Embed Size (px)
Citation preview
WATER RESOURCE TECHNICAL FORUM
WALES WORKSHOP 212TH OCTOBER 2017
LOGISTICS
1
WELSH AGENDATime Activity
09.30 to 10.00 Arrive
10.00 to 10.20Welcome and IntroductionPurpose of this group, expectations
10.20 to 11.00
Presentations covering:• Supply and Demand Outlook• Drought risk assessment• Resilience Options
11.00 to 11.40 Open discussion on topics above
11.40 to 11.55 Break
11.55 to 12.10 Metering and Water Efficiency Options
12.10 to 12.45 Open discussion on Metering and Water Efficiency Options
12.45 to 13.20 Lunch
13.20 to 13.40 Welsh PR19 Business Plan
13.40 to 14.10 Open discussion on PR19 Business Plan
14.10 to 14.30 Wrap up, Benefits and Concerns, Meeting Close
WELCOME
MARCUS O’KANEWATER RESOURCES AND CATCHMENT LEAD
THIS IS OUR 3RD WELSH WRMP STAKEHOLDER FORUM
Meeting Content
Sep 2016
1. AMP6 progress / situation
2. Process and timeline
3. Framing the problem
4. Proposed Strategic Environmental Assessment Criteria
April 2017
1. Recap on previous session2. Feedback from last session and actions driven
from it3. The size of the SDB challenge – sustainable
abstraction, climate change, resilience, growth etc.
4. What options do we have, and how to find the right balance of supply side / demand management
5. Visibility of how to engage on wider PR19 plan
June 2017
1. Focus on Welsh plans2. Update on work done so far3. Visibility of the emerging challenges4. Building stakeholder engagement
Autumn 2017
First view of Draft Water resource plan• Supply and Demand Outlook• Drought risk assessment
• Resilience Options
Spring 2018 Water resource plan consultation feedback
The purpose of the Technical Stakeholder Forum:
• To review and challenge the development of our Water Resource Management Plan 2019 so that it reflects and balances the priorities of stakeholders and customers.
• To inform our dialogue with theWater Forum when required
• To shape our PR19 investmentplan
4
OUR STRATEGIC FRAMEWORK
5
HOW WELSH GOVERNMENT POLICY AFFECTS OUR APPROACH
FOR PR19Well-being of Future Generations (Wales) Act 2015 – improving the social, economic, environmental and cultural well-being of Wales.
• Water companies are not included in the definition of public bodies for this Act. However, the Water Strategy for Wales sets out the Welsh Government’s strategic direction for water policy in Wales, at the heart of which are the principles for sustainable development as set out in the Well-being of Future Generations Act.
6
OUR REGULATORY TIMETABLE
Date WRMP PR19
20
16
SpringDefra, EA and NRW publish
Guidance
Summer Pre-consultation starts
20
17
December draft WRMP submitted to
Welsh Government
Ofwat publishes price review
Methodology
20
18
January /
February
draft WRMP published for
public consultation
July Statement of response to
consultation published
September Companies submit business
plans to Ofwat
20
19
TBCWelsh Government Cabinet
Secretary decision on WRMP
June / JulyOfwat publishes standard
company draft determinations
DecemberOfwat publishes final
determinations
WALES WATER RESOURCE PLAN
We are aligning our borders ahead of the implementation of the Wales Act
For WRMPs this means delivering two water resource plans;
• A Welsh plan covering Wrexham and Powys that will follow WG and NRW guidance and relevant legislation
• An English plan covering Chester and English counties to Defra that will follow Defra / EA guidance
8
For WRMP19 we will take a pragmatic approach due to technical complexity of separating out the inter-linked systems of Wrexham/Chester and Pant/Shropshire
We will hold separate stakeholder meetings in Wales that will include NRW, Public Service Boards and other stakeholders.
HOW MUCH WATER DO WE SUPPLY?
