Whitbread first hospitality firm to be granted water self-supply licence
Regulator Ofwat has granted hospitality giant Whitbread a self-supply licence to deliver its own water and wastewater services for all of its brands in England.
Whitbread, owner of brands such as Premier Inn and Costa Coffee, becomes the first major hospitality firm to obtain a self-supply licence since April’s opening of water retail competition. Organisations can now provide their own retail services including their billing, customer service and account management, to help improve efficiency and drive down costs.
“Self-supply will enable us to build on the efficiency works already undertaken, whilst driving cost and consumption control in the next phase of our water management strategy,” Whitbread senior procurement manager Sean Lavis said.
Whitbread has 1,081 supply points in England. As a self-supply licensee, the company will pay wholesale prices; not pay retail margin added by suppliers in the open water market; become a market participant including membership of MOSL with voting rights and the ability to directly influence the market; and be able to supply water services to multiple sites for its business.
Commenting on the announcement, Ofwat senior director of strategy, planning and policy John Russell said: “For a large, multi-site business like Whitbread, opting to become a self-supplier offers a range of benefits such as: reducing administration costs, cutting out the margin that goes to others in the supply chain and having more control over the service they get.”
Businesses across England are already beginning to see the benefits of renegotiating with their existing supplier or shopping around for a better deal. More than 36,000 businesses have reportedly switched water retailer since the market opened to competition, with around 60% of those switches coming from low-water-users. Pub retailer and brewer Greene King became the first non-household water customer to apply to provide its own retail services earlier this year.
Metal manufacturer Magnesium Elektron is among a number of organisations from across the public and private sectors that have realised thousands of pounds' worth of efficiency savings by capitalising on the market.
However, not all businesses are embracing the change. Indeed, more than half of small businesses are still unaware of the open water market competition, according to research by the Consumer Council for Water.