Ofwat drives up M1 towards sludge and water resource markets

Water companies have until 6 July to respond to Ofwat’s proposed guidance, published last week, on the information they must provide to underpin new bioresources and water resource markets.

The regulator has proposed the following:

• Bioresources – The ten WASCs are to publish information at least annually about the quantities and location of sludge production and sludge processing facilities, and some associated information about the quality of the bioresources at the various stages of its production and treatment. They are also to publish information about contracts they enter into with other parties providing bioresources services to them. On top of that, the WASCs are to provide (not publish) data to Ofwat on market activity, to assist regulatory monitoring activities.

• Water resources – 17 WASCs and WOCs are to publish information to support the development and operation of markets in water resources, demand management and leakage services. This will be at Water Resource Zone level and is structured around geographic data and eight data tables.

The consultation arises from the new condition M1 (Information Remedies) which all 17 incumbent companies recently signed up to as part of broader package of licence changes under Section 13 of the Water Industry Act. Condition M1 gives Ofwat the power to require a water company to provide specified information about its regulated business or to publish information for the purpose of supporting the development and operation of the two new wholesale markets.

Ofwat anticipates finalising its guidance in October.