Sustaining the flow of economic growth

Sara Venning, CEO of NI Water, discusses the critical role the organisation is playing in helping Northern Ireland meet its ambitions for economic growth.

Currently providing 570 million litres of drinking water per day and disposing of 340 million litres of waste water per day, Venning believes that NI Water is arguably the most vital of infrastructure networks and utilities in Northern Ireland.

Highlighting its value, recent analysis of NI Water’s economic impact by Ulster University, assessing the organisation’s 2016/17 expenditure, estimated that for every £1 invested by NI Water, the local economic impact was close to double, equating to £2.5 billion over their 2015 to 2021 regulatory price control plan.

However, while NI Water is a key enabler within Northern Ireland’s economy, it recognises the need for it to aid greater growth and align fully with the vision for growth set out in the Economy 2030 consultation on an Industrial Strategy for Northern Ireland.

Venning explains that NI Water is unique in that it is a “vertically integrated” utility, providing both a transmission network and a distribution network across Northern Ireland, while also being a generator and supplier of product.

“We are different from other well-known utilities in that we make our product, we distribute it to customers, we take away the waste from customers, we treat it and we return it to the environment in a safe fashion. On top of that we also have all the supply end of the business including the likes of meter reading, customer billing, customer contracts, a call centre and website. So, we are an extensive operation.”

NI Water is a top five company in Northern Ireland with over £2 billion of assets and around 1,300 staff, however, despite its scale, Venning believes that the vital nature of the government-owned company and non-departmental public body (NDPB) is often undervalued. Amongst others, a key reason for this, often cited, is that most of NI Water’s assets are either underground or hidden, keeping it further out of public consciousness than other key infrastructures such as roads and transport.

Venning outlines that the knock-on effect is that often NI Water is not given the protection it deserves when it comes to public expenditure cuts.

“Funding is a huge challenge for us, as an NDPB we are not immune from public expenditure cuts and uncertainty over funding. Infrastructure investment is much more efficient when a long-term approach is taken and that hasn’t been possible under shrinking annual budgets. Undoubtedly, these funding pressures risk progress on efficiencies and will inevitably impact on service delivery,” she says.

“As we strive for economic growth, both business and population increases will put greater demand on capacity and our desire is for the funding, independently determined through the comprehensive regulatory price control process, to be direct from central government, rather than us having to compete with other social and economic infrastructures for a funding allocation.”

Core roles

Access to water infrastructure has a significant impact on the capacity for agricultural production and innovation, in addition to substantial health impacts on the domestic population.

Highlighting the three core roles NI Water performs, Venning says: “At NI Water, a key message that we try to get across is that we provide the water for life that we all rely on to thrive. By water, we are talking about our two production lines: our clean water and our waste water. In providing the water for life, we see ourselves as having three key roles: being a key enabler of economic growth; protecting the environment; and safeguarding the health and wellbeing of Northern Ireland’s population.”

Economic growth

“Northern Ireland is an ambitious place and the Economy 2030 document has set out some great economic growth ambitions, which all have an impact for NI Water,” explains Venning. “Added to this our local councils have all published their own economic growth ambitions, each with their specific regional requirements and key business sectors, such as agri-food, have set out growth strategies.”

Pointing to a few of the growth targets outlined in Economy 2030, Venning highlights the impact NI Water does and can have. For example, in the ambition to make Northern Ireland the number one foreign direct investment (FDI) location outside of London, she points to the OECD’s assessment that: “Access to water infrastructure has a significant impact on the capacity for agricultural production and innovation, in addition to substantial health impacts on the domestic population.”

Economy 2030 also sets out a goal of doubling current levels of tourism, recognising it as a key growth opportunity for Northern Ireland. Recent statistics on tourism show that not only is Northern Ireland receiving more visitors but those visitors are also staying longer. As a result, increased water and wastewater capacity for hotels, tourist venues and events, restaurants and pubs just to name a few must all be met.

Venning says: “ The increase in tourism numbers is great news, but it must be recognised that every new hotel requires not just clean fresh water supply, but also brings with it increased demand for laundry, showers etc, and so needs capacity in the local wastewater network to take the wastewater away, treat it and safely return it to the environment.”

Capacity is also an issue in dealing with the rise in popularity of event tourism in Northern Ireland. As Portrush gets set to host the 2019 Open, NI Water has been commissioned to undertake works valued at approximately £0.5 million to ensure that the local water and wastewater networks will be able to cope with the massive influx of people to this event.

Taking a sectoral outlook, Venning stresses the importance of NI Water’s services to Northern Ireland’s agri-food industry. Currently there are ambitions to grow turnover by 60 per cent and employment by 15 per cent by 2020.

She says: “Water is arguably the most vital infrastructure for the agri-food industry for two key reasons. Firstly, it is not only part of the production process but actually a direct ingredient for many food products. Secondly, from a resilience perspective – on site water storage is often not feasible so there is a reliance on a continuous supply from the piped network.”

A reliable and resilient water network is critical to keeping the production lines running. “Added to this is the fact that most processes have a by-product which needs to be taken away and treated efficiently and effectively.”

