drain TRADER
AMP7
spending and investment over the next five years (2020-2025) after OFWAT’s Price Review in 2019 (PR19). The programmes for each of the UK’s Water only and Water and Sewerage companies (WaSC) has been agreed with the UK regulator OFWAT which has also indicated what the charging regime for each of the Water and Water and Sewerage Companies will be over this time period, given its role as protector of the customer interest in relation to the privatised water sector currently operating in England and Wales. Scotland and Northern Ireland have their own systems which, whilst still government operated, work as if they were quasi-privatised operations, more or less (it is more complex than that but we will not even attempt to cover that here!).
J
In the simplest of terms this means that OFWAT and all the Water Companies it regulates have agreed a charging programme for customers within each of their regions of responsibility which will provide the funds to run the businesses and pay for on costs, asset maintenance and infrastructure improvements, leakage reduction, repairs and upgrading/replacement of ageing assets and everything else over the next five year period, whilst providing each water company with a reasonable profit margin. At least that is the theory.
WHAT HAS BEEN AGREED?
For those that are interested in the minutiae of AMP 7, the OFWAT website offers a run-down of the final agreed ‘determinations’ for each of the Water Companies under its jurisdiction, each averages around 60 pages plus so have the caffeine ready. Some of these details will be highlighted in the following for the individual operations and some of the questions these items raise will be discussed later with a view from outside of the sector.
4 drain TRADER | June 2020 |
www.draintraderltd.com
– what will the UK Water Industry be doing for the next five years?
ust to remind people of the terminology, AMP 7 is the UK water industry’s Asset Management Programme as agreed forincome,
For the overall picture of the next five years however OFWAT has provided a summary which shows that in total according to their figures some £51 billion is expected to be spent across all water and water and sewerage companies in the regulated water industry to achieve specific aims and objectives, whilst customer water bills are expected to fall by an average of around 12% (before inflation over the AMP period). Some of the targets highlighted include:
• Over £1 billion to help protect from flooding • £469 million to address long-term drought challenges • Reducing pollution incidents by 30% • Improving over 12,000 km of river • Helping customers reduce water usage by up to 13% • Cutting water losses through leakage by 16% • Reducing mains bursts by 12% • Helping 1.5 million customers with their water bills
Of course when looking for the detail of these headline figures it should be understood that the regulator OFWAT does not refer this as the AMP period at all but uses the term Price Review as mentioned previously, a process which took place in 2019 and formed the basis upon which these determinations have been made.
Furthermore, the industry is made up of several different water and water and sewerage companies of varying sizes serving highly varied customer bases so the individual incomes and commitments for each of the individual companies also varies widely.
COMPANIES COVERED BY AMP7
The number of Water Only and Water and Sewerage Companies covered by OFWAT’s determinations is seventeen (17). Perhaps a quick overview of
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84
