Mainstreaming water efficiency – what could it look like?

www.waterwise.org.uk

Mainstreaming water efficiency – what could it look like?

Nicci RussellPolicy Director, Waterwise

Waterwise Technical Symposium,20th July 2010




• Why mainstream water efficiency?Water efficiency as an opportunity

• Where are we now?

• Where could we be? water sector wider benefits

• How do we get there?

Water efficiency as an opportunity


Water efficiency as an opportunity

• Political• Economic• Environmental• Social• For water companies, retailers and

manufacturers



Political opportunity

Historic context

• The UK has less available water per person than almost all other EU countries

• London is drier than Istanbul• Spain, Italy, Greece have more water than the

UK• South East of England has less water available

per person than the Sudan and Syria


New pressures

• Climate change:– Tackling it– Adapting to it– Developing the low-carbon economy

• People – approx 150 litres pcc• Demographic change – new homes in water-

stressed areas, single households

• And 80% of 2050 homes already built…….



Climate change:Wetter wintersDrier summersIncreasing temperaturesMore droughts and floodsIncreasing strain on water resources


Bewl Reservoir, Kent, Summer 2006


Hosepipe ban announced in the North West07 July 2010 “We have announced that we will impose a hosepipe ban

following the driest start to a year since its records began.It is the first hosepipe ban in the North West for 14 years.”United Utilities

Thirlmere Reservoir, July 2010

Water Stress:Environment Agency map



Economic opportunity

•Every sector of the UK economy is dependent on water•Deficit reduction – government, homes, businesses•Low carbon economy


Economic opportunityValue of waterValue of water“Many of these industries would not be possible

without the use of water. To replace a supply of one million litres of water a day would typically cost about £2 million. The Agency’s regulation of abstraction, therefore, protects resources worth some £72 billion to licence holders. Clearly, water use is of such importance that its value to the economy as a whole is incalculable.”

National Audit Office 2005:


Economic opportunity

31 Thames Water, water efficiency in hospitals study, August 200632 Waterwise estimate


Social opportunity

Comfort

Bills Behaviour

Big society


Social opportunityComfort• Waterwise research shows that 80% of social housing has baths but

not showers• Waterwise fitted showers and other water-saving devices in a social

housing partnership project of 200 homes, through a home visit, and there was a clear social benefit – residents were delighted with their improved lifestyle at no extra cost – as well as 25% water savings with no financial incentive

• Waterwise research also shows that, in terms of the water-saving opportunities in homes subject to the current Decent Homes standard, the installation of showers would be of greatest value in terms of saving water, energy, carbon dioxide, and utility charges to the property

• Quality of life and homes would be improved for social housing residents, and costs cut


Social opportunityBehaviour

• Growing trend towards resource-efficient behaviour• Defra’s recent surveys show an increase in people who report making an effort

to cut down on water use – from 52% in 2007 to 69% in 2009• Waterwise research indicates people are keen to be more efficient with water, as

well as energy:• 5% of households surveyed liked the idea of having an overall water-saving

package in their homes • 48% said they would be willing to pay more for a more water-efficient

home• With water, wanting to waste less extends beyond reduced bills – see

Waterwise-led Tap into Savings example


Social opportunityBig Society


Environmental opportunity• Drawing too much

water, even beyond water-stressed areas

• Protection of the water environment for wildlife and natural resources (including people, economy….)

• Tackling and adapting to climate change


Opportunity for water companies, retailers and manufacturers

• Regulatory compliance – now and in the near future

• Meeting carbon targets and cutting costs• New engagement with consumers – new

markets• Increased brand reputation• Stimulating competition and innovation

Water availability in England and Wales, winter left summer right.

B&Q andWaterwise Campaign:

water butt sales increased by 300%




Where are we now?


Where are we now?Water sector – good news• Tens of thousands of retrofits• Water efficiency targets

(boardroom…)• National campaigns• Starting to work with other sectors –

housing and energy


Where are we now?Water sector – bad news (“opportunity”) 1• Bias towards supply-side incentives• Structures – too much and not enough

– Price reviewsPrice reviews– WRMPsWRMPs– Drought plansDrought plans– Strategic Direction StatementsStrategic Direction Statements– Catchment Management StrategiesCatchment Management Strategies– River Basin Management PlansRiver Basin Management Plans– Notified ItemsNotified Items


Where are we now?

