An interview with the Open Water Director Keith Fowler sets out the next steps in 2014 for the Programme to support and promote effective retail water and sewerage competition for non-household customers ahead of the January 2017 ‘go live’ date.

1. For those that might have missed your recent announcement just what is the Open Water Programme?

As many in the industry will be aware the Open Water Programme was set up to support  the delivery of the market reform element of the UK Government’s vision for the future of water management in England, set out in last year’s Water White Paper.

It is steered by a High Level Group (‘HLG’) (which consists of representatives of Defra, Scottish Government, Welsh Government, customers, Ofwat, Water Commission for Scotland and water companies in England and Wales).

It aims to facilitate the implementation of a new market for retail water and sewerage services for non-domestic customers in England. In short the market should ; stimulate innovation; increase choice forbusiness customers; and drive sustainable approaches to managing our water resources.

2. So what, if any will be the benefits for those already operating in the market?

I think most people agree it is critical that we have a resilient water sector in which water companies are more customer-focused, innovative and where water is appropriately valued.

We believe retail competition offers further opportunities for economic growth. It will encourage incumbent water companies to be more efficient, and encourage new businesses to enter the market as water retailers – potentially offering multi-utility packages.

Opening up this market to all business customers (not just large users), as well as creating cross-border arrangements with Scotland, should significantly enhance these commercial opportunities.

3. And what’s the view from business?

These plans when first announced were welcomed by the Federation of Small Businesses who have been campaigning for greater competition in the sector along with Greene King and Asda.

In fact, research suggests over two thirds of small and medium-sized businesses support competition and the benefits it can bring. The public sector in Scotland (where competition is already in place) is forecast to save over £36 million over four years from discounts to prices and new water efficiency measures.

Being able to switch water and sewerage service supplier will mean that businesses are free to negotiate for the best package that suits their needs; be it through more efficient customer service and better-tailored packages, water efficiency advice, or price.

4. Is there anything for domestic customers?

While this is largely focused around businesses we do anticipate there being a number of useful ‘take aways’ for the industry which will impact domestic customers. Some of these knock-on benefits include an improved customer service culture as their incumbent water company seeks to retain existing business customers and attract new ones in a more competitive market.

5. Are you confident that the Programme will be ready in time?

Yes. The Programme is using the experience of Scotland and other utility market openings to ensure it learns the key lessons and understands the approach to take, what worked well, and what needs to be given greater focus to reduce risk and ensure we remain on schedule.

We are happy that it is being delivered at the right pace and we believe we are on track to deliver the framework needed for  retail competition in 2017.

6. but what about upstream? Will that be ready at the same time?

The Water Bill includes reform of the existing upstream water markets as part of wider market reforms of the water industry. As you’d expect the upstream reforms will require careful planning and close working between the water industry, regulators and customer representatives.

For that reason and to allow sufficient time for this, the main upstream reforms will not be implemented in advance of the next price review which will set charges for 2020 to 2025.

7. Finally, you talk a lot about engagement but what does engaging with the industry look like in practice?

The Programme is very much committed to taking a collaborative approach to market design and as so is working with the wider industry to draw on existing experiences and understanding. As part of this we set up of a high-level design group and a series of smaller working groups.

The first series of these topic-focused stakeholder working groups was held in October and November 2013 – and involved over 200 hours of consultation. Members were appointed following an industry wide request for nominations. From the suggested names members were selected for their expertise and ability to contribute to the specific topic under discussion.

The next round of working groups will take place this year in March and invitations will be sent out to working group members in February.