Regulator consults on proposals to reduce NI Water costs and enhance services
The Utility Regulator today published its draft determination on NI Water’s price control (often referred to as PC10) for 2010 to 2013. It includes the Regulator’s assessment of NI Water’s revenue requirements over the three year period.
The proposals provide for over £500 million of investment by NI Water to benefit customers and the environment, subject to the public expenditure allocations that will be set by the NI Executive. (see note 2 below)
Through efficiency and other savings, the draft determination proposes that NI Water’s revenue requirement could be reduced by as much as 11%, whilst also improving services to consumers.
Commenting on the proposals, Utility Regulator Chief Executive, Iain Osborne said:
“At the heart of our proposals is a determination that Northern Ireland consumers receive value for money water and sewerage services. This would reduce the burden on the public purse and would also reduce the overall bill for Northern Ireland businesses by over £40 million. But this is not just about delivering savings. It is about investing smarter and more efficiently to deliver services that everyone can have confidence in.
“These proposals present an enormous opportunity for NI Water and its staff. We welcome NI Water’s aspiration to be the most improved water company in the UK. We support that ambition and the draft determination is a pathway for achieving that.
“The level of efficiency savings are challenging but deliverable and are a result of a detailed analysis of NI Water’s costs and performance. This is the most robust review ever taken of NI Water’s costs - taking into account both appropriate benchmarks and other relevant factors, including making allowance for extra costs that are specific to Northern Ireland.”
Mr Osborne concluded:
“This is new ground for water and sewerage services in Northern Ireland – the first regulated price control. We very much hope that all interested parties will engage with us during the forthcoming consultation.” (see note 3 below)
The Northern Ireland Authority for Utility Regulation (the Utility Regulator) is the non-Ministerial Government Department responsible for regulating the electricity and gas industries and water and sewerage services in Northern Ireland.
2. Examples of the benefits include: activities to improve security of supply, reduce instances of poor pressure and sewer flooding, reduce the pollution of rivers and bathing waters and to further improve the already high quality of drinking water.
- PC10 Draft Determination Main Report
- PC10 Draft Determination Summary Report
- PC10 Q and A
- Draft Determination Summary Report - Water and Sewerage Service Price Control 2010-13
- Draft Determination Main Report Supporting Annexes
- Draft Determination Annex A Overall Performance Assessment
- Draft Determination Annex B Capital maintenance Assessment
- Draft Determination Annex C1 Letter to NI Water Re OPEX Efficiency Targets
- Draft Determination Annex C2 Methodological Note on Opex Efficiency Targets
- Draft Determination Annex D1 Letter to NI Water re Special and Atypical Factors
- Draft Determination Annex D2 Analysis of NI Water’s Special Factor Claims
- Draft Determination Annex D3 Analysis of NIWater’s Atypical Claims
- Draft Determination Annex E NERA NI Water’s Comparitive Efficiency
- Draft Determination Annex F LECG Top Down Analysis of Efficiency Assumptions in UK Regulatory Sector
- Draft Determination Annex G Calculation of Price Caps and Subsidy
- Draft Determination Annex H Calculating Current Cost Depreciation on Non Infrastructure Assets
- Draft Determination Annex I NERA Ni Water Business Plan -Cost of Debt and WACC
- Draft Determination Annex J NERA Auditof NIAUR Financial and Tariff Basket Model
- Draft Determination Annex K Letter to NIAUR from NERA re Robustness of Financial Model
- Draft Determination Annex M Utility Regulator PC10 Financial Model