Mike Callis, Waterscan Ltd
The water market in the UK is at a turning point, and organisations and policymakers are increasingly starting to treat water with the urgency, respect and innovation it needs.
Waterscan’s State of the Water Market 2024 report painted a stark picture around the time Ofwat released its ‘final determinations’ on price increases coming in from April 2025. It revealed a marketplace that is technically open to competition but held back by structural limitations, a worrying lack of data transparency, and a culture that still views water efficiency as a “nice to have” rather than an operational necessity.
However, it also points to signs of real progress — and an increasingly powerful coalition of voices demanding reform.
The issues are not new, but they are becoming impossible to ignore. Drought risk is rising. Regulatory pressure is tightening. Water costs, once negligible on the balance sheet, are beginning to build up. In addition, the public is increasingly unforgiving of companies and sectors that appear to be wasting or polluting water. The era of cheap, abundant water is over. Organisations that fail to adapt will pay the price — financially, reputationally, and operationally.
What’s needed now is not just compliance, but leadership.
A market open in theory, but not in practice
The water market in England was deregulated in 2017, in theory allowing non-household customers to choose their water supplier. But eight years on, the promise of a competitive, customer-driven market has yet to materialise. Switching rates are low, customer satisfaction is stagnant, and many businesses don’t even realise they have a choice.
Waterscan’s research highlights the root causes: a lack of transparency around pricing and performance, limited innovation from suppliers, and a regulatory model that doesn’t do enough to incentivise efficiency or penalise waste. For too long, the market has tolerated mediocre service and rewarded passivity.
But this status quo is no longer acceptable. Water is becoming an increasingly strategic issue, particularly for large, multi-site organisations. It impacts ESG performance, climate resilience, and long-term cost exposure. Organisations want more insight, more flexibility, and more support — and they’re not getting it from the current market setup.
Data is power — and too few have it
Perhaps the single biggest obstacle to progress is the market’s data deficit. Accurate, timely consumption data is the foundation of any meaningful water strategy. Yet most businesses still operate in the dark, receiving infrequent, estimated bills and lacking visibility of where, when and how they’re using water.
This is not just an inconvenience — it’s a major risk. Without robust data, it’s impossible to identify leaks, benchmark performance, or build a credible case for investment. It also undermines trust in the market and prevents meaningful competition.
Encouragingly, some organisations are starting to take matters into their own hands, installing their own data loggers and working with independent experts to build clearer pictures of usage and risk. But this patchwork approach is no substitute for market-wide transparency. Ofwat and MOSL have acknowledged the problem. Now it’s time for coordinated action.
From afterthought to shared priority
One of the most positive trends highlighted in Waterscan’s report is the growing maturity of non-household customers attitudes to water. Efficiency is no longer the preserve of sustainability teams — it’s increasingly being discussed across all levels of the public sector departments and committees.
This shift is being driven by several forces: the sharp rise in other utility prices (making water cost control more attractive by comparison), the expansion of ESG reporting requirements, and a growing awareness of the reputational risks associated with poor water stewardship. In commercial sectors like hospitality, retail and manufacturing, water use is now seen as a core operational issue, not just a compliance box to tick, and the public sector is quickly following.
Forward-thinking organisations are starting to ask smarter questions: How do we set meaningful reduction targets? How do we design out waste in our processes? Can we reuse greywater or harvest rainwater? How do we measure success?
These questions don’t have easy answers. But asking them is the first step to real progress.
The role of independents
Given the limitations of the current market structure, it’s no surprise that many businesses are turning to third parties to help navigate their water strategy. Independent consultants and water managers are increasingly the ones driving innovation, offering services from auditing and procurement to real-time monitoring and demand-side management.
This is a clear signal that organisations are hungry for more than what many licensed suppliers are offering. It also suggests a new kind of market model — one less reliant on traditional retail competition, and more focused on collaborative, consultative partnerships between organisations and experts who can unlock hidden value.
Several local authorities have taken steps already to gain more control over their water usage and costs by becoming self-suppliers. Blackpool Council was one of the early adopters, switching to self-supply to help drive efficiencies and support wider sustainability goals across its public estate. Sefton Council has since made considerable progress on its water journey, using self-supply to identify and address leaks, improve data visibility, and embed water-saving practices into day-to-day operations
Time to make water count
Ultimately, water is not just a resource; it’s a risk, an opportunity, and a responsibility. The 2024 Waterscan report should serve as a wake-up call for everyone involved in the business of water — from regulators and retailers to facilities managers and CFOs.
If we want a water market that works — one that’s transparent, innovative, efficient, and resilient — we can’t keep doing more of the same. We need bold reform, smarter regulation, better data, and a cultural shift in how we value water.
The good news? The momentum is building. Organisations are ready to lead. Policymakers are starting to listen. And with the right focus, 2024 could be the year the water market starts to live up to its promise.
Keen to learn more and continue the conversation? Join Waterscan at its annual Water Matters conference in London on 19th June 2025 to drive change on water sustainability.
This article appeared in the April 2025 issue of Energy Manager magazine. Subscribe here.