Water Services Auth - Ofwat announces Final Determinations for PR19

 

Water Services Auth - Ofwat announces Final Determinations for PR19

Water Services Regulation Authority

16 December 2019 

Ofwat gives green light to massive investment programme to transform water
sector

Ofwat has finalised its price review for 2020-25 by confirming a major
investment programme to improve services for customers and the environment.

 Ofwat has revealed a spending package of £51bn for the next five years. A
quarter of this, around £13bn, will be investment dedicated to providing
resilient services and a better environment in the face of a growing
population and climate change.

Customers will also see a reduction in average bills of about £50 before
inflation. The regulator has secured this by demanding greater efficiency,
passing through lower financing costs and promoting more innovation. 

 Ofwat has set new levels of service so water companies transform their
performance over the next five years. These include:

  • Cutting leakage by 16% - saving enough water to meet the needs of
    everyone in Birmingham, Bristol, Cardiff, Leeds, Liverpool and Sheffield
  • Identifying and helping an additional two million customers who need
    extra support
  • Investing over £1 billion to protect communities at risk of flooding
  • Reducing pollution into rivers and streams by almost a third
  • Preparing for drier weather by providing £450 million to explore new
    water resources such as reservoirs or moving water from where there is lots to
    places with less.

    The £13bn of additional investment - equivalent to £6m every day for five
    years - will, among other things, see a new reservoir built in Hampshire and
    the construction of a pipeline connecting water supplies from North
    Lincolnshire to Essex. 

    Ofwat recognises that Londoners deserve a better level of service. The
    regulator is stepping in to protect customers by allowing Thames Water to bid
    for up to an additional £480m to deliver improved service resilience. To
    access this, they will need to pass a series of tests and Thames' investors
    will also need to provide substantial additional funding.

    Ofwat Chief Executive, Rachel Fletcher, said:

    "Today we're firing the starting gun on the transformation of the water
    industry backed by a major investment programme to deliver new, improved
    services for customers and the environment and resilience for generations to
    come. Now water companies need to crack on, turn this into a reality and
    transform their performance for everyone. 

    "They will be investing the equivalent of an extra £6 million each and every
    day to overhaul services, strengthen their infrastructure and improve our
    natural environment. And at the same time, customers' bills will fall by an
    average of £50 before inflation."