On 29 January 2025, the PR24 Water Industry National Environment Programme (“WINEP”) was published by the Environment Agency (“EA”) following final determination of water and sewerage companies (“WaSCs”)’ business plans in December 2024. 

The programme identifies an agglomeration of obligations and actions (both statutory and non-statutory) which WaSCs in England must comply with or achieve between 2025 to 2030. These actions are derived from a range of plans, legislative obligations and policies, including Water Resource Management Plans, River Basin Management Plans, Drainage and Wastewater Management Plans and Defra’s 25 Year Environment Plan, each with the aim of delivering tangible environmental improvements and benefits to the nation’s waterways and systems. The programme reflects the 8^th Asset Management Period (”AMP”) (which is linked to the Price Review five-yearly cycles) and is supported by the Water Industry Strategic Environmental Requirements (known as “WISER”). 

The PR24 WINEP looks to be the most ambitious programme yet, with a total expenditure commitment of £22.1billion secured under the scheme to fund ‘targeted interventions’ which, according to the EA, will ‘lead to improvements in water infrastructure to secure future supply, habitats and biodiversity and drinking water quality’. In achieving objectives prescribed under the PR24 WINEP, WaSCs are expected to ‘embrace state-of-the-art technologies and groundbreaking innovations’. This expectation is, in turn, driving opportnuities for new players in the market who are looking to offer cutting edge new technological solutions to support WaSCs in meeting their obligations.

We have examined the headline measures and actions resulting from the final publication of the WINEP programme below.

Investment in Infrastructure

The programme includes a significant commitment by WaSCs to upgrade an aggregate of 2,350 storm overflows across England, which is intended to lead to an estimated reduction of sewage spills by 85,000 each year. These measures run in parallel with Defra’s Storm Overflows Discharge Reduction Plan, which has set targets for English WaSCs to have improved all storm overflows discharging near every designated bathing water and improve 75% of storm overflows discharging into or near ‘high priority sites by 2035, and a target of 2050 to prevent any storm overflows from operating outside of unusually heavy rainfall or causing any adverse ecological harm. To accomplish the upgrades to infrastructure, this commitment will likely require increased storage capacity within the sewerage networks and exploring solutions such as natural and sustainable drainage system (SuDS).

In addition to upgrading storm overflow infrastructure, the programme also requires the installation of 3,500 monitors at emergency overflows sites. 

Reduction of water abstraction

One of the goals set out under the PR24 WINEP is to reduce the total volume of water abstracted from the environment by WaSCs. The EA estimates that this commitment will lead to the retention of an estimated 60 million litres of water in the environment per day. 

Abstraction has been increasingly regulated and restricted in recent years. Amongst others, legislative and policy reforms include the introduction (under the Water Act 2003) of previously exempt abstractors to the licensing regime, the targets envisaged under the Environment Act 2021 to reduce the use of public potable water supply in England per head of population by at least 20% by 31 March 2038 (against a 2019-20 baseline) and the Restoring Sustainable Abstraction (RSA) programme, which seeks to limit abstractions where the removal of water from the environment is considered by the EA to be unsustainable. 

In order to achieve the desired reduction in abstraction, measures which WaSCs are likely to be required to take include agreeing to significant volumetric reductions in their abstraction licences, improving problems with leakage and improving the management of raw water assets such as reservoirs and storage tanks. However, there is clearly a significant part the public can and should play in actively reducing overall water consumption, which Ofwat has previously given its support to through initiatives such as the Water Efficiency Fund.

Protection and enhancement of the environment

Two core commitments arising from the programme include the protection and enhancement of 13,500km of rivers across England and the improvement of 21 recently designated bathing water sites (introduced following a public consultation). According to the EA, WaSCs have also submitted plans under the programme to (a) establish trials to remove nitrate; (b) restore nationally important chalk streams; and (c) and install bespoke biosecurity measures to remove invasive species. 

These commitments, as well as the actions and solutions required to achieve them, are linked to the various plans and strategies outlined above and will likely require a broad range of measures to be taken to achieve the requisite outcome, including upgrades to assets and infrastructure, increasing and expanding monitoring programmes and working alongside other WASCs, public bodies, stakeholders, strategic partners and the public. 

Phosphorous Reduction 

The programme includes a specific requirement for phosphorus reduction to be achieved at over 800 wastewater treatment works via upgrades to the systems in order to mitigate the effects of eutrophication. The existence of phosphorus in rivers and lakes is considered to be predominantly due to sewage effluent (primarily from water industry sewage treatment works) and losses from agricultural land^[1]. The Water Framework Directive 2000 already includes parameters with respect to phosphorus standards for rivers and lakes, and goals and outputs in the WINEP data set list include ‘phosphorus removal technology’, indicating that in order to ensure these objectives are met are likely, significant investment into new scientific or technical solutions might be required.

Timelines and Monitoring

The EA, in collaboration with Ofwat and Natural England, will monitor the progress of the various actions, many of which are tied to a specific delivery date. As WINEP is tied to the five yearly Price Reviews which set the price and investment controls for WaSCs, Ofwat presides over WaSCs’ business plans and is responsible for determining the funding to be allocated to the WINEP actions and setting the mechanisms to incentivise WINEP outcomes (known as Outcome Delivery Incentives, linked to Performance Commitments under each Price Review). It also has the power to impose financial penalties for underperformance. Given the extent and cost of the WINEP commitments under the PR24 it will be interesting to see how Ofwat approaches its assessment of WaSCs’ Performance Commitments and expenditure metrics when it comes to scrutinise progress at the end of the first AMP8 year.

As WaSCs rise to meet the challenges of ever-increasing regulatory obligations in a changing climate, we are seeing a corresponding emerging market of private sector businesses ready to support those companies achieve their targets with an assortment of novel technological offerings. We therefore expect this market to expand, in parallel with those focused on green and nature-based solutions, over the course of the PR24 period.

If you would like further advice on the PR24 WINEP or issues involving the water sector, please contact Michael Barlow or another member of our Environment team.

Written by Philippa Shepherd
 

[1] The Environment Agency, Phosphorus and Freshwater Eutrophication Pressure Narrative (October 2019)