MPs have accepted a range of final amendments to the Water Bill on Wednesday 7th May 2014 including provisions for exits by incumbent companies when the non-household market opens for retail competition in 2017.
The Water Bill was introduced into the Commons on 27th June 2013 to make provisions about the water industry. The Bill has now concluded its 'ping-pong' parliamentary stages and now awaits Royal Assent where the Queen will formally agree to make the bill an Act of Parliament.
The main measures for the water sector include:
- enabling all business, charity and public sector customers in England to switch their water and sewerage supplier
- establishing a cross-border arrangement with Scotland
- enabling businesses to provide new sources of water or sewerage treatment services
- developing a national water supply network by making it easier for water companies to buy and sell water from each other
- enabling owners of small-scale water storage to sell excess water into the public supply
- enabling ministers to set the level to which a water company needs to plan to cope with droughts
- enabling developers and new water or sewage companies to connect new building developments to the water mains and sewerage system
improving the regulations relating to merger of water sewage undertakers
- providing Ofwat a new over-arching duty to take greater account of long-term resilience and changes to improve Ofwat’s regulation of the water industry
England and Wales is currently playing catch up with Scotland, where competition for water supply is already established. South of the border, the usage threshold for having the right to switch the site supplier has already been reduced tenfold from 50,000m3 to 5,000m3 per annum – but that still means that only some 26,000 large water consuming sites have this option.
We at energyTEAM are already helping a number of Scottish businesses to evaluate supplier options and to switch when appropriate. We look forward to the day when all UK businesses can benefit from a competitive market in the same way as those north of the border are able to now.
In the meantime, all businesses should be preparing and ensuring that their current requirements are accurately specified and that they are being charged correctly under the existing regime. This could well lead to immediate cost savings in the run up to full competition, but will also put businesses in the best position to take advantage of market reform when it arrives.