WIREDGOV

The inaugural Water Efficiency Lab (‘WEL 1’) – a £25 million challenge-led competition to unlock and scale innovations that reduce water use across England and Wales is to be launched. 

• The Water Efficiency Lab, a challenge-led competition to fund innovations in cutting water use, is to be launched.
• Demand for water is at an all-time high, yet people lack the insights and tools to track and cut their usage – as a result 94% of people underestimate their daily consumption.
• With £5 million available in its first year, the Water Efficiency Lab will task innovators with developing data-driven solutions that solve this challenge and provide clear, actionable insights to customers to reduce their water usage.
• Part of Ofwat’s £100 million Water Efficiency Fund, the Water Efficiency Lab is designed to help build a more resilient and sustainable water system across England and Wales.

The first year of the competition, offering £5 million in total funding and up to £1.5 million for individual projects, is inviting innovators to develop new technologies, data-driven tools and solutions that enable people and businesses to understand their water use and take steps to reduce it.

Demand for water is already at record levels. England faces a projected 5 billion-litre-per-day shortfall in public water supplies by 2055, driven in part by population growth, climate change and increasing demand. Reducing use is therefore critical to maintaining resilient and sustainable water infrastructure.

However, while many people and businesses want to reduce their usage, most currently lack the detailed data and insights needed to understand their consumption, identify waste and take effective action. Research shows that 94% of people underestimate the amount of water they use per day – over a fifth believe they use less than 20 litres per day, when the average usage per person is 152 litres. *

The first year of the competition will focus on closing this knowledge gap – providing water customers with actionable insights that provide more detailed information on their usage that in turn lead to behaviour change. Innovators will be invited to develop solutions that not only provide water customers with increased data and insights on their usage, but also ways to act on these insights to reduce consumption.

WEL 1 will look to fund a range of innovations, with solutions in potential areas including:

• customer-facing smart data platforms that provide real-time behavioural nudges and incentives;
• fixture-level monitoring systems that track the usage of specific appliances; and
• combined leak detection and consumption systems that provide behavioural feedback.

Entries that provide alternative approaches for properties which are unable to have a water meter fitted, are hard to meter and properties that are a low priority to be metered will also be welcome – ensuring solutions are inclusive and widely applicable, making water efficiency possible for everyone.

While the water sector continues to work to reduce leaks and invest in infrastructure, ensuring these companies support their customers to understand and act on their usage is essential. The Water Efficiency Lab has been created to drive that change – facilitating innovations and breakthroughs that water companies can embed into their services to help customers to cut their overall water use.

Water Minister Emma Hardy yesterday said:

“This year’s prolonged dry weather demonstrates why we all need to take action to protect our water resources, as with a changing climate it is likely we will see pressure on the system continue to grow.

“Saving water benefits everyone, reducing bills whilst leaving more water in the environment. While water companies must go further and faster to fix leaks, this Government is taking decisive action, including developing nine new reservoirs to help secure long-term water resilience.

“I welcome the Water Efficiency Lab initiative which will not only help people understand their water usage but provide them with tangible ways to reduce it.”

Chris Walters, Interim Chief Executive of Ofwat, yesterday said:

“Consumers and businesses want to use water responsibly and reduce its use where possible, but right now most don’t have the information they need to understand how much they use or where they can save. The Water Efficiency Lab has been created to overcome this and turn data into positive insights and action.

“Small changes across millions of people and businesses can make a big difference – helping cut usage now, while protecting the environment, reduces the risk of shortages and creates a more resilient and sustainable water system for the future.”

The Water Efficiency Lab’s first competition is open to all UK-based innovators, and international innovators, that partner with a UK-based lead entrant, from any sector including but not limited to water companies (wholesalers and retailers), tech developers, universities, behavioural science specialists and start-ups. Entries will be assessed on their potential impact to deliver water consumption reduction, innovation, feasibility and pathway to adoption and implementation across England and Wales.

The competition will formally open to entrants at 1pm on Tuesday 25th November and remain open until 10th March 2026. Winners will be announced in June 2026, with funding awarded to the most promising projects that help accelerate adoption, behavioural change and measurable reductions in demand.

More information about the Water Efficiency Lab and the first competition, including the entry form, assessment criteria, terms and conditions and the support available to entrants will be published at launch at waterinnovation.challenges.org.

Notes to Editors

For all media enquiries about the Water Efficiency Lab or the Ofwat Innovation Fund, please contact waterinnovation@seven-consultancy.com or call +44 (0)20 7754 3610

For all media enquiries about the Water Efficiency Campaign, please contact the Ofwat press office on  PressOfficeTeam@ofwat.gov.uk or call 0121 644 7700

* Water UK: Vast majority of Brits have no idea how much water they are using (2023)

WATER: Resilience & Innovation for the Built Environment

The Ofwat Innovation Fund is sponsoring the Building Centre’s upcoming ‘Water: Resilience & Innovation for the Built Environment’ exhibition from 22nd January to 10th April 2026. The 11-week event will explore innovations and solutions shaping the future of water in architecture, engineering and urban design. The exhibition will showcase cutting-edge technologies, pioneering projects and ideas that are driving a new, water-wise approach to building for resilience and sustainability – including those that have been enabled and supported by the Ofwat Innovation Fund.

About the Water Efficiency Lab

The Water Efficiency Lab (WEL) is an annual, challenge-led competition to unlock and scale innovations that reduce water use by households and businesses across England and Wales. The first £5million round of the WEL will launch on 25 November 2025 and will focus on the challenge of providing water customers with actionable insights which help them understand and reduce their water use. The WEL is being delivered by challenge prize experts Challenge Works alongside Arup and Isle Utilities.

The WEL is part of Ofwat’s £100 million Water Efficiency Fund designed to stimulate a transformative, sustained, and measurable reduction in water demand across England and Wales by using a range of water efficiency approaches, including awareness raising and behaviour change. It aims to foster collaboration and innovation on water efficiency at a scale never seen before. The WEF also includes a Water Efficiency Campaign (WEC), which will promote behaviour change that encourages people and businesses to use less water. The delivery body for the WEC will be appointed by Ofwat in 2026.

About Challenge Works 

Challenge Works is a global leader in the design and delivery of high-impact challenge prizes that incentivise cutting-edge innovation for social good. In the last 10 years, we have designed and delivered 101 prizes, distributed more than £310 million in funding and engaged with 16,000 innovators. Challenge prizes champion open innovation through competition. We specify a problem that needs solving, but not what the solution should be. We offer large cash incentives to encourage diverse innovators to apply their ingenuity to solving the problem. The most promising solutions are rewarded with seed funding and expert capacity building support, so that they can prove their impact and effectiveness. The first or best innovation to solve the problem wins. This approach levels the playing field for unknown and previously untested innovators so that the best ideas, no matter their origin, are brought to bear on the most difficult of global challenges.

About Arup 

Dedicated to sustainable development, Arup is a collective of designers, consultants and experts working globally. Founded to be humane and excellent, we collaborate with our clients and partners using imagination, technology, and rigour to shape a better world. Together we help our clients solve their most complex challenges – turning exciting ideas into tangible reality as we strive to find a better way and shape a better world. With a community of over 1800 water professionals, Arup is leading global thinking across key areas like innovation, resilience, net zero carbon and sustainable water management. Find out more: www.arup.com

About Isle Utilities

Isle is a global consultancy, partnering across the water system to accelerate the water environmental transition. Our services and platforms help de-risk the development, commercialization, and adoption of technologies, creating value and accelerating innovative solutions. Find out more: www.isleutilities.com