• We supply approximately 62 million litres of water a day to over 258,000 customers (made up of approximately 112,000 households and 8,000 business customers).
• Our main source of water is the River Dee, providing 85% of our raw water supply, with the remaining 15% coming from our impoundment reservoirs (10%) and a spring in Llangollen and borehole in Mickle Trafford (5%).
• Water is treated at six treatment works and is then supplied through a network of approximately 2000km of water mains, 25 pumping stations and 37 clean water storage reservoirs.
Add Footer Text 9
OUR NETWORK IN WREXHAM & CHESTER
10
OVERVIEW OF OUR EMERGING WRMP
The PR19 water resources challenge is driven by:• Ensuring resilient supplies;• Accommodating future climate change
impacts and uncertainty;• Meeting future growth in demand.
The draft WRMP is likely to include:• Step change in demand management
activity;• Further reduction in leakage beyond
AMP6;• No increase in our current drought
resilience;• Proposals for reservoir improvement
works and catchment level investigations / solutions to shore up our resilience to future uncertainties.
0.00
5.00
10.00
15.00
20.00
25.00
30.00
35.00
40.00
2020
-21
2021
-22
2022
-23
2023
-24
2024
-25
2025
-26
2026
-27
2027
-28
2028
-29
2029
-30
2030
-31
2031
-32
2032
-33
2033
-34
2034
-35
2035
-36
2036
-37
2037
-38
2038
-39
2039
-40
2040
-41
2041
-42
2042
-43
2043
-44
2044
-45
SBD
(M
l/d
)
Supply Demand Balance
Target headroom (climate change component) Target headroom (All other components)
Available Headroom Supply Demand Balance
SIGNPOSTING
Things to look out for in our draft WRMP:
• Preserving the current level of drought resilience.
• Increased ambition on leakage, in line with Ofwat’s 15% industry challenge.
• Exploring opportunities for increased demand management activities, in line with the step change in activity to encourage efficient use of water across the wider Severn Trent area.
• Review of our impoundment reservoir systems to identify the optimal improvement programme for PR19.
• Widening our current catchment management programme scope to investigate possible catchment level solutions for seasonal use restrictions due to taste & colour issues.
dWRMP 2018
SUPPLY DEMAND BALANCE
LIZ FRANKSWATER RESOURCES AND CATCHMENT SPECIALIST (WALES)
OUR WATER SUPPLIES IN WREXHAM & CHESTER
• Chester WRZ supplied by an abstraction from the River Dee, and a borehole.
• Approximately 107k population• 48,600 households and 3,210 non-
households served
• Wrexham WRZ supplied by an abstraction from the River Dee, a spring at Oerog, Llangollen and a number of impoundment reservoirs.
• Approximately 154k population.• 66580 households and 5020 non-
households served.
14
SUPPLY• The most significant change in the development of our WRMP this time has been the use of an
Aquator model for assessment of our deployable output (DO).• As well as giving us more flexibility to look at different scenarios, it has also highlighted
opportunities for optimising use of our impoundment reservoirs, thereby increasing our resilience to future uncertainties.
• The DVW supply system was tested under a number of different conditions. When demands were profiled based on previous dry years, the mean DOs were:• Wrexham – 51.2 Ml/d• Chester – 29.3 Ml/d
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
20
20
-21
20
21
-22
20
22
-23
20
23
-24
20
24
-25
20
25
-26
20
26
-27
20
27
-28
20
28
-29
20
29
-30
20
30
-31
20
31
-32
20
32
-33
20
33
-34
20
34
-35
20
35
-36
20
36
-37
20
37
-38
20
38
-39
20
39
-40
20
40
-41
20
41
-42
20
42
-43
20
43
-44
20
44
-45
Ml/
d
Water Available for Use (own sources)
WRX CHR
• The Wrexham DO under this scenario is constrained by assets rather than water resources, showing that the system is resilient to previous hydrological events.
