Severn Trent forced to re-submit business plan by watchdog

MIDLAND utility Severn Trent Water is to resubmit its business plan to industry regulator Ofwat after the watchdog demanded to know more about its future supply plans for Birmingham.

Ofwat has asked for more evidence on the company’s plans for wholesale water costs and in particular, about its Birmingham Strategic Resilience Project. The project accounts for £255m of the utility’s total expenditure over the five-year period spanning 2015-2020.

The Birmingham strategic resilience project is focused on the Elan Valley Aqueduct, which opened in 1906 and brings water from the Elan Valley reservoirs in Wales to Birmingham. The project will reinforce water supplies for Birmingham to minimise the possibility of future supply interruptions.

Severn Trent said that following the publication by Ofwat of company business plan assessments and ratings in March and earlier this month, the company had continued a constructive dialogue with the watchdog over its 2015-2020 business plan.

In a statement, Severn Trent said: “We need to ensure there is sufficient time and opportunity to fully engage with Ofwat on these evidence requests and on the case for the resilience project, including the importance that our customers place on this project, the support that our customer challenge group has provided and our assessment of the risks of not proceeding with the project.

“Consequently Severn Trent Water has decided to re-submit its plan to Ofwat on June 27 to receive an August draft determination, in line with the process outlined by Ofwat on April 4.

“We look forward to continuing our constructive and positive dialogue with Ofwat, our customer challenge group the Severn Trent Water Forum and other stakeholders over the coming weeks.”
 

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