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14 Nov 2001 : Column 292WH

Water Supply (Ceredigion)

12.30 pm

Mr. Simon Thomas (Ceredigion): I begin by seeking agreement with the Minister. We do not always see eye to eye on Welsh issues, but I should like his agreement regarding one basic fact. I do not want him to misinterpret what I am going to say. I hope that he will agree, without any caveats, that Wales is a wet country, and I will rest my case on that.

Mr. Nigel Evans (Ribble Valley): Even on Sundays.

Mr. Thomas : Yes, even on Sundays.

According to the excellent institute of geography and earth sciences at Aberystwyth university, the typical rainfall in Ceredigion varies from less than 1,000 mm per annum on the coast to 1,600 mm on the uplands. That compares with approximately 3,000 mm in Snowdonia. In the Welsh context, Ceredigion is not as wet as one might suppose. It is an excellent tourist destination, especially on the coast. The Minister may be aware that the coast receives considerable sunshine. Nevertheless, Ceredigion's rainfall is greater than the England and Wales average.

When I initiated the debate, I half expected a Minister from the Department of the Environment, Food and Regional Affairs to respond. I am, of course, pleased that the Under-Secretary of State for Wales is present. When I tabled several questions on this matter, they were also transferred to the Wales Office, but I have not received a reply from the Minister. I am sure that I will soon. I thought that DEFRA might be responsible because the subject impacts on a whole range of environmental considerations about the public water supply, particularly the role of the Environment Agency.

In the context of the rainfall in Ceredigion and of Wales' reputation as a land of rain and reservoirs—though most of those do not provide water for Wales' needs—one can imagine the incredulity earlier this year when the Environment Agency announced that it would oppose Ceredigion county council's unitary development plan on grounds of insufficient water resources in the south of the county.

There are some good reasons for opposing Ceredigion county council's unitary development plan, not least the fact that 6,500 new homes—far too many for such a rural county—are proposed in it. Also contained within the plan are essential economic development projects, such as the Aberporth technology park, an objective 1 strategic site approved by the National Assembly for Wales, for which £2 million has already been topsliced in principle. When the Environment Agency made it clear that because of the lack of water it would oppose not only such large-scale developments but individual dwelling houses or infill developments in the planning process, the people of Ceredigion realised that there was a serious problem with the public water supply in the south of the county. Such a state of affairs in a water-rich county cannot be tolerated.

When I examined the background, it became clear that many agencies had been aware of this problem for several years. It had simply not been brought to the

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public's attention, which is one of my reasons for initiating this debate. These matters must be out in the open and discussed. I understand from other sources that 17 other areas of Wales will shortly face similar problems to south Ceredigion, which is one of the two or three worst affected in Wales at present. One of the difficulties in Wales is that the water-zone areas are smaller than in England, which brings the problems to the fore more clearly than in other parts of the United Kingdom.

In the previous periodic review, Dwr Cymru, as it then was, approached the Office of Water Services with a view to including plans to remedy the problem in the next five-year period. To be fair to Dwr Cymru, it was aware of the problem a couple of years ago and came forward with plans to deal with it. Unfortunately, those plans were refused and it is interesting to reflect on the Ofwat response:

the extra water into south Ceredigion.

It is not surprising that there was no customer support: customers did not know about it. I shall demonstrate, however, that the need is undoubtedly there. The refusal by Ofwat is driven by Government determination to cut prices to water consumers rather than to make environmental enhancements and it threatens to hold back economic development and environmental protection in south Ceredigion.

I shall briefly outline the current problems with water supply in the south of the county. No large-scale reservoirs provide for Ceredigion. Only 2 per cent. of the rainfall used in south Ceredigion can be stored in the Teifi pools—man-made and natural. Therefore, 98 per cent. of the water is extracted from the River Teifi at either Ystrad Fflur or Llechryd. That serves a huge area from the south of the river to Llanrhystud and includes some areas of north Caernarfonshire and even Pembrokeshire. Altogether that zonal area supplies 55,000 persons.

Ministerial guidance on maintaining public water supplies, issued in January 1999, requires that each water supply zone, such as south Ceredigion, have sufficient headroom between water availability and the projected demands based on critical dry years. No such headroom currently exists in Ceredigion and has not existed for several years. The existing deficit is projected to grow significantly over the next five to 25 years. In making those determinations, Ofwat may have observed those ministerial guidelines in the breach.

What is the size of the current deficit in the water-rich county of Ceredigion? Presently, the deficit between available supply and demand for water is 1.7 million litres a day—the equivalent of water for 2,800 domestic properties. One can well imagine what happens in the summer with the influx of tourists to caravan parks. Most caravans these days have plumbed-in water: their residents no longer go to a standpipe in the middle of the field. Dairy farms also take from the public water supply rather than from their own in the summer, so the increase in the deficit has grown—so much so that in 1995, water had to be tankered into south Ceredigion. That was probably when the deficit first became widely known.