• The mean DOs in the climate change scenarios and the impacts, with profiled demands, were:• Wrexham – 50.7 Ml/d (-0.5 Ml/d)• Chester – 27.8 Ml/d (-1.5 Ml/d)
CLIMATE CHANGE
• 85% of our water comes from the River Dee. Therefore, any impact would be most significant here and our modelling applies the climate change factor in line with the Dee General Directions, as advised by NRW through the Dee Consultative Committee Climate Change Working Group. As the Chester WRZ is 100% consumptive, the most efficient way to apply any reduction was at the BarrelwellHill (Chester) abstraction point.
• NRW tested 100 climate change scenarios and used the six median scenarios to generate climate change versions of the abstraction tables set out in the Dee General Directions.
• NRW provided flow perturbation factors for each of the scenarios. The flow factors relating to the Manley Hall gauging station were used to perturb the inflows to the DVW reservoirs in the Aquator model.
• As per the guidelines we have used similar scaling approach as used by Severn Trent in WRMP14, starting with 0Ml/d Climate change impact in 2020, up to the full 2030s impact in 2035.
16
DEMAND - HOUSEHOLD
17
• Initial forecasts for both WRZs are based on DY factors, taken from neighbouring Severn Trent WRZs, and population growth data provided by the key local authorities.
• Indications are that, in both areas, measured PCC will increase slightly while unmeasured PCC will decrease, resulting in a relatively steady picture for household demand over the next planning period.
• However, we have commissioned Artesia to carry out a more in-depth look at the household demand picture, including some micro-components assessment, building on that carried out for WRMP14.
• This information will also help us identify where we need to focus our demand management programme.
DEMAND – NON HOUSEHOLD
18
• Due to data constraints, we opted to update the forecast model developed for WRMP14. A fairly significant dip in industrial consumption between 2012 and 2014, followed by a steep increased return to 2011 levels by 2016 has resulted in a slightly steeper trend line than shown for the last plan.
• We will need to decide whether to adjust this using the same assumptions used in the last plan i.e. that industrial consumption would grow linearly, reaching similar levels as recorded in 2007/08 towards the end of the planning period.
• Initial forecast indicates very little change in the Chester WRZ from WRMP14, while, in Wrexham we are seeing a fairly significant decrease in industrial use consumption.
DROUGHT RISK ASSESSMENT
WHAT IS DROUGHT AND ARE WE DROUGHT RESILIENT?
There is no single agreed definition of a droughtBut it is definitely a prolonged period of below average rainfall
There are:
• Different durations and different severities
• Regional variations
• Droughts that affect some sectors more/ less
• Potential impacts on the environment and customers – restrictions on use
Focus on how drought affects our water resources management plan (WRMP)
WE PLAN FOR THE WORST DROUGHT IN OUR FLOW RECORD
Both Wrexham and Chester resource zones are heavily dependent on the River Dee for their supply of water; therefore the availability of water in the river is regarded as the fundamental operational measure of a drought situation.
Scenario testing for our last Drought Plan showed that under the five worst historical droughts on record we would always be able to meet our customer’s demands in these areas, as long as we manage our resources carefully.
Since 1927, water resources in the Dee catchment have never fallen below the ‘Stage 3 trigger’, which would result in TUBs.
However, we know more extreme events could happen in the future. But what is the proportionate level of drought contingency to plan for?
21
DROUGHT RISK ASSESSMENT• As agreed with NRW and EA, we have
followed the conventional plan (risk composition 1) technique, based on the worst drought on record. For the Dee Valley Water area, this was the 1933-34 drought event.
• Following discussion with NRW however, we also agreed to consider some more extreme events to ensure our risk assessment was robust.
• Initial drought scenarios were developed by scaling the reservoir inflows for four reservoirs in the Aquator model (Pen Y Cae, Pendinas/Llyn Cyfynwy, Nant Y Frith and Ty Mawr) to develop more severe events.
