Richard Khaldi, water sector expert at PA Consulting Group shares his insights with Water Briefing on the time scales for water firms to meet PR19 requirements.
The article states that Ofwat’s new report asks companies to be ambitious and thorough in building and demonstrating their approaches to resilience.
It goes on to note that anyone looking for further detailed guidance on how companies should tackle resilience and articulate it in their PR19 plans would be disappointed by the guidance offered. Richard says that: “Ofwat highlights approaches and best practice from other sectors and makes suggestions, but does not give water companies much more.”
In the report, the regulator suggests a systems thinking based approach to enable them to see the bigger picture and advocates extensive customer engagement.
In Richard’s view: “it will be a real challenge to create an all-encompassing systems based approach from scratch, along with a suitable level of customer engagement, in time for business plan submissions in September 2018.”
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He adds: “That task is made harder because most water companies will have traditionally focused on asset and catchment resilience and not resilience in the round, which Ofwat’s report suggests should cover cyber security threats, supply chain risks, workforce challenges and formal business continuity management systems.
“We will have to wait and see how Ofwat benchmarks water companies’ performance on both assessing and planning enhancements to their resilience in the round. The report it has issued today makes it clear that it is a long term goal, both for PR19 and beyond and that it wants assessing and measuring water company resilience to be an ongoing obligation.”
Richard concludes by saying: “The hope must be that it will find the right balance in allowing companies to start well through the PR19 process and demonstrate a long term commitment to mature their resilience approaches, and not judge the next 20 years just by what they do in the coming 12 months.”