Report produced by Carolyn Roberts

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Contextual summary

Provocateur 1: Dave Crookal, Severn Trent Water

The presentation was based on a number of case studies about surface- and groundwater resources within the East Midlands area served by Severn Trent. This was to give some indication of the direct hydrological impacts of changing weather conditions and differing catchment-specific responses.

The Severn Trent water supply is taken from a variety of sources. These include a large number of large reservoirs in the north of the region, smaller reservoirs further south in Leicestershire (both of which are mainly Victorian in origin) and a relatively new pump-storage reservoir. 25% of the water is sourced from a large sandstone aquifer. The range of sources is quite large, each has its own hydrological regime and storage capacity, but the system is quite integrated.

Modelling has taken place in the catchments using historical climate data. By inputting changes in the climate variables and abstraction models, it is possible to generate models of different stream flows and hydrological climate conditions. We can look at how much water can be relied upon in different scenarios.

Predictions using the UKCIP 1998 scenarios suggest that by 2020, the River Derwent will not have experienced much change. Taking the projections forward to 2050 suggest that there could be greater impact. Predictions for the sandstone aquifer have been made using similar techniques (differences in the aquifer can be accounted for by the effects of urban development over parts of it). In all scenarios up to 2050, there is more water available, with potentially more water in the aquifer.

The secondary impacts in this matter mainly concern biodiversity. There are a number of options that biodiversity managers might choose to take, which fall into three broad categories:
let the changes happen
facilitate change
attempt to protect current conditions
The actual situation might combine all three categories. However, the third option is most likely to be chosen in terms of habitat protection. The implication for water companies in protecting present conditions (e.g. by managing flow regime) might be that water currently used for public supply would be required to maintain historical conditions.

In conclusion, we need more detailed modelling work. Neighbouring catchments, for example, can display very different responses to climate change. A perfect model, however, does not exist and, therefore, when we make decisions we have to make the best use of the information available. This is despite the element of uncertainty.

Provocateur 2: Dr Nick Reynard, Risk Analysis Centre, Environment Agency

Water resources present a first-order impact on climate change. Water resource management must strike a balance between supply and demand.

Supply
The climate change scenarios suggest that the annual distribution of water resources will change. Increased rainfall will give a better opportunity for increasing recharge in groundwater-fed catchments.

We need to focus on the length of future dry seasons, rather than absolute amounts of rainfall, and consider the possibility that the summer period could be extended by either this season starting earlier or ending later. This is where resource problems may materialise.

Demand
Over the next 20-25 years, demand should be considered as more important than supply. How we cope with changes in demand could be more difficult to deal with than the supply/hydrological side. Modelling in order to understand the impacts of climate change on demand is considered to be very difficult because of the complications of adding socio-economic dimensions into the analysis.

The main problems in demand may arise from trying to meet peak demand. Changes in domestic use of water (e.g. for gardening) may cause distribution problems. Demand for agricultural irrigation may 'go through the roof' over the next 25-50 year period. We should remember that there are measures such as a carbon-rich environments that allow crops to use water more efficiently, there are more efficient alternatives to spray-irrigation and that alternative crops exist that are drought resistant/more water efficient.

An important balancing act has to be made between all sectors. We must also remember that there are factors that alter demand that are not climate related, and are far more likely to be important over this period than changes that are related to climate.

Variability
We must be careful to remember that when talking about future climatic changes, we are talking about averages. However, we must take into account natural variability and start thinking about how we cope with this now.

These conclusions have been based on initial research work - there is still a very real need for additional research on both sides of the supply/demand equation. We might know where we stand now, but there is still a great deal of uncertainty that could be addressed by further research.

Provocateur 3: David Tipping, Member, Wessex Customer Service Committee

Water resources are looked at here in terms of reliability and from a customer-services point-of view. As a starting point, the impact that climate change is most likely have is on the supply/demand balance.

It is apparent that water companies could face a serious problem in attempting to meet the customers' demand for water. Customers expect water to be available, but on occasional exceptional circumstances, demand may not be met.

How do we decide what determines 'exceptional circumstances'? Theoretically, there are ways of defining reliability: water companies say that they have the ability to supply a certain yield. In order to supply a reliable yield, the lower the yield must become. To move to a higher percentage of reliability would be extremely costly.

The implication from this is that at some point we will meet climatic conditions that will make it increasingly harder for water companies to meet customer demand, and it will become more expensive to increase the resources to do this. Sooner, rather than later, the cost of this will be incurred on the customer - so the customer must be made aware that they have a choice available to them. This choice is either to pay more for higher reliability or to accept a lower security at a lower price. This question has yet to be put to the customer and it is time that it should be considered, even if it cannot be answered immediately because of uncertainties.

Hydrologists look at the historical sequences in their data and try to work out a way to continue into the future and determine at what point additional water resources will be required. This task is hard enough in normal circumstances, but the hydrologist is faced with the added complexity of climate change. Reliability is an issue that we need to address, but not much has been done so far.

