Innovation in the water industry: barriers and opportunities for US and UK utilities

Water utilities face a variety of challenges in meeting future demands under climate uncertainty, addressing aging infrastructure, ensuring water quality, and reducing energy use. The agility of the utility to implement innovative solutions to these challenges depends upon a variety of factors including utility governance and culture, regulatory environment, condition and performance of water infrastructure, and funding mechanisms for system improvements. The consequences of failing to meet these challenges could include environmental degradation, public health risks, and reductions in the level of service customers have come to expect, all at a highly elevated price. Two different types of water utilities are compared in this context: privately owned companies (using UK water companies as examples) and publicly owned utilities (using US municipal utilities as examples). Examples of innovation in the water industry, in the US and UK as well as globally, provide insight into the key barriers and opportunities for change. The successful drivers of innovation in the water industry are shown to include: a supportive culture at the water utility; a regulatory regime that allows or even promotes innovation; the financial ability to undertake research and implement improvements; and crucially, the backing of the public. Ultimately, neither the municipal nor the private model is perfect but the best elements of these could be combined as the basis for an innovative water utility of the future. (C) 2015 The Author. WIREs Water published by Wiley Periodicals, Inc.