Ofwat proposes competition boost to benefit consumers


Keith Mason,
Regulatory Finance
and Competition 
.London, U.K. — (METERING.COM) — December 21, 2007 – U.K. water and sewerage economic regulator Ofwat has proposed boosting competition in the water market by increasing the number of non-household customers eligible to benefit from competition and amending pricing aspects of the water supply licensing regime.

In particular Ofwat proposes that the number of customers eligible to change water supplier should be increased from the current 2,200 to around 27,000 non-households within one year, and thereafter in the subsequent two years to all 1.2 million non-households. In addition, a set of general criteria should be developed for access pricing, which is the pricing payable by a licensee to an appointed water company.

"Competition in other utility sectors has led to lower bills and improved service, enabling the withdrawal of regulation where markets become effectively competitive," said Keith Mason, Ofwat director of regulatory finance and competition. “Effective competition across the water sector in England and Wales will lead to greater benefits for consumers in the future, driving dynamic efficiency and spurring innovation in a way that regulation generally cannot.”

Ofwat has invited further comment on these recommendations and in the second part of the competition review, will also review issues such as the vertically integrated monopoly structure and household competition.