Regulating water resources

 

Regulatory changes to drive competition amongst water services providers and in water resources trading, along with a proposed price controls mean that the water sector is facing complex new challenges.

 

Key issues include the level of flexibility required to cope with new competition and how the upstream market will develop in light of these changes. Ofwat’s forthcoming FPL consultation and the Water White Paper in December 2011 should answer a number of the key questions about the future of the upstream water business.

 

This paper discusses some of the key issues that will need to be addressed by Ofwat and the water companies, and looks at examples from other sectors where price caps and markets have been combined.