Posted: Tuesday 5th April 2011

Scotland’s public sector organisations are expected to save between £18.6m and £24.5m over the next three years after agreeing a water supply deal with leading non-domestic water supplier Business Stream.

Following a close competitive tender Business Stream was awarded the three-year contract to supply water services to Scotland’s entire public sector, which includes 220 public sector organisations across 17,000 sites.

Competition was introduced into Scotland’s non-household water market in April 2008, after the Scottish Government saw an opportunity to use deregulation to improve customer service, increase value for money and drive innovation.

The contract was awarded by Procurement Scotland, who led the Scotland-wide tender process held under EU rules, and is worth £220 million over the three-year deal.

It is the first time that a contract to supply water services to all of Scotland’s public sector has been put out to competitive tender. Previously only colleges and universities have gone out to tender. The deal also includes charities, the voluntary sector and NGOs (non-governmental organisations).

Business Stream, the biggest Scottish firm operating in the market, will provide bespoke services for each organisation under the Procurement Scotland umbrella, but via a group pricing structure, which will deliver immediate benefits to the contracting authorities concerned.

Scottish public sector organisations which have already been working with Business Stream to improve water and waste water efficiency are likely to be able to make even greater financial savings as a result of the contract.

The deal will also give the organisations access to Business Stream’s range of additional services, including emergency support, which helps customers locate leaks quickly or even before they happen.

They will additionally be able to take advantage of Business Stream’s pioneering “gainshare” approach. Under this model, Business Stream invests in new water efficiency infrastructure, allowing customers to benefit from the associated financial savings without the need for up-front capital expenditure. In return for its investment, Business Stream shares a proportion of the expenditure savings that are made.

Mark Powles, chief executive of Business Stream, said: “This is an important win for us and we’re delighted to have been appointed by Procurement Scotland following a competitive tender. This tender is further evidence that the competitive market in Scotland is delivering tangible benefits for businesses and public sector organisations across Scotland. The public sector has challenging efficiency targets and we’re pleased to be helping them achieve this goal.

“Since the competitive market was established Business Stream has delivered over £13 million of consumption savings (equivalent to 8,025 tonnes of CO2) for customers and over 40% of customers are taking advantage of discounts. We look forward to further market reforms in England so that businesses across all of Great Britain can benefit.

Business Stream will work with every organisation covered by the deal and review water and waste water practice, providing recommendations of how water efficiency can be improved.

Reducing water use helps businesses to minimise their carbon footprint. Last year Business Stream was named green business of the year at the Real business/CBI’s annual UK Growing Business award ceremony for its work in encouraging Scottish organisations to implement environmental and water efficiency programmes.

Mark Powles added: “We hope this deal will highlight the importance of proper water and waste water management, and the efficiencies which it can deliver. The public sector has a lot to gain from building on the water efficiency measures we have already helped introduce, and this is an opportunity to deliver long term, sustainable benefits.”

Case study – Edinburgh Leisure*

Edinburgh Leisure, operators of the prestigious Meadowbank Stadium and Royal Commonwealth Pool, among other venues, achieved water reduction worth £41,000 a year after Business Stream experts helped cut the organisation’s consumption and identified sources of wastage, including leaks. The installation of smart meters also helped Edinburgh Leisure to better understand its water use.

Alan Hughes, energy and sustainability manager, Edinburgh Leisure, said: “In less than a year from when we began Business Stream’s water management service to install smart meters, the benefits were obvious. I expect the total financial saving to the organisation over the year to be substantial – and of course the system will help us to control costs in the future.”

Even customers that have already received such advice can benefit. With changes in building use, or as infrastructure continues to age, new ways of saving water can always be found.

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