Ofwat propose opening retail water market

Water regulator Ofwat has published a report that puts forward opening up the residential retail water industry in England and Wales up to competition.

At the moment, customers have no say over which company supplies their water. Ofwat envisage that this move should mean increased competition leading to price cuts for households.

The report carried out a cost assessment over a 30-year period and could be worth a total of £2.9Bn of potential benefits with a net benefit per customer of £8 per year.

By opening up the market, Ofwat believe that customers would benefit not just from lover bill s but would also see better service and industry innovation.

The proposals would allow companies to purchase water in batches from existing providers and then sell it on to customers.

Households could see water sold as a package with other products such as such as energy and telecommunications.

Ofwat’s Chief Executive, Cathryn Ross, said: “The service offers from water companies can feel behind the curve compared to the innovation customers benefit from when buying other goods.

Ms Ross said that the water industry was stuck in a past needed to keep up with the times: “The uncomfortable truth is that, when it comes to retail offers, water companies provide an analogue service in a digital age.

“Customers tell us they think they should have the freedom to choose and don’t understand why water is the only retail market in which there isn’t some form of competition.

Ms Ross said the move wouldn’t be without significant costs and it was important that vulnerable customers should be protected and efforts taken to ensure that people are treated fairly.

She commented: “The decision for the Government to make is whether the potential benefits outweigh the costs and risks.”

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