If as a new appointee you are providing new water supplies for domestic purposes (such as to new housing developments) you are legally entitled to levy infrastructure charges. These can be raised where premises are connected to the water company’s water supply (or to the sewerage company’s sewers) for the first time. And they are intended to provide a contribution towards the costs of developing or enhancing local networks to serve new customers.
Calculating infrastructure charges
Infrastructure charges are calculated in accordance with Condition C of each water companies’ appointment. We determine the maximum charge that any company can levy.
Infrastructure charges and bulk supply agreements
Generally, infrastructure charges are dealt with in bulk supply agreements, with new appointees agreeing to levy such charges on their customers and pass them through to the existing appointee. We support this approach in that it is generally the existing appointee that owns the relevant network that may need to be enhanced.
The WIA91 does not explicitly set out the timing of infrastructure charge payments. Our view is that we consider infrastructure charges are payable to you, as a new appointee, when supply is made available – that is, when the first time connection is made. The timing of the payment of the amount equivalent to infrastructure charges by you to the existing appointee should be covered within your bulk supply agreement.