The water management team of Torse Ltd attended The Water Event which was held at the Birmingham NEC on 13-14th of September. The Water Event is the UK’s only dedicated water efficiency, management and procurement exhibition, informing a unique audience of large-scale commercial and industrial end users about future proofing and resource management. During the event, Torse got the chance to research and further understand the potential benefits and issues related to water market deregulation. We met hundreds of industry professionals and businesses, attended industry-leading seminars and had face-to-face meetings with suppliers to secure the best deal for business customers.

The 2017 Water Deregulation

The Open Water programme is led by the Department for Food, the Environment and Rural Affairs (Defra), the water industry regulator (Ofwat) and the market regulator – the Market Operator Services Ltd (MOSL). The opening up of the water retail market is part of the wider water act reforms, which 1.2 million Business customers can potentially benefit. During the deregulation, the ‘wholesaler’ remains unchanged but contracts with different suppliers should be signed now. Ronan Palmer, the director of Strategy and Planning, Ofwat, said that “the main objective of coping with the water deregulation is that we need to find out from our clients if this is a priority they would consider as important as other things”.

Impact on different parties

On the one hand customers are able to negotiate better deals, get increased efficiency and reach an improved service level, while on the other, water companies are subject to improvement in billing and payment management services. Water companies are also obliged to improve their customer retail services in order to win the competition. According to Ronan Palmer, “The supply of water is a service, not a commodity, we should view the water procurement on a national scale”.

What customers want and what should suppliers do?

Sue Amies-King, the chief executive of Water Plus, pointed out a few points that customers want from suppliers in one of the seminars. First of all, the customer cares about accurate and timely billing, they also hope that suppliers can understand their business in order to help them save money and make everything easier. More importantly, customers want suppliers to provide them with great service and support them should anything go wrong. To achieve this in the coming opening retail market, business clients should start the conversation with their supplier sooner rather than later. According to Sue Amies-King, 99% of organisations in the UK are small to medium enterprises that have less than 250 people, which means that customer protection in the business retail market in England and Wales in extremely crucial.

As a respond to customers’ needs, retailers are obliged to provide appropriate and timely information, ensure a clear billing procedure and accurate meter reading. Retailers also have a duty to respond to customers in a timely manner.

Options for customers

Collectively, customers have three options for them to cope with the water deregulation.

• Stay with your current supplier, but you will need to negotiate a better deal or wait until the market is mature before deciding.
• Switch all/ some of your sites and find the best deal. In these two cases [this and the above], it is better for customers to have a relationship with TPI (i.e. brokerage), all of which will be active in the water market already.
• The third option for your business is self-supply, which means that you can buy water from wholesalers directly, but they need a retail license to become eligible..

The difference in price between retailers is around 0.5%, and the difference a retailer makes in saving water is 10%-15% – Karma Ockenden from the Water Report

With more information released, customers should consider what they really want (e.g. cheap price or good service). Customers should also think about how much risk they expect to take before making a decision eventually.

What customers could do next?

In order to be well prepared for the upcoming water deregulation. Here are some further instructions for business customers.

1. Talk to Torse as soon as possible so that we can investigate the water market for your business specifically
2. Provide Torse with information about your water sites and your most recent bill
3. Communicate with us on a regular basis and let us know your expectations. This will allow us to organise your own portfolio with the best prices available.

Additional information

For more information please refer to Torse Water Deregulation Summary and see the Water Deregulation Banner design created for display at public events. To discuss your water requirements please contact yannis.lee@torse.co.uk or dominique.rowan@torse.co.uk or call Torse on0115 853 2120.