Ofwat has decided to turn down Thames Water's application for an additional price increase for 2014-15.
It was for Thames Water to justify that this increase was in customers’ interests. Within the three month timescale for assessing the application, Ofwat found that the evidence the company submitted did not justify its proposed £29, or 8%, additional increase in customers' bills.
Rob said:
“I am delighted by Ofwat's final decision to block Thames Water's unjustified extra price rises. This will save customers £29 but I hope it will be the start of regulators regularly pushing back against the demands of big companies. I did ask Ofwat to block this rise and I am pleased it listened."
This is Ofwat's final decision on this application. Thames Water now has the right to trigger an appeal to the Competition Commission.
On 2 December, companies will submit their business plans for the next price review, which will cover the period from 2015 to 2020. Ofwat has called on these plans to reflect their customers’ priorities, and believes there is scope for reductions in bills from 2015. If companies do not propose reductions, they will need to fully explain to their customers why. Jonson Cox last week repeated that Ofwat will set 2015-20 prices using an independent, rigorous process. Its final decision is due on these prices by January 2015.
Rob's letter to Regina Finn the Chief Executive of Ofwat is attached at the foot of this page.