Anglian Water’s Journey to Digitalization

The UK is known as one of the most advanced countries in the world when it comes to digital solutions for water. The success goes hand in hand with regulations from Wales and England's industry authority, Ofwat, which sets targets for the water companies, industry collaborations, and with the creation of hubs for innovation. Anglian water is one of the UK's water utilities leading the sector's digital transformation. So we wanted to discover what it means to be one of the most digitized water utilities and how it happened. Digital enables us to transform the way we operate, and that's the main reason why we're invested in digital at the moment. It's really about enabling our people to be the best they can be, but also really understanding the performance of our assets, getting that situational awareness so we can react much better in terms of the service that we deliver to our customers. And we can be smarter and learn from the data and have that guide us on what we need to do. So it was a natural step from being quite frontier in our asset management approach to actually saying there's a different future coming. Let's be ready for that. To start their digital journey, the company focused on leakage. According to Ofwat, in general, around 20% of water in pipes is lost due to leakage. With the loss of water comes loss of energy, the price of which has really gone up, so also loss of revenue. One of Anglian Water’s latest leak projects involves the use of satellites to identify losses in main pipes in rural areas, but like many utilities, Anglian Water turned to smart meters to have a view of usage and find leaks on the distribution side. They’ve already installed some 1.1 million smart meters in urban areas. The UK water company has 39,000km of water pipes and registered losses of some 182.6 megalitres of water a day in 2022, so all aspects of leakage are considered when turning to sensors and smart technology. We’ve been focusing on for a long time in water is around pressure and the impact that pressure has, on our systems. But because we pump everything that potentially has a negative impact on our network. So we've deployed over 7000 sensors across our network now, which really gives us the insight to what pressure is actually doing. And we've actually also identified where our pumps are interacting in a negative way with our network, actually causing us to have burst mains. So the insight we're now generating from that infrastructure investment is really, really insightful. The water utility is using digital solutions for the upkeep of their crucial infrastructure. Less than a year ago, the company published its Asset Management Plan or AMP8, for the 2025-2030 period, in which they are set to continue to invest in digital, with, for example, an additional 137 million pounds for metering. Anglian water has many types of sensors deployed: smart meters, acoustic, pressure, flow, temperature, sewage level sensors... but as always, with great amounts of data comes great responsibility: Managing it in an efficient manner that brings insights and improves operations and services. So our focus, for a number of years has been on the water distribution system. We've taken those learnings and actually expanded that across the rest of the business. So water recycling networks, we're now heavily starting to move into the supply arena in terms of our treatment works and how we can implement technology in those areas. You could go back to say, yes, we've had digital twins for a long time because we do have digital representation of our networks in terms of our hydraulic models, whether they be our base models, or even GIS could be classed as a digital twin of a water distribution system. For me, it's about when we start to ingest live data. So we're working quite heavily on that at the moment in terms of making our models ingest live data from our telemetry systems. Digital solutions are allowing us to understand, how assets are performing and how we can change it to be there ahead of when they need maintaining. So really predicting the performance of what that might be. So we see those coming about. But then there's some really different things as well, such as the advent of AI and large language models, for example, is something that's really becoming quite commonplace on our projects. So we have rich information that's available for our teams to work from. Anglian water uses the Swan layers model for their smart solutions. Following the stages, they map the solution spaces across the layers to understand how they interact with each other. When we look at the stages zero and six, the strategic driver and the strategic outcome we see the model is in line with Anglian Water’s approach to smart water, which is focused on use cases. Those that have been most successful are those that really understand two things. So one, which is the the need, why would you do this in the first place? And then secondly, have you actually prepared for the change that's about to take place? Understand the problem you're trying to solve is absolutely crucial. You can have the best technology in the world, but if it doesn't solve your problem, actually, what is the point in investing in that technology? Return on investment is a really difficult one with regards to digital transformation. So this is where we really start to expand to really understand the value proposition, rather than just ROI. So yes, it will inform, and reduce our opex, for instance. It will also inform our capital programs. But it's much more than that because there's a direct correlation with people. So it's also changing the way our people interact with our assets. Actually, democratizing knowledge right across the organization to enable people to make better informed decisions. And sometimes it's really hard to actually put a monetary value on that. So we've been really creative in the way we’re developing business cases. Their goal is to give access to all so that the frontline workers have access to the tools, democratizing knowledge rather than having a control room like Global Omnium, to allow for more local control. Andy told me that Thames Water, for example, is also decentralizing data, something that digital solutions enable and that AI is bound to accelerate. So ultimately Anglian Water will have to pay, for our digital transformation. That means that we have to really think differently about the way we build business cases to actually enable that. So that’s been a fundamental part of the journey we've been on over the last five years is how do we create that compelling narrative about what digital transformation can actually do for this business? I think for the next five years, it's hard to ignore that AI has really taken off. And, I think most people would see AI on a strategy somewhere, and I think most companies are coming out to talk about the AI that they can provide. We can see it now. A lot of people are starting to leverage the benefits of machine learning and generative AI in their solutions to enable us. So I think over, over the coming years, we'll see more and more of that. Seeing their track record, we can say that Anglian Water is one of the most digitized water utilities in the UK, and even in the world, with some large smart deployments. One of the reasons for their success is Anglian Water's approach to digital. They're not deploying technology just for the hell of it, but rather because it's a solution to a well-identified problem and use case. The other reason could be because the UK water utility market is extremely specific, with a setup that is most probably facilitating investments. The sector was privatized in England and Wales in 1989 and is under the watchful eye of regulator Ofwat, which, with its regulations, has pushed companies to innovate and adopt new technologies to meet their requirements, meaning water utilities in the UK have had to become creative and invest to really deploy digital solutions at scale to meet demands. Before privatization, water utilities were investing 1 billion pounds a year in infrastructure improvements. Post-privatization, that number went up to 5 billion as access to capital became easier. However, privatization comes with disadvantages as well. Clients have seen bills go up and many fines have been issued to water utilities by Ofwat for endangering the environment, proving that there's still work to do there. And that's where we can circle back to digital solutions. Not only do they provide utilities with a positive direct return on investment, but they can also help them avoid penalties by managing the infrastructure better, with the ultimate goal of providing citizens with a good water quality and customer service.