Complaint against Southern Water regarding the reasonableness of connection costs


Case number


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 powers

Sections 30A of the Water Industry Act 1991

Section 45 of the Water Industry Act 1991

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

Date opened

20 July 2018

Date closed

29 November 2018

Key documents

Final Determination


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