Interim Support with In-Period Outcome Delivery Incentives (ODI) Determinations

We published our approach to the in-period ODI determinations for in an Information notice in August 2018.

On 1 July 2018 Severn Trent Water and Dee Valley Water's areas of appointment were varied so that Severn Trent Water's area is located in England and Dee Valley Water (renamed Hafren Dyfrdwy) only area of appointment covers an area of Wales.

The performance commitments for 2018-19 and 2019-20 for these two companies need to be revised in line with this change.

The companies have proposed how this will be carried out.

It is important that the revised performance commitments for the new company areas of Severn Trent Water and Hafren Dyfrdwy will lead to service for customers that are at least the same under the proposed performance commitments as they would have if no change to the company boundaries had occurred.

Ofwat has a temporary opportunity for two experienced regulatory economists or analysts to assist us with the in-period ODI determinations for 2017/18 and to review the revised performance commitments for Severn Trent Water and Hafren Dyfrdwy for 2018-19 and 2019-20.

The key Deliverables/outputs required are: • three spreadsheets assessing the in-period ODI submissions for Anglian Water, Severn Trent Water and South West Water; • Potentially, if one or more of the companies does not make a submission, an assessment of the reasonableness of the company's information explaining why it has not made a submission for an in-period ODI determination.

It is possible we will still open a determination in such a case and the spreadsheet in bullet point 1 will still be necessary; • Three draft determinations that we will consult on for Anglian Water, Severn Trent Water and South West Water for 3 weeks (probably from 31 October 2018) which will form appendices to a main determination document; Responding to issues raised by Ofwat management and Ofwat's legal advisors on the draft determinations for Severn Trent Water and South West Water; and • Supporting Ofwat's staff who will be drafting the main determination document For example, providing any information on Anglian Water, Severn Trent Water and South West Water that is needed for the main document. • A document setting out the assessment of whether each revised performance commitment for Severn Trent Water and Hafren Dyfrdwy is in the interests of customers and where applicable recommending changes necessary so that customers are likely to receive at least as good a service under the proposed performance commitments as they would have if no change to the company boundaries had occurred.