Workshop Discussion (Comments from Delegates)

The following perspective on water resources management is based on ensuring that sufficient resources are available, both now and in the future, to meet the needs of customers at a level of service that is acceptable to them and the regulators, at a price they are willing to pay, and taking into account supply/demand measures that meet environmental targets. (The environmental targets are set by both the water companies and the regulators - it should be remembered that water companies are environmental managers, not just suppliers.) Climate change is likely to have an effect on all these areas and will lead to an assessment of what these impacts are in our strategic planning. It is high time we had some 'joined-up regulation' to enable longer-term impacts to be considered.

Addressing Leaks…
In investigating the reduction of consumption, the one simple factor to address is preventing the leaks. What kind of pricing structure do the water companies have? Do they make more money if they sell more water? Do they lose money if they encourage economy on behalf of their customers? The use of grey water should be considered; clean water is only required for drinking purposes. There are measures in industry for recycling water, so what incentives are there for this type of investment in the water companies?

What are the water companies doing to promote more efficient water usage? Are the water companies in different regions going to share their resources to resolve other regions' problems? Should there be some form of 'water sharing' arrangement?

This is beginning to address demand management and increasing the flexibility of suppliers.

Some parts of the country experience very high percentages of leakages, so this point was primarily addressed to the representatives of the water companies: why are shareholders being paid when leaks are not being fixed? Should these companies not be paying out dividends unless they are performing well?

In response to this: assessments are made on what is considered to be the economic level of leakage. This is based upon the point at which it becomes cheaper to provide a new resource as opposed to fixing leaks. It is not technically feasible to achieve zero leakage and thus a level of minimum leakage is set. Somebody has to foot the costs of reducing leakages, and for private companies, there will be certain constraints influencing the way they can operate. Shareholders receive their money because it is the interest on the capital they invested in the company.

The arguments that surround the economic level of leakage should take into account social/environmental costs as well as the financial costs for the water companies. These factors must all be taken into account. The technology is there to improve leakage control. Statutory targets for reducing leakages are in place that must be met to avoid penalties being imposed.

(Response from Ofwat representative) Much work has been done over the last few years in addressing the problem of leakages. The UK is faced with the problem of a very old infrastructure. To attempt to reduce leakages by another 3 to 4% would require a great deal of investment and there is a limited amount that the water companies can do. In response to the earlier comment on shareholders, there is no link between company dividends and leakages.

Uncertainty is the concept that surrounds the whole of this debate. Whatever we decide upon during this workshop and conference, we cannot be entirely sure about what will actually happen.

The question should be about addressing reduction of demand rather than increasing supply. We must remember that customers are not just the public in their homes - water is put to a great deal of other uses. The UK government, for example, has international obligations to safeguard international wildlife. Natural habitats are dependent on water supplies.

Responding to the comment regarding variability and planning for uncertainty: any company that requests a license from the Environment Agency to abstract water from a new resource must demonstrate that they are using their current water efficiently. This issue is not just about efficiency, it is about the conjunctive use of systems to attain the greatest amount of water from them possible. We need to consider 'trade-offs' to achieve sustainability and we should be looking at these issues on a long time-scale.

Mitigation
Is there much that the area of water resources can offer in this aspect? Is it possible to reduce water consumption
by demand management? Potentially, there are a number of instruments that could be implemented in mitigation (legislative, economic, education).

We need to look at the overall sustainability of all environmental elements.

Adaptation
Increasing the flexibility in water distribution networks - a 'water grid' - was discussed as a possibility.

We need to think about increasing storage as well as flexibility, although some delegates disagreed with this contention by arguing that we need better management of storage. The precise meaning of 'increased storage' is open to interpretation: does this mean increased management of storage, or increasing the relative balance between supply and demand?

Barriers
Uncertainty is the main focus with regard to barriers and it should not be used as an excuse for inaction. There is plenty of action we can take despite not being entirely certain about climate change.

Socio-economic factors complicate the issue. The public understanding and knowledge of water resource issues in relation to climate change is weak. This could be attributed to a lack of public acceptability and education (on behalf of all stakeholders).

We have a lack of 'joined-up thinking' and legislation in this matter.

Conclusions

The key concern arising from this workshop session was the need to address the supply and demand sides of water resource management. This provoked a heated debate, which concentrated predominantly on addressing water resource efficiency in terms of controlling leakages. This focussed more on dealing with efficiency in the present, than it was on considering the future effects of climate change. Adaptation to climate change was contested between increasing water storage or better management of storage.

Future reliability of water resources was seen as another central concern. Security of the water resource comes at a price to the water customer, but the customer must be made aware of the choice they have in deciding whether they want increased reliability or lower costs.

One of the overarching themes that emerged was the element of uncertainty in water resource modelling (partly due to the complexity caused by taking socio-economic factors into account during analysis) and a lack of public awareness of the issues. It was argued that this barrier could be best addressed by further research and education.

Carolyn Roberts
School of Environment
Cheltenham & Gloucester College of Higher Education
March 2001