22
Drought Duration% of Long Term Average
FlowsDO (Ml/d)
1933-34 18-months 48% 51.2
Scaled Drought (0.9) 18-months 44% 51.2
Scaled Drought (0.8) 18-months 39% 50.7
Scaled Drought (0.7) 18-months 34% 50.4
Scaled Drought (0.6) 18-months 29% 49.9
Scaled Drought (0.5) 18-months 24% 49.6
RESILIENCE OPTIONS
RESILIENCE OF SUPPLIESRef. Scheme
DO gain (Ml/d)
Comments Description
WR1 Bulk import (Vyrnwy Aqueduct) 1.2Agreement required with UU
Bulk import from Vyrnwy Aqueduct (UU supply). Connections already exist and are used in emrgencies.
WR2Nant Y Ffrith licence change for additional winter abstraction 0.5
EA/DVW consultation required
Possible option to change abstraction licence to enable more water to be abstracted in winter. This would help to refill Pendinas/Llyn Cyfynwy reservoirs
WTW1 Wash water recycling (Boughton) 1
Capital works required -covers for wash water tanks
Currently can only be done on a seasonal basis due to algae risk. If the wash water tanks were covered, it could be achieved all year round as at Llwyn Onn.
WR3Maintenance and improvements programme for impounding reservoirs in 7 years
Increase capture of water from catchments through repair and maintenance of impoundment reservoirs and associated infrastructure (leats etc).
WR4
Investigation of cause of colour and taste issues at affected impounding reservoirs in 5 years
There are currently seasonal limitations on usage / treatment of water from some of our impounding reservoirs due to colour / excessive manganese etc, meaning that we cannot access these valuable water sources during high demand periods. There may be catchment solutions to enable us to reduce these issues and make the water more treatable.
WR5Joint catchment protection projects with UU and DCWW in 10 years
A sub-group of the Dee Steering Committee has been formed (Dee Catchment Protection Group) to identify opportunities for joint working opportunities within the Dee catchment aimed at reducing the risk to abstraction (buliding on metaldehyde undertaking work etc), which will start or deliver during AMP7. This may include seeking a joint bid for NEP funding etc.
WR6 Treat brackish water at Boughton in 20 yearsWouldn't need to shut down at tidal windows - research by NRW on future increase in brackish water.
24
RIVER DEE CATCHMENT• River Dee Basin District is home to over 500,000 people and covers an area of 2,251 km3,
mainly in Wales but includes a small area in England.• Nearly 3 million people get their drinking water from the Dee.• It ranges from the mountains and lakes of the Snowdonia National Park in the upper part
of the basin, through the Vale of Llangollen in the middle reaches, to the open plains of Cheshire and the mudflats of the Dee Estuary in the lower basin.
• The Dee and its estuary has a high conservation value, it is designated as two Special Areas of Conservation (SAC), and notified as three separate Sites of Special Scientific Interest (SSSIs).
• The strategic importance of the Dee as a potable water source and the risk posed to it from pollution have led to the Dee becoming one of the most protected rivers in Europe, with a highly developed water quality monitoring regime.
• The Water Companies (Dŵr Cymru Welsh Water, Dee Valley Water and United Utilities), co-fund an intensive monitoring programme of river water quality, working closely with Natural Resources Wales and the Environment Agency.
• This includes continuous on-line analysis for a range of potential pollutants at 3 locations on the main river, supplemented with the analysis of spot samples taken from 8 locations, including the major tributaries, twice a day, 365 days of the year.
Add Footer Text 25
RIVER DEE CATCHMENT
Add Footer Text 26
CATCHMENT MANAGEMENT PROGRAMME
Background to the programme• During the preparation for PR14, we undertook risk assessments in relation to the presence of
pesticides – namely MCPA and metaldehyde – in the River Dee catchment, and their potential impact on our Boughton WTW in Chester.
• We proposed a programme of catchment management activities to reduce the usage of the pesticides by local landowers and avoid the installation of costly removal treatment.
