Further develop options and RWG recommendations for increasing water demand reduction delivery on non-household properties and within the retail market

The funding awarded for this project has allowed the RWG Water Efficiency sub-group to enlist a independent consultant to provide the following: 

1. Recommendations that assist decision making processes and submissions made by the sub-group and its member organisations, seeking to increase the level of water efficiency activity and volume of water savings delivered across the non-household market;
2. Recommendations that would enable better customer outcomes and delivers better environmental improvements, in line with the objectives of the Market Arrangement Code (MAC) and Wholesale Retail Code (WRC).
3. Recommendations in time to influence future relevant regulatory reviews such as the Retailer Exit Code (REC) and Wholesale PR24 Price Review.

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While Defra sets out an overall water demand reduction target, it also includes a specific call for reduction of non-household water usage amongst business customers. The Economic Insight report sets out that the key regulatory and financial mechanisms needed to enable a level of water efficiency delivery needed within the non-household market, so that retailer and wholesaler activity contributes towards a national water target agenda. The market needs “new money” which is unequivocally linked to water efficiency delivery. The value of the work required ranges from £22- £35+ million per annum with many complementary funding options needed to deliver tangible results (e.g. Wholesale Price Review, Market Performance Framework, Retail Exit Code). Wholesalers must have performance commitments and funding that better enables non-household demand rection and collaborative delivery. Also, the market needs to continue to develop competitive water efficiency services which will attract end users. The report sets out their recommendations from page 28.

Information from the report is being used as part of PR24 consultation, REC Review and will feed into the Defra proposed National Water Target. The project team continue to promote the report, and hope it becomes a reference point in the design of PR24 as well as incorporated within the Market Performance Framework (MPF) Reform. 

The study has lead to further work from the sub-group to include creation of specific incentive schemes (micro level funding) and assessment of the overall cost benefit analysis of completing this work to the end user.