WAVE UTILITIES: Keeping Business Flowing, Sustainably

With the energy price crisis and inflationary pressure giving financial managers a headache across the UK business space, arguably the most important utility is often forgotten. Water is the lifeblood of businesses, and for the big drinkers – those in energy generation, oil and gas, petrochemical, food manufacturing, and other industrial spaces – water is directly linked to income.

To ensure that water is used efficiently and billed in a fair and transparent manner, collaboration with a knowledgeable, experienced, and forward-thinking partner is essential. Established in 2017 as a joint venture between Anglian Venture Holdings Limited and Northumbrian Water Group Limited, Wave aims to bring a simplified and highly efficient management service around water.

Today, the company’s client base is around 300,000 businesses, from major international organisations to SMEs with smaller operations.

“We have been involved in the retail water market for some time and our roots go back to 2008, from a retail point of view, to when the Scottish market opened. That was where we started to understand what the retail market was about and what customers were looking for from a retail water market,” says Tony March, Director of Public Sector and Industrial Customers.

“Our core services are reading water meters, raising bills, actively engaging with customers, and driving efficiency,” he adds. “Key to us is how we deliver those services. Quality service delivery is non-negotiable, and we are very active with our account managers around how we engage, how we deliver technical services, and how we bring value added services. Our position in the market is to add value – we want to save our customers money. This can also help customers to hit their environmental goals as well as being cost-effective.”

Head of Operations, Oli Shelley gives insight into the scale of operations inside the Wave portfolio.

“Wave customers use around 15 million m³ each month. The total business community uses somewhere around 110 million m³,” he details.

“Interestingly, there is such a skewed profile of usage for businesses across the country. The top 1% of business users are responsible for 50% of all non-household demand. Then, another 50% of the meters in the market use less than the domestic consumer does at home because they’re small businesses. The big challenge for any supplier is how to cater for that broad spectrum of users. If big industrial process users either decrease or increase their consumption by 10%, that has a material difference on the water resource availability and everything around that. Then you’ve got the really small end of the scale where water is essential but doesn’t affect day-to-day operations – it’s a challenging mix.”

March and Shelley agree that one of the key pillars of success at Wave has been treating each customer individually and understanding their position. The company knows that water means something different for everyone and there is little logic in a blanket approach to service and billing. Actively searching for a diverse portfolio, steering away from simply serving single market segments, encourages problem solving and originality.

“We have dedicated teams and we realise that all customers are different, and all segments are different. Our account managers are dedicated to looking after our individual customers and our business ethos is committed to change and improvement. We actively engage with the market through partnership, consultation, and thought leadership. We are forward thinking about water efficiency and innovation and promoting why this is important. We are always looking to change for the better,” says March.

SUPPLY/DEMAND

In 2021, the UK government – through Environment Agency Chief, Sir James Bevan – released a report stating that a lack of water presents an existential threat. Largely driven by climate change, longer and hotter summers combined with less predictable rainfall, will see the country edge close to the ‘jaws of death’ – a point on planning charts in water company offices where demand outstrips supply.

“It’s very overlooked and very significant,” admits Shelley. “We have a supply-demand crisis looming in this country, that is certain,” he says, highlighting the hot summer of 2020 as a demonstrator of how influential a changing climate can be.

“Look at household demand and what happens with it – you can definitely see when it starts to get above 25 or 26 degrees centigrade, water consumption starts going through the roof. We already over abstract from the environment as it is. So, not only are we getting an increased demand, but we also need to try and find a way to ease off the supplies.”

Businesses are not guaranteed to receive supply from water companies and retailers, and if the day comes when a choice must be made, households will be first in mind. For this reason, the business community must make changes to ensure sustainability. Water efficiency is the Wave promise and whether it’s ensuring correct meter readings, searching for leaks, or advising on reductions, the company is pushing hard to help.

“It’s very rare that we come across a business that has a meaningful water strategy or a meaningful plan or has even really thought of what will happen in 2040 when if we carry on as we’re going, we won’t have enough water to go around and businesses are bottom of the queue for that supply point from a wholesale perspective,” says Shelley.

“That’s why we have things like our Not a Drop to Waste campaign with customers. We’re trying to simplify that message.”

At the large West Burton Power Station – owned by EDF – in Lincolnshire, Wave was called to investigate a recent sharp increase in daily water usage. Little had changed operationally, and staff numbers remained constant. Wave utilised its Leakage Find and Fix service, sending engineers and equipment to check for waste. The sprawling site is home to significant infrastructure and was a challenging arena for finding leaks. But the Wave team quickly found two underground pipes leaking 20m³ of water each day. Repairs were carried out and EDF saved more than £5100. The collaboration helped Wave subsequently discover a further leak, reducing waste and saving resources during a hot, dry summer.

In a similar situation in the SME space, a software development company received a larger than expected bill. Water consumption had increased year-on-year so Wave initiated a Leak and Flow test, discovering a leak in underground supply. Wave contractors then quickly went about pinpointing the leak, repairing, and recovering, leaving minimal downtime or disruption for the client. Water usage went down from 13.5 m³ to 2.9 m³, and the company saved more than £3000.

