2014 price review financial model

The 2014 price review is our process for setting the price and service package (the ‘price controls’) that each of the companies must deliver in each of the five years between 2015 and 2020.

As part of the price review we have developed a financial model to help us assess companies’ business plans. The three main purposes of the financial model are to:

  • determine the wholesale price controls
  • calculate the revenues arising from the retail price controls
  • help assess financeability of the company

We have published our model now to share our approach, and to enable companies to use it – if they wish – before they submit their business plans. The model is still subject to review, and so may be subject to change.

We do not expect companies to test the model for us, nor is it necessary for them to use the model at all. However, if you do use the model we would be interested in feedback from you. We would be particularly interested to understand any variances (deltas) that you find between the results of our model (version 1) and your own. It would also be helpful if you contact us if you think that you have found an error in our model.

If you have any comments on the financial model, please send them to [email protected] or if you are a company please contact your respective portfolio lead. The closing date for responses is 8 November.

If any company is unable to respond by the 8 November they can still submit details of any variances between the Ofwat model (version 1) and their own model with their business plans. We propose to an issue an update of the model during December, following review and receipt of any comments on the model.

PR14 financial model
PR14 financial model rulebook
PR14 financial model user guide

Note that the model is an xlsm spreadsheet. If you are having problems opening it, we suggest you try downloading the file, and renaming it with a .xlsm file extension, and then opening it in Excel. Please note that it needs to be xlsm, not xlsx.