Memorandum submitted by United Utilities
(FL 89)
EXECUTIVE SUMMARY
1. United Utilities welcomes the Committee's
Inquiry into flood management and recognises the need for a joined
up and long term strategy to protect the UK from future flooding
incidents. United Utilities welcomes the opportunity to illustrate
to the committee the lessons the company has learned from recent
experiences in Cumbria in relation to flooding as well as providing
more general observations about flood prevention, alleviation
and mitigation.
2. Climate change is expected to lead to
an increase in extreme weather events in the UK with drought and
flooding becoming more common. In response, Government, regulators
and infrastructure providers have now sensibly begun to consider
long term weather patterns when planning infrastructure investment
and development.
3. While the North West was not affected
by this summer's heavy rainfall, the storms and flooding that
occurred in Cumbria in 2005 provided United Utilities with considerable
experience of dealing with such issues. The significant disruption
caused to water, wastewater and electricity services prompted
United Utilities to undertake a number of studies designed to
enable the prioritising of investment across all the company's
infrastructure networks.
4. United Utilities recognise that significant
investment is needed in order to fully prepare for, prevent and
mitigate flooding. The company acknowledges that in order to properly
plan ahead, a more coordinated approach by the Environment Agency,
the Government and the utility sector is needed to ensure that
all the appropriate information is being shared and put into practice.
5. United Utilities are carrying out further
study and assessment in order to determine the level of risk,
prioritise investment enabling the company to minimise disruption
by putting in place adequate measures to defend infrastructure.
The economic regulators must also acknowledge their role in the
creation of a future flood defence strategy and enable adequate
funding for utility providers in future regulatory price reviews.
INTRODUCTION
6. United Utilities welcomes the Committee's
inquiry into flood management and recognises the need for a joined
up and long term strategy to protect the UK from future flooding
incidents. As the UK's largest water company and multi-utility
provider, United Utilities is acutely aware of the problems caused
by the flooding of utility infrastructure and is committed to
working closely with the Government, regulators and other industry
stakeholders to avoid damage to infrastructure and disruption
to customers wherever this is possible.
7. United Utilities welcomes the opportunity
to illustrate to the Committee lessons learned from our recent
experiences in relation to flooding, as well as more general observations
about flood prevention, alleviation and mitigation.
ABOUT UNITED
UTILITIES
8. United Utilities owns and operates the
regulated water, wastewater and electricity distribution networks
in North West England, providing services to approximately 7 million
people. United Utilities recently announced proposals to sell
its electricity assets. Once the sale of these assets has been
completed, responsibility for the protection of those assets will
transfer to the new owner.
9. Last year, United Utilities invested
almost £600 million in its regulated businesses in the North
West, with investment exceeding profits for the sixteenth consecutive
year.
THE IMPACT
OF CLIMATE
CHANGE ON
UTILITY INFRASTRUCTURE
10. Climate change is widely expected to
lead to an increase in extreme weather events in the UK with drought
and flooding becoming more common. While no individual cases of
extreme weather can be incontrovertibly linked to climate change,
it is clearly sensible for the Government, regulators and infrastructure
providers to consider long term weather patterns when planning
infrastructure investment and development.
11. United Utilities is committed to reducing
the overall environmental impact of its business and its customers
and is at the forefront of managing the reduction of carbon emissions
in the utility sector. In March 2007 United Utilities was the
first water company to set out an action plan to reduce CO2 emissions.
12. United Utilities' plans for investment
across the company's infrastructure therefore have the twin aims
of reducing emissions from the company's operations while also
preparing to adapt to the impacts of climate change, including
changing weather patterns, wherever this is possible and economically
viable.
13. It should be noted that because these
businesses are regulated, any plans for investment in the company's
infrastructure assets, including investment in flood defences,
needs to be approved through the appropriate regulatory processes.
