demand side improvements.
This, Anglian says, should take the region’s average PCC to 124 litres per person daily, a 6% reduction on AMP7.
By 2025, it predicts PCC will be 132 litres per person a day, a 5.4% reduction since 2020. For 2022/23 usage fell to 138 litres, but the company missed its target of 130 litres. This was its lowest annual PCC performance, which it attributed to its smart metering.
By the end of this AMP, half of customers in the region will have a smart meter and during the next period all metered properties will be upgraded to a smart device.
Affinity, which has the largest customer base of a water only company, has put its weight behind reducing abstraction through better demand management. It will install 400,000 smart meters between 2025 and 2030 to one-third of its customer base. This is part of a 15-year programme to move to full smart metering of all properties where possible through a compulsory metering scheme.
It notes that, for itself and the wider industry, the workforce to install vast numbers of smart meters will need to be identified and upskilled.
Together with network calming, the company says 23% of its leakage reduction target will be achieved by smart meters highlighting lost water in the network. Its totex spend on metering proposed in the plan stands at £100 million.
Its PCC target for the period is 16% lower than 2019/20 levels. This will be made more challenging by failing to hit its 2023 target of 148.8 litres.
Northumbrian’s plan sees it aiming for a 6.9% reduction in household consumption and 27% cut in demand from businesses. This will be achieved through smart metering and demand management, accounting for £530 million of investment.
Its business plan includes Essex and Suffolk Water, as well as the north east region. The east of England is the driest part of the country and classified as seriously water stressed.
The plan states customer feedback did not prioritise investment in this area. The company says Covid-19 lockdowns and the shift to home working means PCC has increased by 5.6% for 2022/23 against a 2019/20 baseline. It anticipates a fall in PCC next year as the three-year average will not include the 2020/21 anomaly any longer.
Pennon’s plan stipulates a 5% cut in PCC supported by a smart meter rollout alongside trialling rising block tariffs, which the company describes as its first step to customer transparency of usage and understanding of usage drivers. The company will spend £82 million on metering and infrastructure across its three supply areas, which includes compulsory rollout in Bournemouth and the Isles of Scilly.
For the South West supply region, it anticipates a baseline in 2024/25 of 149 litres PCC with an aim to reach 135.9 by the end of AMP8 and 110 litres PCC by 2050. For Bristol Water, the company has set a target of 142.4 litres PCC, which is just lower than its missed target for this year of 143.1 litres. For 2022 Bristol lowered PCC to 154, while in South West consumers used 145 litres daily. The company wants to install 500,000 smart devices and infrastructure by 2035 to drive 8% PCC reduction by households and 3% by non-domestic customers.
Portsmouth had the highest average consumption in 2022/23 at 161 litres PCC. Although usage did fall year on year, it was not significant enough to meet the ODI of 143.6 litres. Its business plan indicates it will spend £65.5 million on universal smart metering that will continue into AMP9 so that all business and domestic customers will have a meter by 2040.
Severn Trent has a head start on its metering through its Green Recovery spending that will see 157,000 meters installed by the end of 2025 and near universal coverage by 2035. During AMP8 it proposes to spend £150 million rolling out 250,000 meters.
SES Water is aiming for a PCC reduction of 11% and – by working with retailers – a 5.1% cut to business usage by the end of AMP8, compared to 2020 levels. Demand reduction will be achieved through smart metering, education and efficiency home visits to highlight to customers where water can be saved. It proposes to invest £22 million installing 194,000 devices and infrastructure on its accelerated seven-year rollout.
South Staffs and Cambridge will invest upwards of £42 million across both its regions to install 30,000 devices each year as it works towards complete penetration in the next AMP.
Southern forecasts its programme will help save more than seven billion litres of water each year by 2030 and advocates for the rollout to be funded in the period rather than wait for existing dumb meter stock to fail as devices reach their end of life.
The company proposes funding one million meters and network, which it has costed at £175 million, through an alternative finance model.
Rolling out meters would help the company meet its PCC goal, which it did not achieve this year. Ofwat’s recent performance review indicated Southern’s customers used an average of 133.7 litres daily, against a target of 122.4 litres, which is a 4% year on year fall.
For 2030, the company’s target is 122.4 litres also.
Thames Water, which is yet to publish the full plan it has submitted to Ofwat, says it will reduce consumption by 5.5% in part through its ongoing metering rollout. The company will install one million smart devices after trialling them this period.
United Utilities will roll out 900,000 smart meters at a cost of £241 million as it works to cut PCC by 4.5%.
Welsh Water has set out ambition to accelerate its metering programme, without making it compulsory for households to have one fitted. The company aims for 78% of properties to be metered by the end of AMP8, up from 51% forecast to have a meter by 2025 at a cost of £125 million. It pledges to lower PCC by 7% over the five years.
Wessex aims to reduce the average 145 litres PCC to 135 litres PCC by 2030. Despite more than a 4% fall in consumption in 2022/23, the company missed its target of 137.4 litres. It proposes a “rapid” rollout of smart metering beginning in sensitive catchments to include 40% of customers in five years.
It sets a demand reduction target for domestic properties of 110 litres/day by 2050, which smart metering is integral to. It will invest £128 million to install and operate 257,000 meters in AMP8 and 380,000 in AMP9.
Yorkshire intends to commit £461 million to upgrade its metering stock to smart devices as it works towards a 5% reduction in PCC to 121 litres by 2030.