This document is a call for information seeking views from interested stakeholders about the development and implementation of a bilateral market in water resources in England (there are currently no plans for such a market in Wales). By a “bilateral market” we mean a third party provider of water resources (such as an out-of-area water company or other holder of an abstraction licence) contracting directly with a retailer to sell water to its business customers.
In ‘Water 2020: Our regulatory approach to water and wastewater services in England and Wales’ May 2016, we set out how we intend to change the way we regulate to enable the sector to address the future challenges it faces and enable and encourage greater efficiency within the water sector. In Delivering Water 2020: Our final methodology for the 2019 price review, we introduced measures to make it possible for markets to play a more significant role in the supply of water resources.
However, measures related to the introduction of bilateral markets for water resources are contingent on certain provisions of the Water Act 2014 being commenced. Prior to commencement we need to identify and address policy issues, and consider the role of bilateral markets within the broader evolution of the development of water resources, including the new National Framework and the new cross-regulatory initiative, Rapid. This call for information will inform this process.
We welcome responses from a wide range of stakeholders. We are particularly interested to hear the views of parties who would be interested in participating in a bilateral market (such as potential third party suppliers of water resources and retailers or self-suppliers in the business retail market) and to understand their level of interest in participating. We are also interested in stakeholders’ views on the range of policy issues that would need to be addressed in order for a bilateral market to be successfully established, and how such a market could complement, or conflict with, other means of providing water resources.
Following consideration of stakeholders’ responses to this call for information, we will consider our next steps with respect to this market and, working with relevant stakeholders, progress delivery activities.
How to respond
We invite stakeholders to comment on this call for information by no later than 6 September 2019. You can email your responses to [email protected] or post them to:
Bilateral markets call for information
21 Bloomsbury Street
If you wish to discuss any aspect of this document, please direct your enquiry by email to [email protected].
We may publish responses to this document on our website at www.ofwat.gov.uk, unless you indicate that you would like your response to remain unpublished.