PROTECTING OUR
CUSTOMERS AND
FACILITIES FROM
FLOODING IN
THE FUTURE
14. United Utilities is acutely aware of
the problems that flooding can cause to utility infrastructure.
While the North West was not affected by this summer's heavy rainfall,
United Utilities has considerable experience of these issues following
storms and flooding in Cumbria in 2005. These storms caused significant
disruption to water, wastewater and electricity services and prompted
United Utilities to undertake a number of studies designed to
prioritise investment in flood defences. With regard to this summer's
floods, United Utilities supplied logistical and personnel support
to Severn Trent to assist its emergency response.
15. The studies and investigations carried
out after the 2005 Cumbria floods have been used to inform the
ongoing investment programmes across all the company's infrastructure
networks to prepare for and defend against flooding. This continues
to be an investment priority for the company.
Protecting infrastructure through flood defences
16. United Utilities has long adopted the
approach of "building in" resilience to shallow flooding
in certain assets. This has minimised the cost to the customer
and to the company. Clearly, as weather patterns change, climate
change will increase the engineering costs necessary to avoid
flooding of assets.
17. Where flood defences are not part of
the construction of an asset, or when there is a short-term risk
of flooding, temporary flood defences are sometimes used. However,
these temporary flood defences are likely to be inappropriate
in many situations because of the difficulties of transporting
them to a site and the availability of personnel to erect them
during a crisis. Additionally, because temporary defences tend
to be lightweight, theft can be a problem if they are left unsupervised.
Supervision of temporary flood defences by United Utilities is
not an option given the demands on resources in a crisis and the
obvious potential risk to personnel in a flood situation.
18. These problems were evident in the events
of July and August this year, when temporary flood defences failed
to arrive in time and there was interference with them and theft.
Utility companies cannot expect to rely on the emergency services
at times like this, as saving lives will always take priority.
19. It is clear that more permanent methods
of protection will offer better value for money. However, planning
for such permanent methods requires more comprehensive predictions
of the impacts of climate change and weather patterns and regularly
updated flooding data from the Government and its agencies.
REDUCING THE
IMPACT ON
WASTEWATER INFRASTRUCTURE
20. United Utilities operates a number of
different types of wastewater facilities, including wastewater
treatment works, which discharge treated sewage and storm water
flows to rivers, as well as combined sewer overflows, which divert
excess storm flows from sewerage systems to adjacent watercourses
in times of excessive rainfall. United Utilities network treats
2,200 million litres of wastewater every day via a network of
around 39,000 kilometres of sewers.
Assessing the Risks to Wastewater Facilities
21. Extreme weather can have a detrimental
effect on wastewater facilities, increasing the risk of pollution
incidents in waterways and sewer flooding of homes. As part of
the previously mentioned studies by United Utilities on the impact
of floods, the company assessed the vulnerability of wastewater
facilities against the effects of flooding and determined that
a significant number of facilities are sited within the Environment
Agency's defined indicative floodplain maps.
22. If facilities are directly submerged
from flood waters this can lead to loss of sewage treatment capacity,
pollution of the flood water and damage to the facilities, leading
to an increase in the time taken to return service to normal once
flood waters subside.
23. Additionally, even when the storms are
not extreme enough for the facilities themselves to become flooded,
increasing river levels can result in combined sewer overflows
being unable to discharge excess storm flows to watercourses,
which in turn leads to flooding within and from the local sewerage
system.
Measures required for protection
24. Provisional assessments of the cost
of providing a blanket high level of flood defences for wastewater
facilities are considerable. If United Utilities was to invest
in full flood defence protection for all waste water facilities
at risk of a "1:100 years" flood event, the cost would
be in the region of £800 million. To protect all facilities
at risk of a "1:1000 years" flood event, the cost would
be in excess of £1.1 billion.
