John Barnes

1

• John Barnes
• Environment and Sustainability Director
• United Utilities
• Water and Climate Change United Utilities
  Perspective

2
Presentation Overview

• Brief Overview of UU
• The impact of climate change of the provision of
  water services
• Adaptation the impact on our activities and our
  response
• Mitigation our strategy and plan

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Water and Climate Change a starting point

• The economy is a wholly owned subsidiary of the
  environment Herman Daly, 2005
• The effects of climate change will be felt
  everywhere In the UK the effects will be mainly
  mediated through water, with increases in the
  number of both flood and drought incidents
  expected
• H.M Treasury 2006

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Introduction to UU

• We are the UKs largest listed water wastewater
  company
• Turnover of 2,386.8 million (2005/6)
• Market capitalisation of 6,507 million
• We provide services to over 27 million people
  worldwide
• Employing 8,000 people
• 10 billion invested in the UK between 1989-2005
• Between 2005-2010, 3.5 billion will be invested
  by UU in its water, wastewater and electricity
  networks that works out at more than 20 per
  second

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UK operations
Serve close to 30 of the UK population
8,000 employees
Scottish Water 1.4bn capital programme delivery
and PFIs
United Utilities 3.5bn capital investment
programme covering water, wastewater and
electricity distribution over 5 years.
Northern Gas Networks 15 equity owner, asset
management and operation, 36,000km network
Welsh Water Asset management and operation,
1.5bn over 15 years
Southern Water 750m capital programme delivery
Contracted to deliver 5bn of capital investment
projects across the globe
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How Climate Change will impact the north west
water services

• Wetter winters with more intense rainfall
• Hotter and drier summers but with intense
  rainfall
• Longer droughts, more severe droughts and more
  frequent droughts

Thirlmere Reservoir, Lake District
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Responding to the impact on our activities -
water

• 2035 estimate shortfall in supply of some 10
  or around 200 million litres of water every day
• Measures to address this
• Reduce demand for water (leakage control and
  customer efficiency)
• Increase supply of water (small scale new
  resource development and greater network
  integration)
• Key proposal is the East-West link to move water
  from Prescot to Bury linking Lake District and
  Welsh sources

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How Climate Change will impact the north west
wastewater services
Carlisle Wastewater Treatment Works January 2005

• Increased flooding incidences
• Increased CSO discharges
• Reduced final effluent discharge dilution
• Increased blockages

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Responding to the impact on our activities -
wastewater

• Traditional approach, to build our way out of
  this problem, will not work. Focus must be on
• Education awareness that flooding can not be
  eliminated but must be managed,
• Make public true levels of risk of flooding from
  all sources
• Planning input mandatory that all new
  development be drained on a sustainable basis
  e.g. green roofs, rainwater recycling, SUDS
• Responsibility Reduce the number of
  stakeholders involved in urban drainage to 2
  the regulator and a single operator

Green roofs (above) and detention ponds (below)
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Planning Our Response

• Adaptation - a long term problem that demands a
  long term answer
• Planning for its consequences needs to begin
  right now
• We are including our intentions in our regulatory
  plans for 2010 to 2015 .
• These plans will be influenced by the UKCIP
  rainfall scenarios to be released next year

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UUs carbon strategy and plan

• There are four key strands to our carbon
  management strategy
• Seeking to achieve a net 5 reduction on the
  2005/06 baseline for our owned carbon emissions
  by 2012 (with projected rises this is actually a
  reduction of 8 overall)
• Continuing our reduction of emissions beyond 2012
  in line with the long-term government targets set
  for 2050
• Influencing the external environment to support
  the achievement of these aims
• Pursuing a vision of making carbon an integral
  part of the way we do business
• But what is the context for setting this
  direction?

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Providing context UUs carbon footprint

• 2006/7 emissions - directly responsible for 472
  thousand tonnes of CO2 equivalent using one-third
  of one per cent of all UK electricity
• A further 1.57 million tonnes that we dont
  directly own but can have an influence over.

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Providing context emission projections
Graph of emissions 1990 - 2050

• UUs operational carbon footprint has nearly
  doubled since 1990
• This is a direct consequence of 10 billion of
  investment in assets to deliver environmental and
  customer improvements

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Delivering our carbon strategy to 2012
Delivery of one 2.4 MW CHP engine to Davyhulme
WwTW

• A 8 gross reduction in CO2e emissions by 2012
• 22m investment in increasing CHP yield by 80
• UU home to one quarter of all sewage gas CHP
  sites (23 in total)
• Improving pump energy efficiency
• 18 reduction through green energy supply
  contracts

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UUs (and the industrys) challenge the journey
to 2050 and a 60 reduction
488,000 tCO2e
CHP and IPM 38,000 tCO2e Cost 37m
Wind 80,000 tCO2e Cost 80m
Low carbon technology 80,000 tCO2e
Cost ??
170,000 tCO2e TBD

• UU carbon emissions baseline (2005/6) 488,000
  tCO2e
• Climate Change Bill targets 60 reduction on 1990
  levels by 2050
• For UU, this equates to 122,000 tCO2e
• To meet that target equals a reduction of 366,000
  tCO2e
• The diagram illustrates what abatement strategies
  could be adopted, with what impact and at what
  price

122,000 tCO2e
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Delivering our carbon strategy to 2050

• On the journey to 2050, aim to halve owned
  emissions from current levels by 2035
• require energy neutrality in wastewater
  operations
• reduced pumping in water network
• tackle problems at source
• appropriate financial instruments
• on-going research into renewable generation and
  low carbon technology
• promoting water efficiency

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Delivering Our Strategy through influencing
others our customers

• For customers, making the link in the minds of
  our customers that there is a carbon footprint
  associated with the provision and use of water
• Reduced heating of water (about 8 x water cycle
  footprint)

• Power Shower Study
• joint project with Liverpool John Moores
  University
• electric showers better than mixer or pumped
  showers
• water saving showerheads
• Better information

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Delivering our strategy stakeholder challenges

• For Ofwat and the Environment Agency, crucial to
  strike the balance between the on-going delivery
  of aquatic environmental improvements and the
  airborne (i.e. carbon) consequence
• For Ofwat, creating the framework to encourage
  investment in greenhouse gas mitigation
• Financial instruments such as incentives
• Minimising the impact of the enhancement
  programme
• Reducing the footprint of the existing
  assets/maximising energy recovery

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Delivering our strategy the role of employees

• Employee engagement is crucial to change
  behaviour
• Our employees can provide many ideas on reducing
  carbon emissions
• Changed business processes are needed to embed
  carbon into decision making e.g. inclusion of
  cost of carbon into PR09 planning
• Sector first in appointing full-time Carbon
  Manager to lead plan delivery
• Carbon communications plan (both internal and
  external) in place to promote our carbon
  management agenda