• DWI supported this proposal and, in partnership with United Utilities, we set up a Catchment Management Programme.
Add Footer Text 27
• Since November 2015, the programme has funded two Catchment Advisors (CAs) - employed by the Welsh Dee Trust –to cover the Middle Dee and the Upper Dee.
• Their key role is to engage with landowners and local pesticide suppliers with the aim of reducing the use of metaldehyde and other problematic pesticides in the catchment.
CATCHMENT MANAGEMENT PROGRAMME
Programme activities• Chemcatchers (such as the one pictured below) are deployed by
the CAs in tributaries across their catchments.• These are placed in the main flow of the water body for 2 week
periods. A disk inside absorbs any pesticides that might be present.
• The disks are then sent away for analysis. Low levels of MCPA and metaldehyde have been detected since July in Middle Dee, and spot samples of MCPA in Upper Dee indicate an increase in their use.
• In addition, we have a number of preventative initiatives underway:• MOTs for sprayers and weedwipers• Weedwiper hire• Discounted ferric phosphate slug pellets, as alternative to metaldehyde
products• Free pesticide ‘amnesty’ – collection and disposal of unwanted or
expired pesticides
• We have also recently set up the Dee Catchment Protection Group which is looking at catchment management opportunities at a strategic planning level, with particular emphasis on identifying collaboration opportunities.
Add Footer Text 28
SIGNPOSTING
Things to look out for in our draft WRMP:
• Preserving the current level of drought resilience.
• Increased ambition on leakage, in line with Ofwat’s 15% industry challenge.
• Exploring opportunities for increased demand management activities, in line with the step change in activity to encourage efficient use of water across the wider Severn Trent area.
• Review of our impoundment reservoir systems to identify the optimal improvement programme for PR19.
• Widening our current catchment management programme scope to investigate possible catchment level solutions for seasonal use restrictions due to taste & colour issues.
dWRMP 2018
BREAKOUT SESSION 1
30
Now it’s your turn! Hopefully you’ve now got a flavour for what our draft plan will
look like and now we want your views on what you’ve heard so far
• Do you think there’s anything we’ve missed during our assessments? Are there any challenges facing your organisation which you feel could be impacted, or have an impact on the plan?
• From what you’ve seen and heard so far, what are the key messages we need to be conveying to our customers?
• What further opportunities could we explore to increase resilience? Do you think there are possible links to projects your organisation has planned?
31
METERING AND WATER EFFICIENCY
DEMAND MANAGEMENTWe are modelling options to increase the scope of the water efficiency programme. We are applying understanding from our activity in the Severn Trent region for our Welsh Plan. The question we have to answer is how much further should we go?
Options to increase Water Efficiency activity• Distribution of water efficiency products
• Wider range of products including free and subsidised products• Online resources and calculator
• Infrastructure Charges Discounts• Currently trailing infrastructure charges discounts in ST• Potential to incentivise efficiency in new home
• Social housing audits• Building on the AMP6 trials in England
• Partnership opportunities• Exploring opportunities to link to wider environmental / efficiency programmes
• Home audit programme• Extending the coverage of our current AMP6 programme
• Non-household programme• We are exploring options for incentivising non-household customers to reduce demand for water• 11,400 businesses using approximately 30% of the water we supply in DV area
The AMP6 programme is delivering 0.1 Ml/d and we are exploring options to increase this to 0.5 Ml/d for AMP7.
OPTIONS TO INCREASE METER COVERAGE
Within the Dee Valley area we already have 60% meter penetration, but we know long term that increased levels of metering will play a role in helping us manage demand.
We are exploring options to increase metering:• Continue current pace
• Existing FROPT programme• Enhanced FROPT programme
• Encourage more optants
• Large scale installation of meters & persuaded optants• Dual billing, promotion etc.