25. United Utilities is carrying out a criticality
assessment of each of its facilities to determine the impact on
service due to the failure of each facility as a result of both
raised river levels and direct flooding. Once the criticality
of each facility has been identified and the costs to protect
the facilities from flooding have been determined, United Utilities
will carry out a cost/benefit analysis to establish the most appropriate
solution in each case.
26. For example, following the flooding
in Cumbria, which demonstrated the risks to wastewater assets
from river flooding, United Utilities is currently investing approximately
£20 million to upgrade the sewerage system and ensure that
the performance of the local wastewater treatment works and combined
sewerage overflows are suitably protected from flooding and raised
river levels. This work is being developed in conjunction with
the Environment Agency's ongoing flood defence project and will
be completed by 2010.
United Utilities' Strategy in the Future
27. United Utilities believes that while
some of the necessary flood protection can be implemented by the
water companies, the regulator, Ofwat, should ensure that adequate
funding for flood defence work at high risk assets is properly
considered in the periodic price review for 2010 onwards.
28. United Utilities has appointed a consultant
to assist the company in developing solutions and produce robust
cost estimates to allow a programme of work for flood protection
to be submitted to Ofwat in the forthcoming regulatory price review.
United Utilities has identified in the region of £200 million
of investment, which will address ten high-risk areas at a cost
of £20 million per area. This may be phased over more than
one regulatory period.
29. Flood protection of United Utilities'
facilities or Environment Agency driven flood defence work in
isolation will not address the entire flood risk. Integrated schemes
addressing all flood risks across the various asset owners need
to be developed and implemented. The company would like to streamline
the responsibilities and ownership of these asset types ideally
with the Environment Agency still having responsibility for fluvial
flood protection but by moving towards water companies being given
responsibility for development of overall improvement plans for
non fluvial drainage systems in urban areas and potentially transferring
responsibility and ownership of additional assets types to water
company ownership, such as highway drainage systems and sustainable
drainage systems (SUDS).
30. This approach would be a significant
step forward in effectively allowing integrated urban drainage
schemes to be developed, funded and implemented.
PROTECTION OF
WATER INFRASTRUCTURE
31. United Utilities owns and operates the
water network in the North West of England supplying 2,000 million
litres of water every day via a network of around 40,000 kilometres
of water mains, 1,444 kilometres of aqueduct and over 100 water
treatment works. United Utilities has a number of different types
of water facilities in the North West, including impounding reservoirs
water treatment works, pumping stations and service reservoirs.
The Vulnerability of Water Facilities
32. The storms in Cumbria in 2005 caused
significant disruption to water, wastewater and electricity services.
Following the studies mentioned previously, which were undertaken
by United Utilities to investigate the risks of disruption from
flooding of infrastructure assets, the company undertook a further
study into the particular vulnerability of water facilities. This
study concluded that the most significant risk to water assets
would be due to excessive rainfall, potentially leading to fluvial
and/or tidal flooding. United Utilities carried out spatial analysis
to identify which of its water facilities fall within the Environment
Agency's predicted floodplains in order to inform policy and investment.
Mitigating the risk
33. The analysis carried out by United Utilities
led to the creation and "approval in principle" of various
policies. These policies, which are still subject to qualification
of costs and the impact on risks, propose that all new or critical
existing facilities at risk from flooding are to be designed to
withstand a 1:1000 year flood event while all existing non-critical
facilities at risk of flooding are to be designed to withstand
a 1:100 year flood event. `Critical' has been defined as a facility
that if it failed, it would have an impact on over 25,000 customers.
This has been determined using the SEMD guidelines (Standard for
Security Arrangements at Operational Sites), which has been approved
by the Council of Water UK and endorsed by DEFRA.
34. United Utilities is currently carrying
out a study to assess the current levels of flood protection at
each of the facilities deemed to be at risk from flooding. This
work will determine the most appropriate flood defence and associated
investment required to mitigate the risk caused by 1:100 and 1:1000
year flood events. The study, which is being carried out by a
professional support services company, is due to be completed
later in 2007. Impounding reservoirs were not included in this
study as a separate programme of work is in place to identify
whether the impounding reservoirs can withstand a Probable Maximum
Flood (PMF) event, and if not, to determine the investment required
to protect the dams.
