What are New Appointments and Variation (NAVs)?
New appointments and variations (“NAVs”) allow companies to offer water, sewerage or water and sewerage services to a specific geographic area instead of the existing incumbent company. As a result, developers and large business customers (eligible business, charity and public sector customers) can choose their supplier for these services and enjoy the benefits of this competitive market. A new appointment occurs when we appoint a company for the first time to be a water or sewerage provider. The appointment is made for a specific geographic area. A variation occurs when we vary the appointment of an existing appointed company. We publish a register of the new appointments and variations we have granted on our website. We may grant a new appointment or variation of appointment in cases where:
an area does not contain any premises that receive services from an appointed water or sewerage company (it is ‘unserved’);
the customer(s) uses (or is likely to use) at its premises at least 50 megalitres of water a year (if the area of the relevant appointee concerned is wholly or mainly in England) or 250 megalitres of water a year (if the area of the relevant appointed company concerned is wholly or mainly in England in Wales) and wants to change their supplier in respect of those premises (a ‘large user’); or
the existing appointed company agrees to transfer part of its area to a different company (by ‘consent’).
The interactions usually required between applicants and existing appointees, the Consumer Council for Water (CCWater), the Drinking Water Inspectorate (DWI), Natural Resources Wales (NRW) (as applicable), the Environment Agency (EA) and the Market Operator Services Limited (MOSL).
How does this link with adoptable pumping stations?
In some circumstances, a developer or business customer may choose to use a NAV instead of the incumbent water authority to adopt new adoptable drainage works on the site. In this case, the company that is looking to adopt the sewage and/or waterworks must be satisfied with the pump station design and construction in order to adopt it and take on the maintenance for the remainder of its life.
Is this a good or bad thing?
There are many sides to this argument but the important thing to note for a developer is that all the approvals, agreements and adoptions happen as seamlessly as possible. However, a developer has to take the risk that the NAV arrangement will work equally as good if not better than using the incumbent company. Another note is to make sure of the NAV companies’ response times and availability of call out engineers in your area. Incumbent companies tend to have a lot of trained engineers in the area looking after many of these assets and can take care of problem sites without too much difficulty. Should the NAV company not have this ability or realise after an initial period of 12 to 18 months before adoption that this pump station is going to be troublesome, they may refuse or delay adoption or request some costly additional works before it happens.
As the addendum for a NAV company tends to be simpler and based off an incumbent water company specification, it is not difficult for our technical teams to follow and get right with a single set of comments. Technical approvals, in general, tend to be more straightforward as long as the addendum is kept to and any deviations and the reasoning behind them is fair and made very clear.
Is this the future?
For one reason or another, the use of NAVS hasn’t been taken on in a big way. Once it has been proven that it can be done effectively for larger areas over a long term period for these companies, maybe it will be taken on to a greater degree.
The great benefit of this is an increase in competition in a market that is mostly dominated by very large corporate companies and reduce costs. The downside is that smaller companies may struggle to treat wastewater as cost-effectively, leading to lead to mixed results.
As this industry affects every person in the UK, governments have aimed to give all users a fair experience and the use of NAVs has been to this end.
What companies are using NAVs?
Since 1997 the companies that have used these are as follows:
Anglian Water (Hartlepool)
Dŵr Cymru Cyfengedig
Icosa Water Limited
Icosa Water Services Ltd
Independent Water Networks Ltd
Leep Water Networks Limited
Peel Water Networks
Severn Trent Services
South Staffordshire Water
Veolia Water Projects
Full details can be found here https://www.ofwat.gov.uk/publication/register-of-new-appointments-and-variations-granted-to-date/