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It gets worse because the projected deficit by 2004-05 is 3.4 million litres a day, the equivalent of water for 5,600 domestic properties, and by 2025 8.5 million litres a day, the equivalent of water for 14,000 domestic properties. Those projections are based on past performance and do not take new developments, such as the Aberporth technology park or any other developments that objective 1 brings to the area, into account.

Remedies to date have been the traditional ones: reduce leakage, a new bore hole in the middle of the county in Aeron valley and water efficiency projects initiated by the Environment Agency and Glas Cymru. We are exploring objective 1's potential for water as well as energy efficiency projects on farms. Tankering contingency plans have also been considered, though it is odd to be tankering water to a place such as south Ceredigion. The abstraction licence at Llechryd on the lower Teifi has been extended to 2005—temporarily, at least.

I have serious environmental concerns about the increase in abstraction from the River Teifi. The Teifi is a glorious fishing river, which attracts huge tourism, as does Llandysul, the centre of excellence associated with white-water canoeing in Wales. The Teifi is an environmental treasure. It is a historical river with many castles and scenes of great interest along its banks. It is to become a special area of conservation. Plainly it would not be acceptable under European guidelines to continue to extract more and more water from the Teifi and not to remedy the deficit of water provision in the south of the county.

Taking more water from the Teifi would be disastrous for fishing, tourism and the ecology of the river. However, as the Minister no doubt recognises, it will be disastrous for the economy and social well-being of Ceredigion if we cannot get more water into the south of the county to support the need there. Although I cannot understand Ofwat's initial refusal, I appreciate that it had some concerns about the fact that Glas Cymru does not have a policy on hosepipe bans, for example. That may have coloured Ofwat's decision. We should not bring water in tankers to the south of the county again.

There is a way forward. Glas Cymru, the new Welsh water body, has considered 26 different options for increasing the water supply to the south of the county. Its favoured option, which it has now decided upon, is a water transfer from the Claerwen water shed directly to the water extraction facility in Ystrad Fflur, which is on the opposite side of the mountain.

That is a direct water transfer from one storage facility to an extraction facility. It will not transfer the water of one river to another river, which might cause ecological and environmental concerns. As a Plaid Cymru Member, I might be expected to look forward to water that was once flowing into England flowing once more into Wales, but there is a sad side to this, which the Minister may know about. The ability to extract more from the Wye valley is partly due to the run-down of Corus in Llanwern, which has lessened water need in the lower Wye valley considerably.

The cost of the pipeline would not be huge when one considers that it would serve 55,000 people; it is in the order of £8 million to £9 million. Funding has been difficult because the initial refusal by Ofwat to put the

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project in the approved programme meant that Glas Cymru would find it difficult to recoup the investment. There has been intensive lobbying over the past few weeks by Glas Cymru, Welsh Assembly Member Elin Jones and me. At a recent meeting, Ofwat's director general, Philip Fletcher, confirmed that Glas Cymru would be able to move ahead with that investment if it can be seen to deliver

I hope that the Minister will agree that that output would be valued by customers in south Ceredigion and should therefore be taken into consideration as an investment for the next periodic review. That investment by Glas Cymru can be recouped. The Minister will be aware that the new arrangements with Glas Cymru mean that it needs that security to show its bondholders that they can get their money back. The new model for Glas Cymru, which the Government are looking at for Railtrack, is one that we want to see working in Wales. I am sure that the Government agree that we need that underpinning.

Following a board meeting yesterday, Glas Cymru announced that it would move on with the new project in Ceredigion. I congratulate it on that. It will still be looking for partnership funding from bodies such as the Environment Agency, Ceredigion county council and the National Assembly for Wales, but it is a lesser issue than when I first applied for this debate. Yesterday's announcement has moved things along.

A couple of environmental concerns remain. The plan to transfer the water from the Claerwen water shed to the extraction at Ystrad Fflur has not yet been approved. It will need the approval of several different agencies: the Environment Agency, the Countryside Council for Wales and English Nature, because, of course, the River Wye runs into England and affects the English as well as the Welsh ecology. All those organisations need to approve the plans of Glas Cymru.

I do not want to see any degradation of the environment on the uplands of Ceredigion, and we cannot continue to extract directly from the River Teifi at the same level. We must consider further water conservation measures, particularly in respect of farming, industry and caravan parks along the coast. It is not sustainable either to take in water in tankers, which has a huge environmental cost—one should consider fuel consumption, for example—or to thwart economic opportunities in south Ceredigion when water resources are not scarce.