However, it’s not always underground leaks that cause the biggest problems. “We’re also talking about leaking toilets, overflowing storage tanks, urinals that don’t have any kind of control on them at all. If you have a urinal that is running 24-hours a day, filling for five minutes and then flushing, you might as well have a leak,” says Shelley, highlighting a project across a police force base where high bills had been reported and the root cause of the problem was a poorly maintained, battery powered urinal flushing system which had been loading and discharging unnecessarily for weeks.

“The outrageous thing we know is that around 26% of the non-household demand is actually continuous, which indicates leakage,” he adds.

Both agree, this is an opportunity. Defra has introduced a 9% water consumption reduction target by 2037 in the non-household market. While this could be viewed as a major challenge, Wave is already looking at it as highly achievable by taking leakage and waste seriously. Shelley is sure that “people don’t engage enough with their water infrastructure because much of it sits beneath the ground.

“I guarantee if it was above ground that people would take notice. A lot of those buildings are quite old and gone past their design life. No one’s ever replaced that pipework. No one’s looking at it.”

INNOVATING

When Wave was formed, the company was keen to do more than a standard utility provider, making life easier, quicker, and more efficient for clients. This has been put into practice and while legislatively, the company is only required to read the meter and issue the bill, there is so much more bubbling under the surface. Wave is home to innovation and ideas that few others in the industry could boast.

“We look out, we assess some of the new technologies that become available, and we look at new opportunities out there,” says March, “but our customers are really engaged with that as well. We do see some good engagement with them which provides us with a lot of assurance as we go through the process. It demonstrates the strength of relationships and trust that we have with our customers.”

When bringing new ideas through the system, the test for any partnerships is whether or not they solve Wave customer problems. While often there is a risk in developing new concepts, if the customer can benefit then Wave is keen to invest as it separates itself in the market as a partner and not simply a utility provider.

“We are passionate about adding value and doing the right thing for the environment,” comments Shelley.

“From a service point of view, it’s about providing a good quality core service, providing the information, providing the data that the customers need to be able to assess their water bill, but also be clear on the water that’s actually being used across their sites,” says March.

Advancing technology and bringing innovation to the sector is, for Shelley, about taking the industry forward because it’s the right thing to do, not because it benefits the balance sheet.

“We go and find out what are our customers pain points and problems are and have open discussions with them asking what are we not doing for them that we could.

“We put a huge amount of effort into working with a lot of smaller suppliers, trying to bring innovative stuff to the marketplace. That means taking the risk and giving those companies access to our customers and putting our neck on the line at very early-stage trials. We’re very willing to put the time into pushing things forward. It’s not just about where we see value for our customers, but I think our wider sense of responsibility to the marketplace around water efficiency and making things better.”

In October 2022, Wave furthered an exciting partnership with OccuTrace – a specialist data collection provider – to understand more about the NHH meter market. Current evidence suggests that 11% of the meters in this space show zero consumption but Wave expects this means that many are broken and could be replaced to help companies understand their consumption and billing correctly. Without this data, there could be a misunderstanding around leakage or usage. This partnership follows from a previous project where the pair addressed a large number of meters which had not been read for more than 12 months.

“The key thing is looking at it from not just an innovation angle but certainly a water efficiency point of view. When you have over 300,000 businesses that you work with, it’s about focus. We hold a lot of data against these customers in terms of their water consumption, patterns, and habits and they can be physical meter reads as well as electronic meter reads,” says March, adding that data and innovating ways of generating it will drive advancements for the industry.

David McKenzie, MD at OccuTrace agrees: “It feels great to be a part of the project that is going to move the market forward and will help develop the knowledge base for improvements in the industry.”

The faster Wave can generate accurate data, the quicker problems can be identified, and the sooner sustainable solutions can be put in place, working alongside customers to reduce loss, save money, and overcome challenges.

This is the same on both sides of the market for Wave. Occupying the space between water company and business consumer, as a retailer, the company must perform a balancing act to ensure both supplier and bill payer exist in harmony. Recent changes to the market have helped here, and Wave’s success and scale in recent times ensures a rock-solid team of 320 people across two national offices is able to handle both ends of the spectrum.

“There’s so many suppliers and they all operate regionally quite differently because they have slightly different challenges and different rules,” says Shelley on the importance of innovating across the board. “We have to have a running dialogue about lots of different things and trying to be that customer advocate in the middle.”

This is particularly true where there is growth on the cards for the customer but limited supplies in the reservoirs. “Our role is often to be impartial, but also to try and be more creative,” says March.

“One of the things that we’ve become adept at is translating,” Shelley smiles. “Because the suppliers have got their way of talking you’ve got a customer who just wants to run their business. The retailer in the middle has to sit with a foot in both those worlds and I think because we’ve grown up from that environment we’re really, really good at it.”

In the coming months, this attribute is going to be more important than ever as the market is shaken by changes to pricing.

