Ofwat’s Chief Executive says the UK water sector must think broadly about the resilience of water supply and sewerage systems in the long term - including ecosystems.

In a speech at Water UK’s innovation hub this week, Cathryn Ross emphasised that the 'resilience objective' in the Water Act talked about the resilience of water supply and sewerage systems over the long term – not networks and  kit.

“I think it is pretty clear that we - and of course those who actually provide the water and waste water services on which we all rely, are being encouraged to think broadly about the resilience of those services over the long term and about the resilience of the entire system - yes pipes, and other bits of kit, but also ecosystems - that underpins that”, she said.

Referring to a recent visit by the Ofwat  Board to Dŵr Cymru's Rainscape scheme, Cathryn Ross said that as far back as the 2009 price review customer engagement had revealed support for resilience schemes.

Building on this, the expectations on the sector from both Ofwat and from customers on resilience were “ pretty clear”.

Firstly, by taking ownership of the relationship with customers, and responsibility for delivery of the outcomes that customers and society more widely want to see, which  “resilience is clearly part of.”

Secondly, by talking to customers about resilience, which “can and will mean different things to different people.”  There was considerable risk that if we take the concept for granted, if we assume 'we all know what it means' we will end up delivering something that doesn't reflect expectations of customers and society, with trust and confidence being undermined.

Ofwat’s Chief Executive also called on the water companies to think creatively, innovate and be flexible, urging them to “think services, think systems. Really understand and manage risk.”

Commenting on the regulator’s role, Cathryn Ross emphasised that Ofwat would not be taking ownership of or responsibility for the delivery of resilient services,  mandating a single approach or setting universal targets or regulatory requirements.

Ofwat’s independent task group on resilience, chaired by Jacob Tompkins, MD of Waterwise is currently considering what resilience means for the sector and what that means for economic regulation. The group’s work includes:

• reviewing the current UK structures for resilience;
• considering resilience (and the risks to it) from a variety of perspectives, including economic, social, environmental, customer, regulatory, security;
• skills, training and supply chain issues

Cathryn Ross also highlighted some key questions for the sector, including:

• What are the services that matter to customers and society? Right the way through the value chain?
• What are the risks to the provision of those services? Risks at every stage of the system
• How can we think more creatively about the options for mitigating those risks, to make sure we have the most cost effective option?

Based on lessons learnt in PR14, she said the sector had some way to go in understanding the value of outcomes, the risks to outcomes, and appraising options for risk mitigation - something Ofwat would “come back to for sure in PR19.”

Over the next few months Ofwat will be thinking about how the framework it sets through the allocation of risk and reward informs, enables and incentivises resilience and encourages efficiency and creative thinking.

The regulator will be publishing a consultation document with “some early thoughts on this” in the next few weeks which would also set out some examples of good practice across the sector on the resilience of water and wastewater services e.g. catchment management, demand management, trading and new schemes .