RD 12/00

TO THE REGULATORY DIRECTORS OF ALL
WATER AND SEWERAGE COMPANIES AND
WATER ONLY COMPANIES

7 April 2000

INTEREST RATES FOR REQUISITIONS AND INFRASTRUCTURE CHARGES - SIX MONTHLY REVIEW

The basis for Ofwat's approval of interest rates for requisitions and infrastructure charges was set out in the letter of 9 April 1990 (FD4).

The latest published value of the reference rate (10 year gross redemption gilt yield) is 5.36%. Rates to be adopted from 1 April 2000 will therefore be decreased from those published in Tony Ballance's letter of 5 November 1999 (RD 23/99) [. They will be for borrowing, 6.75% (water and sewerage companies) or 7.00% (water only companies) and for deposits, 4.50%.

Any queries on the content of this letter should be addressed to Sukvinder Khangure on 0121 625 1312.

I am copying this letter to Bob Dinwiddy (DETR), Bob Macey (National Assembly for Wales) and Pamela Taylor (Water UK).

Yours sincerely

Charles H Whitworth

Head of Tariffs

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