The Big Questions facing the

Steve Kaye - CEO

27th March - 2019

1 Key challenges facing the water sector

• Climate change • Population Growth • Water availability (resilience) • Ageing assets • Environmental • Culture • Industry complexity • Regulation that drives/stimulates innovation • Aligning & engaging academia, supply chain and end users

2 2 Totex – What does it mean ? A shift to the right

Build New Assets Optimise Assets

Upgrade Assets Maintain Assets

Capex bias Opex bias

3 3 Other Opportunities • Totex o Making more of our ageing assets o Low or No build solutions o More asset maintenance and optimisation (less pouring concrete and laying pipes) o Natural capital

• Digital Transformation o Real time control o Developing sensors o Connecting the OT to the IT o Artificial Intelligence

• New Skills - People of the Future o Customer engagement o Data and Information Management o Managing Complex Systems o Modelling o Analytical Skills

4 4 Stimulating Innovation

• Open Innovation or Ivory Tower ?

• Short or Long Term ?

• Incremental or Step Change ?

• Risk Management or Risk Taking ?

• Innovator or Fast Follower ?

• Large central budgets or collaborative funding ?

• Market led or Technology led ?

5 5 UKWIR Members

o o o o Dwr Cymru o Irish Water o Northern Ireland Water o o o o Water o SES Water o o South Staffs Water o o o o o o

6 6 UK Water Industry Research

• Not for Profit organisation set up in 1993 by UK water companies

• Funded and wholly owned by its 20 current members

• Common interest research themes

• Research on ‘one voice’ issues

• Annual subscription revenue for research £3.2 M

• Over 1,000 projects commissioned over past 25 years

7 7 Our aims

To shape the future water To deliver real outcomes to research agenda The water sector

Create a platform for research and innovation for the UK Water Industry

8 8 UKWIR Community Programme R&D Leads Managers (12) (20)

Consultants UKWIR Board Contractors Staff & (19) Universities (6)

Project Project Managers Steering (15-25 part time groups contractors)

9 9 Our Research Programme

• Research Topic areas

Drinking Water Engineering & Environmental Climate Change Customers Quality & Operations Quality Health

Materials & Programme Process Control Regulation Sewerage Standards Management

Wastewater Water Mains, Sludge & Waste Water Toxicology treatment & Service & Management Resources Sewerage Leakage

10 10 Why create a platform for Research and Innovation in the UK Water Sector?

• Leverage funding for projects • Bring stakeholders together, (including other industrial sectors • Support from and involvement of regulators, lateral endorsement and partnerships • Reduces the problem of fragmentation in the water industry • Do research collaboratively & deliver outcomes locally • A platform for Open Innovation • Develop short, medium and long term projects

11 11 A Strategic Approach – Asking the Big Questions Halve Abstractions Zero Interruptions Sustainable WW Service Zero Leakage 100% Compliance Zero uncontrolled discharges

2050 Drinking Water Wastewater Regulatory framework, (incentivising - asset maintenance, efficiency etc.) 2040 Customers, Regulation Asset Management

2030

Zero Water Poverty Carbon Neutrality 2020 Sustainability

Waste into products

2020 2030 2040 2050

12 12 Areas for further development

SMART, Real Time, Assets of the Future Condition Monitored

Circular Economy, Natural Capital, Triple bottom Sustainability line, reduce carbon, Waste to products

Behaviour, Choice, Engagement, Great Customer Experience Segmentation, Contribution

13 13 Opportunities to Collaborate

14 14 Project: National Sewer and Water Mains Failure Database UK Water Mains failure rate by material • Enables industry to compare and analyse sewer and water mains failure data with anonymised data o “State of the Nation reporting” o Improved benchmarking of failure rates for different pipe sizes, material, environments…. o Better understanding of failure behaviour against different criteria

o Source of data for validating models and Mains Repairs for PVC mains 2007-2014 business cases o Helps ongoing research and model development o International collaborative research

15 15 Project: Climate Change Modelling and the WRMP

• Project Objectives

o Strategic: Strategically plan for UKCP18 and WRMP 2024 o Efficient: Provide a less labour intensive approach to assessing climate change impacts on water supply than WRMP 2014 / 2019…… o Communicate: Support effective communication of climate risks and uncertainties to stakeholders o Resilience: Redefine the climate change methodology in terms of system drought resilience and exploit the richer understanding being developed by water companies

Evolution of climate change projections and methods in WRMPs

16 16 Project: Source Apportionment GIS (SAGIS)

