Ofwat has set out its draft methodology for the upcoming Price Review (PR24) with a focus on securing better outcomes for customers and the environment.
PR24, which will cover the period 2025-2030, will drive water companies to step up to deliver in the face of urgent challenges on the environment and climate change. The review will push companies to find new and innovative ways of delivering affordable, reliable and resilient services for all.
Ofwat has highlighted four key ambitions for PR24:
- Focus on the long term: The sector must address immediate and long-term challenges. Business plans for the next five years will be set in the context of a 25 year delivery strategy, and Ofwat will hold companies to account for the improvements that they need to deliver.
- Deliver greater environmental and social value: A better environment for everybody will be delivered through immediate and sustained action to improve performance on river water quality, bigger steps towards net zero, and more nature-based solutions.
- Reflect a clearer understanding of customers and communities: New open public meetings on companies’ plans, more robust research to understand and reflect customers’ views, and stronger partnership working will deliver better outcomes.
- Drive improvements through efficiency and innovation: Companies need to step up with ambitious plans that will help set the benchmark for resilient, affordable services for all.
The consultation on the draft methodology provides stakeholders with an opportunity to help Ofwat shape the future of the sector and guide the business plans of companies.
David Black, Chief Executive, Ofwat said:
“Water and wastewater companies provide an essential service for customers across England and Wales. We’ve listened to people’s concerns and ambitions for the water sector. We understand the urgency of the environment and climate change challenges and the pressure on people’s finances. In PR24, companies need to step up to meet these challenges by finding new and innovative ways of delivering reliable and resilient services.”
Aileen Armstrong, Senior Director, Company Performance and Price Reviews, Ofwat said:
“This price review matters for all of us and our environment. We are keen to hear views on our proposals from everyone with an interest in the future of this vital service.”
“This price review will continue to push the sector to deliver more for customers and the environment. We are proposing changes to ensure that customers’ voices are heard more clearly and are better understood in this review than ever before. We’re also proposing to focus attention on the outcomes that really matter now and for the long term, and that companies should set their plans in the context of their strategies for the next 25 years. Overall, our proposals are designed to challenge companies to deliver affordable water and wastewater services that meet the needs and expectations of customers and the environment.”