From April 2017, all non-domestic properties in England will have the opportunity to switch water supplier. This is because the government have acted to break the water monopoly to deliver improved value to customers.

Competition between suppliers means increased choice. It means potential savings on water bills and improved customer service. For businesses with multiple sites across the country it also means just one bill from one supplier; saving huge amounts of administrative resources.

The market will operate in much the same way as in other utility services where a range of suppliers compete for customers by offering them the best deal. Suppliers (retailers) buy wholesale services – the physical supply of water and removal of sewage – from the regional wholesaler (the former monopoly supplier). If a customer switches supplier, the water they buy and the pipes used to supply it remain the same. The water is purchased from a ‘retailer’ rather than their current regional ‘wholesaler’. This market model is exactly the same as the Scottish water market where competition has been in operation since 2008. The opportunity to switch will not be available in Northern Ireland and only to sites in Wales that consume over 50,000m³ of water annually.

As was the case in the Scottish market, the financial margins from switching are expected to be relatively low initially. However, these did increase and are now over 20% savings. It is important that every eligible customer does switch from 2017; since by doing this it creates competition and puts pressure on the market to reduce prices further.

Our recommended approach (from our experience of the Scottish market) is to gain savings by switching supplier and at the same reviewing tariff structures and water reduction measures, typically enabling a 20% reduction in costs. Once this is achieved, you can switch again to benefit from further reductions as the competitive market drives down costs.

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