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Reducing water consumption and promoting efficiency with customers will be central to the next price review, Ofwat’s David Black has said.
Speaking at the Waterwise 2021 conference, the chief regulation officer, who will step up to interim chief executive next month, said driving forward water efficiency is important for PR24 and beyond regardless of the impacts Covid-19 has on household consumption behaviour.
Per capita consumption (PCC) soared last spring when warm weather coupled with lockdown saw usage rise across the UK. This led to some companies asking Ofwat to rethink the outcome delivery incentives (ODIs) relating to PCC.
Black said Ofwat was “concerned companies still have as strong incentive as possible to drive down consumption as much as possible”, even with the pandemic.
He added that the pressures from Covid-19 arguably strengthened the water efficiency case and Ofwat wanted to see water companies take further steps to promote it.
To support that, Ofwat is considering making the ODIs associated with PCC an end-of-period rather than in-period adjustment. This would give the regulator more time to understand the impact of the pandemic on PCC regarding weather-driven or lifestyle changes. He said it would also allow companies to redouble their efforts based on what was learnt about behaviour during the lockdown.
He added it would allow time to consider a targeted adjustment as an in-the round assessment of Covid-19.
“For example it might be that penalties should be adjusted if there is a marked step up by companies for water efficiency during this period, which could include a longer term commitment to a national campaign.”
Meanwhile Defra’s deputy director of water services Sophie Broadfield told the conference that the department is still not ready to publish the long-awaited response to the 2019 consultation “Measures to reduce personal water consumption”. It explored interventions including water labelling, behaviour change, building regulations and supply pipes. Broadfield said it remained an “immediate priority”.
Mandatory water labelling of white goods, bathroom fittings has long been suggested as a means to save water in the long-term.
Last year the Committee for Climate Change (CCC) called on Defra to mandate labelling as a means to save water and lower carbon.
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