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THE MAGAZINE FOR THE DRAINAGE, WATER & WASTEWATER INDUSTRIES


of -£124.3 million over the five year AMP 7 period (or a loss of £24.87 million per annum). It seems unusual to allow a loss for a water company but there must be some reasoning behind this although this writer has had no luck finding out what it is in the figures available - I am probably not up to that level of accounting or have missed something vital (or not).


As part of this, Affinity Water programme there is a scheduled water bill reduction of some 6% expected over the AMP 7 period.


Key targets for Affinity Water include: • Leakage down 20%


• Water use down 13% (this is highlighted as the biggest drop in England and Wales)


• Maintain the British Standards Institution’s standard for accessible services


Anglian Water – The Allowed revenues for Anglian Water have been set at £ 6,134.1 million against a Totex of £5,309.7 million for its wholesale operation along with a £403.0 million figure for its retail operations. This gives a final Totex of £5,712.7 million and a margin of £421.4 over the five year AMP period (equivalent to £84.28 million per annum). The scheduled water bill reduction across the AMP is set at 10%.


Key targets for Anglian Water include: • £305 million to interconnect water supplies • Pollution incidents down 33% • Carbon emissions down 10%


what has been agreed for each and what they have committed to in some of their key targets might give some idea of where the industry is expected to be going for the next five years.


It should perhaps also be noted that the figures accompanying in the following are taken from the final determination documents available to view on the OFWAT website. The details of how these figures have been reached can be found (for those either with insomnia or who have a ‘masters’ in accountancy and economics) on the OFWAT website. It should also be noted that this writer has tried to read much of this documentation and the final outcome of this effort is that for the next AMP review article another writer can do it!


Within each company review it might also be noted that Total Expenditure (Totex) covers all expenditures for the Water Company or WaSC over the five year AMP period (not per annum). The figures shown are those finally agreed by OFWAT for that Water Company or WaSC for both the company’s wholesale business and its retails business with the sum of the two indicating the total Totex expected for the full five years of the current AMP 7 period. Where in the following Bill reduction is referred to as a percentage, this indicates the reduction in bills before inflation between 2020 and 2025.


Looking at the companies involved in no particular order other than alphabetic (that’s how OFWAT presents them on the website) some basic figures pertaining to the final determination from OFWAT for each follows.


Affinity Water – The Allowed revenues for Affinity Water have been set at £ 1,459.3 million with a Total Expenditure (Totex) being £ 1,441.4 for its wholesale operations with an additional £142.2 million for its retail operations. This gives a final Totex of £1,583.6 million. Assuming the difference between these is the margin for the company that leaves a margin


FOLLOW US


Bristol Water – The Allowed revenues for Bristol water have been set at £ 553.3 million with a Totex of £420.2 million for its wholesale operations with an additional £50.8 million for the retail sector, giving a final Totex of £471.0 million. This provides a margin of some £82.3 million across the AMP (or £16.46 million per annum). The water bill reduction target for Bristol Water is set at 15%.


Key targets for Bristol Water include: • £8.1 million to improve water mains resilience • Installing more than 48,000 water meters • 85% of vulnerable customers satisfied with the help they receive


Dŵr Cymru (determined separately but overall forming part of the Welsh Water Operation) – The Allowed revenues in this instance have been set at £ 3,729.6 million, with a Totex £2,942.8 million for wholesale operations and £204.6 million for retail. This indicates a final Totex of some £3,147.4 million. The margin here is therefore around £582.2 million over the AMP (or £116.44 million per annum). The water bill reduction target is 9%.


Key targets for Dŵr Cymru include: • Replacing 7,000 lead pipes • £97 million to improve water quality


Hafren Dyfrdwy (determined separately but overall also forming part of the Welsh Water Operation) – Allowed revenues in this case have been set at £ 127.9 million, with Totex of £165.6 million for wholesale operations and £14.4 million for retail or a grand total of £180.0 million Totex. This offers a margin (loss again) of -£52.1 million over the AMP (or -£10.42 million per annum). Again, it seems odd that the AMP programme should allow for a negative margin? The bill reduction target for Hafren Dyfrdwy has been set at 3%.


Key targets performance targets include: • Pollution incidents down 39% • £2.8 million to improve reservoir safety and resilience • Internal sewer flooding down 23%


June 2020 | drain TRADER 5


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