A welcome change of direction for AMP 6?

Tony Hoyle, General Manager for ABB’s UK Measurement Products business, explains how the AMP process could finally be undergoing a much needed change of direction.

After years of acting contrary to the interests of many of the parties within it, it would seem that the AMP process is finally starting to undergo some welcome changes. Especially encouraging is Ofwat’s focus on ‘long term outcomes’ and its aim to give water companies greater flexibility in how they deliver them.

The prospect of a focus on the long term offers encouragement for those keen to see a smoother AMP process. In particular, a focus on the longer term would certainly help to avoid the detrimental impact caused by the ramping up and ramping down of activities during the transition between previous periods.

Partnerships and early starts

A quick scan of the marketplace offers encouraging signs of a changed approach to the new AMP period. Several of the UK’s largest water utilities are already well underway in selecting partners for their AMP 6 projects so that they can get work underway as soon as Ofwat releases funding.

The establishment of long-term partnerships could well present a workable and effective template for future AMP periods. As well as allowing the fulfilment of the immediate objectives of an AMP period, they could also provide the much-needed framework for continuity that has been badly lacking in previous years. By enabling partner companies to count on their continued association with a water company outside of the five year period, the creation of long-term partnerships could yield a wide variety of benefits that have not been fully realisable within the previous AMP structure.

Breeding innovation

In the same period that Apple has created and refined its market-leading iPhone and iPad products, there has been relatively little if any real change in the technologies used by water companies to treat, distribute and collect potable and wastewater.

The AMP process has done little to encourage technological innovation. Faced with an uncertain environment caused by the five year structure of an AMP period, companies have had little incentive to risk investing time, money and resources into new products and services.

It is to be hoped that the prospect of a more long-term approach will help pave the way for greater innovation. For suppliers especially, the prospect of working with water companies on projects across the AMP periods provides a much more attractive environment in which to provide and develop new products and services.

Summary

All of the indications are that AMP6 could well be the first all-round win scenario in the scheme’s history, delivering benefits for water companies, suppliers and customers. Whereas in the past water companies were reliant on Ofwat to set their investment priorities, the greater freedom being afforded within AMP 6 means that they can now focus more on their existing infrastructure, leading to potential improvements in performance that could increase effectiveness and, ultimately, profitability.

Advertisements

Tags: , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


%d bloggers like this: