6 min read26 April 2018
PoliticsHome speaks to the water client director for SNC-Lavalin’s Atkins business in Scotland, Northern Ireland and the North of England about the latest developments within the water industry to improve client outcomes and customer service.
The recent cold weather spell labelled ‘the beast from the east’ saw water supply disrupted in many different parts of the UK. Richard Whale explains why some of these problems took place and how to eradicate them:
“At the heart of water companies is the requirement to provide high-quality water to our taps and responsibly manage wastewater. Despite their similarities, each water company has very different challenges that arise from variations in topography, population growth, climate change, customer expectations and infrastructure performance. Regulators recognise their differences and expect companies to manage business risks accordingly.”
Richard went on to explain that the role of the economic water regulators in the UK is to ensure that water companies improve customer services, protect the environment and maintain bills at an affordable and sustainable level:
“The regulator recognises customers expect great service – we are all customers and require water and wastewater services to be resilient to both short-term shocks and long-term challenges such as population growth, the effects of freeze thaw and climate change. Despite the obvious need for sustained investment in company infrastructure to avert service impacts, the regulator assures customers that the bills they pay are unlikely to rise in real terms for the foreseeable future. These regulatory pricing pressures encourage the industry and its suppliers to become more efficient and innovative.”
OFWAT, the water regulator in England and Wales, has set out its plans for more stretching common performance commitments against which water companies are now measured and compared. In the next regulatory cycle, known as AMP7, higher penalties and rewards will be attached to some of these performance commitments, and Richard consequently expects water companies to focus their investments on specific commitments, which carry high service risk and reward.
“For example, improved company performance against leakage, interruptions to water supply and sewer flooding of property are all likely to be key investment areas in AMP7. Take Anglian Water who has recently announced its intention to invest £20 million per year to reduce its leakage to 10% lower than its 2015 baseline.”
Richard Whale has spent his entire career in the water industry working first for a local authority and for the last 18 years for Atkins, initially as a graduate and culminating his technical career in the role of director of networks and drainage. He has now been the client director within the Atkins water market for two years – with principle responsibility for the relationship Atkins has with its water company clients in the north of England, Northern Ireland and Scotland.
“Whilst this covers a large geographic area, its diversity is perhaps best expressed in terms of the range of water company business models contained within it. Northern Ireland Water and Scottish Water are both state owned. Meanwhile, Yorkshire Water, Northumberland and United Utilities are typical shareholder-owned privatised water companies”.
Crucially he adds that whilst environmental and economic regulation are fundamentally the same, there are different economic, environmental and water quality regulators for all three UK regions. Noting that in England and Wales, water is a privatised industry, Richard notes: “The regulator has recently shown its willingness to address and simplify company accounting practices – encouraging companies to be transparent and meet the highest standards of UK governance and disclosure. This helps build trust and confidence in the water sector.”
In addressing the need for improved efficiency, Richard considers the Totex challenge. He says: “The water industry is transitioning away from large capital investments and towards more holistic interventions, which require engineers to focus on asset optimisation strategies before considering the refurbishment and replacement of existing assets. Remember, industry regulation is focusing on customer outcomes and no longer fixated on building new assets.
“The supply chain will continue to work with the water industry to find more efficient ways of delivering better customer outcomes and the secret to unlocking further efficiency lies with the availability of quality and reliable asset performance data.
“Atkins is proud of its contributions in this regard. For example, we are collaborating with Servelec Technologies to assess the capital maintenance needs of Northern Ireland Water’s existing infrastructure. The strategic study will be used to inform the company’s business plan for the next Price Control period and ensure appropriate levels of investment is available to meet the company’s service commitments and address the future performance requirements of assets”.
Asked how the digital revolution can improve the services of SNC-Lavalin’s Atkins business for clients, he highlights the departure from the traditional linear processes involved in planning and designing infrastructure projects:
“What we are doing through digitisation is automating commoditised engineering activities throughout the project life cycle. For instance, a six-month engineering process can now be consolidated into weeks using machine and artificial Intelligence. This streamlines our approach and frees up resource and time to think more creatively about our clients’ needs and project risks. Atkins invests significant sums in its R&D programmes and has developed several new technologies that make planning and design for new water infrastructure faster, smarter and more reliable.”
Richard cited the example of Dynamic Objects – Atkins’ parametric design tool, which automates the design of water infrastructure assets including drainage systems, pumping stations, sewer overflows and water mains to allow companies to make better informed Totex decisions earlier in the project lifecycle. This also creates the opportunity for collaboration and value engineering workshops with other key stakeholders including supply chain partners, utility providers, regulators and authorities.
Furthermore, Richard explains how Atkins is working with clients to improve customer service especially in London and the South, working with Thames Water:
“Atkins is helping Thames Water through its ThamesConnect programmes to better coordinate the work that it does in its customer streets with local authorities and other utility companies. Our technologies provide more visibility of planned street work therefore creating opportunities to pool resources and reduce the extent and impact of temporary traffic controls – making customers’ daily commutes less frustrating in and around London.”
Given the water industry works in five or six-year Asset Management Plan (AMP) cycles, Richard implies that these new tools enable more efficient AMP7 outcomes for water companies and a better service for customers.