‘Failing’ Ofwat to be reviewed

Water regulator Ofwat will be reviewed to make sure it can cope with 'future challenges', according to the Government.

The industry has welcomed with the news, announced by Defra yesterday (August 27), saying the two-decade-old water monitor needs a shake up.

Defra has brought in David Gray, the man who reviewed the Department for Transport, to act as lead reviewer.

Lord Redesdale, chairman of the Anaerobic Digestion and Biogas Association (ADBA) has called for Ofwat to be scrapped in the past.

Today he said it was still has ‘failing’ to meet the joint Government objectives of combating climate change and promoting renewable energy.

He said: “Ofwat should have used its position as regulator to promote renewable energy, especially anaerobic digestion, to reduce carbon emissions and take a lead role in combating climate change.

“The cost to the consumer of water is important, but failure to develop a renewable anaerobic digestion industry will increase the cost to the same consumer in the future. Ofwat has claimed that the regulation that guides their action is too restrictive.

“This review should make climate change a priority and without it the very case for Ofwat as a regulator must be questioned.”

Chair of the Institution of Civil Engineers (ICE) water panel, David Nickols, said the Institution ‘welcomed’ the review.

He said: “As ICE’s recent state of the nation report stated, the world we are living in now is very different to that when Ofwat was first set up and the regulatory framework must be reformed to reflect today’s environmental and societal challenges.

“The current investment plans do not do enough to address long-term needs, especially climate change issues including reducing carbon emissions and driving down demand. ICE fears that without significant change in the regulatory regime to drive appropriate long-term investment in sustainable infrastructure, our long-term water security could be severely jeopardised.”

The review, due to be completed early next year, will examine the role of Ofwat. This will include its objectives, its responsibilities, and how it will meet future challenges and ensure value for money.

The review will also look at how well the current arrangements, involving Ofwat and the Consumer Council for Water, work in protecting water customers and in making sure their views are heard.

Defra is also due to publish a Water White Paper early next summer which will set out policies for the future of water management.

Luke Walsh

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