Ofwat is proposing to modify Castle Water’s existing Water Supply Licence and Sewerage Licence (WSSL) to enable the retailer to introduce water into the public network in England as part of the Didcot pilot project.
Castle Water requires the licence variation in order to progress the Didcot Project which was awarded funding in the first round of the Ofwat Innovation Fund. The pilot is being undertaken to understand the feasibility of taking water abstracted by a third party from the River Thames, under an existing permit, treating it to drinking water standard and inputting into the Thames Water network.
In September 2016 Ofwat granted Castle Water a retail authorisation to supply water and sewerage services to customers using the water and sewerage systems of water companies operating wholly or mainly in England, together with restricted retail authorisation to supply water in Wales. The business water retailer supplies thousands of businesses, charities and public bodies in England and Scotland.
If Castle Water’s application for a wholesale authorisation is granted, this will enable Castle Water to introduce water into the public water networks in order to supply the licensee’s own customers if their non-household premises consume at least 5 megalitres of water a year.
Ofwat says that due to the novel nature of the project, Castle Water does not intend to operate any other sites but by granting the wholesale authorisation, Castle Water will be authorised to operate other sites in the future with no further assessment by Ofwat. Castle Water has not applied for a supplementary authorisation for Wales.
The Didcot Project will assess whether smaller package schemes serving local customers would benefit the market.
The Standard Licence Conditions require the Drinking Water Inspectorate to approve any new water source that Caste Water introduce. The DWI also have powers under the Water Quality Regulations to veto the introduction of any new water sources as well as issuing enforcement and criminal proceedings where water quality standards are not met.
Ofwat says that Castle Water "has satisfied the DWI, Environment Agency and Natural Resources Wales that it has the systems, processes and knowledge in place to comply with its duties under the relevant legislation, guidelines, market codes and the standard licence conditions that will apply to WSSLs." The regulator plans to modify the licence “as soon as reasonably practicable” following on from the formal consultation process.
Deadline to comment on the proposal to modify Castle Water’s existing licence is 12 August 2024 – click here to access the consultation document.
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