Ofwat, the water industry regulator, has launched a consultation that could reshape how large business customers are charged for water, with a focus on promoting water efficiency and tackling water scarcity. The consultation, “Promoting water efficiency in wholesale charges for business customers,” aims to review current and potential wholesale charging structures for larger users and examine the rationale behind offering discounts.
Ofwat has identified several options for amending the Wholesle Charging Rules (WCRs) to enable reforms that could lead to better environmental and social outcomes. Under section 66E of the Water Industry Act 1991, Ofwat is required to issue rules for water and wastewater companies’ wholesale charges for businesses and to revise these rules when appropriate.
The consultation highlights the growing awareness of water scarcity and the importance of water efficiency. It also addresses the potential confusion about the value of water arising from discounted charges to large business customers. Ofwat is exploring how companies might place more weight on water efficiency considerations when setting wholesale charges.
“Water efficiency is crucial for the environment and for the long-term sustainability of water resources,” said Ofwat. “This consultation is an opportunity to ensure that our charging rules support these goals and reflect the true value of water.”
The consultation relates to water companies operating wholly or mainly in England and Wales. Stakeholders are encouraged to participate and share their views on the proposed changes. The consultation document and details on how to participate can be found on Ofwat’s website.
This consultation could significantly impact the water sector by encouraging large businesses to use water more efficiently, potentially setting a precedent for broader changes in water charging structures. It also underscores the increasing recognition of water as a precious resource that must be managed sustainably. The outcomes of this consultation could influence how water companies balance commercial interests with environmental and social responsibilities, sparking a much-needed debate on the true value of water in a scarcity-conscious world.