William Jacobsen:  As the Water Resource Management Plans for 2019 (WRMP19) are gradually signed off for publication by Defra and with the publication of Ofwat's PR19 final determination, there is little time for water resource planners in England and Wales to rest on their laurels.

In previous cycles the early years of the five-year period might have presented a slower pace of work for planners, but this time around the regulators are introducing a new tier of planning for water companies to engage with in the early stages of the cycle. This new tier will be aimed at fostering greater efficiency, resilience and problem-solving abilities between individual companies through regionally focussed planning groups.

The Environment Agency led National Framework team aimed to provide clarity on expectations for these planning groups in December with a publication akin to a guiding principles for regional planning and although it now seems likely that this publication will be delayed until early next year due to the election that doesn’t prevent the requirement for this work to be completed before WRMP24.

Possibly the most important document within the draft determination, for water resources planners at least, was the appendix on regional strategic schemes. This document set out plans to effectively put £450 million of funding on the table for investigation, design and planning of strategic regional schemes aimed at increasing national resilience and bridging any future deficits. A closer inspection of some of the terms behind this headline figure shows that, in keeping with the general theme of this price review, this is anything, but easy money and that funding will only be released for schemes which pass gateways to the next stage.

At the time of writing Ofwat’s regional strategic appendix has tried to set the number of initial schemes for which funding is available at 15. These 15 schemes include some of the most notable strategic schemes from the WRMPs such as the Severn-Thames transfer, Abingdon reservoir and Fawley Desalination to name just three. There is also the possibility of substituting in other schemes beyond this initial 15 as work progresses. It will be interesting to see if the approach remains the same in the final determination.

The PR19 determination on the funding and approach to strategic regional schemes dovetails in with the forthcoming publication of the findings from the National Framework for Water Resources Planning and Management. This publication will likely set out some of the approaches and objectives of this new tier of planning and may also provide new evidence to build on the findings of the Long Term Planning Framework and National Infrastructure Commission.

Of course, it is important to take step back for a moment to understand why this planning tier is necessary in the first place. After all some might argue we have been forecasting supply and demand under the current system of water resources management planning for 25+ years and that the uncertainties inherent within this planning have not changed a great deal within this time. Climate change forecasts have been available to the industry since UKCIP02 for WRMP04 and sustainability changes and population change are not particularly new concepts either.

WRMP planning methods are evolving and improving with each successive round of plans

In fact, planning methods are evolving and improving with each successive round of plans with WRMP19 seeing some of the most sophisticated and innovative plans yet. The elephant in the room here though is that water companies are only legally obliged to serve their own customers and as a result of this approach planning currently takes place largely within the, sometimes arbitrary, boundaries of individual water companies, and seldom on a broader geographical scale which might allow the most effective and efficient use of water. This means there is currently no wider strategy to bring water to companies where demand outstrips supply and only expensive or environmentally damaging options are available in their immediate area, leaving them high and dry.

One of the exciting possibilities of the National Framework is that it could provide alternative solutions to those presented in the WRMPs and possibly identify less costly solutions in terms of social, economic and financial cost than otherwise would have been found through standard WRMP planning. The result of this new planning tier is likely to be optioneering on a broader geographic scale than we have been used to in previous cycles with assessment of large-scale transfers and strategic multi company resources of the type seldom seen in “normal” WRMPs.

The prevailing view according to the Long Term Planning Framework and National Infrastructure Commission is that it is the south east that requires the most new resource. It seems likely that the National Framework will mirror that view in its findings and encourage trades from deemed surplus areas in the north and west, among other things. It will therefore be interesting to see how Ofwat’s RAPID and the Environment Agency’s National Framework teams work together to enable the fair assessment of large-scale transfers that could facilitate this in a way that doesn’t unfairly increase the cost and risk of operations for customers in those donor companies.

It is therefore exciting times indeed for water resource planners awaiting the publication of the National Framework and Ofwat’s final determination. The next two years are going to be critical to the way that regional plans are set up and the supra company options that are considered and progressed into WRMP24 plans.