The Water Act 2014 makes changes to the Water Industry Act 1991 that will allow the Water Services Regulation Authority (Ofwat) to set rules about charges for new connections – this is where an owner or occupier of a premises/building, to which the supply of water and/or wastewater services are provided, requires access to the existing public water supply or wastewater system by means of a service pipe or lateral drain, or a new water main or public sewer. Throughout this document, we use the term ‘developer’ to refer to any business or individual whose new buildings or premises require water or drainage services.
These rules will cover new connections to both household and non-household premises, but only where the connections are for ordinary domestic purposes (normally drinking, washing, cooking, central heating and sanitary purposes). The rules will not cover applications for a supply of water for non-domestic purposes (for example, for factory production purposes) or to discharge trade effluent to a public sewer. This reflects the legislative framework.
We will formally consult on charging rules for new connections in the summer, which will cover companies operating wholly or mainly in England. Before then, this document sets out a series of options for different charging approaches, and our emerging thinking on how we could help facilitate improvements in water companies’ approaches to charging through our rules.
In developing this document, we have taken account of the guidance issued to Ofwat by Defra on 29 January 2016 as set out in ‘Charging guidance to Ofwat’. In making our charging rules, we will have regard to the guidance issued by Defra and the Welsh Government, and the rules will be developed in line with our broader statutory duties.
Our emerging thinking is for rules that allow sufficient flexibility and tailoring of charges to meet customer needs. This includes allowing regional variation where the circumstances warrant it. In addition, we will have regard to any forthcoming guidance from the Welsh Government in developing charging rules for companies whose areas are wholly or mainly in Wales in due course.