Ofwat Protecting consumers, promoting value and safeguarding the future

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Ofwats perspective on sustainability Mike
Keil Water UK Sustainability Seminar 17 November
2008
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Overview
Our interest in sustainability Our view on
sustainability How sustainable are the
sectors? How are we contributing? The future
challenges
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Introduction
Regulating for sustainable water and sewerage
sectors We have a duty High quality and good
value water and sewerage sectors Successful
companies will be sustainable companies
Ofwat Protecting consumers, promoting value and
safeguarding the future
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What is sustainability?
The Governments five guiding principles
of sustainable development Brundtland
definition development that meets the needs of
people today without undermining those of
tomorrow Internal and external
sustainability Three main areas Financial Enviro
nmental Social
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Sustainable water and sewerage sectors
We need A sustainable environment A sustainable
service delivery of high quality water and waste
water services now and in the long term Water
that is affordable A financially sustainable
sector and A dynamic and innovative industry to
deliver those services.
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Our strategy
Keeping consumers at the heart of what we do
Keeping companies accountable
Enforcing compliance
Introducing competition where it benefits
consumers
Taking a long-term view of sustainability
Shaping the regulatory agenda at national andEU
level




































Regulating effectively
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Embedding sustainability

• Responsibility of each water
• company to
• Embed sustainability in every
• aspect of its business
• Understand the wider impact of
• investment decisions
• Sustainability is not an added extra,
• but an integral part of each
• companys operations.

Ofwat Protecting consumers, promoting value and
safeguarding the future
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How sustainable are the water and sewerage
sectors?

• At any one point look backwards and forwards
• Measure and monitor performance
• Future plans through SDS and business plans

Ofwat Protecting consumers, promoting value and
safeguarding the future
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What has been achieved so far
Leakage has fallen by 35 since peak in 1994-95
80 billion has been invested. Companies are more
efficient bills are 30 lower than they would
have been
Water and environmental quality has improved
99.96 of drinking water now meets required
standards, compared with 99 in 1990
Network is functioning better more companies
have stable serviceability than ever before
Customer service is significantly better than 17
years ago only 4,825 properties (0.02) are now
at risk of low water pressure, compared with
344,259 (1.6) properties in 1990-91
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Our contribution to sustainability
Leakage targets
Affordable bills
Enforcement
Sustainability
Protect environment
Maintain sewers
Climate change
Ofwat Protecting consumers, promoting value and
safeguarding the future
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PR09 reflecting our approach to sustainability
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Into the future

• PR09 a barometer on industry
• thinking
• Assessment
• Policies and approach
• The challenge
• Identify gaps in policies
• Spot emerging issues
• Better regulation

Ofwat Protecting consumers, promoting value and
safeguarding the future
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Future challenges a long-term perspective
Climate change will have an impact on water
resources more volatile weather
(droughts/floods)
Need resilient infrastructure network is
335,000 km long, much of which is ageing
Increasing burden on drainage systems
Growing population UK will have largest
population in EU by 2060
Rise in single households, which use more
water. Water efficiency needs to be improved
Water is the new oil Goldman Sachs
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Developing the regulatory regime
Future challenges anticipate responsive Need
improved regulation and effective market
mechanisms Cave and Walker reviews Floods and
Water Bill
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Staying focused on sustainability
Financial
Social
Environmental
Ofwat Protecting consumers, promoting value and
safeguarding the future
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Summary
We want sectors that deliver high quality and
good value services Successful companies will be
sustainable companies Develop the regulatory
regime Water and sewerage sectors that are fit
to face the challenges ahead
Ofwat Protecting consumers, promoting value and
safeguarding the future