• Apportion loads and concentrations of chemicals to WFD water bodies to identify effective programme measures (supported by EA and SEPA) o SAGIS is the product of a series of UKWIR research projects o Looks at both national and river catchment spatial scales o Identifies sources of pollution and contributing sectors o Enables scenario testing and the simulation of measures and policy. o Complete coverage for England, Wales and Scotland o In E&W SAGIS is estimated to have avoided up to £4bn in investment

17 17 Project: Sink to River – River to Tap A review of potential risks from nanoparticles and microplastics (2018/19)

• Objectives o Review current knowledge regarding risks posed by NP o Establish what is known, and to provide empirical evidence on MP entering and leaving UK WTW and WwTW. o Identify whether the fate of MP are influenced by different treatment processes • Benefits o Most comprehensive study yet on prevalence of MP in drinking water and wastewater treatment

• Sink to River – River to Tap 2 (2019/20)

18 18 Big Questions

Our Ambition: To Create a Sustainable Water Industry for the Future

Theme 1 Theme 2 Theme 3 Theme 4 Drinking water production & Wastewater collection & Cross cutting Operating Sustainably distribution Recycling

1. How do we halve our 5. How will we deliver an 7. How do we achieve zero 10. How do we remove more abstractions by 2050? environmentally customers in water carbon than we emit by poverty by 2030? 2. How will we achieve zero sustainable wastewater 2050? leakage in a sustainable service that meets 8. What is the true cost of 11. How do we maximise way by 2050? customer and regulator maintaining assets & how recovery of useful expectations by 2050? do we get this better 3. How do we achieve zero resources and achieve reflected in the regulatory interruptions to water 6. How do we achieve zero zero waste by 2050? decision making process? supplies by 2050? uncontrolled discharges 12. How do we achieve zero from sewers by 2050? 9. How do we ensure that 4. How do we achieve 100% harmful plastics in the the regulatory framework compliance with drinking water environment by incentivises efficient water standards by 2050? 2050? delivery of the right outcomes for customers 19 & the environment? 19 Big Question

Outcome Outcome Outcome

2050 Research Research Research Research Research Research

Research Research Research Research Research Research

2020 Research Research Research Research Research Research

20 20 21 21 Vision 100% compliance with Drinking Water Standards at point of use

Customers Zero Ownership and are satisfied Chemical & An appropriate balance of risk for substances of concern, responsibility for water Outcomes with their Regulate the right things low energy their public health impact, and mitigation quality is clear and all play drinking treatment their part in its protection water processes

We can inactive We can identify We understand We have We understand We can We can identify We understand We have the viruses in the biochemical the impacts of accurate the chemistry measure taste emerging the use of CI as right tools to distributed pathways to microplastics information that controls and odour contaminants a treatment deliver the right water cost resolve on drinking about DBPs and the solubility of quantitatively of concern option solutions effectively and treatment water quality their precursors lead sustainable needs Key Benefits We can We can We can We can CI can be We have an We understand determine the We can inactive We can implement cost implement implement cost implemented adaptive the occurrence affordable & viruses using implement effective processes to effective means as part of the system that of taste and acceptable sustainable sustainable measures for remove to minimise treatment responds to odour solutions for Pb means solutions removal microplastics DBPs process change compliance

Integrity of Achieving How to eliminate systems – minimum but use of chlorine as Company & stable 2030 disinfectant customer disinfection Investigating biological pathways to Identify & Monitoring treatment Removal or Educating Affordable and How to produce Optimised implement disinfection elimination customers about acceptable (to biologically solutions to catchment and residual in the techniques – lead control customers) lead stable/ low AOC 2025 minimise DBPs raw water network (better & WWTW or WTW solutions control solutions water in the UK interventions at optimal points)

Advanced Real time Toxicology/ Protecting water New methods for Treatability/ Taste & odour – Micro plastics & toxicology Catchments as monitoring of Treatability quality in the lead control – Disinfection Taking energy occurrence and Nanoparticles information the first stage of bacteria 2020 review of CIP etc. home (domestic materials and efficacy for virus out of processes fate removal efficacy about DBPs & treatment downstream of comps fixtures & fittings) linings inactivation their precursors WTWs

Better Risk assessing Taste & odour - Micro plastics Improved understanding of Intensifying 2018 CIP data in terms Data gathering methods of Nanoparticles understanding of the chemistry of natural of implications for viruses detection data gathering DBPs of concern the control of processes for DW sources lead 22 Priority Projects 22 Next Steps

• Accelerate BQ Route maps • Develop a balanced programme of short, medium and long term projects • More industry support to deliver strategic research programmes • Engage other organisations – more collaboration • Increase external funding • Benefits realisation • Increase communication – our successes and future strategy • Collaboration through GWRC (Global Water Research Coalition) • Links with TWENTY65

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