How do water companies deliver more for less? Matt Bateman, Water Sector Director, Costain, shares possible solutions.
Water companies are allocating record levels of investment to enhance water and wastewater infrastructure across the UK.
But there is a record number of projects for the sector to deliver, so funding decisions are not straightforward. Consequently, water companies have never been under greater pressure to find efficiencies across all aspects of the delivery of these critical water programmes.
And that’s before additional headwinds are factored in. Population growth and climate change are dramatically increasing pressure on water supplies both now and in the future.
Existing infrastructure, meanwhile, is under strain from the mass proliferation of data centres. Whilst new consents to safeguard UK waterways are critical to protect the natural environment and support biodiversity, an additional regulatory burden has been created.
But all these factors do not change the challenge for water companies, which is to deliver more for less.
AMP8 has therefore provided a renewed impetus, ushering in new approaches to find efficiencies and challenge norms in programme delivery to deliver resilient, fit-for-purpose infrastructure for the end-user.
Enterprise and integrator models
To front into the challenge, water companies are pioneering various approaches across their frameworks and delivery programmes. One of these is collaboration, brought to life through enterprise models, which have become commonplace during AMP8 as the sector realises the need to pull together and innovate to find increasingly clever solutions to tricky problems.
Crucially, it recognises that no single party has all the answers. It is resulting in asset owners, contractors and supply chain partners coming together at an earlier stage, which is yielding material uplifts in productivity and efficiency.
The models are also adopting a ‘left-shift’, or even a ‘left-left shift’ approach to early contractor involvement. This is allowing contractors with in-house design and engineering expertise to have a more hands-on role in shaping a solution before it gets to site, reducing the likelihood of costly reworks.
Engineering efficiencies across the project lifecycle
This collaborative mindset is encouraging value engineering, which is specifically designed to help water companies meet the challenge of delivering more for less.
The approach is focused on empowering project teams and engineers to adopt ideas or techniques that help deliver projects simpler, quicker and at a lower cost.
Many of these solutions involve Production Thinking, which combines modern methods of construction with innovative new technologies and engineering techniques to boost productivity and efficiency. Other efficiencies are stemming from increased standardisation in the design of assets, offsite manufacturing, design for manufacture and assembly (DfMA) and streamlining procurement practices.
The approach embodies the greater transparency and knowledge sharing evident in the enterprise models, leveraging the use of data analytics and digital tools to clearly visualise how water companies can find efficiencies, and indeed optimise assets.
Encouragingly at Costain we’ve seen this approach translate into tangible savings for water companies. More than £320m of cost savings to date have been identified across our AMP8 design and build projects, with more than £116m already built into the design of solutions or delivered.
The results are testament to the collaborative mindset that water companies are embracing, and with it the benefits of incorporating constructability at the earliest possible stage.
Asset optimisation: even if it ain’t broke, try and fix it
Crucially, value engineering also prioritises optimising existing assets before building new ones. Whether it be pipes, storage tanks or filtration systems, project teams are leaning into asset optimisation, which involves maximising the performance of existing assets to promote low or no build solutions, to improve the efficiency of delivery across an entire water company’s portfolio.
For one major water company, we successfully identified no-build solutions at four different wastewater treatment sites by challenging traditional approaches, which resulted in millions being saved and prioritised to other sites in the portfolio where the need for funding was greater.
This is just one of many examples across more than 100 sites where we have been able to optimise solutions, improve the efficiency of the existing sites and enable funding to be released to support additional upgrades and project work.
Managing and optimising asset health is being enhanced by the sector increasingly recognising the importance of data analytics.
With Northumbrian Water an AI-powered tool has been developed to help analyse and capture enormous volumes of data to assess the health and performance of operational assets.
This is enabling more informed investment, renovation and management decisions of the water company’s asset portfolios across its water facilities.
These innovations that are increasingly evident are the sort of step changes required to deliver the vast upgrades to water infrastructure. But when set against a total investment package of £104bn for AMP8, approaches such as value engineering and asset optimisation need to be industrialised across the entire water sector.
Efficiencies will also be realised from those that embrace an ‘end-to-end’ approach to infrastructure; one that threads engineering and design through to construction and asset maintenance at the earliest stages of a project.
All told, the path for meaningful change during the rest of the current investment cycle is clear, but perhaps more critically into AMP9 and beyond.
By establishing the right partnerships, construction principles and approaches to managing assets, the water sector will be well placed to deliver value-for-money, resilient, infrastructure.
