Consultation on economic asset valuation for the bioresources RCV allocation at PR19

About Consultation

This document is a consultation on the approach for water and sewerage companies (WaSCs) to value their bioresources assets to inform the allocation of the legacy wastewater Regulatory Capital Value (RCV) at 31 March 2020 between the network plus and bioresources controls at PR19 and the information that is required from companies in September 2017. In order to provide a level playing field for bioresources trading and processing and to protect customer interests, it is important that a robust and accurate valuation of sludge assets supports the proposed RCV allocation to bioresources. This proposed guidance in this document sets out our view of the appropriate approach to asset valuation.

Alongside this consultation we publish a report we have commissioned from Reckon LLP (with Jacobs) that we intend will be used by companies as they consider their valuation of sludge assets to inform their proposed RCV allocation. This report provides supporting guidance on the topics considered in this consultation and can be found in the supporting documents section below.

We welcome any comments or representations on our proposals.  Please send written responses by close of business on 31 March 2017. You can email your responses to [email protected] or you can submit your responses by post to: Water 2020, Ofwat, Centre City Tower, 7 Hill Street, Birmingham B5 4UA.