For those of you who, like me, have never heard of Ofwat, it is The Water Services Regulation Authority, and is the economic regulator of the water sector in England and Wales.
Ofwat’s vision is one where customers and wider society have trust and confidence in vital public water and wastewater services and it is working hard to ensure that customers, the environment and wider society have confidence in the water sector.
Ofwat on Dealing with Future Water Challenges
Ofwat recently published a series of discussion papers on the particular challenges facing the sector and the sectors that need attention, which include:
- Affordability;
- Dealing with new challenges around environmental water quality;
- Meeting the demand for water in areas where there are stretched water resources; and
- The development and maintenance of resilient services and systems;
In keeping with its collaborative approach, Ofwat has asked for input from companies as to whether it is correct in its assessment of the challenges facing the sector by setting up a ‘marketplace of ideas’.
Ofwat is not proposing any solutions at this stage, but has stated that it is looking to include a more proportionate and targeted approach to regulation, which will put the onus on companies to act responsibly, and to make effective use of regulation and market mechanisms to enable and encourage companies to create value. This approach will benefit the environment, customers, society in general and also investors.
According to Ofwat Chief Executive Cathryn Ross, Ofwat wants to build on the successes of the 2014 price review so that it can encourage and enable companies to deliver more for less. Providers must deliver better services at better prices in order to maintain trust, and the sector needs to be innovative in order to create value that can be shared between the environment, society, customers, and investors.
Ofwat has invited discussion and responses to its discussion papers during September 2015, after which it will continue to build on the conversation and engagement throughout the autumn, and will put forward proposals on the particulars of its approach to regulating water and wastewater wholesale controls for the 2019 price review by the end this year.
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