Water sector – bad news (“opportunity”) 2• Question as to whether structures adequately

reflect, incentivise and deliver:– Innovation Innovation – Competitive new practicesCompetitive new practices– Widespread mitigation effortWidespread mitigation effort– Widespread adaptation effortWidespread adaptation effort– International learningsInternational learnings– Customer demand (for example, national campaigns, hosepipe bans)Customer demand (for example, national campaigns, hosepipe bans)– National prioritiesNational priorities


Where are we now?Water sector – bad news (“opportunity”) 3


Where are we now?Water efficiency and wider national

priorities• Long-term challenges are common across

sectors: climate change, population growth, economic stability

• And water efficiency can help address these• But water efficiency does not feature in

policy for energy, housing, carbon reductions, developing the low-carbon and green economy, or deficit reduction


Where could we be?


Where could we be?Water sectorA regulatory and political framework for water which (building on targets, Cave and Walker…)

•Reflects the full, long-term value of water•Incentivises water service companies•Is not biased towards capital expenditure•Drives a long-term investment framework•Has tradeable carbon targets at water company level•Is developed, and works, alongside those for energy and housing•Is linked to an overall per capita consumption target•Recognises the importance of engagement with people•Is supported by a political commitment to full metering


What would this look like?A water company is delivering services such as water efficiency and rainwater harvesting to its customers on a large-scale, earning a return on this activity as much as for supply water and wastewater services. It is developing innovative funding and delivery frameworks and partnerships with local authorities, schools, retailers, manufacturers and NGOs. It is retrofitting tens of thousands of homes and helping all of its customers to change behaviour. All its programmes are measured and targeted for their contribution to national adaptation and mitigation aims. It is a key player in a toilet scrappage scheme for householders, a spend-to-save scheme for schools, and retrofitting programmes for energy and social standards and is working with garden centres to drive water efficient behaviour…..


And possibly

The shadow price of water is beginning to be developed in the regulatory framework, in advance of full regulatory reform – reflecting regional and price differences


Lessons from the energy sector

Obligation – led to a huge market developingIncluding commodities – providers selling creditsMetering keyFinancial savings key – little behaviour change?

The same but different....?


Incentive for going beyond base level targets.....?

Capex opexTreatment of riskBalance of regulation (energy) and incentives (housing)

Green Deal provider.........


Where could we be?Wider national priorities: mitigation, adaptation and the Big Society

Water efficiency is included in•Public sector adaptation strategies and resilience programmes•Carbon budgets•Government guidance on adaptation and good business practice•New planning frameworks•Strategies and funding to develop the green and low-carbon economy•The Big Society


•Water efficiency is in the Green Deal: £40 vs 6.5K•Water efficiency is included in new green financial products – such as mortgages•Water efficiency standards for new homes and buildings follow the same trajectory as for energy efficiency, and zero carbon•The Energy Performance Certificate is used to drive water and energy efficiency measures•Product standards are set for taps, showers and urinals, and linked to procurement•Insurance discounts for adaptation measures apply to water efficiency as well as flood defence

Where could we be?Wider national priorities: energy efficiency, homes and buildings


•Product standards are set for taps, showers and urinals, and linked to procurement•Toilet scrappage scheme involves retailers, manufacturers and public and third sector•Innovative spend-to-save funds in the public and private sector are delivered and financed in partnerships, driving product development•Low-carbon strategies and funding, and training, include water efficiency manufacturing and services•Including water in the Green Deal increases the number of green service jobs

Where could we be?Wider national priorities: the low-carbon and green economies


1 million toilets in England flush at 13 litres: 56% owner-occupiedGreen Deal: £6,500 – versus £40 water retrofit80% of social housing has no showers

Where could we be?


Toilet scrappage schemeGreen DealSingle water efficiency plumbing standardSingle water efficiency labelShowers in social housingEnergy Performance CertificateNew green financial products Community-scale water provision and SUDS

Where could we be?Angle 1



Water efficiency product standardsProcurementSingle water efficiency labelIncentivesAdviceNational campaignPartnerships



Incentives for water-efficient manufacturingSingle water-efficiency plumbing standard and labelTargeted training, education, R&DClusters of environmentally responsible areasInnovation supported in regulatory frameworks, including cross-sectoral working and new partnerships



Financing

•Piggybacking•Capex-opex•European Investment Bank•Reduced bills in homes and businesses•Untapped EU funds•Mainstreaming water efficiency in government policy•Big Society – maximising cost-effectiveness of existing programmes

And finally:



How do we get there?


How do we get there?More research:

•Costs and benefits (Waterwise Evidence Base)•Consumer behaviour and attitudes•Optimum per capita consumption•Potential contribution to the

green economy


How do we get there?Ofwat’s “Sustainable Water” processWaterwise White Paper June 2010Blueprint for Water Autumn 2010Government White Paper – early summer 2011Legislation 2012UK LinksWaterwise water sector groupAnd wider government policy.....

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Mainstreaming water efficiency – what could it look like?