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Ofwat confirms final in-period ODI determinations

The Water Services Regulation Authority confirmed on Thursday that £67.0m would be repaid to companies or customers as a result of water company performance against their 2020-21 performance commitments.
Ofwat said the largest outperformance payment would be made to Severn Trent Water, which will receive £25.0m, while Thames Water and Southern Water will return £53.0m and £46.0m to customers, respectively.

For Severn Trent and Portsmouth Water, Ofwat agreed to defer some outcome delivery incentive payments.

“Our 2019 price control determinations set the price and service packages that companies have to deliver through to 2025,” said the regulator.

“The outcome delivery incentives (ODIs) are the financial or reputational consequences for companies of outperformance or underperformance against their performance commitments and these are reviewed year on year to make them timely against the company performance and customer experience.”

Ofwat stated the payments would affect the amount of revenue companies can recover from customers through their 2022-2023 bills.

“Following a consultation about the impact of Covid-19 on customers’ use of water, we have decided to review company performance on per capita consumption at the end of the 2020-25 period, rather than by individual year,” added Ofwat.

“ODI payments for per capita consumption performance commitments will be determined at the end of the period for all years within the 2020-25 price control period. Consequently, we have not included any adjustment in relation to this performance commitment in our final determination.”

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