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Retail competition in the water sector from 2017 will result in the sector becoming “a bit like the energy industry”, according to the commercial director at Thames Water.
Speaking at Sustainability Live in Birmingham, Piers Clark said that there will be companies that succeed in the short term in supplying water which will end up being bought out by the larger companies.
He told delegates “there will probably be consolidation” as the sector matures, but he added water would not end up with a “big six” like there is in the energy sector.
Mark Powles, the chief executive at Business Stream, who was also speaking at Sustainability Live, agreed that “we do need some consolidation”.
He added: “There are 22 incumbents and potentially 18 to 10 new entrants fighting for 1 million customers.
“Do the sums: it just doesn’t add up.”
Powles was confident that the model set to be introduced would “encourage new entrants and create quite a vibrant market”.
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