Blog: new water entrants, and the approval of Hinkley

In her news editor’s blog for Utility Week, Lois Vallely rounds up some of the big stories of the week.

Over the past two weeks, the water market has seen a raft of exciting developments.

To start with, I got a call from a Graham Mann, who told me all about his new water supplier – fittingly named ‘The Alternative Water Company’ – which has entered the non-household retail market hoping to undercut the incumbents by as much as 25 per cent.

The company’s business model is based on designing, building, maintaining, and supplying water from boreholes at underground water sources which exist on the properties of large customers.

Apparently water will be treated at source, and will depend on the quality of the water abstracted. But, Mann insists, the water supplied will be of the required high quality drinking water standard, and may even be of “superior quality” as it will not have to travel far through pipes.

It occurs to me that supplying water from underground water sources in this way could, if not kept a close eye on, wreak havoc for the sustainability of water supplies.

The next thing that happened was that water management company Waterscan applied to Ofwat for a water supply and sewerage licence – the first non-water-supplier so to do. The company’s current remit includes developing solutions that enable commercial water users – large or small – to use less water, lower their water bills and become more socially responsible.

Refreshing the market

Shortly after this, news reached the Utility Week news desk of the largest UK-wide switch to date, as Water Plus – the joint venture between United Utilities and Severn Trent – signed a deal with major sport and leisure business, David Lloyd, to supply water to all 84 of its UK sites.

Water Plus sales director Tony McHardy, who’s on the ‘United Utilities side’ of the company, tells me the company had been targeting and engaging with these sectors for “quite some time”.

David Lloyd, he says, wanted “simplification of the process”, and only wanted to deal with one supplier, rather than the 15 it has to engage with at the moment.

“They wanted a single point of contact, and a single point of expertise that could demystify the market for them,” says McHardy. The company went out to full tender, and Water Plus won the contract based on its range of products and services and the “personalised approach” it gives.

To top all of this exciting news off, Kelda Group – better known as the parent company of Yorkshire Water – launched a brand new non-household retail business which it called ‘Three Sixty’.

Newly appointed managing director Robert Marrill tells me the idea for the name came from wanting to “stand out and be different from the rest of the market”. “It’s all-encompassing, it’s looking out, it’s looking beyond, and it fits with our vision to be a leading water retailer,” he says.

The company is now focussed on growth. It has already secured some large contracts in Scotland – such as BT and Royal Mail Group – and will be looking to do the same in England before too long.

However, Marrill stressed to me that the company “did not want to be a Water Plus”: “We don’t need to be the biggest, but we do want to be the best. We’re passionate about that” – a nice quote, I like it.

Full Q&A with Robert Marrill here

Here’s Hinkley

So, Hinkley has been approved… with conditions.

Neither of said statements are a surprise. The approval of the £18 billion plant has been a long time coming.

The conditions are: EDF will be unable sell its controlling stake in the project prior to the completion of construction, without the consent of ministers; and ministers will impose a new legal framework for future foreign investment in Britain’s critical infrastructure.

The reaction has, unsurprisingly, been explosive, with statements flooding into the Utility Week news desk inbox throughout the day yesterday.

Green Party co-leader Caroline Lucas called the decision “absurd”. Power-Gen Europe’s Nigel Blackaby said: “Hinkley Point has been the poster child for UK’s so-called nuclear renaissance, which as a policy, has been stuttering for years, due to the prevarication over whether or not to proceed.”

Nuclear people have (obviously) welcomed the news, saying it is a positive step towards the development of the UK’s nuclear industry. As have the union’s, which see it as a positive for the nation’s construction workforce.

I was in Stroud to interview Ecotricity founder Dale Vince at the time the news broke, so I took the opportunity to ask him his opinion (although I had a pretty good idea what it would be).

He laughed and simply said: “It’s so last century.” [Full interview coming soon].