The case for smart water networks is so strong it will prevail without a policy mandate - and Arqiva stands ready to meet the demand as it grows, says CEO Paul Donovan
This article first appeared in The Water Report in February 2022
Ready when you are You might expect the man who heads up the company which owns the infrastructure through which smart meter data is transmitted to bang the drum for smart metering to be mandated in water, as it is in energy. But no, says Paul Donovan, chief executive of Arqiva. It's not his place to intervene directly on policy, particularly as the business and environmental case speaks for itself With the right focus during PR24 we are, he believes, on a trajectory to a smart water future anyway.
Arqiva builds and operates a network of complex ecosystems through which data and content move. This includes entertainment and information for broadcasting and transmission services and data for utilities. It supplies 17m homes with Freeview; broadcasts 1bn hours of radio a week; and delivers around 50m data points every day for energy and water companies. I describe myself as the CEO of the most important company you've never heard of, he jokes.
Donovan took the reins in April 2020, a few weeks into the first lockdown. Fortunately, he says, he had been a non executive director on the board for some time, so was no stranger to the company. He also came with 20 years experience in senior roles across the technology, media and telecommunications sectors, including as CEO of Odeon and UCI Cinemas Group and as head of Vodafone's emerging markets businesses.
His almost two years in post has been busy, initially grappling with Covid impacts and completing the sale of Arqiva's mobile phone towers business, and subsequently planning the company's strategy for the next decade. This involves focusing more acutely on its two remaining business segments: media distribution, a largely mature market accounting for 80% of revenues with relatively slow growth; and smart utilities networks, an immature market accounting for 20% of revenues but with high growth.
What we see is a lot of opportunity for more growth in meter penetration. Clearly there's a business case for it, a social equity case for it, and an environmental case for it
Multi-benefit metering
The utilities in question are energy and water, and Arqiva provides four key services: meter data (including as partners to the DCC on the energy smart meter rollout, and on behalf of Thames Water, Anglian Water and others who have taken the plunge on smart meter rollouts); data analytics; managed connectivity; and a managed service for sensors.
Donovan expects some growth in the utilities segment to come from companies migrating to its spectrum and satellite networks, as the traditional BT copper network is phased out by 2025. But significantly: What we see is a lot of opportunity for more growth in meter penetration. Clearly there's a business case for it, a social equity case for it, and an environmental case for it and then also helping people to run their networks in a more efficient way.
While smart penetration in energy is spearheaded by the mandatory roll out, Donovan says there are plenty of drivers in water too. These include:
Resource efficiency At the macro level, society is waking up a little late perhaps to the carbon impact of water but also to the fact that water is a scarce resource. With population growth, the difficulty of transporting it around the country and climate change, we need to think differently about how we acquire and distribute, charge for and process water.
Affordability Most providers have some sort of social tariff but actually they are quite blunt instruments. If all homes had water meters, you would have the potential for there to be a nationwide and very just set of charges for those people who are most economically disadvantaged. He explains there would the opportunity for tariff flexibility and to tailor offerings to individual households' needs.
Network optimisation For example in the identification and reduction of leakage If you put together all the data from a much more dense application of smart meters, we've demonstrated you can identify and awful lot more leakage customer side and network side. There is appetite, he says, for leakage as a service'.
Donovan reflects: The evidence is pretty clear that when you install the meter, the usage actually drops lower bills, and lower operating costs that can result in lower bills. So smart metering can be a catalyst for a virtuous circle of operator and customer benefits that's relatively transparent.
Sensors as a service
With wastewater very much in the spotlight now, Donovan goes on to highlight the advantages of smart wastewater networks. In many instances, the waste infrastructure of water companies in the UK is based on a design from Victorian times and is unable today to cope with the surges from rainfall sometimes resulting in massive overflow The opportunity to place sensors throughout the network, with data coming back to network operating centres, should enable the waste networks to be run in a much calmer way.
He appreciates cost will be a sticking point, but pledges: One of the things we are keen to work on with the water industry is lower cost sensors. It's the actual cost of the sensors which is the barrier to widespread adoption. These things will come; where there is demand, technology companies will always find a way to meet those needs.
He adds: If you are already working with Arqiva on your smart meter installation and we have already built our network over your footprint, then the opportunity to add other applications is both quick and cost effective.
The UK consumer has a brilliant track record of adopting new tec
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The case for smart water networks is so strong it will prevail without a policy mandate - and Arqiva stands ready to meet the demand as it grows, says CEO Paul Donovan
