All water companies in England and Wales have water resource management plans which look ahead 25 years and include projections of current and future demands for water. The plans, which are regularly updated, show how water companies propose to meet demand for water, and will include any new water supply resources that are needed. These plans are due to become a statutory requirement in April 2007 under provisions in the Water Act 2003 and will then be subject to public consultation.
Water companies in the south have identified the need for five new and three extended reservoirs in their 25-year water resource management plans.
In their 2004 “Periodic Review of Future Water and Sewerage Charges 2005-2010”, Ofwat, the economic regulator, assumes water companies’ capital expenditure to be £1.7 billion to maintain the balance between supply and demand for water, and in some cases to enhance the security of water supply. This capital expenditure covers a range of measures including leakage reduction, upgrading water treatment processes, enhancements to water treatment and distribution, network improvements, groundwater resources and metering.