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Government warned: don’t neglect upstream market in the rush for retail

The benefits of upstream competition in the water sector are in danger of being overlooked in the hype around retail, the head of a small market player has warned.

Following the release of a draft Water Bill on Tuesday, three workstreams were set up to implement its objectives, all around elements of retail competition. They will help set up the framework for non-domestic customers to be able to choose their water supplier.

Jerry Bryan, managing director at sustainable water and sewerage service provider Albion Water, is pressing for a workstream to specialise in the upstream side. He is also calling for the issue to be on the agenda of a “high level group” formed of government, regulator, customer and market participant representatives.

“There is a danger of ignoring the potential benefits, short term and long term, of upstream competition,” said Bryan.

“If you look at some of the detail of what we are trying to do in that space, it is genuinely innovative and arguably revolutionary.”

The government’s proposals around upstream activities are intended to make it easier for new entrants like Albion to compete with incumbent water companies and innovate. That could involve providing alternative supplies or methods of water or wastewater treatment.

There are currently limited opportunities to do so through Ofwat’s “new appointments and variations” regime.