• Universal metering• Options around pace / targeting
Key to this will be customer engagement - what do customers think and how do we communicate messages around metering to pre-empt concerns around bill increases etc?
Ultimately the pace and volume will need to align to the supply demand balance challenge over the next 25 years and beyond, together with customer attitudes to water metering and alignment with Welsh Government policy.
METERING – WHAT HAVEWE LEARNED FROM OTHERS?
There are a range of savings quoted for the demand reduction impacts of metering 8-16.5%. Even using lower forecasts the potential impact for our demand management programme is significant.
Southern Water• Universal metering in AMP5• 40% - 92% meter penetration• 16.5% reported demand reduction• 10% reduction in peak demand
Thames Water• Ongoing smart meter rollout• Indicating potential 12% demand reduction• 11% of homes with continuous flow >5l/h• 5% homes with leaking loo (215 l/d ave)
Affinity Water• Ongoing meter rollout• Indicating potential 8-9% demand reduction• No compulsory switching (to date)
OFWAT’S CHALLENGE TO THE INDUSTRY
Ofwat’s PR19 methodology has challenged water companies to target a minimum 15% leakage reduction in AMP 7.
Our investment modelling illustrates the scale of this investment challenge.
Our WRMP will explore how to achieve a 15% leakage reduction target. To deliver this leakage reduction we will need more innovation and we will need to integrate with other demand management solutions.
We will also be considering how to achieve this ambition in the most efficient way, which will include looking at the most appropriate pace for delivering this reduction to maximise the benefits from other policy ambitions, such as:
• Supply pipe adoption• Working towards a lead free Wales
BREAKOUT SESSION 2
37
From what you’ve heard this morning we want your views on how we can get the
maximum benefit from our proposals:
• We are not forecasting a water resource shortfall, so how far should we push our
demand management ambition?
• Water scarcity is not a major concern in this region, so how can we better engage
with customers on demand management and water efficiency issues?
• We are always looking for opportunities for collaboration. Are you aware of any
resource efficiency schemes – either within your own organisation or elsewhere
– that we should be engaging with?
• What more can we do to support our non-household customers to reduce their
water use?
38
WELSH PR19 BUSINESS PLAN
TIMELINE
40
J F M A M J J A S O N D
2016
OutcomesConsultation
Submission
J F M A M J J A S O N D
2017
J F M A M J J A S O N D
2018
J F M A M J J A S O N D
2019
PR19 Framework
PR19 Methodology Consultation
PR19 Methodology
RBR ResultsDraft
Determination
Final Determination
2017/18: Identifying what we should do
2016: Identifying what we could do
2018: Final package development
Strategic options
Final package testing
PR19 plan
March Workshops1st Flooding3rd Water Resources10th Water supply resilience13th Supporting customers23rd Environment
BUILDING BLOCKS
41
Risk and reward
Resources
Sludge
Water:Network plus (incl. treatment?)
WasteNetwork plus (incl. treatment?)
Retail -hh
Retail –non-hh
Cost assessment8 possible modelsbase expenditure x 4enhancement expenditure x 4
Outcomes (for our customers)
Return (WACCs +net margin) + rewards/penalties (ODIs) + risk items (WRFIM etc)
Financeability and affordability Fast and slow money
PR14 legacy (true-up for ODIs, totex etc) Midnight adjustment
1. Adv. Customer engagement2. Bespoke PCs (eg system optimisation)3. Comparative PCs (drinking water quality)
New annual information requirements
SCOPE OF THE WELSH PLAN
42
A key feature of our acquisition of DVW was a commitment to align the two licenses to national boundaries as per the Silk Review creating distinct English and Welsh licensees
To deliver this objective we need to undertake a transfer between STW and DVW - this would transfer customers, territory and assets between the two licensees (although they would still be part of Severn Trent Plc)
The framework for this transfer is called a “new appointment or variation” (NAV) and to -date has been used for housing developments – what Ofwat calls “competition for the market”
Ofwat are currently going through a period of assessment and public consultation.
