Complaint against Southern Water regarding the reasonableness of connection costs

Case number

OFW0016533

Summary of case

This dispute was about the charges made by Southern Water for making new water supply connections to two blocks of flats 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 Southern Water’s charge was too high and that the company should refund £5,863.69 (plus interest) to the customer.

Wider lessons for companies and customers

As a starting point, we would expect the administration costs for a new water supply connection to be no more than £105.30. This is the reasonable charge set out in ‘Independent review of section 45 administration fee and overhead costs on behalf of the Water Services Regulation Authority (Ofwat) – summary’.

If a water company believes that a higher charge is justified, it must set out compelling evidence to demonstrate what administration activities it is carrying out, the costs that it incurred in providing the activities and the reasons these activities were necessary in order to provide the customer with the new connection(s).

Relevant powers

Sections 30A of the Water Industry Act 1991

Section 45 of the Water Industry Act 1991

Date opened

07 November 2016

Date closed

18 July 2017

Key documents

Final determination 

Enquiries

If you have a query, please contact: casemanagementoffice@ofwat.gsi.gov.uk

Media enquiries to: 0121 644 7642/7821 or pressofficeteam@ofwat.gsi.gov.uk

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