Although the current water sector media focus is on flooding, it could be argued that water scarcity is the bigger long-term issue. Analysis has indicated:

• 7 out 17 water supply regions in England are set to experience severe water stress by 2030. This rises to 12 out of 17 by 2040
• The National Infrastructure committee believes there is a 1:4 chance of worst drought in history before 2050
• 2022 was one of the driest years on record and (over the last couple of years) many water companies have implemented hosepipe bans.

How do water companies control the water supply demand balance?

In simple terms, companies can either seek to increase supply or reduce demand.

• Increase Supply: through developing new sources, reducing leakage or moving the water around the networks in an innovative way. They can also look at utilising new technologies such as desalination.
• Reduce demand: targeting either individuals, communities, or companies to reduce how much water they use (in the home, garden, or business). Water Companies are also looking to incentivise home builders to implement rainwater harvesting and grey-water reuse during construction so that all new homes are water efficient. One key demand management tool is to introduce metering. Research shows that overall water consumption falls by c22% in the two years after meter installation.

Water metering in the UK

Old fashioned meters require a (human) reader to visit your house or a self-reading. Increasingly, smart meters are being installed. These use a data network to automatically (and wirelessly) send readings. They also provide an in-home digital display showing what water you’re used and how much it cost.

The energy sector is targeting (but unlikely to achieve) 80% UK smart meter coverage by 2025. The water sector is even further behind. Around 60% of households in England (including empty properties) have a water meter but only an estimated 14% of households have smart meters.  In April Ofwat approved the acceleration of seven smart water meter schemes, as part of a £2.2 billion plan to install 462,000 smart meters by the end of 2025. A current view of current meter penetration is shown below: –

While the different presentations of the recent PR24 business plans make it difficult to extract complete figures (without in-depth assessment) some standouts include:

• Anglian Water – full smart meter rollout by 2030
• Welsh Water – 48% smart meter penetration in 2023 and is targeting 65% by 2030
• Northumbrian Water – extending its smart metering programme at a cost of c£125 m
• Severn Trent Water – 1 million smart meters to achieve a 16% leakage reduction
• South West Water – installing c530,000 smart meters
• Southern Water – installing 1 million smart meters at a cost of £165 million
• Thames Water – installing 1 million smart meters
• United Utilities – installing 900,000 smart meters
• Wessex Water – 1.2 million meters by 2030
• Yorkshire Water – replacing 1.4 million and upgrading all household and non-household meters to smart meter technology by 2040
• Affinity Water – deploying 400,000 smart meters
• Portsmouth Water – installing smart meters to 324,000 customers and nearly all its customers by 2035
• South East Water – replacing 275,000 meters and a complete rollout by 2035
• South Staffs Water – installing 31,000 meters annually with a100% penetration target in 2035.

What does this mean for Skewb

The Water sector is entering a period of unprecedented change and this will also bring opportunity. Skewb has a number of ex-Executive Directors from water companies. We have expertise, products and services that can support water companies. We have direct experience of delivering the metering programmes (plus managing demand management) at Affinity Water. We are actively seeking partners to identify market opportunities though Gurvinder Bedesha supported by Rob Upton-Moir leading our Smart Metering strategy.  Watch this space!

By Christopher Jacques

Christopher Jacques is Cadent DPP Transformation & Strategy Lead at Skewb. To speak with him about this topic in more detail, you can connect with him on LinkedIn.