Water Sector Resilience through Adaptive Systems Planning

Long-term Adaptive Planning is a relatively new approach cited by Ofwat, Central Government and other water industry regulators as a means by which organisations can deliver more resilient services. Systems Thinking is recognised by academics as a valid approach to dealing with the Volatile, Uncertain, Complex and Ambiguous (VUCA) world we find ourselves living in. Today, a key challenge for many organisations is the creation of new digitally enabled capabilities, integrated within core business processes and operating models, enabling more effective and confident planning and decision making within a VUCA world. Water companies need to fully understand and embrace all relevant aspects, relationships, constraints, interdependencies and trade-offs which characterise the environment and system of assets they use to deliver water and wastewater services. But to be truly effective in the long term, they need to forecast how these characteristics are likely to change within an evolving and dynamic context. In other words, in order to reflect and cope with a VUCA context, the planning capability needs to be both systemic and adaptive. Our CASE partner, Business Modelling Associates UK Ltd. (BMA), provide digital representations of complex systems known as Advanced Digital Business Twins (ADBTs). These ADBTs are deployed in a variety of industrial sectors to support planners and decision makers. Clients use ADBTs to run a range of complex scenarios which will inform their ongoing strategy development & delivery. The solve & cycle times for these cloud-based solutions are now such that rapid, multiple scenario analysis is possible, enabling the prospect of a new organisational capability: Adaptive Systems Planning (ASP). By considering two longer-term global water sector challenges, this research seeks to inform how ASP could be deployed and enabled through all potential tools which could enable this capability, providing a means of establishing a best practice approach. We therefore propose development of best practice in ASP capabilities to inform a roadmap to meet the multiple challenges faced by the global water sector. To enable the evolution and validation of such an approach, special focus will be applied to the following water challenges: • a zero-carbon footprint source-to-tap water system, considering both operational and embedded carbon and enabling a hydrogen economy, • a carbon-neutral market for bio-resources. The project(s) will include a review of the role that technology plays in enabling an ASP capability to be developed within a water utility. It may also be relevant to relate specific insights derived from the water sector to broader questions such as: • How does distributed decision making deal with uncertainty in the case of long-term planning? • How does technology affect organisational ability to effectively respond to uncertainty? • How has information technology helped and/or hindered organisational capability to build resilient long-term plans under extreme uncertainty? • What role does information technology play in an organisations ability to effectively adapt to extreme uncertainty? Objective/Project 1: A zero-carbon footprint source-to-tap water system How to: • Ensure the long-term availability of NetZero potable water, particularly for water stressed areas whilst providing sufficient potable water to enable the development of a hydrogen economy. • Provide an ongoing & iterative assessment of existing & future renewable or low-energy water treatment & transfer options, providing rapid business case evaluation within an existing programme. • Evaluate water recycling opportunities, including the linkage of water & wastewater processes. • Balance nature-based solutions against traditional capex solutions whilst assessing the associated operational & embedded carbon implications. • Understand & explore the true systemic benefit of leakage & PCC reduction, including the application of new technology (leakage detection, leak repair, water saving devices & campaigns). • Explore, evaluate & test future incentive mechanisms & frameworks. • Quantify the systemic risk & benefit of potential inter-company water trading opportunities. • Explore future network design & configuration possibilities, identifying & exploiting existing headroom, redundancy & hidden potential. • Promote the integrated management of all raw water abstraction (i.e. across all industrial uses) e.g. balance the timing of abstraction with the benefit of current & future storage options, across multiple sectors, to minimise environmental impact. • Assess the systemic impact of agricultural & upland catchment management practices on water quality & the consequential impact on the unit cost to supply potable water. Objective/Project 2: A carbon-neutral market for bio-resources How to: • Ensure the long-term availability of NetZero wastewater treatment & sludge management. • Rapidly assess the viability of existing & future renewable/low-energy treatment & transfer options, including different options for low-carbon logistics, localised gas-to-grid, decarbonised grid etc. • Balance nature-based solutions against traditional capex solutions whilst assessing the associated operational & embedded carbon implications. • Identify & quantify the true benefit of potential inter-company wastewater sludge trading opportunities, accurately reflecting the changing impact on unit-rates & gate fees for different processing options. • Explore future network design & configuration possibilities, understanding & exploiting existing headroom & redundancy. • Promote integrated management of sludge treatment across existing & future technologies, particularly with regards to co-digestion opportunities & the impact of de-regulation. • Explore the systemic impact of other opportunities such as nutrient recovery, alternative disposal routes and risk factors such as seasonality and severe weather events. The above list of considerations, which are likely to affect ‘the challenge’ now and into the future, are not exhaustive and simply provide examples of the type of constraints and contextual changes that will affect the asset systems and their financial, operational, service and environmental risk and performance. Within any ASP approach, they are the types of characteristics that would need to be taken into consideration in a holistic and integrated way. It is expected that a value framework (e.g. Six-Capitals) and environmental social & governance (ESG) reporting will be used to define the desired long-term outcomes of the asset systems.