18/08/05
On 15 August water companies in England and Wales submitted their draft business plans for 2005 to 2010 to the economic regulator Ofwat. The aim is to secure the success the industry has achieved in recent years. (1)
Companies are to make their draft plans public at the end of August (2) in accordance with Ofwat requirements. This is an important early milestone in the 2004 price review process, as noted by today's business media.
The plans provide a number of possible investment scenarios for discussion with regulators, customers and other stakeholders in the coming months. Some are based on reference assumptions laid down by Ofwat (to enable comparisons between companies), others are companies' own views on how best to meet customers' needs and wishes.
First cost estimates
All the plans will contain first estimates of the costs of proposed investments and give an early indication of the potential impact on customers' bills.
Each company has naturally designed its plan to take account of the particular needs of its own customers and local environment. However some common themes are expected, as newspapers have reported:
• higher priority given to maintaining and renewing old failing infrastructure
• higher priority to meeting customers (3) particular requirements, such as preventing flooding from sewers
• continuing investment in environmental and drinking water quality improvements
• proper consideration for maintaining the balance between supply and demand
• some increase in customer bills to ensure a reliable system in the future and enable the government to implement environmental directives on time.
Notes
1) For a brief summary read Water in the sun (7 August)
2) Water UK holds a full media briefing at 1100 on Thursday 28 August.
3) The companies together with all the water regulators and the government will carry out a major customer research survey in September and October. The regulators are also researching stakeholder views as announced on 12 August.
