Price Control is the process through which NI Water reaches agreement with the Utility Regulator on the organisation’s priorities and plans for the period of the Price Control. It also determines the financial framework for the period, setting limits on the levels of non-domestic customer charges.
NI Water is an organisation which, as the monopoly supplier of water and sewerage services in Northern Ireland, is regulated by the Utility Regulator. However, NI Water is also designated as a Non Departmental Public Body (NDPB), operating within the financial framework and funding allocations of the Department for Regional Development (DRD).
The Utility Regulator, in consultation with NI Water, DRD, the Consumer Council for Northern Ireland (CCNI) and other stakeholders, sets the period for each Price Control. The first Price Control period was PC10, running from April 2010 to March 2013. PC13 will be for two years, running from April 2013 to March 2015. PC15 is expected to be six years.
Because PC10 means little to our customers, we reflected the priorities of our Business Plan in our PC10 logo – ‘Prioritising Customers'. We have used the same logo for PC13.
Prior to the commencement of each Price Control period, NI Water will submit a Business Plan to the Utility Regulator providing details of the funding the company requires to maintain our infrastructure and assets; to continue the delivery of the best ever water and waste water standards to our customers, and also meet our increasingly challenging compliance targets.
The Utility Regulator assesses the Business Plan and publishes a Draft Determination providing NI Water, customers and other stakeholders with an initial view of approved investment, service levels and price limits.
Following a period of consultation, the Utility Regulator will then issue a Final Determination for NI Water to consider. On acceptance of the Final Determination, NI Water will publish a Monitoring Plan to confirm the performance targets and outputs which the company will seek to deliver over the period of the Price Control.
There are currently three Price Control periods to be noted:
This is the first Price Control period for NI Water and the first time the Utility Regulator has set a regulatory determination for water and wastewater services. The agreed funding, performance levels and outputs for PC10 are contained in NI Water’s PC10 Monitoring Plan. The PC10 period ends on 31 March 2013.
This will be a relatively short Price Control period as there is a reasonable certainty of DRD funding up to 2014/15. It also allows DRD to develop a Long Term Water Strategy which will inform NI Water’s more strategic approach to PC15.
NI Water published its PC13 Business Plan in August 2012 and then provided a response to the Utility Regulator’s PC13 Draft Determination in November 2012. The Utility Regulator published the PC13 Final Determination in December 2012 which was accepted by NI Water in February 2013. We published our PC13 Monitoring Plan at the end of March 2013 to outline our commitments to customers for the PC13 period.
PC15 will be a six year Price Control period, with a mid-term review in 2018. The longer term of this Price Control and the Long Term Water Strategy will enable NI Water and all our stakeholders, including the Drinking Water Inspectorate and the Northern Ireland Environment Agency, to take a more strategic and sustainable approach to the future provision of services.
NI Water will submit its PC15 Business Plan to the Utility Regulator in March 2014.