MOSL has today published its response to Defra's consultation on the proposed water demand reduction targets that will form part of the Environment Act.
We welcomed the introduction of a statutory water demand reduction target as we believe it has a critical role to play to drive action in the short term to help secure future supplies. However, we disagreed with a target being put forward without further evidence or detail on how the proposed overarching target - to reduce the use of public water supply in England per head of population by 20% by 2037 - was reached or will be realised.
We set out the need for a systems wide approach to securing water efficiency savings. While we welcomed that a specific non-household demand reduction target may help ensure the potential savings in the non-household market are not forgotten, the proposed target - of a 9% reduction in non-household demand by 2037 - is less ambitious than the equivalent household target and therefore creates a risk that there is not an equal focus for water companies to reduce demand across the system.
There are significant non-household water efficiency savings that have not been realised since the market opened in April 2017, however, in order for them to be realised there is a need to remove structural barriers in the market through mechanisms including via the PR24 price review.
Defra need to provide clear details on the mechanisms to be used and/or commit to making changes to the non-household market’s structural barriers preventing water efficiency from being realised. A key part of this will be ensuring retailers and wholesalers are incentivised to work together to drive the right outcomes.
MOSL has also responded to Ofwat's Innovation fund consultation – Approach for 2022-25. We strongly welcomed the proposed new competition and the intention for it to allow anyone to put forward a bid without the need for a water company to lead an entry. We believe this will make retailers more likely to come forward with bids for projects that may be able to deliver benefits for household customers and benefits to non-household customers. Our response is available here.
If you have any questions or comments on our responses please email
