Water profits surge

June 24, 2008 at 3:48 am

It has been revealed in a number of national newspapers that the three largest water companies in the UK have seen huge rises in their profits. The expected total of the three companies’ profits is an incredible £1.2 billion, which has provoked joy amongst shareholders, but concern amongst consumer groups.

Thames Water, the largest water company in the country, saw the biggest rise in profits, which were revealed at £590 million, up 34% in the last 12 months from their previous figures.

However, for the 8.5 million customers of Thames Water this will not be such great news. Water bills have gone up by 5.9% this year alone, mirroring the rises in utility bills across the board, and they will be wondering if the company plans to share the wealth from their record profits by reducing the bills in the near future.

Severn Trent, the second biggest company in the UK, saw its profits increase by 16%, which equates to £292 million. However, the company is worried by a possible £35.8 million fine that Ofwat is planning to impose on it.

The third largest provider, South West Water, saw an 18% rise in profits to £185 million.

The figures are great news for the shareholders, who were left reeling last year when the profits of all companies were down an average of 40%, mainly due to the flooding that hit large parts of the country.

However, The Consumer Council for Water said: “It is essential that the success a company enjoys is shared with customers as well as shareholders”, which would help to ease the burden of high bill prices that have plagued so many households recently.

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Water charges need to rise

June 17, 2008 at 2:54 pm

The water company United Utilities has called for an increase in the prices it currently charges its customers. It has stated that the recent hike in energy costs, combined with problems caused by the credit crunch, are having a harmful effect on its profits.

In its plea to Ofwat, the water industry regulator, it put forward its concerns for the future of the industry over the next ten years. The increased risk of flooding, and the challenges posed by climate change, are all areas that have been highlighted as points of concern.

It is thought that the energy costs for United Utilities could rise by 60% by the end of this year. However, although this may seem devastating, over the last year their profits have been very healthy, with net profits doubling from the previous year to £909 million.

The company provides water to seven million homes, but wants to improve the services that it currently offers its customers. Over recent months, such improvements have come in the form of easy-to-read bills and an updated online service.

Chief executive Philip Green claimed that keeping prices down would pose a “tough challenge” with all of the increased costs that the industry is facing. The company already spent £42 million on energy last year, and this figure is set to go up steeply.

However, Green also claimed that the company would keep the price rises below the rate that income is expected to increase, in a bid to help its customers keep up with their bill payments. Although fees will be higher, he did have some comfort for the company’s customers, stating that huge changes were being introduced to improve the quality of supply.

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Solar water heating at Environment Agency HQ

June 10, 2008 at 2:29 pm

We recently saw Number 10 finally returning to drinking water from the tap in order to try and practise what they preach. Now the Environment Agency is following suit in its own, more adventurous, way.

The Green Building press has revealed that, in their offices in Reading, the Environment Agency has just installed a solar water heating system which will supply its 350 members of staff with hot water for their canteen and then eventually their bathrooms.

There are five panels which collect the sun’s heat and then transfer this energy, which warms a 400 litre tank, and then feeds into a 24kw gas-fired water heater. The offices will proudly boast a 20% reduction in C02 usage per year, which equates to around 26 tonnes saved. Those in charge at the Agency are delighted with the work carried out on the project by Jacobs Engineering Ltd. They must also be pretty pleased with the fact that it’ll be saving the offices roughly £3,400 per year on fuel expenses too.

The reasons for the move might seem obvious but it was implemented as part of the Environment Agency’s Internal Environmental Strategy, which they themselves are rolling out nationwide this year, so it would have made sense to set a good example. But the question as to whether this will influence the rest of the country is one that is much harder to predict. The Environment Agency is keen to stress the savings of up to £40 per year for households willing to try heating their water in this way, but many people remain as sceptical as ever.

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Bottles of water in the Commons

June 2, 2008 at 4:00 pm

There’s an old phrase that goes ‘practise what you preach’ and never has this seemed more apt than when it comes to bottled water in the House of Commons. While the government and their shadow government in Whitehall are going on about how much we should all be doing for the environment, at the same time, they are quite happy to snub harmless tap water in the building in favour of shipping in truckloads of bottles of the finest mineral water at a considerable cost to the environment.

Every year, MPs quaff 30,000 litres of bottled water in meetings and at lunch etc. These are available at canteens, bars and served in their thousands during the course of the year. It is estimated that the lorries that deliver the bottled water have clocked up around 70,000 miles over the past five years.

Number 10 and the cabinet have changed their spots when it comes to this issue and they now drink flasks of chilled tap water. But the attitude of the rest of Westminster isn’t quite the same. Apparently on the grounds of hygiene and cost, bottles are still preferable to the tap. It’s hard to see this ever changing when there is a House of Commons special brand of bottled water that comes into parliament more or less every day from Hampshire.

With the House of Lords even more snobbish about the idea of drinking from the tap, it looks as though it’s going to take a lot for Westminster to practise what they preach.

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