Summary of case
This dispute was about the charges made by Severn Trent Water for making new water supply connections to six new build properties and it was referred to us for determination under section 45 of the Water Industry Act 1991.
Summary of Ofwat’s final decision
We have determined that Severn Trent Water’s charge was reasonable and that no refund should be made.
Wider lessons for companies and customers
Ofwat uses the Hyder Report and the independent review of section 45 administration fee and overhead costs to inform our consideration of whether companies’ costs for providing a new water supply are reasonably incurred. The figures included in both of these reports are benchmarks, not suggested charges. In this instance, the charges levied by Severn Trent Water were reasonable.
Ofwat assesses every case on its individual merit. Companies should be able to provide justification for the costs they have charged
Relevant Ofwat guidance
Charging for new connections
Water Services Regulation Authority (Ofwat) Comparative Study: Cost of new water supply connections work (Section 45 Water Industry Act 1991)
Independent Review of Section 45 Connection Costs
20 July 2018
29 November 2018
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