In-period ODI determinations

At the 2019 price review we set water companies service targets (‘performance commitments’) during 2020-25. This encourages the companies to deliver on the objectives that matter to today’s customers, future customers and the environment.

Most of companies’ performance commitments have rewards and penalties (‘outcome delivery incentives (ODIs)’) associated with them.

The majority of these ODIs are financial.

If a company performs better than the performance commitment level, it may get a financial reward (‘outperformance payments’)
If a company performs worse below the performance commitment level it may pay a financial penalty (‘underperformance payments’)

In this way, each company’s management and its investors are encouraged to deliver what customers want. They get outperformance payments for doing well; and make underperformance payments if they do badly.

In-period payments

Most of the outperformance or underperformance payments companies get for financial ODIs are paid to or recovered from each company every year during 2020-25 (or ‘in-period’).

We think this is better than waiting five years until the next price review process. This is because companies get the financial impact closer in time to the performance that generated it. This focuses each company’s management on delivering better services year after year and improves companies’ accountability to their customers.

In-period ODI determinations 2020-25

An in-period determination is the process by which we adjust each company’s price controls to reflect companies’ performance against these in-period ODIs.

Unlike the five yearly price reviews, in-period determinations have to be triggered by either us or the water companies. So they may not be required every year for every company.

In-period determinations for 2020-21

On 5 October 2021, we published our in-period outcome delivery incentives draft determinations for 2020-21.

On 11 November 2021, we published our final determinations, including a sector-wide report, confirming the payments due to companies or customers as a result of water company performance against their 2020-21 performance commitments. Overall, £67m will be repaid to customers. The payments will affect the amount of revenue companies can recover from customers through 2022-23 bills.

The largest outperformance payment will be to Severn Trent Water, which will receive £25m. Thames Water and Southern Water will return £53m and £46m to their customers respectively.

For Severn Trent Water and Portsmouth Water we have agreed to defer some ODI payments.

Following a consultation about the impact of Covid-19 on customers’ use of water, we have decided to review company performance on per capita consumption at the end of the 2020-25 period, rather than by individual year. ODI payments for per capita consumption performance commitments will be determined at the end of the period for all years within the 2020-25 price control period. Consequently, we have not included any adjustment in relation to this performance commitment in our final determination.

We analyse and compare water company performance through publications such as our Service Delivery Report and Financial Monitoring Report, both of which are due to be published before the end of 2021.

Company	Consultation on our draft in-period ODI determination	Consultation response	Final in-period ODI determination
Sector-wide report	Sector-wide report – Draft determination	Sector-wide responses	Sector-wide report – Final determination publication Download the sector data for the 2020-21 final determinations Download the sector data for the 2020-21 draft determinations.
Affinity Water	Affinity Water – Draft determination	Affinity Water – responses	Affinity Water – Final determination publication Affinity Water – final models
Anglian Water	Anglian Water – Draft determination	Anglian Water – responses	Anglian Water – Final determination publication Anglian Water – final models
Bristol Water	Bristol Water – Draft determination	Bristol Water – responses	Bristol Water – Final determination publication Bristol Water – final models
Dŵr Cymru	Dŵr Cymru – Draft determination	Dŵr Cymru – responses	Dŵr Cymru – Final determination publication Dŵr Cymru – final models
Hafren Dyfrdwy	Hafren Dyfrdwy – Draft determination	Hafren Dyfrdwy – responses	Hafren Dyfrdwy – Final determination publication Hafren Dyfrdwy – final models
Northumbrian Water	Northumbrian Water – Draft determination	Northumbrian Water – responses	Northumbrian Water – Final determination publication Northumbrian Water – final models
Portsmouth Water	Portsmouth Water – Draft determination	Portsmouth Water – responses	Portsmouth Water – Final determination publication Portsmouth Water – final models
SES Water	SES Water – Draft determination	SES Water – responses	SES Water – Final determination publication SES Water – final models
Severn Trent Water	Severn Trent – Draft determination	Severn Trent Water – responses	Severn Trent Water – Final determination publication Severn Trent Water – final models
South East Water	South East Water – Draft determination	South East Water – responses	South East Water – Final determination publication South East Water – final models
South Staffs Water	South Staffs Water – Draft determination	South Staffs Water – responses	South Staffs Water – Final determination publication South Staffs Water – final models
South West Water	South West Water – Draft determination	South West Water – responses	South West Water – Final determination publication South West Water – final models
Southern Water	Southern Water – Draft determination	Southern Water – responses	Southern Water – Final determination publication Southern Water – final models
Thames Water	Thames Water – Draft determination	Thames Water – responses	Thames Water – Final determination publication Thames Water – final models
United Utilities	United Utilities – Draft determination	United Utilities – responses	United Utilities – Final determination publication United Utilities – final models
Wessex Water	Wessex Water – Draft determination	Wessex Water – responses	Wessex Water – Final determination publication Wessex Water – final models
Yorkshire Water	Yorkshire Water – Draft determination	Yorkshire Water – responses	Yorkshire Water – Final determination publication Yorkshire Water – final models

C-MeX model

D-MeX model

Any in-period ODI determinations for 2021-22, 2022-23 and 2024-25 will appear here.

We will carry out in-period ODI determinations for 2023-24 as part of our 2024 price review.