Severn Trent has launched an incentive trial for businesses and high-volume water users to reduce demand during the summer.
Several different approaches will be tested in parallel for the trial to see which delivers the greatest water savings. These include water retailers being paid 25p for every litre saved by their non-household customers.
Another approach includes notifying retailers when demand is forecast to be extremely high. A third will be based on the Triads approach in the electricity market where businesses will be offered incentive payments to cut consumption during peak hours.
Retailers will be given 48 hours’ notice of a forecasted high demand period in which incentive payments will be available.
Shane Anderson, director for strategy and regulation at Severn Trent, explained the pressures on water companies and the environment to supply water during a dry summer will be exacerbated by fewer people travelling abroad for holidays this year.
“That’s why we’re really excited to launch this new water efficiency trial with retailers. By incentivising them to use less water during times of peak demand, we hope it’ll help us to protect this most precious resource,” Anderson said. “Encouraging businesses and other large users to be more water efficient in this way could bring huge environmental benefits too. This approach could help us to reduce our carbon footprint by trying to change behaviours instead.”
The pilot will begin later this month for four months to encourage business customers to be more water efficient.
Thames Water trialled a cash incentive scheme in 2019 for retailers to earn 5p per litre saved by their non-household customers.
Earlier this year, a water efficiency steering group established by the Retailer Wholesaler Group (RWG) trade body published an action plan to set efficiency ambition within the sector.