Water loss in UK becomes major problem as drought risk rises

The UK’s water management system risks being left behind by the rest of the world – as rampant profiteering leaves infrastructure under-prepared for stress tests. A new study suggests that leakages in the UK water network are some of the worst in Europe, even as droughts put the nation’s supply under continued strain.

As the effects of climate change become more apparent, escalating crises relating to water distribution could cost the global economy trillions of dollars in the coming 30 years. The UK alone could take a GDP loss of more than $150 billion in that same timeframe, amid an increasing risk of both flooding and drought in the UK historically temperate island nation.

Earlier in 2023, Minette Batters, the president of the National Farmers’ Union of England and Wales, made headlines noting the need for new reservoirs across England to cope with increasingly severe water shortages – and warned that failure to manage the country’s water adequately was creating problems for farmers and threatening food supplies. But while the country is becoming increasingly aware of these dangers, the UK’s water network seems to be doing little to prepare for the coming crises.

A study from Tax Research’s Richard Murphy noted that of the £25 billion in profit Britain’s companies have collectively made since the sector was privatised, every single penny has been paid out to shareholders. Meanwhile, of the £91 billion invested in the industry, just 15% comes from shareholders, leaving the rest to be filled in by loans, deferred tax payments and pension fund borrowing – 20p in every £1 customers pay to water companies now serves to pay interest on the debts this incurs.

All this means that while shareholders of water companies are doing very well from their business, Britain’s water networks are frighteningly under-prepared for climate change. With heavy storms having become more regular, and sewer capacities having remained the same, water companies have continued to make headlines for the damaging discharge of record levels of raw sewage into the country’s waterways as an ‘emergency measure’. And while a rise in wet weather seems to have staved off drought for this year, the next time heatwaves hit the UK, the water network is still one of the most leaky in Europe.

A new study from Roland Berger suggests that the continent of Europe has the highest proportional use of household and manufacturing use for water. To reduce the continents 45% use of water on manufacturing, the strategy firm suggests its nations need to reduce leakages with enhanced digitalisation (helping predict where maintenance is needed), while the 25.9% used on households could be reduced if domestic household water were collected and treated for reuse, to water plants, fill toilets, or similar tasks.

With much of Europe’s south having encountered blistering heat and wild fires through 2023’s summer, it has become clear just how important this is. As Europe braces for severe droughts in the years to come, this could be crucial to maintaining a working agricultural system, and keeping the continent inhabitable.

But the UK seems under-prepared compared to many of its European counterparts, according to Roland Berger. Looking at its wastage alone, the country is far behind others with similar climates. On the other side of the North Sea, the Netherlands is the global leader when it comes to tackling leakages in water distribution – losing just 5% of its supply to leaks, even while it only hosts one water treatment plant per 87,000 people.

In stark comparison, Roland Berger estimates that the UK loses around 21% of its water to leakages at present. That is even with a much higher number of treatment facilities – at one per every 38,000 inhabitants. This saw the UK lag well behind the likes of Germany and Switzerland, while also performing less effectively than Belgium and France. Spain, Norway and Italy all forfeited even more water to leakages, though, suggesting that even as their climates change dramatically, their governments and utility providers are also dragging their feet in response.