Excerpts from THE WATER REPORT
October 2020 issue 64
FULL STORIES AVAILABLE ONLY IN THE MAGAZINE IN PRINT AND PDF
CONTENTS full contents of the magazine
REPORT The CMA’s draft redeterminations.
INTERVIEW Emma Clancy wants CCW to be a team player in improving customers’ lot.
REPORT Household complaints spike 13% despite most companies improving.
INTERVIEW Portsmouth Water’s Angela Smith speaks up for empowering customers.
EVENT 2020 Social Contract Summit:
Public Purpose in a Pandemic.
NEWS REVIEW South West Water launches customer share giveaway.
REPORT Overflows and chalk streams take centre stage as better data reveals the real state of rivers.
REPORT Southern Water’s Pollution Incident Reduction Plan.
INDUSTRY COMMENT Supply chain transformation at Southern Water.
REPORT Green recovery – collaboration will be key.
REPORT The PAC continues to push on resilience.
REPORT Northumbrian Water pulls off a week long virtual Innovation Festival.
INDUSTRY COMMENT Six success factors for organisational change.
Nonetheless, the companies – who were very measured in the formal statements they issued on the day of the announcement – are unlikely to do much complaining. Viewed ‘in the round’ as price reviews must be, companies have secured a significant benefit from the WACC uplift, and will probably take the rough with the smooth.
“I think water companies need now to develop what may have seemed to some as a superficial exercise on building reputation, into something that is really meaningful. All decisions have to be on a win win win. Is it good for the company in terms of its financeability and profitability? Is it good for customers?
And is it good for the planet? All decisions need to bear those three considerations in mind. That’s how we deliver the social contract.”
This has really opened everything up about the future path of allowed
returns both in water and elsewhere.”
Clancy can see opportunities to build on these positive first impressions, both in her organisation and the sector. On the latter, firstly: “You also get the sense there are some barriers to doing that [delivering better service] in terms of systems, processes and practices, with a theme of the lack of investment in the sector over time, and therefore repeat problems that are very challenging for consumers. While it’s great if calls can be handled well etc, it would be better if they weren’t happening in the first place.”
While it’s great if calls can be handled well etc, it would be better if they
weren’t happening in the first place.”
With chemical quality a legacy issue with no short-term remedy in scope, it is not surprising that the problems causing ecological failures are first in the frame for action. Policy intervention could change these results. It’s not that nothing has been done to date; those in the water sector will know that billions has been spent over successive AMPs on water quality improvements with more to come.
But in light of the water body classifications, that feels like running to stand still and if there are to be improvements, things will have to change. While agriculture, industry and customer behaviours must be in scope as well, for water companies, two headline issues have bubbled to the surface
Retailers are expected to obtain meter reads to reflect actual consumption, or where a meter read cannot be obtained, to engage with the wholesaler and the customer to get an accurate estimate.
To support the work, MOSL said it would implement an Additional Performance Indicator (API) around levels of ex-Covid 19 vacant premises which have not been evidenced as vacant or confirmed as occupied. MOSL said it would “act quickly and decisively where we see trends, behaviours and activity levels which either give cause for concern, or merit being called out as good practice”.
After the initial monitoring period, the Transition Review Group will consider next steps as appropriate.
It noted: “Ofwat has a range of tools at its disposal, including enforcement action, should it have concerns around how retailers have approached the removal of temporary vacant flags and use of yearly volume estimates and does not rule out the possibility of introducing a financial incentive associated with this if it deems it appropriate.” Local lockdowns and the possibility of a future national lockdown have not been dealt at this point.