Modifications to Ofwat's rolling incentive schemes (MD191)

Ofwat's conclusions on "rewarding future out-performance and handling under-performance", including adoption of proposals to introduce a special surcharge payable in the period 2010-2015 by customers of companies which are were deemed to be at or near the frontier in unit expenditure comparisons and econometric models used in the 2009 review. The amount of the surcharge would depend on the extent to which these companies had spent less than the operating expenditure projections set by Ofwat at the 2004 review. A commentary on consultation responses (11 pages, PDF) and some worked examples (3 pages, PDF) are appended.

For further information or advice please contact Franck Latrémolière.

Filed under Ofwat, Price controls, Water.

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