WWT ROUND TABLE 2009
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they would be happy to, but added that
“The government might be quite good at picking
they quite frankly thought it was the industry
and government’s job to do it really. They
problems but it is not very good at picking winners”
didn’t mind doing a little where they could,
but it wasn’t really their responsibility. They
said: “There’s loads of rain. What are you and what the customer can afford to do. It is will mean that investment decisions will be
talking about?” one thing to say: “Here’s this beautiful made in a more sustainable manner. If it is
We then stretched it out to some of the blueprint – let the engineers go away and cheaper to do interconnections and to
environmental issues. How clean are English construct it,” but the reality is that someone move water around in a different way, then
rivers? What percentage of English rivers are has to pay and they are feeling the pinch let us create the regulatory framework that
clean, according to European directives? already. For the consumer, social incentivises you to do that, rather than
They all had them in the 60, 70 or 80 per sustainability is one of the key issues. There having a system whereby, as currently, it is
cent range. So therefore, the picture of these are the economic issues, as in whether you, in your best interests to do things in your
supposedly relatively bright Londoners was as companies, can get the cash to do it. It is patch. There is no real incentive, because
very different from the one you would one thing to have a diktat, or to change the there is no real value of water. That is where
imagine. This quite shocked me, if I am regulatory framework but, if we change it we position ourselves.
candid about it. too much, suddenly no one will lend you
Ofwat’s perspective is that part of it is any money and all of these great plans will Richard Aylard That is interesting, Rob.
education and part of it is about getting fail to come to fruition. We therefore have to Ofwat has a duty of sustainability. How do
society to behave in a different way. Much try to maintain stability in the regulatory you formally assess the sustainability impact
of it is about how we motivate the industry framework while we shift you, or shift the of your policy decisions? What is the process
to do its job in a different way, and what motivating mechanisms, to a different place by which you assess them? I can tell you
information we need to provide you, or so that you can do things in a different way. that companies have done a huge amount
what different tools we need to give you That is quite a difficult balance, particularly of work in their water resource plans and
to do your job in a way so that we in the current climate. We then have the their business plans for PR09; everything
are incentivising you to do what needs to broader sustainable issues that Ian has has been assessed in terms of sustainability
be done. covered so well. – certainly from Thames, and I suspect from
We take sustainability in the broader We do it in that round, but the heart of it other companies too. Our proposals are
round – we have not jumped in here and is that we do not have the answers. We are assessed for sustainability, but it would be
talked about the quantity of water and how working towards putting some value on interesting to know the Ofwat process for
we are using it, but we have put it in the water, which consumers can recognise and looking at your policy decisions?
social context of what we can afford to do, the companies can recognise, and which
Rob Ashley We are now into this PR09
ground a little, and I have to be very careful.
There are some questions that I just cannot
answer. You have all had individual
meetings – there have been two sets of
meetings over the last six months or so, one
at the CIS, in which you went through your
asset and investment strategies. We went
through how you were gauging your
sustainability.
Richard Aylard I am not so much interested
in the way you are assessing the
companies’ plans but the way you look at
the sustainability impacts of policy decisions
that you, as Ofwat, take.
Rob Ashley That is interesting. Can you give
me an illustration of a particular policy?
Richard Aylard Well, any policy that you
bring in. In board rooms, companies have a
sustainability assessment process for any
decision they take. We have experts – John
has Simon Lyster as a non-exec, and Wessex
have Jonathan Porritt who is chair of the
Sustainable Development Commission;
Anglian have Robert Napier, ex-Chief
Martin Hurst: Moving building regs to make new builds more water efficient Executive of WWF. They, and groups of
12 Round Table June 2009