Water - the hidden driver of UK growth: Insights from Anglian Water
Often seen as background infrastructure, water is a vital driver of development, resilience, and economic growth. From housing and clean energy to digital industries, access to water shapes what we build, where we build, and how quickly we build. As water becomes increasingly strategic to the UK’s growth ambitions, cross-sector collaboration has never been more essential.
To explore how the water sector is adapting to shifting demand and regional growth pressures, we sat down with Lydia Dareheath, Public Affairs Manager at Anglian Water. In this interview, Lydia shares insights on delivery at scale, the role of effective partnerships, and why anticipating infrastructure needs is now a shared challenge.
Key Takeaways:
"To respond effectively, we need stronger cross-sector collaboration to improve accurate predictions of future water resource needs, align shared policy goals, and ensure infrastructure planning supports the UK’s growth ambitions."
Lydia Dareheath , Public Affairs Manager at Anglian Water Services .
How can the water sector enable economic growth, and what does this mean for interacting with other sectors?
Water is foundational to facilitating economic growth. Water and wastewater services underpin business resilience and growth across various industries, including clean energy, defence, digital technologies, agriculture, food production, leisure, and many manufacturing sectors. Building the right water infrastructure at the right time is also crucial for enabling housing growth and is key to delivering on the government’s target of 1.5 million new homes.
We have a lot to do. Between 2025 and 2030, total expenditure in the water sector is expected to increase by 70% in real terms compared to the previous five years. Anglian Water alone will deliver over £5 billion in new infrastructure, including the development of two new reservoirs, new wetlands, 52 new sustainable drainage schemes, and nearly 700 km of new pipelines.
What are the biggest challenges in the water sector which might hinder growth?
Delivering large-scale investment in essential water infrastructure relies on navigating complex planning and regulatory frameworks, many of which were not originally designed with today’s long-term, climate-resilient needs in mind.
For example, current frameworks prioritise value for money in the short term over longer-term investment in resilience. This can create tensions when planning and building infrastructure that supports future population growth, climate pressures, or new industrial demands.
Planning processes also present challenges. Water infrastructure schemes can be subject to local planning or the Development Consent Order (DCO) process, depending on their size and scope. While each planning route has its place, both can be time-intensive. In our experience, over half of our planning applications submitted in the past three years faced delays, some lasting several months or more. This is particularly difficult for mid-scale projects, which often fall between the thresholds of traditional local planning and nationally significant schemes.
As delivery environments become more complex, it’s becoming increasingly important to consider how existing frameworks can be improved to best support timely, coordinated infrastructure investment.
What are the key enablers of effective cross-sector collaboration?
Current water regulation does not require water companies to supply water for non-domestic use—such as industrial processes—if doing so is uneconomical or risks compromising domestic supplies. This could cause major problems for other sectors and businesses if, for example, there wasn’t deemed to be enough water resource in an area where growth was planned.
A key issue is the difficulty of forecasting non-household demand. Business needs vary widely - warehousing, agribusiness, and hydrogen production all place very different pressures on water systems. In 2023, for instance, demand in the Anglian region rose by 20%, double the forecasted increase.
Due to this uncertainty, non-household demand is often overlooked or excluded from strategic long-term planning. This limits water companies' ability to invest adequately in meeting business needs, leaving systems increasingly vulnerable to climate change and ill-equipped to support economic growth.
Efforts to reduce non-domestic consumption, such as the government’s 9% reduction target by 2038, may also conflict with ambitions for industrial expansion. For example, hydrogen production alone on the Humber Bank could drive a 60 million litre daily increase in demand. To respond effectively, we need stronger cross-sector collaboration to improve accurate predictions of future water resource needs, align shared policy goals, and ensure infrastructure planning supports the UK’s growth ambitions.
Can you share an example of successful cross-sector collaboration, which others could learn from and replicate?
Earlier this year, we launched our Investing in a Thriving East conference to bring together government officials, regulators, businesses, developers, and local authorities. The aim was to develop a shared understanding of where growth is planned in the region, so that we can work together to plan the necessary investment in our assets early and avoid being a barrier to development due to water availability or system capacity constraints.
Another example is the Anglian Water@one Alliance model, a partnership of consultants, contractors, and other stakeholders who together will deliver projects accounting for over half our capital investment programme. With nearly 20 years of experience, this model enables more efficient and safer delivery, resulting in significant capital and carbon savings. It’s also recognised in the Government’s Construction Playbook as best practice. We’re now expanding this approach with a new Programme Delivery Partner to help deliver our capital programme over the next 15 years, including major projects like two new reservoirs.