IB 02/05: Ofwat proposes changes to water companies' licences

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IB 02/05	14 January 2005
Ofwat proposes changes to water companies' licences

Ofwat today published proposed changes to the licence conditions of water and sewerage companies in England and Wales.

The effects of the proposed modifications are to:

Remove a potential effect on overall prices where a company changes its charges to unmeasured premises;
Align the definition of large customers in companies' licences with the definition in the Water Industry Act 1991;
Allow in the case of two companies - Thames Water and United Utilities - either the company or the Director General to seek a review of their price limits where circumstances beyond their control have a substantial effect on the business. This brings these companies into line with the rest of the industry;
Make 15 September of each year the date by which a notice triggering an interim determination of prices must be given to Ofwat;
Replace a condition about the disconnection of domestic customers for non-payment of bills (which is no longer permitted) with a Code of Practice for domestic customers on the payment of bills;
Ensure there is consistency between the details of the licence and the way in which in practice Ofwat handles interim determinations; and
Amend the standard interim determination mechanism to cover revenue gains in the same way as revenue losses.

The proposed changes, which have already been the subject of consultation, will ensure greater consistency in the licence conditions of the regulated water companies. Full details of the modifications and the reasons for making them are set out on Ofwat's website www.ofwat.gov.uk

Representations or objections to the proposed modifications should be made to Paul Hope at Ofwat, Centre City Tower, Hill Street, Birmingham B5 4UA, by 15 February 2005.

Notes:
1. The Director General of Water Services is the economic regulator of the water and sewerage companies in England and Wales. He exercises his powers in a way that he judges will allow them to carry out their functions properly, and finance them.
2. The effect of the modifications and the reasons for making them are set out in letters referenced MD 189, MD 194 and MD 196. Copies of these letters and of the modifications themselves are available free of charge from the website (www.ofwat.gov.uk) or on application to Paul Hope at the Office of Water Services at City Centre Tower, Hill Street, Birmingham B5 4UA.

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Out of hours enquiries to pager: 08700 555 500 water 509. Ofwat publications and press notices can be found on Ofwat's website at: www.ofwat.gov.uk

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