Ofwat compares business plan bill movements, leakage cuts and PCC

September 10, 2018

Ofwat has today published a comparison table on three key metrics from its preliminary scrutiny of the business plans water companies submitted last Monday - see HERE

 

This showed variety as well as common trends, as follows:  

 

Bills

All but six companies proposed bill cuts between 2019/10 and 2024/25. Northumbrian Water offered the deepest saving, of up to 14%, with other large reductions on the table from South West Water (11%), United Utilities (10.5%) and South Staffs (11%). Thames and South East seek to keep bills flat. Yorkshire Water earmarked the largest rise, of 3.5%. It cited the water industry national environment programme in the executive summary of its plan as a key source of the upward price pressure. The two other companies seeking rises are Hafren Dyfrdwy, largely due to increased investment, and Anglian Water which explained its 1% rise as a result of the burgeoning investment programme (30% up on the current period) needed by its region in light of its dry climate, rapid growth and large environmental programme. 

 

Leakage

Most companies are clustered around the 15% mandated reduction. The two exceptions are Yorkshire Water (25% cut in Ofwat’s table; the company cites a 40% cut between 2018-25 in its business plan executive summary) and South Staffs (23%).

 

Per capita consumption

Companies seek to improve on the 2017/18 average of 141 litres per person per day, most edging it down to the high 120s or 130s. The most ambitious numbers in Ofwat’s analysis come from Yorkshire Water (119 litres) and Southern Water (120 litres).

 

In a comment on the plans last week, the National Infrastructure Commission made the point that the industry will need to go further in future to ensure resilience: “With as much as 20 per cent of mains water lost to leakages every day, it is encouraging to see water companies setting out five-year plans to tackle this issue. However, the threat of hosepipe bans this summer showed the need to shore up water supplies, and so we want to see companies look even further ahead, with a clear target to halve leakages by 2050. That, combined with a new water transfer network to support areas suffering shortages, and measures to reduce demand, would greatly improve the resilience of our infrastructure for the future.”

 

 

 

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