PRICE CAP

Industry regulator, Ofwat, recently announced that it would change the price cap in the commercial water market to promote further competition across the industry. In April, SMEs will likely see increases of around 6.4% + inflation. Default water suppliers will be allowed to increase prices by an average of around 30% and this will mean higher bills. At the time of a crisis around energy and cost of living costing, this news will mean that Wave will again have to reinforce relationships with customers to drive financial savings through better water efficiency and deliver service of the highest level.

“I think last year, when we had water supply issues with the hot summer, it probably came to the surface,” says March. “This isn’t about the cost of water; this is about the availability of water and acting now.

“There was a review in 2019 but it didn’t involve analysis and review of the costs,” he adds. “This has been a good time to take stock of what has happened over the last few years and look at the cost that it genuinely takes to run a retail business. For Wave, that’s a pretty positive point because, relatively speaking, we are an efficient business and we always thought we were.”

He believes that with everything Wave brings to clients, and the market, this change could result in potential growth as companies re-evaluate their position and search for added value. 

“That’s why we’ve been very active in the market to promote our offerings beyond our core, and also to successfully provide the services and deliver on what we talk about,” he adds. This is vital as many are unsure about how to switch or even aware that they can switch.

As one of the top three retailers in the market, home to more than 14 years’ experience, and award-winning, Wave is confident that choice in the market is not only about price.

“It’s about value of the service from the customer’s point of view and the water efficiency side of things is quite key to this as well,” details Shelley, explaining that water savings and efficiency remain the best way to reduce cost and Wave is a thought leader here. “The cheapest cubic meter of water is the one you don’t use.”

He highlights work with clients in recent years around efficiency and reducing consumption, taking usage out of their model, as those who are less concerned about changes to the price cap as they have already made significant savings.

Recently, on site at a multinational utilities company, Wave was made aware of an inaccessible leak which made repair tricky and caused significant inefficiency. The company’s Water Efficiency Services team visited and installed a new overground pipe, allowing for easier leak detection and repair, while remedying the challenging leak below ground. This solution has the potential to save the client £1.5 million in water consumption annually compared to leaving the difficult leak unattended. Addressing consumption and making savings is the first step towards cost reductions.

“We pride ourselves in being a bit different in that conversation,” says Shelley, highlighting that SMEs calling in with bill queries is by far the largest job for Wave account managers.

“We actively try and avoid sticking everyone in the same pot. A lot of retailers are very quick to state that bills must be paid, whatever the case. We are trying to take them through a journey, understanding their consumption, resolving problems, rather than becoming another hurdle.”

FUTURE FLOW

By most metrics, Wave is performing well as it moves into the second half of its first official decade. Customer numbers are growing, particularly in March’s area in the public sector, and revenue is strong. Innovation and problem solving are built into the company culture, and Shelley is happy with what has been achieved as the company looks forward with ambition.

“I’d say we’re buoyant. What we have noticed is that this year, across the board, has been a lot better than previous years despite all of the challenges.”

He says that, from a water efficiency perspective, Wave has been more engaged with clients than ever, with the number of litres saved as high as ever, and the number of organisations actively discussing solutions higher than before. “That has really blown me away because traditionally we’ve done a lot of work in that space.

“What we’ve seen is lots of customers who have never spoken to us about water efficiencies before, who have never queried about leaks or getting on top of that, actually engaging with us in that conversation, and then taking positive action – and that’s even with all the other pressures going on.”

Perhaps external factors have focussed the mind within organisations, and alongside the pressure from the public for big companies to do more, there is a fresh driving force behind investment into sustainability.

“Many businesses are discovering that they can’t exist in their own little bubble anymore. Everything else around them influences their well-being and whether their business succeeds or not, whether they like it or not,” suggests Shelley.

“That is why we don’t just talk about water efficiency – it’s the same thing with energy efficiency. If we don’t find a way to be more sustainable as a society, it won’t matter how profitable we are, and it won’t matter how successful people’s businesses are,” he adds of the wider consequences of inaction, but positively stating that compared to when he started in the industry, there is now much more happening that would have previously been thought of as impossible.  

The important message here is that now is the perfect time to act. There is much that Wave can do, and much that is being done within the industry for companies that are searching for better.

“The worst thing you can do is assume that the water that you use and have been using for the last five or six years is actually the right amount. That always needs to be reviewed,” reinforces March. “And it’s something that we discuss with customers an awful lot. We need to understand what should be used rather than what they are using. If you just assume that what you have been using is an efficient level then you’re going to miss opportunities where savings can be made. If you don’t use that water, then that’s the biggest saving you’re ever going to make, as well as contributing to your future environmental goals.”

Ultimately, Wave exists to support its customers, helping them to use less and save more, and against a challenging backdrop, even half of the success it has achieved would be mightily impressive. Going forward, the company’s sustainability focus will not change, and water will not be forgotten.  

“Our ability to influence our customers – where we have 300,000 collectively using large quantities of water – is where our ability to do good is. So, if we can encourage them to just use a little bit less, that makes a big difference,” Shelley concludes.