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).
How does Price Control Work
The Price Control period
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 will be six years, running from April 2015 to March 2021.
The Business Plan
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 Draft Determination
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.
The Final Determination
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.
Current Price Controls
There are currently three Price Control periods to be noted:
Price Control 2010 – 2013 (PC10)
This was the first regulated Price Control period for NI Water and the first time the Utility Regulator 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 ended on 31 March 2013.
- PC10 Summary Business Plan
- Monitoring Plan
- Tapping into customer views
- Social & Environmental Guidance
- Cost and Performance Report
Price Control 2013 – 2015 (PC13)
This is a relatively short Price Control period as there is 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.
- PC13 Business Plan summary
- NI Water’s Response to the PC13 Draft Determination
- PC13 Monitoring Plan
- PC13 Cost & Performance Report
Price Control 2015 – 2021 (PC15)
PC15 is a six year Price Control period, with a mid-term review expected in 2018. The longer term of this Price Control and the DRD 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.
As a prelude to our PC15 Business Plan, we prepared ‘Our Strategy for NI Water’ which sets out our long term strategy for providing water and wastewater services to our customers in Northern Ireland. The strategy supports our vision for NI Water to be a valued and trusted provider of one of Northern Ireland’s most essential services; an organisation our customers and staff are proud of.
NI Water submitted its PC15 Business Plan to the Utility Regulator on 24 March 2014. Our Business Plan is very much focused on building on our successes in PC10 and PC13. We intend to continue to improve services to our customers today, while investing to safeguard services for future customers and we acknowledge we will need to do this while continuing to deliver improvements in our efficiency.
NI Water provided a response to the Utility Regulator’s PC15 Draft Determination in October 2014. The Utility Regulator published the PC15 Final Determination in December 2015. At the time of writing, there is no clarity on the funding position beyond the end of 2015-16. As a result NI Water has prepared a Monitoring Plan outlining the key commitments NI Water is making to its customers, shareholder and stakeholders for 2015-16 only.
While we continue to engage with government and wider stakeholders to fund water and sewerage services to the level set out in the PC15 Final Determination, our focus remains on delivering water and wastewater services in a sustainable way including investment in the local economy and supply chain.