Ofwat publishes final Climate Change Principles for England and Wales’ water sector
Ofwat has published its Final Climate Change Principles, setting out a principles-based framework to guide how water companies respond to the growing risks posed by climate change. The regulator positions the principles as a flexible but consistent approach to supporting resilient, sustainable water and wastewater services for customers and the environment, now and into the future.
The document highlights how climate change is already affecting water availability, infrastructure resilience and natural systems, with projections pointing to warmer temperatures, increased volatility and more frequent extreme weather. Ofwat states that responding effectively will require not only technical solutions, but changes in decision-making, governance and ways of working across the sector.
From consultation to final principles
The final principles follow a discussion paper published in July 2025, which proposed a principles-based regulatory approach to climate mitigation, adaptation and resilience. Over summer 2025, Ofwat engaged with stakeholders through three workshops – with regulators, water companies and environmental groups – and received 20 written responses.
Responding effectively to climate change will require not only technical solutions, but changes in decision-making, governance and ways of working across the sector
According to Ofwat, feedback broadly welcomed the approach and reflected current practice and opportunities within the sector. The final document incorporates clarifications and minor revisions, particularly around implementation, monitoring and reporting, while maintaining the core structure set out in the consultation.
The six Climate Change Principles
The publication sets out six principles that Ofwat expects water companies to embed across governance, planning and operations:
- Aligned and transparent pathways – developing pathways that align with UK and Welsh government targets, using established climate scenarios and voluntary frameworks to support transparency and stakeholder confidence.
- Comprehensive and integrated actions – addressing mitigation and adaptation together, considering interdependencies with other sectors and taking whole-life approaches to emissions and resilience.
- Circular economy – incorporating circular economy principles into operations, including reducing waste, recovering resources, improving water efficiency and protecting and regenerating nature.
- Monitoring and reporting – monitoring and reporting progress in a continuous, standardised and transparent way, including on operational, process and embedded emissions and climate adaptation.
- Research and innovation – demonstrating leadership in research and innovation, scaling solutions through collaboration, and supporting open data to enable sector-wide learning.
- Actively engaging stakeholders – placing stakeholder needs at the centre of climate decision-making, engaging customers, communities and partners, and being transparent about trade-offs, costs and long-term impacts.
Alignment with wider reform and policy direction
Ofwat states that the final principles are intended to support the direction set out in the Independent Water Commission’s Final Report and the UK Government’s White Paper, A New Vision for Water, published in January 2026. The principles also reference national adaptation and circular economy strategies in both England and Wales.
By aligning climate action with existing planning processes – such as water resource management plans, drainage and wastewater management plans and price review business plans – Ofwat aims to embed climate considerations into core regulatory and operational decision-making.
Next steps and future focus
While the principles are final, Ofwat describes them as a framework to guide ongoing action rather than a prescriptive rulebook. The regulator confirms it will continue to work with the sector on implementation, including further engagement on climate resilience metrics planned for Spring 2026.
Ofwat also signals an expectation of continued improvement in adaptation reporting, embedded emissions monitoring and transparency, with the aim of enabling effective scrutiny and building trust with customers and stakeholders as the sector responds to accelerating climate risks
