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“Untapped” Savings on Water Costs

27th Mar 2020

I believe that many UK businesses may still be sitting on thousands of pounds in cost savings on water charges which could go straight to their bottom line.

At a time when there is a huge amount of uncertainty in the UK over Brexit and the future of energy prices (our core business) are on an upward trajectory and cost-cutting exercise should be welcomed with open arms by any business.

So why are there anomalies with water costs?

The process of billing a site accurately for water costs is more complex than you may assume. The inner workings of a water bill have to contain assumptions such as the processes on-site which may affect the amount of water leaving the site, for example, if it is going into the product, where and how water leaves the site into drainage from rainfall, the “quality” of the effluent leaving the site amongst others!

As you can imagine the water authorities simply do not have the time or resources to be able to ensure all these parameters remain correct, therefore discrepancies occur.

What can be done?

Thankfully as the water suppliers are quite aware of their inability to be able to bill correctly for some or all these costs, they are amenable to re-adjustment of the current billing and historic recovery of any overcharges going back up to 6 years. You just need the right expertise to assess where these gaps lie and how to get them corrected!

How does this relate to switching water supplier?

This service affects the underlying charges that sit beneath the tariff which as of 1st April 2017 are open to offers from alternative suppliers.

This means that even if you have moved suppliers and achieved a saving in doing so there may be more to come. It can be more difficult to recover historic charges in this case however it still can and should be investigated.

If you haven’t yet switched water supplier, then we recommend a water audit is carried out prior to doing this. This will ensure that you are fully aware of any anomalies before  starting the tendering process to the market. If there are no savings, then at the very least you know you are being charged correctly!

How do I go about carrying out a water audit?

If you or your team have the knowledge and time to competently carry out an audit, then that’s fantastic! Ensure you look at all costs for water, incoming supply, borehole licence costs, drainage, and effluent. Once you have established all the costs bases you must ensure that these fit in line with your on-site activity to determine the potential overcharge.

Most businesses, however, do not have this knowledge and employ experts like us who typically work on a share of savings basis, which means there is no financial risk to you.

Article written by Louis Fairfax, Managing Director

Please get in touch with CUB on 01354 606848 if you want to know more.