Research shows more action needed to protect against growing drought risk

An effective response to the significant and growing risk of drought in England and Wales is possible if concerted action is taken now, according to new research published by the water industry today.

The research modelled the possible effects of climate change, population growth, environmental protection measures and trends in water use to produce a wide range of future scenarios. It breaks new ground by deploying new modelling techniques and by looking 50 years ahead across the whole of England and Wales.

The results suggest that, in some scenarios, we are facing longer, more frequent and more acute droughts than previously thought. Drier areas of the country (the south and east of England) face a higher risk of more severe droughts than those experienced in the past, while English regions further to the north and west are also more exposed to the prospect of future water shortages.

The modelling shows that extensive measures to manage demand and enhance supplies of water are needed to contain the risk of drought, for example, by:

• promoting more efficient water use in homes and businesses, through improved building standards and widespread use of smart metering, as well as more ambitious reduction in leakage from water mains;
• moving more water from one region to another through existing waterways and new pipelines, building new reservoirs, treating more water for re-use and building desalination plants to make use of sea water.

The report’s authors conclude that, by adopting a step-by-step approach, the additional cost of making the supply of water more resilient to severe droughts would be equivalent to about £4 per annum per household. By contrast, the impact on the economy of inaction could be very high, costing an estimated £1.3 billion per day during the most widespread situations of severe drought modelled in the report.

The report comes shortly after publication of the Government’s National Floods Resilience Review, which acknowledged that at many times and in many places, water is in increasingly short supply. The Review said there are obvious benefits to managing water in a way that reduces both flood risk and water stress.

The research into drought risk was carried out by independent consultants and peer reviewed by leading experts in water resources, climate change and environmental management. It was commissioned by Water UK after the government asked water companies in 2015 to look at the long term resilience of water resources in England and Wales.

Michael Roberts, Chief Executive of Water UK, said:
“Since privatisation, the industry has invested billions of pounds in securing the nation’s precious water resources, but we all need to do more in the face of current and future pressures on those resources.

“We are publishing this ground-breaking research today so that water companies, government, regulators and other agencies can together raise their game in how we plan to keep homes and businesses supplied over the next fifty years.”

Jean Spencer, Regulation Director at Anglian Water, who chaired the project, said:

“The threat of drought is already with us – were it not for the unprecedented rainfall in the spring of 2012, we might have suffered significant problems with water supply that summer. This is world class research that will support companies and government in planning for resilient water resources in the future."

Notes to editors

1. The report was commissioned by Water UK and delivered by an independent consortium of:

• Atkins
• Mott MacDonald
• Nera
• HR Wallingford
• Oxford University

The consortium’s work was overseen by a water sector Steering Group consisting of regulators, national and devolved governments and water companies.

2. An independent peer review panel was also established to carry out a review of the work, to ensure that the project met its objectives and was technically sound. The peer review has been conducted by:

• Professor Jim Hall, University of Oxford and member of the Adaptation Sub-Committee of the Committee on Climate Change
• Dr Colin Fenn, Hydro-Logic Services
• Robin Smale, Vivid Economics
• Dr Steven Wade, Met Office

3. The report assessed the existing degree of risk to three different levels of drought (worst historic, severe and extreme). “Severe” drought in the report refers to rare events beyond those seen in the 20th century (events which might include periods where standpipes or other forms of water rationing might be in place for 2-3 months), which might only be expected to occur once every couple of centuries.

4. The report identified that, for the last 20 years, the majority of companies have already been planning to be resilient to the worst drought recorded for their area in the 20th century. Notwithstanding that, in the east and south of England there still remains today a 12% chance of seeing a “severe” drought event (ie worse than any seen in the 20th century) over a 25 year planning period.

5. The report further identified three main factors which could increase the future degree of risk to drought: climate change, population and economic growth, and reduced permitted abstraction of water to protect the environment. Just taking climate change alone, even under a moderately dry future, for example, the risk of standpipes and other restrictions could double in the South East and Bristol, or treble in the London and Anglian regions.

6. As an example of action currently being taken, water companies continue to focus on bringing leakage down. Total leakage was around 4,500 megalitres per day in the mid-1990s, but is now down to around 3,000 megalitres a day. All companies have agreed tough targets with the regulator Ofwat for bringing leakage down in 2015-2020. The overall aim is to save 370million litres a day by tackling leakage and promoting efficiency. Since privatisation in 1989, the water industry has invested more than £130 billion to bring lasting improvements to their customers. In 2015-2020, a further £47bn will be invested.

7. The £4 per annum per household figure in the report is an indication of the additional investment required. This does not necessarily translate to a £4 increase in bills because of the way the water industry is financed and because of other commitments which water companies have to meet. As this is a national average, there will also be regional variations within this figure. These costs also only include the expenditure involved in demand management and new resource schemes (which includes some allowance for treatment and transfer costs) – where projects to transfer water from one area to another are involved, no allowance has been made for any additional treatment or transaction costs that may be required as a result.

8. In calculating the cost to the economy of severe drought, the study modelled the loss of economic worth as measured by lost gross value added (GVA) as a result of water shortages and restrictions. GVA provides a monetary value for the amount of goods and services produced, less the cost of all inputs and raw materials directly attributable to that production. The analysis considered the GVA impacts on all sectors of the economy, some of which (for example, agriculture, food processing, textiles) would be heavily affected because of their operational reliance on water. Commercial and manufacturing sectors more widely could also be affected, for example, where severe water shortages posed workplace hygiene or health and safety risks to employees.

Water UK Communications
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