Two articles focussing on resilience. The levels of investment by UU in solar and AD are interesting and reflect clear thinking on energy and energy prices. 

Climate change ‘huge’ threat to water resilience 

Utility Week: ‘Bristol Water boss Mel Karam, warns against complacency as “drought watch” kicks in across parts of the UK. The chief executive of Bristol Water has warned that climate change will play a key role in the future transformation of the water sector, calling it a “huge threat” to resilience. Speaking at Utility Week Live in Birmingham last week, Mel Karam said companies need to ask themselves “How do we respond to massive issues around the resilience of our networks in the face of climate change?” He also admitted that, although the UK is “not known for being a dry country” some areas are “already under what we call drought watch” following low rainfall this winter.

Karam said this should serve as a “reminder” to water leaders that “we can never be complacent”.

Karam explained that increasingly frequent extremes of weather are making water network resilience “problematic”. It is becoming more and more challenging, he said, to ensure reliable and continuous supplies of water while minimising environmental detriment and ensuring abstraction remains sustainable.

Karam welcomed moves from Ofwat to open up commercial opportunities in water resources, which he said would help companies balance these pressures. “Opening up of water trading and water resource trading is an essential part of the industry being able to deal with these longer-term requirements” he said. However, “It is not the only element that we need.”

In addition to liberalisation of water trading, Karam said that companies need to go further to make internal changes which respond to resilience threats. He also called for more cross-boundary collaboration between water companies. During his appearance in the Keynote theatre at Utility Week Live, Karam also admitted that he would personally be in favour of extending competition to the domestic water market. Again, he said that establishing markets for water trading, to make water a “valuable commodity”, would be required to make domestic competition work. Click more to read here 

United Utilities announces additional £100m of new investment to improve resilience

United Utilities is making a further £100 million available to invest in resilience, according to its full year results for the year ended 31 March 2017 published this morning. The company’s underlying operating profit rose 3% to £622.9 million. Total capital expenditure during the year, including £148 million of infrastructure renewals expenditure, was £804 million, in line with the company’s plans to accelerate the AMP6 investment programme. The additional £100 million for resilience will take United Utilities’ total AMP6 investment 2015-20 to around £3.2 billion. The company also expects to invest over £100 million in non- regulated projects. In addition to the electricity it generates from bioresources, the company is developing other renewable energy facilities. It has invested £45M in solar in the first two years of the 2015-20 period. The group will continue to invest in solar, which it sees as a “huge opportunity”. It expects to invest more than £100M in solar generation across the five-year period, “provided it can see the returns”.  Click here to read more