Ofwat confirms Outcome Delivery Incentive payments with £70m going back to customers

Only five water companies will not return money to customers as a result of their 2022-23 performance, under final decisions issued last week by Ofwat.

The table shows the net impact of total Outcome Delivery Incentive payments, the payments for the customer measure of experience (C-MeX) and developer services measure of experience (D-MeX) performance commitments, as well as any deferrals, abatements or bespoke adjustments, by company. For example, Severn Trent's revenue adjustment includes additional funding for Green Recovery investment, and the recovery of deferred outcome delivery incentive payments from previous years.

The industry will return £70m in total, down from the £114m in the draft determinations. Among the main changes, Southern’s penalty to be applied in 2024-25 was reduced from £42.9 to £21.5m after Ofwat agreed the company’s request to defer half of the penalty to the 2025-26 year. Substantive changes were also made to Thames Water’s draft determination, on the basis of corporation tax adjustments and bill smoothing.