Memorandum submitted by Blueprint for
Water Coalition (Ofwat 23)
1. INTRODUCTION
1.1 The Blueprint for Water was launched
in November 2006 by a unique coalition of environmental, water
efficiency, and fishing and angling organisations to call on the
Government and its agencies to set out the necessary steps to
achieve "sustainable water" by 2015 and to fully implement
the Water Framework Directive (WFD). The Blueprint for Water is
a campaign of Wildlife and Countryside Link (Link).
1.2 Link brings together 38 voluntary organisations
concerned with the conservation and protection of wildlife and
the countryside. Our members practise and advocate environmentally
sensitive land management, and encourage respect for and enjoyment
of natural landscapes and features, the historic environment and
biodiversity. Taken together, our members have the support of
over 8 million people in the UK.
1.3 We welcome the Committee's inquiry into Ofwat's
Price Review 2009 and the opportunity to submit our concerns and
suggestions. Members of the Blueprint coalition have responded
individually to this consultation. Our joint response therefore
focuses on key issues of collective concern and is supported by
the following nine organisations:
— Association of Rivers Trusts.
— Buglife—The Invertebrate Conservation
Trust.
— Campaign to Protect Rural England.
— Royal Society for the Protection
of Birds (RSPB).
— Salmon & Trout Association.
— The Wildfowl & Wetlands Trust.
2. SUMMARY OF
KEY CONCERNS
AND RECOMMENDATIONS
2.1 We are aware that a number of organisations
have been questioning the need for an environmental investment
programme of the scale revealed in draft water company business
plans. In our opinion, this investment, considering the state
of our water environment and the scale of the challenge ahead,
is the absolute minimum required between 2010 and 2015. In addition,
much of the environmental investment required underpins the tourism
product and benefits the rural economy for many regions. Many
projects will improve the quality of life for thousands of water
customers. Investment in the Lake District, for example, will
protect raw water quality but also repair damage done to landscape
quality and biodiversity.
2.2 Much of the investment required under the
driver of the Water Framework Directive is investigative work
to ensure that the best and most cost effective solutions are
ultimately selected. Cutting these projects would not only hamper
efforts to achieve legislative targets, it would also raise the
risk of choosing sub-optimal and unnecessarily costly solutions
in the future.
2.3 A lot of the planned industry investment
is for essential infrastructure maintenance. In many ways, this
is "catching up" after misguided cuts in investment
in previous periodic reviews. England and Wales already have assets
(water mains and sewers) that have replacement rates into the
hundreds of years. Reducing this unsustainable rate is vital in
the face of climate change uncertainties and to protect the environment
from failing infrastructure that results in high levels of leakage
and pollution incidents. Cutting back now will only make the problem
and the cost worse for the next review in 2014 and does nothing
to help economic problems and unemployment now.
2.4 It is important that the recommendations
from the Walker Review regarding metering and water efficiency
are reflected in Ofwat's response to final water company business
plans. The Blueprint for Water is concerned at reports that Ofwat
has been discouraging some water companies from investing in accelerating
the rate of metering or from introducing compulsory metering.
Removing this investment from PR09 would unnecessarily delay the
introduction of a fairer means of payment for millions of customers
and hinder the success of water efficiency programmes. We believe
that to maximise benefits and reduce costs, metering should be
part of an integrated package of supply pipe replacement (customer
supply pipes are the source of up to a third of all leakage),
fitting of water efficient devices and appliances and the provision
of advice.
2.5 This periodic review has seen a break-through
at the company and regulatory level in the attitude towards tackling
quality problems at source. Over 100 catchment projects have been
proposed by water companies—working with partners these
will produce huge benefits to society and the environment at a
low cost to customers. Much of this innovative thinking will be
lost if environmental investment is "squeezed" at the
determinations stage. The Blueprint for Water strongly supports
these initiatives and the very welcome shift in policy and will
continue to campaign for their inclusion in the final price determinations.
2.6 We believe that the Consumer Council
for Water (CCWater) when representing customers in PR09 should
not neglect its sustainability duty or the wider interests and
priorities of customers. We are disappointed at reports that so
far in the PR09 process, CCWater have opposed the scope and scale
of essential environmental investment and pursued a very narrow
focus fixated on price.
2.7 We strongly believe that the huge benefits
for society and the environment to be gained from further water
industry investment should not be sacrificed to protect a minority
of customers who struggle to pay their water bills. It is important
that these customers are protected but this would be better achieved
through carefully designed tariff schemes or through the benefits
system.
2.8 We are pleased that a large number of
water companies are proposing water efficiency measures either
as stand alone programmes or as part of an integrated demand management
approach. However, we have been disappointed that some water companies,
in the development of their statutory water resource plans, have
not fully embraced the many recent policy and regulatory breakthroughs
in water efficiency. In failing to properly account for these
in their forecasting many have predicted high levels of per capita
consumption prompting them to put forward proposals for expensive
and potentially environmentally harmful new resources. Recent
Environment Agency reports suggest that if per capita consumption
fell to the government's target level by 2030 then none of the
reservoir options put forward by water companies in southeast
England would be necessary, saving customers over £1.5 billion.
Whilst we see the possible need for some new resource development,
we do not believe that the full potential of demand management
has been taken into account in these plans.
2.9 In the context of challenging targets
for greenhouse gas emission reductions, we believe that water
efficiency should play a central role in PR09. Wasting less water
in homes and businesses will reduce direct energy consumption
in buildings from hot water use—as well as helping the water
industry meet their own carbon emissions targets through reducing
the pumping and treating costs from supplying water and treating
wastewater.
2.10 Given the context of climate change
impacts, targets and commitments, we hope that PR09 will see a
significant step change in the scale and number of water efficiency
schemes included in water company plans and approved by Ofwat.
Particularly as Waterwise, working closely with the water industry
and its regulators, has now built an Evidence Base for Large-scale
Water Efficiency in Homes.
2.11 While this periodic review has so far
included many positives for the environment and may be the most
innovative we have seen since privatisation, it has still failed
to be as open and transparent as we would like. While we accept
that much of the detail must remain commercially confidential,
it is not easy for NGOs or the public to assess company plans
when, for example, the specific protected areas that will benefit
from planned investment are not revealed.
Blueprint for Water Coalition
March 2009
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