SCOPE OF THE WELSH PLAN
43
ENGAGEMENT APPROACH
44
Approach to engagement to cover different needs and interests
CCG
ENGAGEMENT APPROACH
45
What
• To use all operational/customer data (e.g. complaints) within to ensure
full 360 view of conscious and unconscious needs.
• To recognise the hierarchy of customer needs. Not all customer needs are equal.
• Only segment customers differently where we can do something different to customers in segment e.g. vulnerable
Approach
• Build on existing knowledge to avoid spending customers money on things we already know.
• To focus on what matters most to customers.
• Sequencing of work components should build knowledge cumulatively in a coherently structured work programme.
• Ensure a clear line of sight between research and the business plan.
How
• Triangulation of sources to inform the business plan.
• Methodology choices to be determined by questions to answer. Fitness for purpose is paramount.
• Communicate research findings in an accessible way so customers know they have been heard.
Together with our customer challenge group, we have designed a strategic approach to customer engagement which is based on these guiding principles:
ENGAGEMENT APPROACH
46
What matters to customers:
Developing a plan that:
Testing and refining the plan:
• Testing the package through trade-offs research
• Testing and refining appropriate performance commitments & outcome delivery incentives
• Expert customer panels• Acceptability research• Splitting costs between
current and future generations
• Finds ways of enhancing the lives of our customers through best in class service and experience (based on a wide understanding of what matters to different customer segments)
• Delivers customers’ needs, through our core services (based on our valuation research and the choices in how we deliver our core service)
POLITICAL AND REGULATORY STAKEHOLDERS:
NEXT STEPSWhat By When Why
Write to stakeholders to:• Remind them what we have done so far,• Outline our next phase of engagement that will
include stakeholder workshops.• Ask how we can best continue to engage with
them.
End of October 2017 • We want to check we’re engaging with Welsh stakeholders in a way that best suits them.
• We want to arrange small balanced workshops so we can test emerging ideas.
Stakeholder briefing to be issued on emerging plan.
December 2017 • Provide all Welsh stakeholders with the opportunity to contribute and shape our Welsh plan.
Option to hold stakeholder workshops:• Detailed review of issues as they emerge.• Jury panels on trade offs as we balance the
plan.
January / February / March 2018
• Test views around our trade-offs and emerging views.
Provide Welsh stakeholders with an update on progress
April / May 2018 • Feedback from workshops
Ongoing engagement with stakeholders through one-to-one meetings.
Ongoing • Helps us to understand particular detail in greater depth.
Add Footer Text47
OUTCOME AND PERFORMANCE DELIVERY
48
Outcomes
Performance commitments (measures)
Performance commitments (targets)
Outcome delivery incentives(ODIs)
• High level, long term outcomes that reflect customer and societal needs
• A measure of service – should be accessible to customers and stakeholders
• A committed level of service or service improvement• Can be annual or at any point over the five year
period
• A reputational incentive to meet commitments, or• A financial incentive – penalty only, or reward and
penalty if we under or over perform
PERFORMANCE COMMITMENTS
49
PERFORMANCE COMMITMENT LEVELS
50
We will be considering several sources of information to ensure we set stretching performance levels
Cost benefit analysis
Comparative information
Historical information
Maximum level
attainable
Minimum improvement
Expert knowledge
Take into account wider customer information that just stated preference WTP.Companies should also take into account impacts on the environment and natural capital.
Companies should use this where it exists. Use a forecast of upper quartile in 2024-25 for their commitment level or justify why not.
Use past performance and improvements to forecast a rate of future improvement
Maximum possible level over time of justify performance relative to the maximum
Companies might propose for example a minimum 20% improvement
For example use engineering expertise and / or models to inform asset health commitments and the level of future improvement
STRATEGIC CHALLENGES
51
STRATEGIC CHALLENGES
52
There are currently four challenges that need to be addressed over the long term, and could drive significant investment in the next planning period (2020-25):
• Lead free Wales combined with potential supply pipe adoption• Supply resilience• Reducing the impacts of flooding• Enhancing biodiversity
Across all four aspects we need to consider how they can be approached and achieved in a way that contributes towards the goals set out in the Well-being of Future Generations (Wales) Act 2015.
