The UK and Ireland’s water industry research body (UKWIR) commissioned Frontier to investigate one of the biggest questions affecting the water industry, how to ensure that the regulatory framework incentivises efficient delivery of the right outcomes for both customers and the environment.

Identifying key priorities 

Our team conducted a series of virtual interviews with water companies,  focused on identifying key strategic priorities for future improvements in economic regulation. A number of trends emerged from these virtual interviews, and our team then facilitated industry workshop discussions on these topics:

• The role of the customer;
• Long-term incentives;
• Optimal investment in achieving environmental outcomes;
• Government role and light-touch regulation;
• Integration of cost-assessment and service quality; and
• Balancing risk and reward.

Building on our virtual interviews and workshops, we hosted an event with UKWIR to gather further feedback from key stakeholders within the industry, particularly professionals from economic regulators, environmental regulators, government departments and consumer bodies.

Where to next?

Following our interviews and workshops, we developed three scopes of work that can be used by UKWIR to commission future work to explore these issues in more detail. Our scopes of work covered:

• Long term incentives and investments;
• Customer and stakeholder engagement; and
• Regulatory risk and reward measures.

The future work that UKWIR conducts in these areas will be used to inform the decisions that economic regulators make in each of the jurisdictions covered by UKWIR’s members.