35. Throughout the course of the study,
United Utilities has worked closely with the Environment Agency
to establish whether there are existing Environment Agency flood
defences in place to protect these facilities from flooding. Furthermore,
this work has sought to authenticate the quality of the Environment
Agency's predicted floodplain data at each facility in order to
determine the levels of risk.
Implementing the Necessary Protections
36. United Utilities is also carrying out
a criticality assessment of each of its facilities to determine
the impact on service due to the failure of each facility as a
result of flooding. Once the criticality of each facility has
been identified and the costs to protect the facilities from flooding
have been determined, United Utilities will carry out a cost/benefit
analysis to establish whether the policy is suitable and, if not,
will amend it as appropriate. While some of the necessary flood
protection can be implemented by the water companies, United Utilities
will be making the case for adequate funding for flood defence
work in the next Ofwat price review.
37. In the meantime, United Utilities is
currently investing £2.1 million to protect Huntington intake
pumping station, which is situated next to the River Dee, near
Chester. The pumping station feeds Huntington water treatment
works, which is one of United Utilities' most strategic works
supplying water to a large number of industrial users and 1.7
million domestic customers. The pumping station has been close
to flooding on a number of occasions and thus following a cost/benefit
analysis, as mentioned above, a decision was made to protect the
pumping station from the future risk of flooding.
FLOOD DEFENCES
FOR ELECTRICITY
INFRASTRUCTURE
38. With regard to electricity infrastructure,
United Utilities operates and maintains electricity substations
in North West England, delivering electricity annually to approximately
2.2 million residential, commercial and industrial customers.
Impact of Flooding on Electricity
39. Many electricity assets, such as major
substations, are sited near riverbanks and watercourses due to
the historical need for cooling water for predecessor power stations
(ie power stations that existed on the site but have since been
replaced by substations connected to the national grid). As a
result, over the years there have been a number of incidents of
flooding of electricity assets, especially where they are either
located on floodplains or where there is a risk of flash floods.
In the past, the industry was able to rely on publicly funded
flood defences to protect infrastructure. However, the increase
in the number of incidents due to more variable weather patterns
there is a greater need for the industry to do more to protect
assets from flooding in order to limit disruption to customers,
ensure continuity of supply in non-affected areas and minimise
insurance costs related to the assets.
40. As mentioned above, the first step in
United Utilities' strategy to manage the risk of flooding was
to carry out studies to identify and understand the depth and
likely frequency of potential flooding of electricity assets.
41. In order to protect electricity assets
United Utilities and other electricity network operators must
determine at what depth a flood will adversely affect the electricity
plant's ability to continue to provide supply. The nature of substations
means that the higher the operating voltage, the shallower the
flood likely to have a detrimental impact and the greater the
loss of supply in terms of numbers of customers affected and the
geographical spread of the loss. Currently, some substation sites
are able to flood to some degree providing that the control room
and indoor switch houses are protected. However, if this indoor
equipment is inundated, it will result in loss of supplies and
electrical danger to operators.
The Response of United Utilities
42. To demonstrate compliance with the relevant
electricity statutory regulations (based on guidance given by
the then DTI in 2006) United Utilities policy includes for flood
protection of 132,000V substations for 1:1000 year flood risk
as these sites feed between 250,000 and 10,000 customers. 33,000V
substations are now required to have flood protection for a 1:100
flood risk as they feed between 15,000 and 1,000 customers. Low
voltage substations were not specifically mentioned in the DTI
guidance and these tend to supply only a small number of customers
meaning that any disruption should be localised. However, United
Utilities' risk assessment process will identify and protect low
voltage substations that merited special consideration, such as
where there is something unusual or unique about the customers
being supplied.
