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.