Two water companies have been given an effective ‘thumbs up’ from the regulator Ofwat for their business plans – which both include a drop in water prices.
South West Water and Affinity Water are the only ones to win draft approval so far because they handed in plans which didn’t need extra evidence to back up or need to do more for customers.
As they are monopolies in their separate regions, all water suppliers in the UK must get approval from Ofwat for the prices they charge for water and sewage services every five years.
Between 2015-2020, South West said the bills of customers in Devon, Cornwall and parts of Somerset and Dorset will fall an average of 7% before inflation and it will spend around £1.7bn on maintainance.
Affinity which serves parts of north west London and the Home Counties said its bills will fall an average of 11% before inflation, with investment of roughly £1.2bn over the period.
The other 16 major companies in the UK are likely to get their own draft “determinations” in the summer. Final decisions for all companies will come by the end of the year.
Ofwat’s Chief Regulation Officer, Sonia Brown said: “We wanted to see companies really stretch themselves and South West and Affinity rose to that challenge with innovative and affordable business plans. This is a good deal for customers.”