Responding to Ofwat’s Draft Determinations for Price Review 2024 (PR24), Thames Water says the company put forward an ambitious plan to Ofwat that focuses on what their customers and stakeholders told them were their priorities.
The struggling water company wanted £19.8 billion of total expenditure, a record level of investment to improve infrastructure, meet new environmental standards and reduce river pollution. The plan was also designed to improve the resilience of critical infrastructure in the face of challenges such as climate change and population growth.
Thames Water agrees their plan is ambitious, but they also believe it is deliverable, financeable and investible. The company pointed out it is underpinned by a package to support over 500,000 customers with reduced bills.
However, Ofwat has categorised the business plan as ‘inadequate,’ with the regulator also considering the appointment of an Independent Monitor to report on the water company’s progress.
Ofwat has made clear it will revisit its view if Thames can provide further evidence to reach a final determination that is, in the round, affordable for customers, deliverable, financeable, as well as investable.
As part of its draft determination, Ofwat has also asked Thames to look again at their turnaround plan. In a statement, Thames said it was “taking stock of our turnaround plan under our new leadership and reflecting on our progress to date. We will consider all of Ofwat’s proposals as we go through this process.”
