Sustainable Finance - Water Scarcity Roundtable
Hosted by Fintech West, Waterwise and Shakespeare Martineau, this event brought together stakeholders from the water industry, business sector, fintech, and the water efficiency space to raise awareness and understanding of water scarcity in the UK, particularly in relation to its impact on business and the economy. The purpose of the event was to explore what the drivers might be to encourage businesses to prioritise water efficiency.
The event on the day was managed by the brilliant Richard Tidswell who is also a Waterwise Associate.
Nothing Happens Without Water, Nicci Russell, Waterwise
Nicci captured the attention of the room by encouraging them to imagine a day without water - at work and at home. She outlined the stark realities of water scarcity across the UK - a growing issue with increasing media attention - caused by increasing populations, changing behaviours in terms of water use, and climate change. Nicci shared some startling statistics:
There’s a 1 in 4 chance over the next 30 years that households and businesses will experience water supply cuts
This could lead to an economic impact of between £25 billion and £40 billion
Daily water use has doubled compared to 60 years ago
The Environment Act 2021 sets statutory demand targets for business water use reduction in England - a 9% reduction in consumption by 2038
The cost of not taking action would be 5 times the cost of taking action now
Nicci went on to outline what we as a society collectively can do to tackle the issue, introducing the UK Water Efficiency Strategy to 2030, developed by Waterwise in collaboration with 130 stakeholders. To end the presentation, Nicci encouraged everyone in the room to think about what they could do about water scarcity within their business.
Policy and Regulatory Drivers, Bhikhu Samat, Shakespeare Martineau.
Bhikhu outlined the policy and regulatory issues affecting the water industry. He explained the pressures on water companies to meet the needs of an increasing population whilst protecting the environment, and how seasonal weather patterns can have an impact on the availability of water. He commented on the fact that although Ofwat are investing heavily in the industry, this is largely focused on achieving targets, with very little investment available for tackling water scarcity. He also described the challenges of an ageing water infrastructure - stating that the last new reservoir constructed in the UK was more than 30 years ago. However, he encouraged industry to consider what role they could play in reducing consumption; and for individuals and businesses to recognise their own responsibilities when it comes to tackling water scarcity in the UK.
Discussion facilitated by Claire Spendley, Waterwise
The discussion facilitated by Claire outlined:
We’re starting to see businesses move from prioritising energy in their climate action to also considering water; and price rises in the water sector are having an impact
There is a lack of clarity around wholesaler metering programmes, but businesses can’t wait for long-term roll-out plans
To encourage businesses to have water efficiency on their radar, facilities managers need to understand the issues - but this should be driven from the Board
More education is required to raise awareness of water scarcity and engage the business community
Business Perspectives on Water Efficiency, presented by Richard Tidswell on behalf of John Gilbert, MOSL
Richard outlined how the business water market works, explaining that there is a competitive market, operated by MOSL, who were established in 2017 to open up the retail market and allow businesses to choose who they bought their water from. He shared some interesting statistics on business water consumption:
Only 10% of business water use is non-potable, indicating significant potential for efficiency
1% of businesses use half of the market’s total demand - and this 1% is already quite engaged in water efficiency - the question is how do we get the reach, engagement and awareness to the other 99%?
Water security is a key concern, with 75% of England classified as water-stressed. Because the ‘right to connect’ sits with domestic, not commercial properties, we are already seeing some business connections being refused.
Richard also shared MOSL’s water efficiency dashboard - a rich source of data that needs further exploration in order for us to fully understand the bigger picture of business water use across the UK. He mentioned the new report published by Waterwise, Wave, Weir the Agency and MOSL, exploring the financial, regulatory and reputational incentives that may encourage businesses to reduce their water consumption.
Discussion facilitated by Richard Tidswell
ESOS energy reporting is mandated by the Environment Agency - why doesn’t this also include reporting on water consumption?
There needs to be a national narrative, similar to that around Net Zero, and a realisation that we won’t get to Net Zero without reducing water use
We talk about water security - should we change the narrative?
We need to remove confusion around water and make it easy for businesses - awareness needs to be an enabler of action
Where there are success stories we should share best practice
Why isn’t there a National Rainwater Strategy to make rainwater harvesting commonplace?
Impact on Business Models, Peter Bradley, University of the West of England
Peter explained that there is a lack of data and understanding of business water use - and better ways of harvesting data will be necessary to make a significant impact in this area. He stated that much research has been done on the circular economy and net zero in the business community, but not on water. Price is currently a minor driver for water efficiency in the business community - and therefore we need to better understand business values and drivers around water. He explored some suggestions for businesses to consider when thinking about water efficiency:
If your customers care - there may be more business value to you from connecting with the water efficiency agenda
Look at direct water use but also indirect water use eg. water embodied in production processes - blue (surface and groundwater); green (rainwater); grey (recycled)
Remember that the context we’re operating in is always changing - eg. increasing prices changes behaviours
Flood vs drought - how can rainwater harvesting be helpful?
Changes in Commercial and industrial water demand – e.g increased use of AI, is likely to change industrial and commercial water use and there is a need to plan or regional strategies carefully and accommodate new practices and approaches to improve efficient water use and management
Work out the connection between our water use and the impact on nature (because consumers care about this)
Innovation and Behaviour Change, Benjamin Gardner, University of Surrey
Benjamin emphasised that although education is part of the solution, it is not the only solution - and that education alone is not sufficient to drive change. He presented the COM-B model (Capability, Opportunity, Motivation) which can be used for behavioural diagnosis, enabling us to better understand why people are using water and how to encourage them to change their behaviour - by providing them with the capability, opportunity and the motivation. Benjamin presented a case study from the University of Surrey, where they used a shower sensor to build a data set on people’s showering behaviours, coupled with persuasive messages around saving water. This research found that with higher water pressure, in a shower where the sensor was installed, they tended to have shorter showers - because they feel clean quicker.
Discussion facilitated by Claire Spendley, Waterwise
A quick show of hands around the room found on the messages that would resonate most with the audience, in terms of drivers to reduce water consumption, were:
Financial
Practical and tech-based solutions
Business continuity and business risk
ESG/green credentials
There are new price drivers to reduce water use, but it is still the cheapest utility
Business continuity is a key driver but normally in reaction to an outage
Mandating reporting would help businesses to realise the importance of water efficiency
Is there a way of creating a competitive advantage through water efficiency - increasing revenue opportunities, or offering water credits?
Why doesn’t water feature within business sustainability metrics?
It is important that the investment community sees water as part of sustainability - as a value driver
Wrap-up from Richard Tidswell
Richard closed the event by highlighting the disconnect between water scarcity in the UK and business perspectives on water efficiency. He summarised the key thinking from today - that there is a need for better access to data, and for a clear and consistent narrative that turns awareness into action. He reiterated that it is everyone’s responsibility to ensure that the message on water scarcity is spread beyond the event.