Water UK

Water companies in England and Wales publish investment plans for 2010-2015

11/08/08

Water companies in England and Wales have published proposals for maintaining and improving water and sewerage services to meet the priorities of their customers in the five years beginning 2010.

Draft business plans sent to water regulator Ofwat today show how the industry will invest to ensure the reliability of the service in the face of more extreme weather conditions and climate change in the years ahead.

Overall the companies plan to invest around £27 billion in keeping up the high quality achieved in recent years, ensuring the right balance between supply and demand, and improvements that are good value for customers.

Different levels of investment will affect customer bills differently, but all will be impacted by significantly higher operating expenditure, particularly the cost of energy.

Changes in the five years to 2015 range from inflation-only to increases of £15 each year. The average bill in 2015 is forecast to be around £350, a £30 increase over the five years, or approximately 12p more each week each year.

The main themes in the industry’s draft business plans are:

 •  Differences between them, led by differences in the populations they serve, the history of the infrastructure they operate, and the environment and climate they must manage.

 •  Detailed research among customers and customer priorities at the heart of business planning.

 •  'Locking in' current high standards by investing properly now to protect our quality of life in the future (and our children’s and grandchildren’s).

Pamela Taylor, Chief Executive said:

"The plans are proposals for meeting customers' priorities, maintaining the infrastructure, and delivering legal requirements for environmental improvements. The companies have worked hard to meet these complex demands while keeping prices affordable and providing good value for money.

"The combined industry programme is a major and timely investment in national infrastructure that everyone depends on and we know will be severely challenged by climate change."

Full statement

Ends

For more information please contact:

Barrie Clarke, Director of Communication
020 7344 1804
Janet Wright, Economic Regulation Adviser
020 7344 1842
Rob Wesley, Policy Adviser
020 7344 1819

Note

Water UK Finance and Investment Briefing Notes explain the background to the Price Review and industry investment:

"In recent years the water industry has invested half its annual turnover in new assets. In other sectors capital expenditure is much smaller in relation to revenue."

"The main advantage of this regulated investment is that benefits come more quickly than if companies used a pay-as-you-go system. The costs can be spread over a longer term like a mortgage. It would be unrealistic and unfair to ask today's customers to foot the whole bill."

1 Priorities and Prices

2 Why water services need so much investment

3 Customers and shareholders investing in improvement