Re: OFWAT Price Review

14 Dec 2007 10:17

Bristol Water PLC14 December 2007 BRISTOL WATER ACCEPTS REVISED PRICE LIMITS Bristol Water has accepted regulator Ofwat's decision that it can put its pricesup by more than the limits set in 2004. The increased limits reflect an updating of Ofwat's views on a number ofspecified uncertain costs that had to be estimated when prices were previouslyset. Ofwat will now allow average Bristol Water prices to increase by 3.6% aboveinflation from April 2008. There will be only an inflationary change in averageprices from April 2009. Prices for April 2010 and beyond will be set in twoyears at the end of the current industry wide price review. The decision means the average household water supply bill will increase by £5 ayear in April to £144 per year before inflationary effects are added. Pricespreviously set would have seen a 0.7% increase next year and a 2.3% reduction in2009 - both before inflationary adjustments. When setting price limits for 2005 onwards, Ofwat identified a number ofuncertainties where, if the original assumptions proved to be wrong, pricelimits could be reviewed by an interim determination. In three of these areas Bristol Water has experienced significant increases incosts: the soaring number of domestic customers opting for a free meter; thelevel of bad debts; and water abstraction charges. -------------------------------------------------------------------------------- For further information about this release, please call Jeremy Williams or Paul Kelson on 0117 9536470 (office hours) or 07831 453924 or 07831 518964 (outside office hours) This information is provided by RNS The company news service from the London Stock Exchange