Price review 2024 – company appeals update

18 Feb 2025 08:18 PM

Following the publication of the 2024 Price Review final determinations in December 2024, Ofwat yesterday confirmed that six companies have requested references to the Competition and Markets Authority (CMA).

The companies who have requested a review are:

• Anglian Water
• Northumbrian Water
• Thames Water
• Southern Water
• South East Water
• Wessex Water

Chris Walters, Senior Director for the Price Review at Ofwat, said:

“As part of the standard process underpinning our Price Reviews, it is the right of companies to request a redetermination by the CMA. We will be re-stating our case as part of this process.

“Our PR24 final determinations unlock a quadrupling of investment by the sector. This will accelerate the delivery of work to deliver cleaner rivers and seas – as well as securing long-term drinking water supplies for customers.

“Final determinations were based on a robust examination of all funding requests made by companies to ensure every pound of customer bills provides value for money, delivers real improvements and enables the sector to attract the investment it needs.”

The next step will be for Ofwat to formally make the references to the CMA, which will then have six months to make its own determinations. If required, this can be extended by up to a further six months.

For information on the appeals process, please see this link from the PR19 process.

Notes to editors

• Ofwat’s review of company business plan submissions in the second half of 2024 led to the removal of £8bn of unjustified costs compared with companies most recent requests (a company-by-company breakdown can be viewed in Table 1 of our PR24 expenditure allowances document). In addition, our approach to setting a rate of return saved customers £2.8bn.
• Any appeal will not impact bill increases announced for the 2025/26 billing year. If the CMA ultimately make any changes to the final determinations and sets different price controls, this will be reflected in bills in subsequent years.
• At PR19, four companies appealed Ofwat’s final determinations (Anglian Water, Bristol Water, Northumbrian Water and Yorkshire Water). The appeals led to modest increases in expenditure allowances for the four companies, ranging from 2.1% (£108m) for Anglian Water to 6.6% (£27m) for Bristol Water. These changes were in part because of new information available to the CMA (such as 2019-20 outturn data) that was not available at the time of Ofwat’s final determinations.
• At PR14, just one company appealed Ofwat’s final determinations (Bristol Water). The CMA provided a total expenditure allowance to Bristol Water of £428.6m, which was 4.8% higher than Ofwat’s PR14 allowance of £409m.