WATER SERVICES
REGULATION AUTHORITY News Release (23/07) issued by The Government
News Network on 16 July 2007
Ofwat has launched
a consultation on how to deliver improved competition to benefit
water customers in England and Wales.
Keith Mason, Director of Regulatory Finance and Competition at
Ofwat, said:
"Ofwat has a duty to promote competition which is in the
interests of water customers. This consultation opens a
substantial debate on how that can best be achieved and what
Ofwat, and other parties can do to make that happen. We are
looking for views to help us take this forward."
In the paper, Consultation on market competition in the water and
sewerage industries, Ofwat sets out a range of options for
discussion. These include ways that existing competition under the
water supply licensing (WSL) regime could be improved, such as:
* Adopting a new access pricing system that better reflects the
costs of access for new companies entering the market; and
*
Recommending a significant one-off reduction in the current
eligibility threshold of 50 million litres of water a year.
The paper also considers major changes to the industry by:
* Separating the different parts of the water supply and waste
water collection services to open them up to competition, e.g.
separating water treatment and distribution;
* Extending
competition to household customers; and
* Extending
competition in the production and abstraction of water.
Mr Mason added:
"We believe that two significant obstacles to the present
competition regime are the current approach to access pricing and
the high eligibility threshold. We welcome the Government's
commitment to bring forward its review of water supply licensing
to ensure that it delivers more effective competition, and we will
play our full part in the review."
Notes to Editors:
1. The Water Services Regulation Authority (Ofwat) is the
economic regulator of water and sewerage companies in England and
Wales. It exercises its powers in a way that it judges will allow
companies to carry out their functions properly, and finance them.
Its duties include protecting the interests of consumers, wherever
appropriate by promoting effective competition.
2. The consultation paper will be available on the Ofwat website
and from the Ofwat Library by phoning 0121 625 1373.
Centre City Tower
7 Hill Street
Birmingham
B5 4UA