Water deregulation - whats changing

If you didn’t know, deregulation of the water industry in England is coming. This means, as with electricity and gas supply contracts, you will soon be able to choose your own water provider.

Whilst large business customers i.e. those using more than five megalitres (one megalitre equals one million litres) of water per annum have enjoyed water supply choice in recent years, by 2017 the whole business water market will be opened up in England for the very first time. However, if you are a business in Scotland this is old news, as you have had retail competition in place since 2008.

Using Scotland as a benchmark, businesses can expect savings, discounts, more attractive payment terms, increased customer satisfaction and improved water efficiency. Since 2008, Scotland has seen an estimated £35 million in water efficiency savings from wider customer choice. However, for many businesses reading this, it will likely be the first opportunity you have had to negotiate better prices or payment terms with water companies.

Key water deregulation facts to be aware of:

• All businesses and other organisations will be able to shop around for their water and sewerage suppliers from April 2017.
• However, if your business is in Scotland or has at least one site in England that uses more than five megalitres of water per year you, can switch water supplier now.
• High spend water users and multi-site water users with low spend can expect the biggest potential gains.

What to do about water deregulation

• Understand your current water usage figure (in megalitres) to check if you can switch supplier today.
• Ensure you are being charged correctly under your existing pricing regime – this will lead to immediate cost savings in the run up to full competition and your business will be better placed to gain if you switch.
• Engage your procurement team about the changes in 2017 and the need to negotiate prices with suppliers in the same way that gas and electric contracts are currently negotiated in your business.
• Begin dialogue with your existing water and sewerage provider to understand what they will be offering to your business as part of their deregulated service offering from 2017.