United Utilities and the Net Zero Energy-Water-Carbon Nexus

TL;DR: United Utilities is repositioning its asset base as a virtual power plant and resource recovery platform, using 100% renewable electricity and circular economy projects to cut carbon, generate green energy and support jobs while delivering core water and wastewater services.

The transition to a net zero carbon economy reshapes the relationship between energy, water and carbon, turning utilities from passive energy consumers into active producers and system integrators. Historically, water and wastewater operations have been energy-intensive, with emissions largely treated as a by-product of essential services. Emerging operating models instead see utilities as catalysts for regional decarbonisation, decoupling infrastructure growth from environmental degradation. United Utilities Group PLC illustrates how this shift plays out in practice by embedding renewable energy generation and resource recovery across its asset base.

Net Zero Systems Thinking in the Energy-Water-Carbon Nexus

System logic for the net zero transition starts from the recognition that water and wastewater services sit at the intersection of energy use, process emissions and resource flows. United Utilities has committed to operating its services using 100% renewable electricity, achieved partly through an extensive on-site generation portfolio and partly through green power procurement. This reframes treatment works, pumping stations and reservoirs as distributed energy assets that can support grid decarbonisation while maintaining secure water supplies for more than seven million people across North West England.

This evolution matters because utilities’ historic reliance on grid electricity and fossil fuels exposed customers to volatile energy prices and locked in high operational emissions. By generating electricity via combined heat and power engines, solar arrays and other renewable schemes, and exporting biomethane to the gas network, United Utilities can control a greater proportion of its energy costs and shield bills from market shocks. At the same time, a virtual power plant model enables flexible operation of assets, allowing the company to align high-energy processes with periods of abundant low-carbon generation and support system balancing services.

Governance and trade-offs are managed through a dedicated net zero strategy that sets science-based targets, defines carbon pledges and applies an internal carbon price to future investments. The carbon valuation, set at approximately £188 per tonne of CO2e, is derived from UK government policy values and used to translate emissions impacts into financial terms during option appraisal. This approach means that schemes with higher embodied or operational emissions must deliver proportionately greater benefits to progress, encouraging adoption of lower-carbon technologies, design choices and construction methods across the AMP8 portfolio and beyond.

Virtual Power Plant Operations and Circular Resource Recovery

United Utilities advances decarbonised operations by integrating its assets into the regional energy system as a virtual power plant, in which multiple treatment works and renewable installations operate as a coordinated portfolio. The company now uses electricity exclusively from green sources, with around a quarter generated on-site via solar farms, wind turbines and energy-from-sludge projects, including floating solar arrays on reservoirs and high-efficiency combined heat and power engines. At Davyhulme Wastewater Treatment Works, biogas from sewage sludge digestion is used to generate electricity and produce biomethane, with exports sufficient to meet the annual gas needs of several thousand homes while powering site operations.

Beyond energy, United Utilities is progressing circular resource recovery by extracting valuable materials from wastewater and residuals that were previously treated as waste. Through initiatives such as the Biopolymers in the Circular Economy project at Blackburn, technologies are being trialled to recover glucose and other organic fractions for use in bioplastics and biofuels, creating new bio-based value chains. The company also recovers significant quantities of phosphorus each year from treatment processes, returning this critical nutrient to agriculture and reducing reliance on imported phosphate rock, thereby linking wastewater management directly to food system resilience.

United Utilities now powers its water and wastewater operations entirely with renewable electricity, combining on-site generation and green procurement to serve more than seven million customers.

Take-Out

United Utilities demonstrates how a water and wastewater company can become a net zero infrastructure platform by treating energy, carbon and resources as integrated system variables. Virtual power plant operations, circular resource recovery and carbon-priced investment decisions together offer a practical template for utilities seeking to decarbonise while supporting regional economies.

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Analysis by Our Future Water Intelligence • Robert C. Brears