This is the second of three blogs on the changing face of water resources in England and Wales.  My first blog reviewed how new guidance will affect how water companies plan to maintain supplies in the long-term.  This blog looks at planned changes that could have even wider and more fundamental implications for water resources.

But first a bit of history.  The Water Resources Act 1963 required all groundwater and surface water abstractions to be licensed by newly established River Authorities for the first time.  Licences were awarded, effectively in perpetuity, with little or no regard to environmental requirements, but based on abstractors’ estimates of likely future water requirements[1].

Fast forward half a century and many of these licences are still in place[2].  The UK government (led by Defra) and the Welsh Government, have been looking at ways of reforming this dated system over the past few years, and have consulted widely on options for abstraction reform.  Their response to this consultation was published in January 2016 and provided a clear indication of likely future reforms[3],[4].  Key points are summarised in the box at the end of this piece.

Our views

Overall, the changes are welcome – there is clearly a need to update the licensing system to reflect our current understanding of hydrology and ecology, and implement an approach which achieves a better balance between the water requirements of society, business and the environment.

Changes will be gradual and are likely to have any significant or near term impact on abstraction in non-enhanced catchments.  This means the changes planned should be broadly fair and proportionate.

Having said that, the draft Water Resources Planning Guideline (issued in November 2015 and described in the first of these blogs) states that water company yield assessments should not be affected by these reforms.  However, there seem to be risks in these proposals that will affect abstraction rights relatively early in the planning process.  We expect water companies will want to consider this further, especially where they have abstractions in an enhanced catchment.

The document states that the plans to applying increasing controls at low flows (in enhanced catchments) will ensure a proportionate, evidence-based approach to protecting the environment.  Whilst we recognise that prolonged low flows or over-abstraction will damage aquatic flora and fauna, we also believe there is a significant amount of research required to establish clear, quantitative links between the duration and frequency of low flows and the status of rivers.  Such links are likely to be site-specific and will need to take account of climate change; as well as the price society is willing to pay to protect the environment.

The proposals indicate that if the Environment Agency determines through monitoring that significant risks to the environment are continuing due to abstraction, they are likely to implement mandatory restrictions on abstraction proportionate to the risks, taking into account essential water needs and economic impacts.  It is unclear how this will be linked to water company drought plans and the methods used by companies to restrict the demand for water.  Additionally, there is no clear definition of essential use at present, particularly in terms of customer demand.

There are many other interesting issues to explore that can’t be addressed in a brief blog, and will maintain a keen interest in how these plans develop over the next few years.  After all, the early 2020s are not that far away.

In summary:

The new abstraction management system will result in ‘abstraction permits’ replacing existing licences from the early 2020s.  Permitted will “at least reflect current business use and have a similar reliability to current licences”.  The proposal is to assess this based on abstractors’ past peak water usage over at least 10 years. Licensed volumes that have not been used will be removed, subject to appeal, if they pose a risk to the environment.

Conditions on licences that are designed to protect low flows, such as ‘hands-off flows’ will be standardised to simplify the system; and all surface water licences will be subject to flow-based controls, tailored to local conditions.

Abstractors will be allowed to take water when flows are “high” to store it.  There will be no seasonal permits.

Abstractors will be able to trade water in a quicker and easier way in catchments where there are potential benefits. In these “enhanced catchments”, there will be a range of preapproved trades based on the allocation of “shares of…different water resources.”  Other mechanisms to address concerns regarding market dominance by larger abstractors will be explored.

No permits will be time limited but permits will be reviewed on a risk-based approach, taking account of environmental risks. Catchment abstraction reviews will link to the overall management of catchments as a key natural asset working closely with local people. Notice will be provided of permit changes but there will be no compensation for loss of permitted volumes.

Abstractions that are currently exempt, including those for mine and quarry dewatering, navigation (i.e. supplying canals), and trickle irrigation, will be brought into the permitting process, to ensure a fair, level playing field for managing water abstraction.

[1] Ofwat, Defra (2006) THE DEVELOPMENT OF THE WATER INDUSTRY IN ENGLAND AND WALES.  Accessed at 03/2/16.

[2] Many of the most environmentally damaging abstractions licences have been revoked or reduced as part of the Environment Agency’s Restoring Sustainable Abstraction programme, and via EU Habitats and Birds directives.

[3] Defra (2016) UK Government response to consultation on reforming the Water Abstraction Management System, 15 January 2016

[4] Welsh Government (2016) Consultation – Government response. Making the most of every drop consultation – reforming the water abstraction management system in Wales.  January 2016.