techUK attends The Economist’s first Water Summit

The Economist’s first annual Water Summit, bringing together 424 attendees ranging from utilities, industrial water users, policymakers and investors.

Data centres and water

The Summit opened with Tom Standage, Deputy Editor of The Economist, challenging perceptions around water use and data centres. He reminded the room that America’s golf courses currently consume more water than its data centres - a fact that techUK has also shown to be true for the UK..

When water company CEOs were asked how they are tackling data centre water use, “water reuse” emerged repeatedly as solution for managing demand. Scottish Water explained how they are already reusing wastewater to recover phosphorus, which can be used as a bioresource for agriculture and sustainable aviation fuel. Similarly, desalination was brought up as a tool for water resilience, with deep-sea desalinisation championed for its easy deployment, low environmental impact and ability to remove contaminants such as PFAS.

However, the regulatory conditions in the UK have not encouraged widespread adoption of these innovations. Water is historically under-priced compared to energy, so cost signals do little to encourage efficiency. In the UK, there is currently no formal framework distinguishing potable vs non-potable water, with existing legislation assuming water supplied through public systems is potable. This serves as a major barrier to wastewater re-use. It also means there are unclear rules for pricing recycled water, the definition for wastewater, and wastewater permitting.

The sector is also extremely risk-averse, with high infrastructure costs creating barriers for start-ups. Compared with energy, water is underdeveloped in both R&D and digital adoption, despite being a finite and increasingly scarce resource. techUK has pointed out that though data centres may wish to invest in water reuse or resilience infrastructure (such as reservoirs), current Ofwat regulation limits how water companies can accept third-party investment.

Country-specific best practice

Emma Reynolds, UK Secretary of State for Environment, Food and Rural Affairs, told the room she is “impatient for change,” drawing on her finance background to show a willingness to learn from other sectors in reforming Ofwat and attracting long-term investment into water. She faces a challenge, however: multiple speakers warned that a “cloud of uncertainty” is deterring institutional investors.

Scotland was cited as best practice, with a tariff-based investment model, clear government direction, and an innovation-friendly environment. Modular ‘plug‑and‑play’ upgrades in Scotland - such as those used at Eela Water Treatment Works - use offsite, pre‑built treatment units that can be added to existing water infrastructure with minimal civil works, shortening delivery times and lowering costs. One speaker also highlighted the need for “Integrated Water-Resource Management” in the UK, with a common database and alignment of stakeholders at the watershed level to coordinate and speed up decision-making.

Spain was brought up as a region where water stress is driving innovation. Around 70% of its territory is at risk of desertification yet Murcia currently leads Europe in water reuse. Francisco Javier Fernández Delgado, CEO of Madrid’s water supplier Canal de Isabel II, explained it has reduced demand over the past decade through progressive and seasonal tariffs that charge more for higher consumption and during summer months, a major pipeline replacement programme and investment in data management. The utility has also rolled out 1.6 million smart meters (with 1.1 million installed so far), already alerting 90,000 customers of a leak.

Other European examples included the Netherlands, where Brabant Water is using 24/7 sensors on 20,000 km of pipelines, to monitor flow, pressure, and temperature to enable predictive maintenance. AI is also being used in sewers (where CCTV is the main inspection method) and to help customers understand their individual water use. Yet, as cautioned by Charley Maher, Group CEO of South Staffordshire plc, data quality and “human wrap-around” remain essential. AI can extract and analyse data, but it requires correct prompts, governance, and well-functioning systems. For example, AI cannot yet interpret contextual information from smart meters, such as household size, usage patterns, or behaviour. Investment must also keep pace with detection; otherwise, companies may identify record leaks but not have the resources to fix them. A risk-based approach to data is crucial to protect customer privacy.

techUK is working at the heart of these issues, through our water digitalisation working group which foster collaboration between the tech industry, water companies, and regulators. We see digital transformation of the water sector as key to addressing climate resilience, data access, infrastructure development, and sustainability. Huge transformation is underway, as highlighted in the Government’s recent white paper. We will soon be publishing what we believe are the key “system requirements” for a resilient system, requirements which can help restore regulatory certainty and public trust, attract capital, and embed data at the core of decision making.

Smart Infrastructure and Systems Programme activities

techUK champion the role of technology in driving positive outcomes in our built infrastructure; from hitting net zero goals to improving safety. In doing so, we also optimise the commercial and regulatory landscape to ensure innovation in infrastructure can flourish. Visit the programme page here