Top 3 things we will see in the water utilities sector 2017

In a report detailing Ofwat’s expectations of the opening of the water market in 2017, Tim Griffiths, Ofwat’s director of retail market opening, states that customers must be at the heart of communication; that retailers should be fair and transparent and information must be timely, allowing customers to make informed choices. Customer service arrangements and processes should also be accessible and effective for customers.

With this in mind, what can we expect in 2017 when businesses and non-household bodies in England and Wales are free to choose their water supplier and how can licensed suppliers prepare for the dawn of this new era? 

1) Potential billing errors.

Our experience in deregulated markets in New Zealand and Australia means we have seen what can happen during a period of significant change. With an estimated 1.2 million potential new customers on-boarding from April 2017, errors with billing and incorrect data entry will happen.

To counter this, organisations need to make sure that there is a revenue assurance system in place to improve the quality of data. Tactical transition planning programmes, data validation and tariff management tools will also be vital components in helping with costly errors that could occur during the changeover.

2) Customer retention will require more effort.

Gas and electricity markets became deregulated in 1996 and 1998, respectively. Doorstep selling was poorly regulated and suppliers gained a bad reputation (not to mention a few fines in mis-selling energy contracts). Fast forward twenty years and it’s a different ball game. The Internet is at the centre of customer communications and its capability needs to be further harnessed and maximised by water suppliers.

Customer expectations are at an all-time high and comparison and switching websites are part of consumers’ everyday vernacular. Streamline billing, web based customer services and water metre asset tracking will give suppliers a competitive edge needed to acquire and retain customers.

3) Some companies might not be ‘ready’.

Being ready for customers will involve a muti-faceted approach that some companies won’t be prepared for. In the Water Report, April 2016, Defra’s Sarah Hendry states that companies need to define what it means to be ‘ready’. In the same article, Ofwat’s Cathryn Ross, says there are three distinct parts for water companies being ‘ready’. The first being technical, while cultural shifts and strategic aspects will also be very important in the success of water companies making the transition. To gain a competitive edge, suppliers will have to make sure they have all of these aspects at the fore of their plans.