Fresh from the Future of the Water Industry seminar, and with the recent publication of Defra’s review of Ofwat, we thought it would be timely to cover the issue of regulatory change in the UK water industry.
With Ofwat engaged in an open review of the way the industry is regulated, there’s renewed vigour for seizing the opportunity of shaping the regulatory future of the industry in addition to delivering mechanisms for more efficient use of water and the protection of poorer households.
Defra’s recommendations for Ofwat are generally being welcomed by industry. The water companies are keen for Ofwat to deliver practical regulation in the key areas of water pricing, abstraction licensing and water resource resilience and help support the development of relationships across the variety of stakeholder groups.
Developing retail competition for water would include the challenge of transferring water large distances, without an equivalent national network to electricity and gas. However, companies have identified opportunities for improved network resilience across their boundaries, indicating practical options do exist despite the current absence of a clear nationwide solution.
Concerns about the timing of any regulatory changes in respect of the price review process indicate the next challenge: that of bringing the range of ideas into a phased, deliverable and coherent roadmap.
What’s certain is that this is an interesting time for all of us involved in the water industry. To find out more about our work in water, visit our website @ http://www.baringa.com/our_industries/energy_and_utilities/water/ or contact us blog@baringa.com
