LONDON, Dec. 16, 2004 (GNN) -- Although there have been no hosepipe bans over the last few summers, some water companies in England and Wales still have more to do to reduce the risk of supply restrictions during prolonged dry periods, an British Office of Water Services (Ofwat) report revealed today.
The 'Security of supply, leakage and the efficient use of water 2003-04' report assesses each company's ability to supply its customers in dry years without imposing demand restrictions.
The report shows, for example, that three companies in the south-east of England, Southern Water, Folkestone and Dover Water and Thames Water, need to invest heavily to ensure the continuing reliability of future supplies.
The price limits recently announced by Ofwat will enable water companies who face these problems to carry out a substantial programme of investment of nearly 1.3 billion British pounds to safeguard future water supplies. Ofwat expects that by 2010 the deficits between the amount of water that companies have available to supply and their expected needs will be largely eliminated.
The Security of supply report also confirmed new leakage targets for the next five years that will see water companies in England and Wales reduce total water losses by more than 300 million liters a day - enough to supply the average daily needs of two million people.
Bill Emery, chief engineer and director of costs and performance at Ofwat, said: "The water companies have made great strides over the last decade in reducing water losses and the majority are now meeting their economic leakage targets.
"As part of Ofwat's recent decision on price limits, each company will be able to maintain, and where necessary improve, its security of supply through the development of new or improved water resources, better management of leakage and further work to promote efficient use of water by its customers. This will minimize the cost to both customers and the environment over the long term."
The biggest cut in leakage of 180 megaliters (million liters) a day - around 20% of its current water losses - will be made by Thames Water. Achieving this target will bring its performance into line with the rest of the industry.
Leakage at Thames Water has now stabilised after three years of rises. The company has had a long-standing problem with losses of water from its network of pipes, and Ofwat's new price limits will enable it to renew around 1,400 km of mains in London.
Other big leakage reduction targets have been approved for Dwr Cymru (15%), Mid Kent (7%), Northumbrian Water (6%) and Folkestone and Dover (5%). In each case economic analysis has shown that further leakage reductions will be cost effective.
Following two years of rising leakage at United Utilities, Ofwat is requiring extra progress reports on the work the company is undertaking to reduce its level of water loss. Ofwat expects to see rapid progress from United Utilities to rectify its position quickly and meet its leakage targets.
The amount of water lost from the supply networks of water companies in England and Wales remained stable in 2003-04, after two previous years of rising leakage largely driven by the problems at Thames Water. Most water companies are now operating close to their economic level of leakage -- where making further reductions would be more expensive than developing new water sources or managing customer demand.
Notes to Editors:
1. The Director General of Water Services is the economic regulator of the water and sewerage companies in England and Wales. He exercises his powers in a way that he judges will allow them to carry out their functions properly, and finance them.
2. The new five year targets for each of the 22 water companies are contained in the "Security of supply, leakage and the efficient use of water 2003-04" report which is published today. This will be available at www.ofwat.gov.uk or from the Ofwat library on +44 121 625 1373.
3. A table of leakage targets up to 2009-10 by individual water company is available at www.ofwat.gov.uk.
4. Ml/d = Megaliters per day. A megaliter is the equivalent of one million liters. It would take 2.5 megaliters of water to fill an Olympic-sized swimming pool.
5. The action plan agreed with Thames Water to reduce its reported level of leakage is set out in appendix 4 of the Ofwat report, "Security of supply, leakage and the efficient use of water 2003-04, published today. This is available at www.ofwat.gov.uk or from the Ofwat library, +44 121 625 1373.
6. Details of the capital expenditure to maintain the balance between supply and demand can be found on p182 of the document, 'Future water and sewerage charges 2005-10 - Final determinations'. This is available on Ofwat's website.
7. The level of water losses has been reduced by nearly a third -- around 1,500 megaliters per day -- from the recorded peak in 1994-95, with the savings enough to supply the average daily needs of almost 10 million people -- the combined populations of London, Birmingham, Leeds, Sheffield, Bristol and Newcastle-upon-Tyne.
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