British Water Members' Handbook 2017 2017 Edition | Page 50

MESSAGE FROM THE UK FORUM CHAIR M A N We are embarking on a period of probably the most significant change that our industry has experienced since privatisation over 25 years ago – fundamental change in the economic environment in which we operate, change in the organisational structures of many water companies and the opening up of market competition. This unprecedented level of change will undoubtedly present many challenges in the next three to five years but for some it will also create many opportunities. British Water is uniquely placed to help member organisations steer their way through this period of uncertainty through ongoing engagement with the water companies, regulators, delivery partners and the wider supply chain. It is however equally important that member organisations seize the opportunity to proactively engage in the process because now is the time to help influence and shape the future of our industry. The start of AMP6 has already experienced its fair share of change with the introduction of a TOTEX based approach and an ‘Outcome’ rather than ‘Output’ lead regulation, with associated Outcome Delivery Incentives. This change in approach, coupled with the structural reorganisation of a number of water companies to enable vertical segregation in preparation for the changing market conditions, has undoubtedly contributed to another slow start to the AMP period despite the early contractor involvement in some areas. Whilst we have experienced another slow start I believe that the industry is better placed now and more open to innovation than at any other time in its history. Innovation in technology; innovation in methods of construction, particularly with off-site build solutions; innovation in the collection and intelligent use of data; and innovation in commercial models, all of which will be vital in helping our clients outperform against their business plans to deliver excellent service to their customers. Retail competition starting in 2017 (followed later by competition in the retail domestic market), should not have a dramatic effect on the wholesale activities during AMP6 but as we move forward with PR19 the relationship between water companies, operators in the retail sector and customers will need to be carefully managed to maintain customer satisfaction. The Water 2020 regulatory reforms and the opening of the sewage sludge market has huge potential to unlock the true asset value of sludge treatment facilities and provide additional opportunities for British Water Members. Provided that environmental permitting and regulation is aligned we are very well placed as an industry to provide innovative technological and commercial offerings for the movement, treatment and disposal of biosolids to maximise energy generation and resource recycling. So in this period of change I look forward to working with you and representing member interests to help ensure that we meet the challenges ahead of us and maximise our business potential. Michael Froom Chair of the British Water UK Forum 50 www.britishwater.co.uk