Water market opening has made an ‘April fool’ of businesses

Businesses have been taken for an "April fool" with the promise of a competitive and open water market, utility consultancy Utilitywise has insisted, as research reveals fewer than 1% of businesses have switched water retailer since the market opened.

Utilitywise chief executive Brendan Flattery has written to environment secretary Michael Gove, urging him to “put the customer first and make the water market truly open and honest”.

Research carried out by the consultancy has found that just one in four small businesses feel informed about the impact of water market deregulation on their business.

Additionally, only 1% of businesses have switched water retailer since the non-household market opened in April, suggesting market liberalisation has “gone off the boil”.

In his letter, Flattery insisted that water regulator Ofwat should be “empowered to force suppliers to publish tariffs so that businesses can compare prices”.

He wrote: “The water market deregulated on 1 April, but since then fewer than 1% of businesses have switched water supplier, showing that the water market is still not truly open. The regulator, Ofwat, has not been given the authority to enforce policies which would result in better deals for customers.

“We’ve all been taken for an April Fool with the promise of a competitive and open water market, and that’s why we’re calling on Michael Gove to take action in his new role.”

A spokesman for Ofwat said that its data shows there have been 30,000 switches since the market opened. However, this includes multi-site businesses.

There are approximately 3.5 million supply points in the non-household market, suggesting that only 0.85 per cent of the market has switched. Utilitywise claimed the figures are “actually far worse”, as around 11,000 of these switches were made before 1 April.

The spokesperson added: “It is just 13 weeks since the opening of the world’s largest competitive water retail market. Since then, we’ve seen new retailers enter the market and new offers, bundles and innovations emerge. And in this new market, thousands more have renegotiated a new deal with their current retailer, and we hear customers have saved hundreds of thousands of pounds.

“There is much more to do, in making sure all customers know about the market and can find all the information they want, when they want it. We have told retailers that we expect them to make this happen and we will continue to hold feet to the fire to get the right outcome for customers.”

The open water market is expected to deliver up to £200 million of benefits to the economy and water customers over the next 30 years, through improved service and value for money.


To coincide with the opening of the market, edie published a guide to explain the changes, and the benefits and implications that the market is expected bring.

The edie explains: Water retail competition guide, produced in partnership with edie’s sister title Utility Week, provides an in-depth summary of the government-led strategy which will allow all non-domestic water users to switch suppliers of water retail services.

The 10-page edie explains guide answers all the questions and more to help those that manage their organisation’s water consumption understand how water retail competition could be used to consolidate bills, generate significant financial savings and deliver key environmental benefits.

Lois Vallely 

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