By Cathryn Ross, chief executive of Ofwat
“I didn’t give it a thought”. That is the first thing someone said when we recently asked them about the water sector. It isn’t an unfair or unexpected reply. I imagine many of you would start there too.
We all want to know that when we turn on the tap, clean water will come out. And when we flush the loo, the wastewater will be taken away. As that almost always happens, we don’t think much else about it.
But with so many profound challenges to confront and exciting changes coming, maybe we should think about it.
Maybe we should think about the impact of climate change and population change on parts of the UK with less water per head than Malawi.
Maybe we should think about the criticality of water and wastewater services for our society and economy. And about how we make sure our children and grandchildren have access to the services we take for granted.
Maybe we should think about why the water sector has seen so little innovation in customer service when, in every other service sector you can think of, we see a stream of new products and offers.
At Ofwat, we accept the challenge and are shaping the changes needed to ensure the resilience of these services.
What this means in practice
In part, that means using markets to enable choice and help deliver more for less. For example, the market in so-called ‘poo power’, where treated sewage or bioresources is used to generate green electricity. And the new market for water companies buying and selling water between themselves, so areas where water is scarce call on those with more than they need.
However, the most significant and exciting change will see head-to-head competition in part of the sector previously ruled by monopolies.
In April, the largest competitive retail water market in the world opens, meaning 1.2 million businesses, charities and public sector organisations in England can choose their water retailer.
They will be able to shop around, renegotiate and find the right deal. If they don’t like the service they get, they can take their business elsewhere.
Maybe we should think about the impact of climate change and population change on parts of the UK with less water per head than Malawi
This market could deliver lower bills, help people use less water, improve services and see new offers emerge. But customers also want to know there is appropriate protection for them. And there is. As well as a new customer protection code of practice, we will monitor the market closely and limit the price customers pay if they don’t switch.
One question that follows from opening this market is if businesses can choose, why can’t all customers?
We recently reviewed the costs and benefits of extending choice to all and think it could be good for customers.
The immediate savings on bills look modest. And we would need to ensure customers could find the best deal for them and were treated fairly.
But competition could deliver the kind of innovation customers get elsewhere, bringing new offers, such as leak detection and a single utility bill, and technology helping to reduce consumption and manage your account.
As the customer we recently asked went on to say: “I didn’t give it a thought. But having thought about this, now I do feel why don’t we have a choice?”
If you want to give it a thought, you can find out more at www.open-water.org.uk