43. United Utilities has already adopted
the principal requirements of the National Planning Guidance PSS25
in terms of new substations operating at 33,000V and above and
attempts as far as possible not to site these in areas of flooding
risk. Such substations typically serve approximately 10,000 customers.
In contrast, 11,000V substations need to be sited close to the
developments they serve (typically 300 customers); therefore when
local authorities approve such developments on flood plains utility
companies need to respond accordingly.
44. As part of the measures for longer term
flood defences, United Utilities is ensuring that the external
walls of its buildings are properly rendered, bunded (ie coffer
dam) areas are installed around the doors and above-ground access
ways, while sealing all the underground access ducts. United Utilities
is working with specialist consultants to determine the further
specifications required for defending key assets and to ensure
that all measures are carried out correctly.
45. United Utilities has recently invested
approximately £0.5 million in actively addressing known high
risk sites, specifically Lancaster 132kV substation, Carlisle
132kV substation and Willowholme primary substation (also in Carlisle).
United Utilities has also made specific investments where other
new build work has been constructed, taking account of the perceived
flood risk at the time of installation and retro-fitting flood
protection to existing assets proven to be at risk. There are
plans to invest at least a further £1m in the current regulatory
review period up to March 2010.
46. In order to put in place long term and
adequately designed flood defences, it is vital that the electricity
industry works with the Government and the Environment Agency
in order to ensure the provision of flood depth data predictions.
Better coordination is required between companies, the Environment
Agency and other appropriate bodies in order to plan flood defences
and relationships would benefit from being formalised as part
of the overall strategy.
47. While United Utilities recognises its
responsibility to tackle this problem, the regulator must also
be willing to play its part and allow for extra and effective
funding for flood defences in regulatory settlements as companies
look to put in place permanent measures.
48. Regulators and the Government must recognise
that utility companies should not be reliant on the emergency
services, or indeed the military, to assist in the event of extreme
weather and need to have appropriate funding to be able to respond
appropriately and independently.
49. For the next regulatory period United
Utilities is proposing to seek funding to address the flood risk
at all the grid, bulk and primary substations but target investment
at the highest risk distribution substations that supply strategic
infrastructure or emergency services on condition that the strategic
infrastructure is itself flood protected. This would address 20%
of the distribution stations at a cost of £5.2 million and
gives a proposed total programme of £8.9 million in the period
2010-2015. This approach will be reviewed in light of industry
work that the Department for Business, Enterprise & Regulatory
Reform has just commenced.
CONCLUSIONS
50. If, as predicted, weather patterns continue
to change, scenarios such as the flooding in Cumbria in 2005 and
the extreme weather of the recent months will become more frequent
and water, wastewater and electricity assets will continue to
be at risk of severe damage.
51. There is a consensus that significant
investment is needed in order to fully prepare for, prevent and
mitigate flooding. While United Utilities recognises that temporary
protection can alleviate some of the immediate problems caused
by extreme weather, due to the generally unreliable nature of
such measures, it is necessary to put in place longer term plans
in order to mitigate against such risks.
52. Further study and assessment is required
of individual facilities in order to determine the level of risk
and the vulnerability of particular assets, and all utility companies
must recognise that in order to minimise disruption and ensure
continuity of supply to non-affected areas, they have a responsibility
to put in place measures to adequately defend infrastructure.
As such, each company must be prepared to carry out its own cost-benefit
analysis in order to properly define the potential costs.
53. In response, the economic regulators,
Ofwat and Ofgem, alongside the Government and the Environment
Agency, must acknowledge their role in creating a future flood
defence strategy and provide adequate funding to support the work
of the utility providers.
54. Finally, in order to properly plan ahead,
a more formalised joined up approach by the Environment Agency,
the Government and the utility sector must be created in order
to ensure that all the appropriate information is being shared
and put into practice.
United Utilities
September 2007
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