New water retailer prepares to enter the market

A brand-new water supplier called The Water Retail Company has applied for a licence to participate in the water retail market in England when it opens next year.

The Water Retail Company – which will be headed up by Lord Rupert Redesdale, with support from the Energy Managers Association – has applied to Ofwat for a water supply and sewerage licence (WSSL).

A spokesperson told Utility Week the company is currently in discussion with several customers, and will limit itself to no more than 20 businesses in the first year. Its aim is to secure £30 million of turnover in its first year, £100 million in year two, and £200 million in year three.

In its application, the Water Retail Company said it will offer “highly competitive pricing for water and sewerage services”.

“The company will use technology and innovation to provide enhanced services and focus on water efficiency and water reuse to drive down bills through reduced water use, reduced effluent discharge and reduced surface water drainage,” it added.

The spokesperson added that the company will be “focussed on bespoke one-to-one services”.

This application brings the total number of companies to have applied for licences to 19, since Ofwat opened the process. The regulator has predicted as many as 40 new applications in the coming year.

First licences were granted at the beginning of October. Successful applicants were: Anglian Water Business; Castle Water; Clear Business Water; Kelda Retail – now part of Three Sixty – Northumbrian Water Business – now Wave – Severn Trent and United Utilities, on behalf of Water Plus; South Staffs Water Business; SES Business Water; and Water 2 Business – a joint billing venture between Wessex Water and Bristol Water.

Business Stream, Cobalt Water, Pennon Water Services, Thames Water Commercial Services (which has since decided to exit), and Affinity for Business have also been successful in obtaining licences.

In November, Pennon Group – which includes South West Water and Bournemouth Water – announced it has entered into a joint venture called Pennon Water Services with South Staffordshire Group – which includes South Staffordshire Water and Cambridge Water. Each company will retain their existing trading names in-area, and the joint venture will operate out-of-area as Source for Business.

South East Water Choice has applied for a sewerage licence only, in order to provide its existing customers with a combined water and sewerage bill. It has also applied for a WSSL through its subsidiary Invicta Water, which will trade as Water Choice South East.

Companies which have submitted applications which have not yet been granted are: water management firm Waterscan; commercial gas supplier subsidiary Regent Water; and Invicta Water (Water Choice South East).

Small Scottish supplier Everflow told Utility Week it is considering buying into the English market when it opens and will be applying for a licence soon. Veolia UK has also said it wants to grow its retail activities in the market, but has not yet applied for a licence.

New entrant Blue Business Water also told Utility Week it will apply for a licence before the market opens. Chief executive Chris Clark stressed that the company is “keen to acquire the customer bases of companies looking to exit”.