Worked examples

Proposal 

A brewery in East Liverpool has a borehole on site, which has an Abstraction Licence with a permitted maximum abstraction of 12 million litres per day. The borehole has been in operation since 1975, and there are weekly readings of water quality (from an accredited laboratory) and weekly yield. The reliable average yield is 9 million litres per day.

Changing patterns related to their business means that the brewery is consolidating production from a number of locations, into a single large brewery located in Derbyshire. The brewery will no longer require abstraction from the borehole at their Liverpool site, and they make a bid to United Utilities offering water from the borehole.

Likely outcome

This bid is likely to be considered in detail. The bidder has a reasonable volume of water available, with detailed records of water quality and reliable yield. The water source is located close to one of our major water treatment works at Prescot, where we can treat the water and distribute it to our customers.

Provided the cost of the bid is reasonable (less than our costs for developing a new 9 million litres per day source) the bid would likely be successful.

Proposal

A large multi-national electrical generation company is the operator of a coal fired power station, located in central Lancashire, which is built on the banks of a large river. The business has an Abstraction Licence for the river, with a permitted volume of 150 million litres per day, which is used for cooling water for the power station. There are documents showing daily abstraction going back to 1923, which demonstrate a reliable yield of 145 million litres per day. However the business does not have details of water quality.

The changing business environment for electricity generation means that the business now plans to close their power station. However the business still intends to maintain a presence on the site, which also includes a large transformer and electricity network connection hub.

Some water from the river (25 million litres per day) will still be used by the business, to cool the transformers on site. The business bids to offer United Utilities 120 million litres of water a day.

Liekly outcome 

This bid would be categorised as requiring further information. The bidder is offering a substantial amount of water, with an evidenced reliable yield, which has existing regulatory permission. The source is located close to an existing strategic water treatment works at Blackburn.

The key issue with this bid would be the lack of water quality data. The bidder should discuss with United Utilities what water quality might be needed in this location (given the type of source in question). 

At this stage the likely outcome is that further investigation is required.

Proposal

Following on from the above BAF submission, the Bidder agrees to a programme of water quality sampling and analysis at an accredited laboratory. The water sampling shows the water in the river to be exceptionally pure. The bidder then submits a revised bid with the details of the water quality assessments included. 

Likely outcome

Provided the cost of the bid is reasonable (less than our costs for developing a new 120 million litres per day source) the bid would likely be successful.

Proposal 

A farm located near Southport has a well, from which water is abstracted for agricultural irrigation. The abstraction is not metered, and has not been declared to the Environment Agency. There are no details of water quality available. The farmer bids to offer United Utilities 5 million litres per day.

Likely outcome 

This bid is unlikely to be successful. The bidder cannot demonstrate that there is sufficient water available to meet the amount being offered in the bid. The bidder does not have the approval of the regulator for this abstraction (no Abstraction Licence) and may face significant regulatory enforcement action by the Environment Agency for operating in an unlicensed manner. There is no data to evidence the water quality, and the source is a type and location where contamination from surface activities (agricultural run-off) is a significant risk.

The lack of available detail, and lack of regulatory approval, means that it is unlikely that this bid could ever be implemented.

Proposal 

A company has invented a device that can be installed on every customer stop tap and identify when a customer has a leaking toilet. Any leaky loo detected by the company will then be repaired, following agreement from the customer. This service can be deployed across the whole of the region supplied by United Utilities and has the potential to reduce demand by 20 Ml/d, based on experience of carrying out exactly the same service at another water company.

Likely outcome

This bid is likely to be considered in detail. The bidder has identified the potential to reduce demand by a large volume with a method that has been proven to work elsewhere. Provided the cost of the bid is reasonable and the approach to dealing with customers on behalf of United Utilities is acceptable the bid would likely be successful.

Proposal

A joint venture of companies with expertise in leakage detection and water network maintenance submits a bid to offer a comprehensive service to find and fix leaks. This service is offered for a particular part of the United Utilities network, where the bidding companies have a local depot and resources. The bid claims that they will reduce leakage in the area by 5 Ml/d and hold it at that lower level for a period of 5 years. The joint venture sets out a comprehensive method to measure the benefits of their activities and have references from another water company in the UK, with similar conditions to United Utilities, where leakage reductions have been achieved.

Likely outcome

This bid is likely to be categorised as requiring further information.  This bid is worthy of consideration in detail in terms of potential benefits to customers. While the option has the potential to impact on existing activities and reporting methodology, inclusive of existing network management and maintenance activities which would require extensive review during a full or early BAF process, the potential has merit but would require additional guarantees around longer term benefit and the provision of surety that the proposed information is indeed valid.

At this stage the likely outcome is that further investigation is required with the potential to trigger and early BAF post confirmation of some of the initial claims made by the bidder. 

Proposal 

A company has invented a device that can be inserted into a live pipe and measure defects and leaks as it travels to a designated collection point. The device would need to be deployed by United Utilities operatives and any defect or leak detected would need to be repaired by United Utilities and its partners. The company estimate a leakage saving of 50 Ml/d per year but have never deployed it before in a live environment and only carried out testing offline. The company are awaiting Regulation 31 approval from the Drinking Water Inspectorate and expect to receive it in the next few months.

Likely outcome 

This bid is unlikely to be appropriate for an Early BAF, as the Bidder cannot demonstrate that there the technology is proven elsewhere and the option relies on significant input from United Utilities to achieve the benefits. The bidder does not yet have the approval of the regulator for deploying the device in a live potable water system and, therefore, it is still at the early developmental stage. The idea and technology may prove to be successful in the future and should be directed to our ideas process.