Ofwat publishes final methodology for 2019 Price Review
Data models used to calculate water companies price controls
Certain information needed to set those
On 13 December 2017, Ofwat published the final methodology for its 2019 Price Review (PR19). The PR19 is a once-in-five-year review of the price controls that govern the water industry in England and Wales. Ofwat uses data models to calculate the price controls for water companies, and the information it needs to set those controls includes:
- The cost of providing water and wastewater services
- The level of risk in the water industry
- The expected level of investment in the water industry
Ofwat's final methodology for PR19 has been developed following a consultation with the water industry and other stakeholders. The methodology sets out the principles that Ofwat will use to calculate the price controls, and the information that it needs to collect from water companies in order to do so.
The PR19 price controls will come into effect on 1 April 2019. Ofwat's final methodology for PR19 is available on the Ofwat website.
Conclusion
Ofwat's final methodology for PR19 is a significant step in the process of setting the price controls for the water industry in England and Wales. The methodology sets out the principles that Ofwat will use to calculate the price controls, and the information that it needs to collect from water companies in order to do so. The PR19 price controls will come into effect on 1 April 2019.
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