In a constructive move, Severn Trent has published its views on the challenges facing the water industry. The report called “Changing course” challenges whether its sustainable for water bills to continue to rise – up 45% in real terms since privatization.
Debt has increased to around £33bn from nothing at privatization and carbon emissions are rising in direct contrast to the Government target of a 34% drop by 2020.Severn Trent questions whether these trends can continue.
The main changes proposed are:
- A review of the current regulatory framework including a more efficient price setting process involving customers, and a more flexible approach to implementing the EU Water Framework Directive
- Greater support for competition and trading within the industry allowing more efficient distribution of water resources, benefiting customers, stakeholders and the environment.
- Greater policy support for energy efficiency which rewards those companies which significantly reduce carbon emissions, and a consenting regime which recognises the trade-off between higher absolute standards and curbing increases in carbon emissions
It is a critical time for everyone on the water industry. It is clear that with bad debts spiraling out of control and carbon emissions rising the current plans are not viable. It is vital to stand back and question the way forward currently proposed. This report is a welcome contribution to the debate and worth reading.
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