STRATEGIC CHALLENGES
53
Lead free Wales &
supply pipe adoption
Seeking customer views (on need and solution
preferences)
WTP results -Nov 17
CCW research – Sept 17
PR14 customer research
Legislative / policy driver:
- Section 75 of Water Industry Act 91 – lead standard is 10μg/l at the customers tap
-DWI guidance note – including lead
-Water Strategy for Wales aims for a lead free Wales.
-Lead free Wales would support several of the Well -being of Future generations goals (predominately a healthier Wales)
- Actions from the task and finish group.
Protect vulnerable customers:
-Children and expectant mothers are particularly vulnerable
Collaboration & partnering:
- Housing authorities, schools, nurseries, hospitals and care providers.
- Working with the task and finish group
Inform future policy:
- Contribute to better understanding costs and benefits to inform the longer term policy on supply pipe adoption
Current performance:
- Ensuring compliance with standard
- Ensuring we have up to date risk assessments
STRATEGIC CHALLENGES
54
Flood resilience
Seeking views from customers:
-WTP on interruptions
-Deliberative research on resilience
-STW specific immersive research on flooding
Investment driver:
-SoNaRR identification of increased flood risk
-Defra guidance on protecting assets up to 1 in 1000 year event
-WBFG Act – contribution to A resilient Wales goal
Efficiency and affordability:
-Identifying an appropriate pace of improvement to time investment to deliver multiple drivers
-Identifying partnerships and collaborative approaches to maximise efficiency and innovation
Holistic and innovative solutions:
- Build into catchment approach
- Collaboration with other sectors or areas that have already considered flood resilience (e.g resilient cities approach)
Understanding current performance & risk
STRATEGIC CHALLENGES
55
Supply resilience
Seeking customer views:
- WTP on interruptions
- Considering deliberative research on resilience
Investment driver:
- Lumpy maintenance –need to make a case to Ofwat
- Customer driven improvements in resilience to external shocks and strains where risks are greatest
Able to align it to vulnerable customer policy (eg selecting
the most appropriate resilience response depending on specific customer impact)
Efficiency and affordability:
-Identifying an appropriate pace of improvement to time investment to deliver multiple drivers
Align it with land strategy and efficiency maximising (through rationalisation and interconnectivity options)
Consider it as part of water trading options
Working collaboratively :
to understand service resilience (not asset resilience) eg electricity providers, response and recovery providers, universities to better
analysis future trends (eg climate change)
STRATEGIC CHALLENGES
56
Enhance biodiversity
Seeking customer views:
- WTP on biodiversity improvements
Developing and testing measures with customers (to make it meaningful and outcome based
Investment driver:
-Section 6 of Environment Act Enhance (not just maintain) biodiversity
SoNaRR identification of risks to biodiversity (specifically chapter 5)
-WBFG Act – main contribution to ‘A resilient Wales’ goal
Efficiency and affordability:
-Align it with land strategy and efficiency maximising
- Look for opportunities to change ways of working rather than construction approach Holistic and innovative
solutions:
Identify partnering and collaboration eg developing/ extending relationships with
RSBP, tourism groups etc
Utilise expertise:
Other research will help us target where we can contribute
the most (NRW area statements and the well being
risk register?)
BREAKOUT SESSION 3
Finally, we would like to get your views on our proposed approach to the PR19 business planning process in Wales:
• Do we share any challenges? Could there be shared solutions?
• Should we be aligning metrics between stakeholders where we have similar goals?
• Do you think we are focusing on the right areas?
57
DO YOU HAVEANY QUESTIONS?