Environment

As one of Northern Ireland’s largest land owners and its largest energy consumer, NI Water has a significant potential environmental impact. Venning explains that on their 23,000 acres of land, NI Water has over 1,000 water and wastewater treatment works and the company returns treated wastewater to loughs, rivers, the sea and streams at approximately 2,500 locations.

“We do this cleanly and safely every single day,” she adds. Recently NI Water were heavily fined for a pollution incident at the Moyola river in Derry-Londonderry, something Venning states is “painful” for everyone in NI Water.

“With an ageing sewer network and ageing equipment, some failure is inevitable. We work very hard to ensure that this is kept to a minimum. In 2016/17 we delivered record levels of wastewater compliance and water quality remained at near record levels so we feel our environmental credentials are very, very good.”

To deliver its services, NI Water consumes some 290 GWhrs of electricity, equal to 64,500 domestic homes. Venning explains: “As the largest user of electricity in Northern Ireland we have an opportunity to play a key role in addressing climate change and to take advantage of the huge changes taking place in the electricity market.”

NI Water has set out a target of increasing their use of renewable energy from 13 per cent in 2012/13 to 40 per cent by 2021. Recently, as part of this focus, they commissioned a large solar farm in Dunore Point, County Antrim, which will provide around 25 per cent of that particular water treatment plant’s electricity usage over the year.

Health

Venning highlights that the importance of safe drinking water and sewage treatment to the health of Northern Ireland’s population cannot be underestimated. In 2007 the British Medical Journal stated that sanitation (clean drinking water and waste disposal) was the most important medical advance since 1840. Safe drinking water piped to buildings and flushed sewer systems have been around for a long time and its availability is often taken for granted by the 850,000 households and businesses served by NI Water daily.

While NI Water carry out around 200,000 water quality tests every year to ensure drinking water meets the required standards, Venning believes more needs to be done to improve ageing assets. Pointing out that infrastructure investment has generational impacts, she outlines a desire for a long-term investment strategy, spanning some 40 years, to ensure that water infrastructure is sustainable for future generations.

Venning says: “We have a vast network; over 42,000 km of water and sewer mains, thousands of pumping stations and treatment works, and hundreds of reservoirs, but much of the network and equipment is old. The majority of NI Water’s pipes were built many decades ago. In fact, records show that over 70 per cent of water and sewer mains are now more than 50 years old and made up of over 20 different material types of pipe e.g. clay, brick, concrete, iron and PVC.

“Also, water and wastewater don’t flow uphill. So, add into the mix that 20 per cent of the circa 10,000 pumps we need to pump water and wastewater are over 25 years old; and that 30 of our wastewater treatment works are at maximum capacity and you start to get a feel for not just the scale of maintenance, repair and replacement that is essential just to keep the current network working, but also and more importantly, that investment is needed to build increased capacity to meet future growth demand.”

Digital

Quizzed on the challenges facing NI Water going forward, Venning believes that they must press ahead with their ambitions to make people more aware of the role NI Water plays. Last year the organisation celebrated its 10-year anniversary and as part of their ‘decade of delivery’ celebrations opened up many of the wastewater treatment works to the public. This, tied in with a successful school education programme, is going some way to raise that recognition.

“What we will also be striving for is gaining a commitment to medium and long-term funding to allow for greater capacity, to equip us with resilience and sustainability and to enable NI Water to deliver what matters for the economy, environment and health.”

As is their digital presence. The power of digital is a running theme throughout the improved operating and efficiency aims of NI Water.

“The infrastructure we have has to meet a number of demands including climate change related issues such as adverse weather, demographic changes and our ambitions to help grow the Northern Ireland economy. The advances of digital is a challenge for NI Water but it is also a huge opportunity,” she explains.

“Customer interaction is changing and through our customer focussed approach, we see a dynamic whereby our older customers still require the traditional telephone contact but the millennials want online capability. We’re ensuring that we are catering to both and through our digital strategy we are looking to harness digital disruption in a way that meets all of our customer needs.”

Venning outlines that digital advances has seen NI Water improve the end to end customer journey by enabling the company to react to problems quicker and to have a constant stream of information flowing from their assets to mobile-enabled staff. However, she also sets out ambitions to be even more proactive, utilising big data to identify issues before they occur and enhance the efficiency of NI Water greatly.

Future

Looking to the future, Venning believes that NI Water is striving to grow value and trust by positioning itself as a world class utility. Being customer-centric is at the heart of these goals and will be the means test for business improvement in areas such as digital utilisation, energy usage, customer service interaction and shared best practice.

“We tend to be forgotten about because many of our assets are underground and out of sight unlike other infrastructures, so we will continue to raise our profile, not just with the public but also through closer engagement with stakeholders, the business community and consumers.

“What we will also be striving for is gaining a commitment to medium and long-term funding to allow for greater capacity, to equip us with resilience and sustainability and to enable NI Water to deliver what matters for the economy, environment and health.”

The Business and Industry Advisory Committee (BIAC) to the OECD sums up the criticality of water quite succinctly: “Water is as essential to human activity as air. Health care, education, economic production and social activity depend on it. When cities or societies neglect water, they face collapse.”

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