Water is set to be deregulated in April 2017 and will give businesses and organisations the chance to shop around and switch providers. Up until now, all customers could do was complain. Soon, customers will be able to choose their provider.
Scotland was the first country in the world to deregulate its water market in 2008. Since then, customers have benefited from savings, fewer CO2 emissions and an improved knowledge and understanding of water use.
Water experts from Utilitywise, the UK’s largest energy consultancy say that the Scottish model can teach us a lot about what’s in store for England’s new water market.
Tony Hitchens from Utilitywise said: “Water deregulation in Scotland happened when the Scottish government decided it was dissatisfied with the monopoly held by Scottish Water.”
“When the English market deregulates, the margins will be small at first because the wholesale price is artificially inflated by the country’s 14 water companies. So we expect there will be little price advantage initially, although businesses and organisations will see some modest savings,” he added.
However, the situation may be complicated by some of the country’s 14 water companies not committed to entering the retail market.
Benefits for businesses
Apart from potential savings, businesses with multiple sites will be able to benefit from having one simple water bill for all sites. This will reduce the amount of paperwork and admin required to pay bills from different offices or shops across the country.
The big savings will likely come three years down the line, like they did in Scotland, when industry watchdog Ofwat plans to force the wholesale price down to rebalance the market.
CEO of Ofwat, Cathryn Ross said that savings for individuals were likely to be modest but said: “I’m sure customers would rather have that money in their pocket, than not.”
Utilitywise is trying to encourage the idea of a multi-service bundle, where all utilities are from the same provider and customers can enjoy one simple bill.
They said: “We hope we can save non-domestic users money and tidy up their bill in all utilities, while ensuring wastage and consumption is reduced.” With water deregulation, this concept seems like a more realistic idea for the future of utility bills.