Will the Minister monitor the progress of Glas Cymru in its negotiations with Ofwat, to ensure that the public concerns and values that Ofwat represents come across clearly to the company? That will mean that Glas Cymru will be able to make available finance that can be recouped in the next periodic review. I would be grateful if the Minister talked to the various agencies, because he is in an excellent position to do so. There is a unique mixture of devolved, non-devolved and English bodies, which must come together and realise the importance of the project for the economic and social future and viability of south Ceredigion. He should also ensure that environmental concerns are met, and that progress is

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made to ensure that sufficient water is available to meet not only present needs, on which there is a deficit, but future needs, such as the Aberporth technology park.

I am sure that the Minister will join me in wishing that technology park every success. It is a vital objective 1 project, as the National Assembly has recognised. It will have to go through the planning process and meet all environmental guidelines, but a simple lack of water cannot be allowed to hold it back. I hope that, having brought the problem into the open and engaged the public in the issue of the lack of water supply in a water-rich environment such as Ceredigion, there will be much more urgent action to secure investment in time. Water delivery takes time to provide and if we are to meet the 2004-05 target, we must start now. Ofwat gave Glas Cymru the amber light this week. I want Glas Cymru to be given the green light on the environmental concerns. I would like the Minister to help me to achieve that.

12.47 pm

The Parliamentary Under-Secretary of State for Wales (Mr. Don Touhig) : I congratulate the hon. Member for Ceredigion (Mr. Thomas) on securing the debate. He asked me at the outset to agree that Wales is wet. In all truth, I must do that, but it has shattered one of my attempts over the past six years to persuade my English colleagues that we have less rain in Wales because we are closer to the Caribbean. I pay tribute to his efforts as the hon. Member for Ceredigion, which is a beautiful county. It is a wonderful place in which to live and to visit, and has some fine wine produced around Aberaeron. I have tasted the wine and certainly found it wet and welcoming.

Outside Cardiff, Ceredigion has been the fastest growing county in Wales. In the past 10 years, the population has increased by about 8 per cent. As the hon. Gentleman knows, Ceredigion county council predicts that if that trends continues, a further 5,000 to 6,500 homes will be needed during the next 15 years. That will affect the water supply and provision, particularly in mid and south Ceredigion. It will be necessary to provide high-quality employment sites to sustain that growth and to support a viable local community. The Aberporth project is a positive and sympathetic way in which to introduce job and new skill opportunities into a community that would not perhaps have attracted them otherwise. Clearly, such a development will require a reliable water supply if it is to progress.

I am sure that the hon. Gentleman will join me in welcoming the recent decision on water supply to Ceredigion by means of a pipeline. I pay tribute to his efforts in securing that advance on behalf of his constituents. There has been debate on the way forward for water supply in mid and south Ceredigion, and concern has been expressed about increased abstraction from the River Teifi, which already provides some 98 per cent. of the water supply to that area.

I share the hon. Gentleman's concerns about the impact that greater abstraction would have on the environment and the river. The alternative, to which he has referred, is to transport water by pipeline from the Claerwen reservoir in the Elan valley. Dwr Cymru discussed that with Ofwat, the Environment Agency, and the Welsh Assembly. The pipeline will cost between £8 million and £9 million.

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On 2 November, Ofwat's director general met representatives of Dwr Cymru, and told the company that Ofwat would agree to the proposed development, which would bring water from Elan valley to Ceredigion, if agreed outputs were met. The pipeline would be Dwr Cymru's concern, not Ofwat's. Ofwat has confirmed that the investment will be included in the company's regulatory capital value, so the investment will not be discounted at the next periodical review of water charges. Dwr Cymru is prepared to go ahead with the scheme on those conditions.

The Environment Agency supports the proposed pipeline transfer on water resource grounds. The hon. Gentleman mentioned the environment. The pipeline will cross or go under three sites of special scientific interest, although most of the land is owned by Dwr Cymru already. That may smooth discussions on how to proceed.

It will take time to construct a scheme on such a scale. Other factors, apart from the SSSIs that the pipeline will pass through, must be accounted for. Severn Trent Water and Dwr Cymru must agree on what additional water can be taken from the Claerwen reservoir. Dwr Cymru must obtain an abstraction licence from the Environment Agency, and may also need planning permission for a pumping station and an extension to the Strata Florida water treatment works. Those must all be in place before the scheme can go ahead.

I am pleased that the scheme has not been ruled out, although many steps have yet to be taken. We are making welcome progress on the solution. The hon. Gentleman asks me to continue to take an interest in the matter; I assure him that I shall. I will do all that I can to bring pressure on the agencies and other bodies involved in the scheme in order to bring about a favourable outcome. We have the opportunity for a sympathetic development scheme that will have a major impact on Ceredigion's economy in the early part of the century. That economy must not be stymied by problems with the water supply. We have a solution at hand. I hope that we pull together to ensure that it is realised.

Mr. Nicholas Winterton (in the Chair): The hon. Member who has secured the next debate is present, but unfortunately the Minister is not, so I shall suspend the sitting until 1 o'clock.

12.53 pm

Sitting suspended.

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