How can innovation drive circularity in the UK’s water sector?

By Jeannette Henderson, Principal, Ofwat Innovation Fund

Circular economy business models will play a vital role in helping the water sector to  decarbonise its operations and reach net zero by 2030. Innovation will be essential to making the circular economy function successfully.

Circular approaches encourage the reuse and recycling of resources, ultimately leading to the reduction of waste. In the context of the water sector, this means transforming waste products such as sludge and wastewater into valuable resources, such as energy, raw materials, nutrients and clean water.

As well as reducing landfill use and greenhouse gas emissions, a circular approach can also help water companies find new revenue streams through the sale of recovered resources such as biogas or recycled water. This prompts more financially sustainable business models, which helps reduce customer bills.

Reflecting on progress to catalyse innovation

Despite some progress in recent years, it’s a long way until water companies are fully circular and further research and innovation is needed to make this vision a reality. This is why the Ofwat Innovation Fund, delivered in partnership with Challenge Works, Arup, and Isle Utilities, has funded a number of projects looking into the circularity of water.

These projects have brought together diverse partnerships from across the sector – utilities companies, engineering firms, universities, non-governmental organisations and private companies – to collaboratively tackle the challenges in resource recovery and circular systems. They include a project to unlock bioresources market growth and an exploratory study on deriving hydrogen from biogas.

For a circular economy within the sector to be achieved and the benefits of this funding fully realised, progress must be evaluated. It’s vital the sector reflects on its journey in innovation both through exploring how to best adopt solutions that have demonstrated their value – and learning from those that haven’t. To contribute to this, we’ve launched a new report on our learnings: ‘Circularity in water: resource recovery and circular economies in the water sector’.

Download the Report (PDF, 3 MB)

The importance of knowledge sharing

Focused on five circular projects we’ve funded, the report reiterates the importance of sharing knowledge, information, and data to ensure successful projects can be scaled up and adopted more widely. It also reduces the need for multiple companies to trial the same solution.

We know it’s also important that knowledge and data are shared at all stages of a project (not just the end) so we can all learn from what works, and what doesn’t. By sharing and learning from each other, and doing so in an accessible format, the sector can meet the challenges it faces whilst building up public trust.

Many of the findings mirror what we heard from participants in a recent industry sprint at the Northumbrian Water Innovation Festival last month. The sprint explored the barriers preventing new innovations from being adopted at scale and how we can overcome them by working together more effectively.

Another insight from the sprint and report is the value of developing a standardised data collection and sharing protocol amongst water companies. This could support better decision-making and scenario modelling, addressing the current limitations in data and other obstacles to exploiting circular economy growth opportunities.

Innovation as ‘business as usual’

Crucially, we’ve learnt that consideration needs to be given as to how best to transfer a project from an innovation team to operational managers – ensuring innovation projects can become a core part of ‘business as usual’.

Our hope is that this, our first themed report sharing insights from Ofwat Innovation Fund projects, will be a useful tool in implementing and scaling the knowledge that’s been generated by the ambitious project teams supported by the Fund.

It’s a starting point for connections and further collaboration – as well as a catalyst for change that can have a positive impact for the water sector, its customers, and the wider environment – ultimately driving circularity across the sector.

Download the Report (PDF, 3 MB)