Abstract
This research has been guided by two hypotheses. Firstly, that the water industry in England and Wales wishes to be seen as an environmental company or industry but is not prepared or equipped to take a proactive approach which may lead to the adoption of the ideas of Sustainable Development. Secondly, that the integration of environmental information can aid decision-making in the water industry and promote the identification of more sustainable practices. For this research Thames Water has been used as a case study, and is assumed to be indicative of the water industry in England and Wales. The environmental information for use in decision-making has been provided by conducting Life Cycle Assessments (LCA) of the following processes and services in the water industry: replacement and rehabilitation of potable water pipes; the management of sludge disposal; disinfection of potable water; and aeration of activated sludge. These studies have shown that LCA can help identify the Best Practicable Environmental Option (BPEO) and Best Available Technology Not Entailing Excessive Costs (BATNEEC). For example, rehabilitation by a technique known as rolldown was identified as the BPEO and BATNEEC for the future maintenance of the distribution (potable water pipe) network. The studies also demonstrated how LCA can aid decision-making. For example, options for sludge disposal which displayed similar economic cost were differentiated from each other by applying LCA, which in turn aided the decision-making process. LCA results can also be used to inform the development of company policies, as demonstrated through the study of the disinfection of potable water. The process of undertaking an LCA study was also found to be beneficial in highlighting where data gaps exist, which if filled, could further improve the efficiency of a process like aeration. The environmental image promoted by the water industry has been assessed by analysing the Environmental Reports each company publishes, and looking at the Press Releases issued by Thames Water. This image is compared to the views held by regulators and government of the industry's environmental performace. The views of Thames Water stakeholders, including employees, customers and board level executives, have been investigated and correlated to this external image. The key finding was that the environmental awareness of executives was low and the environmental criteria were not thought to be important when formulating strategy. This runs contrary to the company's environmental image, which Thames Water strongly promotes through press releases and annual reporting. It was also found that this externally promoted environmental image is not substantiated by actions within the company when formulating strategy. In addition, executives were unsure of the difference between environmental improvements and sustainable practices. This research has also exposed the incorrect view held by some in the water industry that water companies are environmental per se. Thames Water and other water companies need to adopt sustainable practices as part of their long term strategy. To do this they must improve environmental performance by integrating environmental criteria into decision-making processes, as demonstrated in this portfolio through the application of LCA. However, strong visionary leadership would be required to bring about such a change in the approach to the formulation of strategy and decision-making. The framework established by regulators and government within which water companies operate, can act as a constraint on their activities and promote the current short-term approach to planning. This demonstrates that the regulatory framework should change to be refocused from setting price limits to achieving Sustainable Development with all of the regulatory bodies co-ordinating their activities instead of being in conflict with each other. The government must also address the current shortterm approach promoted by the City, which drives companies to focus on shareholder returns instead of long-term sustainable growth. Therefore, the regulators and government, as well as water companies have a responsibility to change their current practices to promote Sustainable Development.