United Utilities has launched a new consultation on its proposed Water Trading and Procurement Code which will apply when other water companies and third parties trade water with United Utilities.
Introducing the Code, United Utilities said it is in principle willing to trade with any party that either wishes to take from it, or offer to it, a reasonable volume of reliable, sustainable and cost-effective water resources, commenting:
“We support economic growth within our supply area and we believe water trading can play a part in encouraging growth, as long as it is done in a sustainable way.”
Water regulatior Ofwat wants to encourage greater water trading - although many companies (including United Utilities) already trade water, Ofwat has introduced a financial incentive to encourage companies to consider more trading.
If a company wants to apply for the trading incentive, it needs to have a Trading and Procurement Code in place that has been approved by Ofwat. In order to qualify for the incentives, the trade will be a new agreement with another water company for United Utilities to import from or export to that company’s water supply network.
Qualifying trades must start in July 2013 or later and be operating in practice and generating revenues during the price control period 1 April 2015 to 31 March 2020. The trades must also be between wholly-unrelated companies.
United Utilities operating area shares a border with Northumbrian Water, Yorkshire Water Severn Trent Water, Dee Valley Water and Welsh Water. Another company operates as a ‘new appointee’ within the North West - Leep Water Networks Limited, which supplies the Media City development in Salford.
The company already has more than 20 bulk water trades already in place with some of the companies - either trades of potable water or non-potable. The most significant of these by volume is a bulk supply export from the River Dee to Welsh Water, where around 20 Ml per day is exported.
United Utilities’ estimated water resource position suggests it will be more likely to offer exports than seek imports during the period. Once the Thirlmere transfer is complete all its Water Resource Zones are estimated to have supply demand balance surpluses over the period to 2040.
The UK Government supports more water trading through greater interconnection between water companies’ water networks as part of measures to help tackle the emerging challenges of climate change and population growth, as well as addressing current problems of over abstraction.
A qualifying trade must be between wholly-unrelated companies. Once our Thirlmere transfer is complete all our Water Resource Zones are estimated to have supply demand balance surpluses over the period to 2040.
Deadline to submit responses to the consultation is 5 March 2018 and can be emailed to This e-mail address is being protected from spambots. You need JavaScript enabled to view it
Click here to download the draft Water Trading and Procurement Code.
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