Bristol Water customers to get cheaper bills as competition watchdog tells firm to make 17% cuts over the next five years

  • Annual Bristol Water bill to drop £32 to about £159 for next five years if calculated using a 2012/13 price base
  • Final pricing decision to be announced on September 3 

More than a million households in Bristol could see their water bills slashed by 17 per cent, before adding inflation, over the next five years after a ruling by the competition watchdog.

If calculated using a 2012/2013 price base, the average household bill for Bristol Water customers is expected to drop from £191 to about £159 per year for the 2015-2020 period in real terms.

Bristol Water, which supplies around 1.2 million customers in the area, had been ordered by sector regulator Ofwat to reduce household bills by 19 per cent earlier this year.

Cuts: Some 1.2m Bristol Water customers could see bills slashed by 17 per cent for the next five years

Cuts: Some 1.2m Bristol Water customers could see bills slashed by 17 per cent for the next five years

The company rejected that request on the basis that it would not have enough funds to run the business, saying it would lower the bills by 6 per cent before inflation instead.

Ofwat then referred Bristol Water to the Competition Market Authority, which today published the provisional findings of a detailed review and told Bristol Water to implement a 17 per cent cut in bills. A final decision will be announced on September 3.

Bristol Water had claimed it would need to spend £537million on wholesale activities, which include abstracting, storing, treating and transporting water. But the CMA said this would cost £429million, a bit more than Ofwat’s assessment of £409million, but much lower than Bristol Water’s estimates.

CMA inquiry group chairman Anne Lambert said: ‘Our provisional findings would result in substantial reductions in bills, as compared with Bristol Water's plans, although they involve a small rise above the price limits set by Ofwat.

‘We provisionally rejected several projects proposed by Bristol Water which would have increased its expenditure - and ultimately bills - because we did not consider they were fully justified and in the interests of customers.’

Bristol Water chief executive Luis Garcia said:’The provisional findings are positive in some areas.

‘We will continue until the conclusion of the process on September 3 to ensure we can deliver what our customers want - a reliable and quality water supply - at an appropriate bill level.’

The average water bill across England and Wales is set to drop by around £9 from next year, according to Ofwat.

At the start of the year the regulator said bills will drop by an average of two per cent and households struggling to pay will share a pot worth £40million to help them pay their bills or write off earlier debts.

Water companies are cutting charges after the regulator Ofwat ordered the industry to lower annual bills by five per cent in real terms over the next five years.

However, actual bills dropping through customers' letterboxes in five years' time will be higher because they will take into account the rate of inflation.


The comments below have not been moderated.

The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline.

By posting your comment you agree to our house rules.

Who is this week's top commenter? Find out now