PN 51/04: Ofwat publishes final price limits for South West Water

This site uses the UK Government AccessKeys system	Protecting consumers, promoting value and safeguarding the future Skip Menus
	What's new \| Publications \| Media centre \| Price review \| FAQs Update alerts \| Consumer issues \| Site map \| Competition \| Contact us


Advanced Search \| Help

Ofwat home

About Ofwat

Ofwat key work areas

Customers and complaints

Access to information

What's new?

Publications

Media centre

FAQs

Related industry links

Update alerts

Ofwat home > Media centre

PN 51/04	2 December 2004
Ofwat publishes final price limits for South West Water

Ofwat today published final price limits for South West Water for the five years from 1 April 2005.

Effect on customers' bills

Customers' bills will be as high as they need to be to enable South West Water to carry out its functions, but no higher.
Average household bills for water and sewerage up by £87 to £444 by 2009-10, before inflation. This compares with the company's proposal in their business plan for an increase of £120 over the period and Ofwat's draft price increase of £61.
Initial increase of £29 in the first year to reflect the build-up of company costs.
Average bills allow for the cost of 113,000 customers (one third of all unmetered household customers) switching to a meter over the next five years. Because this reduces company revenue and increases its costs, other customers are likely to see higher than average increases.

Benefits
The price limits will enable South West Water to invest £760 million to:

Safeguard all essential services – including a bigger programme to maintain pipes, sewers and treatment works.
Ensure customers receive safer, more reliable drinking water – achieved through further improvements in water quality; e.g. by renovation of more than 3,200km of water mains.
Provide further protection for the environment – achieved through an investment programme to improve rivers and coastal waters, e.g. upgrade of 40 sewage treatment works, including Falmouth, which will improve the Fal and Helford Special Areas of Conservation.
Resolve or alleviate internal flooding from overloaded sewers for all high risk properties identified in the company's plan.

Philip Fletcher, Director General of Water Services, said:

"I recognise that these price increases will be unwelcome to South West customers, especially those on low incomes. However, having scrutinised all of South West Water's costs and the future demands on the company, I am convinced the increases are no higher than is necessary.

"We have considered carefully the comments made by customers, the company, environmental groups and others, and we have taken into account guidance from Ministers following our draft price limits announced in August.

"The increases will enable the company to invest more in pipes, sewers and treatment works in order to safeguard supplies for the future. South West Water will also be able to continue to play its part in protecting the environment on a long-term, sustainable basis. The benefits they will deliver include the water quality and environmental improvements that Ministers wanted.

"We have listened to customers, WaterVoice and South West Water who wanted to see more investment to deal with the scourge of sewer flooding. These increases mean the company will be able to resolve or alleviate, by 2010, all known high risk problems identified in its plan where overloaded sewers cause flooding inside properties. It will also be able to make further progress in dealing with external sewer flooding."

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.
2. The final determinations document, 'Future water and sewerage charges 2005-10' - Final determinations', will be available from the Ofwat library on 0121 625 1373 and on the website at www.ofwat.gov.uk
3. The figures quoted in all the attached tables are before inflation. Average household bills in both tables are presented in 2004-05 prices.
4. Although this marks the end of the periodic review, companies will have until 1 February 2005 to ask the Director General to refer the price limits he has set to the Competition Commission for redetermination.

Media enquiries to Ofwat Press Office on : 0121 625 1416/1496/1442. Out of hours enquiries to pager: 08700 555 500 water 503/509.

Disclaimer & Privacy Statement