REG - Water Services Auth - WATER COMPANIES TO RETURN £114m TO CUSTOMERS

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26/09/2023 08:15

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RNS Number : 5748N  Water Services Regulation Authority  26 September 2023

WATER COMPANIES TO RETURN £114m TO CUSTOMERS FOR UNDER-PERFORMANCE

 

Under-performance by the majority of water and wastewater companies in England
and Wales, will mean companies have to return £114m to customers next year.

 

The rebate, set out today by Ofwat following its assessment of performance
against targets set for 2022-23, will come off customers' bills for next year.
Water companies were set stretching targets for 2020-25 to deliver better
outcomes, for both customers and the environment. Where they fall short on
these, the regulator reduces the amount of money companies can collect from
customers.

 

Ofwat's decision comes as it publishes its annual Water Company Performance
Report, which categorises companies' performance as 'leading' 'average' or
'lagging', against a set of common metrics including pollution incidents,
customer service and leakage. This year, no company has been ranked in the
'leading' category.

 

Ten companies are in the 'average' category and seven have been categorised as
'lagging' (Anglian Water, Dŵr Cymru, Southern Water, Thames Water, Yorkshire
Water, Bristol Water and South East Water).

 

Ofwat's Water Company Performance Report has also assessed company performance
for the three years since the start of the current regulatory cycle (which
covers 2020-2025). Over that time, companies have shown improvements in areas
including leakage and internal sewer flooding and last year, all but one
company achieved the performance level for unplanned water outages.

 

However, across the board, progress has been too slow. In 2022-23, fewer than
half of companies achieved their performance target on reducing pollution
incidents and fewer than half of the companies meeting their performance
commitment on leakage. This performance is matched by an overall decline in
customer satisfaction during the past year.

 

In addition, Ofwat also reports that most companies have not fully invested
their 2020-2023 allowed funding for delivering service enhancements.

 

David Black, Ofwat CEO said: "The targets we set for companies were designed
to be stretching - to drive improvements for customers and the environment.
However, our latest report shows they are falling short, leading to £114m
being returned to customers through bill reductions. While that may be welcome
to billpayers, it is very disappointing news for all who want to see the
sector do better.

 

"It is not going to be easy for companies to regain public trust, but they
have to start with better service for customers and the environment. We will
continue to use all our powers to ensure the sector delivers better value."

 

Ofwat is currently investigating all 11 water and wastewater companies and
there are live enforcement cases for six companies for potential failures on
sewage discharges into the environment. There are also two live enforcement
cases into Dŵr Cymru and South West Water in relation to the accuracy of
reporting of leakage and per capita consumption performance.

 

Ends

 

Notes to editors

 

·    The in-period determinations can be found here
(https://www.ofwat.gov.uk/regulated-companies/price-review/in-period-odi-determinations/in-period-determinations-for-2022-23/)
.

·    The Water Company Performance Report can be found here
(https://www.ofwat.gov.uk/regulated-companies/company-obligations/outcomes/water-company-performance-report-2022-23/)
.

 

In-period draft determination (2022/23)

·    The draft in-period determination is now open for consultation with
stakeholders. The final in-period determination will be published in November
2023. Underperformance and outperformance adjustments will be reflected in
customers' bills in 2024-25.

·    The stretching performance commitments agreed in the PR19
determinations included a commitment to a 30% reduction in pollution
incidents, a 16% reduction to leakage and a 41% reduction to sewer flooding
incidents.

 

Table 1.1: Total draft determinations adjustments to price controls (£m,
2017-18 FYA CPIH prices)

 

 Company                               Total draft determination adjustments to price controls to be applied to
                                       customer bills in 2024-25

                                       (£m, 2017-18 FYA CPIH prices)
 Affinity Water                        -8.088
 Anglian Water                         -22.357
 Dŵr Cymru                             -24.080
 Hafren Dyfrdwy                        -0.513
 Northumbrian Water                    -0.113
 Portsmouth Water                      0.302
 SES Water                             -1.123
 Severn Trent Water                    88.083
 South East Water                      -5.230
 South Staffs Water                    0.869
 South West Water (South West area)    -9.244(1)
 South West Water (Bristol area)       -2.577(3)
 Southern Water                        -42.903
 Thames Water                          -100.719
 United Utilities                      25.229
 Wessex Water                          7.960
 Yorkshire Water                       -19.825
 Industry total                        -114.330

 

 

 

(1) Payments for 2022-23 are provisional until Ofwat completes the in-period
process, payments for other years are as reported in the relevant final
determination.

 

 

 

 

Water Company Performance Report

2022/23 standings

 

 Lagging behind                           Average
 Southern Water =   Anglian Water ⬇       Northumbrian Water ⬆    Portsmouth Water =
 Thames Water =     Bristol Water ⬇⬇      South West Water ⬆      Hafren Dyfrdwy =
 Yorkshire Water =  South East Water ⬇    Wessex Water =          United Utilities =
 Dŵr Cymru =                              Affinity Water =        Severn Trent ⬇
                                          SES Water =             South Staffs Water ⬇

⬆ company has moved up one category

= company in the same category as 2022/23

⬇ company has moved down one category

⬇⬇ company has moved down two categories

 

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