Customer support low for decarbonising water industry

Customers rank achieving net zero as a low priority for their water companies according to research to support business plan submissions to Ofwat for 2025-30.

Despite this, the sector has proposed spending over £1.4 billion to drive down harmful emissions.

Decarbonisation was repeatedly highlighted as a low priority for water company customers, ranking behind essentials such as providing water and sewerage services, keeping bills affordable and high profile concerns such as minimising pollution.

In its blueprints for the 2025-30 period, the regulator endorsed the UK’s national target to be net zero by 2050 and said enhancement spending to reach this would be supported but made no indication of support for the accelerated 2030 goal water companies had set themselves.

The 2030 target, coordinated by Water UK, was always intended to be stretching to encourage decarbonisation at pace. The scale of the challenge around process emissions was not fully understood when that commitment was made. Work to understand how much methane, carbon dioxide and nitrous oxide are emitted from treating wastewater showed higher potency than previously thought.

With further to go to get to operational zero and Ofwat not endorsing the 2030 target, companies’ plans instead focus on meeting the national 2050 target as rapidly as possible. SES and Northumbrian both explicitly said they would not be able to deliver what they previously hoped to, which included a 2027 goal for the latter.

Work by Severn Trent, Aarhus Vand and Melbourne Water has indicated levels of process emissions are far higher than previous calculations showed. This significantly increases the challenge of meeting net zero targets, however preliminary work by SVT into capturing and mitigating the methane and nitrous oxide are proving more effective than expected.

Across the industry the ambition is strong to continue at pace with driving levels of carbon out of processes, switching vehicle fleets to lower carbon options and implementing alternative solutions to high carbon capital programmes.

Anglian Water set the ambition to be a carbon positive business and will dedicate £153 million to achieving this in AMP8.

Its net zero enhancement investment focuses on process emissions released from wastewater treatment, the export of biogas to the grid and decarbonising its fleet of heavy goods vehicles.

During the current AMP, Anglian’s capital investment programme has been designed and built to be carbon neutral, which the company said has significantly saved costs as well as emissions.

Lower carbon concrete for capex projects as well as further developing circular economy opportunities to manage sludge from wastewater feature in how Anglian is transforming its approach to greenhouse gas emissions.

By 2030, Anglian hopes to have cut capital carbon 70% from a 2010 baseline; operational carbon targets of 3.2% lower for wastewater and 2.2% reduced at clean water assets have been set compared to 2025 levels.

Northumbrian Water previously set itself an ultra-ambitious goal of being operational net zero by 2027 – three years ahead of the sector’s 2030 Public Interest Commitment (PIC). Despite having slashed more than 90% of its greenhouse gas emissions compared to 2008 levels, the company has had to row back on its ambition.

With process emissions from treatment works significantly higher than previous calculations, Northumbrian said this target will not be met. It will endeavour to reduce these gaseous emissions by as much or more than it estimated when setting its targets, but admitted net zero was not deliverable in that timeframe.

Customer research indicated billpayers were not supportive of funding net zero by 2030, Northumbrian is therefore not seeing enhancement spending and said improvements will be delivered through base funding.

Pennon Group, which operates South West, Bristol and Bournemouth, remains committed to the 2030 target for operational emissions and 2045 for net zero. It wants to spend £430 million on this together with enhancing biodiversity.

Severn Trent will open the world’s first carbon neutral wastewater site next year, which will be a major milestone on the road to operational net zero. The company said its ongoing investment in driving down process emissions “will establish a pathway for our industry to follow”.

It remains dedicated to the 2030 goal, supported by investment to retrofit 100 wastewater sites to remove 45% of process emissions during AMP8.

It proposed spending £430 million on this goal, which accounts for £1 extra on customer bills by 2030.

Southern Water’s plan will keep reducing operational emissions in line with the PIC and set the company up for 2050 net zero through self-generation, using biogas and tackling process emissions. With customer feedback showing decarbonisation as a low priority, the company said it will meet rather than exceed government targets for both net zero and drought resilience.

Thames Water said its focus will be lowering operational emissions from wastewater by 5% and by 2% in clean water processing and will request £71 million to deliver further carbon cuts. This year, it generated 536GWh of renewable energy, or 27% of its own usage.

Its plan is to replace assets with carbon neutral versions, including infrastructure and vehicles as existing ones reach the end of their life rather than invest in projects with no other drivers than reduced emissions. Thames’ energy strategy will also increase self-generation and explore gas to grid from our digestion sites.

United Utilities’ approach, the company said, will complement and goes beyond the water industry PIC for net zero scope 1 and 2 emissions by 2030 and aligned to national 2050 targets.

Between 2010-20 the company drove emissions down 70%. By 2030, the company will reduce scope 1 and 2 emissions by 42% and scope 3 emissions by a quarter.

Its work in AMP8 will focus on low regrets action to reduce emissions where feasible, sustainable and cost-effective.

Its plan proposed £196 million net zero enhancement programme to deliver immediate reductions in AMP8 and as building blocks for work to be completed in AMP9 and 10.

Innovation and alternative approaches to the challenges are core to Wessex Water’s intentions. It said traditional engineering and solutions “would be at odds” with its 2030 operational net zero ambition. By 2040 it wants to be fully decarbonised but admits this goal will be made more difficult due to the scale up in capital works over the coming decades. Therefore it will work with nature-based and green/ blue solutions where possible.

Across Yorkshire, the company is dedicating £51 million on measures that will reduce greenhouse gas emissions to net zero by 2050 including investing in renewable energy generation on its land and driving down operational emissions.

Across the border, Welsh Water said its own monitoring has shown emissions of methane and nitrous oxide from wastewater treatment are approximately double the levels previously calculated. Its PR24 plan proposed £42 million enhancement spend

In Wales there is a legal commitment to achieve net zero emissions by 2050, with an aspiration to achieve that sooner. The company said its target goes beyond the target set by its English neighbours because the net zero strategy encompasses total emissions, rather than operational emissions by 2030

The Welsh Government’s SPS to Ofwat stated that water companies should “adopt practices and behaviour which act as an exemplar and positively enable change to achieve a net zero carbon society in Wales.” The SPS makes clear that the Welsh Government expects companies to develop plans to achieve net zero on the basis of both operational and embedded carbon emissions. This is why we have committed to achieve net zero on total carbon emissions by 2040.