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Ofwat has today placed two new obligations on water companies to enable competition to develop further in the water industry in England and Wales. Changes to their appointment conditions will require each regulated water company to put in place arrangements that will enable their: · water supply systems to be used by licensed water suppliers; and · eligible customers to transfer effectively to another water supplier. Tony Smith, Ofwat Director of Competition and Consumer Affairs, said: "The two new conditions we have introduced for water companies are the cornerstone to developing competition in the water industry. It is critical that a new water supplier understands the terms on which they will be able to use an existing water company's supply system if they are to compete fairly. And a clear, simple and standardised transfer process will ensure that customers can easily change supplier and take advantage of the benefits of competition." The new conditions are a further step towards preparing for the launch of the new water supply licensing regime on 1 December 2005, when licensed companies will be able to supply water to individual business customers using at least 50 megalitres of water a year. This could affect some 2,200 customers who collectively spend around £210 million each year on water charges. Notes to Editors: 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. His duties include protecting the interests of customers, wherever appropriate, by promoting effective competition. 2. The DG has written to each water company (MD 206) setting out these modifications. These are held on the Ofwat website at www.ofwat.gov.uk They are also held as part of the Director's register and are available for inspection at the Ofwat library. Paper copies of the modifications are available for sale at 10p per page (minimum charge £1.00) from the Ofwat Library on 0121 625 1373. 3. The modifications made to the licences for Albion Water Ltd and Cholderton & District Water Company Ltd reflect their relative size and circumstances. 4. 50 megalitres = 50 million litres, and is the equivalent of 50,000 cubic metres. 5. Water Supply Licensing competition results from the Water Act 2003 (WA03). The changes have been made under the Water Act 2003, which allows Ofwat to modify water companies' appointment conditions without their agreement or a reference to the Competition Commission. 6. Prospective companies interested in supplying water can now apply for one of two new licences from Ofwat to enable them to compete in the market. These comprise either a: · Retail licence, which entitles the holder to buy a supply of water from an appointed water company and sell it eligible premises; or · Combined licence, which enables the holder to develop their own water source and use the supply systems of an appointed water company to supply eligible premises. MEDIA ENQUIRIES TO OFWAT PRESS OFFICE ON: 0121 625 1416/1496/1442 Out of hours enquiries to pager: 08700 555 500 water 502/503. Ofwat publications and press notices can be found on Ofwat's website at: www.ofwat.gov.uk  | ||||||
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