Tensions are growing between the government, the water sector and its regulators over the management of England’s water supplies, as the Environment Agency warns of a potential widespread drought next year.
Research commissioned by a water retailer has found water scarcity could hamper the UK’s ability to reach its net zero targets, and that industrial growth could push some areas of the country into water shortages.
The government has a legally binding target to reach net zero greenhouse gas emissions by 2050, and has committed to a clean power system by 2030 with at least 95% of electricity generated from low-carbon sources, but the study concludes there will not be enough water available to support all planned carbon capture and hydrogen projects.
Development of these kinds of projects, which use significant amounts of water, could push some UK regions into water shortages, according to the analysis undertaken by Durham University and funded by the water retailer Wave – a joint venture between Anglian Venture Holdings, the investment and management vehicle responsible for Anglian Water Group’s commercial businesses, and the Northumbrian Water Group.
Led by Prof Simon Mathias, an expert in hydraulics, hydrology and environmental engineering, researchers assessed plans across England’s five largest industrial clusters in Humberside, north-west England, the Tees Valley, the Solent and the Black Country, to determine how much water would be needed to reach net zero and whether the UK’s future water supply could meet this demand.
“Decarbonisation efforts associated with carbon capture and hydrogen production could add up to 860m litres per day of water demand by 2050. In some regions, for example Anglian Water and United Utilities, deficits could emerge as early as 2030,” said Mathias.
Decarbonisation within the Humberside industrial cluster could push Anglian Water into water deficit by 2030, leading to a shortage of 130m litres a day by 2050, while plans around the north-west cluster could push United Utilities into a deficit of around 70m litres a day by 2030, according to the research.
However, a United Utilities spokesperson said the deficit figures were “overstated as regional water management plans already make allowances for the predicted hydrogen demand”, and added that the “drive to net zero is an important issue facing the water sector, with significant work already under way to drive sustainable solutions”.
Anglian Water did recognise the deficit figures but said they were at the upper end of a range it had considered. It blamed Ofwat for not allowing water companies to spend more, hindering its ability to secure future supplies.
Business demand is often excluded from strategic planning, according to Anglian Water, which it said prevented water companies from making the investments needed, weakening the system’s resilience to the climate crisis and limiting its capacity to support economic growth.
A spokesperson for Water UK confirmed water companies’ plans to ensure there were enough water supplies in the future did not take into account the needs of some large planned projects, and blamed the Environment Agency for the omission.
“After being blocked from building reservoirs for more than 30 years, we have finally been given approval to build 10. The problem is that the Environment Agency’s forecasts, on which the size, number and locations of these reservoirs are based, do not account for the government’s economic or low-carbon ambitions. Hydrogen energy needs a lot of water, so correcting these forecasts is increasingly urgent.”
Nigel Corfield from Wave said he had commissioned the work because “water companies don’t have the same statutory obligations for businesses as they do for households, and we sensed that there was going to be a bit of a problem”.
“Government and Ofwat are allowing businesses and these big projects to sort themselves out in terms of how they’re going to get their water,” said Corfield. “We generally don’t think that’s right, because this is about energy security so we think that the best people to provide that and supply that and support that are the water companies.”
The government said the UK was “rolling out hydrogen at scale”, with 10 projects said to be shovel-ready. It said it expected all schemes to have sustainable water-sourcing plans and, where required, abstraction licences. Carbon capture schemes would get the green light only if they could prove they met strict legal standards and limits and offered “a high level of protection” for people and the environment, it said.
“We face a growing water shortage in the next decade and that is one of the reasons we are driving long-term systemic change to tackle the impacts of climate change,” said a government spokesperson.
“This includes £104bn of private investment to help reduce leakage and build nine reservoirs, as well as a record £10.5bn in government funding for new flood defences to protect nearly 900,000 properties by 2036.”
But Dieter Helm, a professor of economic policy at the University of Oxford, said England’s water system was stuck in the past and that there was no lack of water, rather that it was badly managed.
“It’s worse than an analogue industry,” he said. “Until recently, some water companies didn’t even know where their sewage works were, let alone whether they were discharging into rivers. The information set is extremely weak. But a data revolution now means we can map water systems in extraordinary detail, digitally, at a far finer resolution.”
Helm said every drop of water should be measured and reported in real time, and that the data should sit with a new, independent catchment regulator, not the water companies.
“You should never be able to have an abstraction without an abstraction meter,” he said. “And it should be a smart meter, automatically reporting. You can’t run a system without data, and you can’t rely on the water companies to hold the data for everyone in the system – they’re just one player.”
In his model, the catchment regulator would hold live data on “all the catchment uses of water”, such as abstraction, runoff, water and river levels, sewage discharges, and publish everything on a public website. Anyone, he said, should be able to look up a catchment, see what was going on, and even model the impact of a new project, such as a hydrogen plant, on the system.
“That’s how you run an electricity system,” Helm said. “Why don’t we have that in water? And why don’t we have a body responsible for it? There’s an information revolution required here, quite separate from the question of whether we actually run short of water.”
The government and the Environment Agency have already warned of an England-wide water deficit of 6bn litres a day by 2055, and have said England faces widespread drought next year unless there is significant rainfall over the winter.
