Business plan 2025-2030

Since the submission of our PR24 business plan to Ofwat in October 2023, we have made some small changes to parts of our plan. These have been in response to requests from Ofwat or other regulators and to clarify some points in our original plan. The result of these changes to date is that Ofwat are now considering a PR24 business plan for Wessex Water that includes total expenditure of £5,007 million (down from £5,031 million in our October 2023 plan), and average annual customer bills of £666 by 2030 (down from £668 in our October 2023 plan). We expect Ofwat's draft determinations will be based on this expenditure and these bills, and the associated data tables.

The main reason for the change to our total expenditure for PR24 and associated average annual customer bills is a reduction in the costs of our smart metering programme. We have also made some corrections to the costs of planned net zero and biodiversity schemes, which has slightly affected our total expenditure.

Ofwat has also asked us to provide some further data tables to reflect the Environment Agency’s 18 September 2023 version of the Water Industry National Environment Programme (WINEP). These tables reflect the additional costs of delivering the full WINEP nutrients programme by 2030, rather than phasing some of this programme beyond this date (as proposed in our business plan). This would increase total expenditure to £5,416 million and average customer bills to £690 by 2030. However, it is important to note that this is not a revised Wessex Water business plan submission in that:

• only a subset of data tables (primarily on cost information) have been updated
• the deliverability, financeability and affordability of a plan that included this work is not covered by our board assurance statements
• these numbers are unaudited and have not been assured or approved by our Board
• we have also not sought to update our view of the appropriate WACC to reflect an increase in the capital programme of this size.

Consequently, we do not expect Ofwat's draft determinations to include this expenditure and its impact on bills.

An average bill increase of up to 30% (up to £670) would still mean that Wessex Water bills are lower in real terms than they were 15 years ago. However, we are very conscious that this is a time of austerity so any bill increase will be unwelcome, and that some customers are already struggling to pay the current level of bills. Almost all our investments are driven by legal or regulatory requirements but even so, we will work hard with our regulators to minimise the bill impact.

For customers who find it difficult to pay, we already have tailored assistance programmes to help and we will extend these as necessary to meet our commitment of eliminating water poverty by 2030.

We started by setting out our future priorities - what we aim to deliver for customers, wider society and the environment. Find out more about our strategic direction.

We worked with our stakeholders, regulators and customers to create our draft DWMP, which set out how we aim to deliver resilient drainage and wastewater infrastructure for the next 25 years. We published the draft DWMP for wider stakeholder and customer consultation. The consultation ran from 30 June 2022 to 1 October 2022.

Ofwat published their draft methodology in July. We fed back our response in September.

Additional response documents can be found in the documents area.

We submitted our plan for the next 25 years to Defra, setting out how we will balance water supplies with water demands to ensure adequate supply for our customers, while also protecting the environment. We then published the plan as a draft for consultation – the consultation ran for 12 weeks up until February 2023.

The Environmental Agency lists outputs we need to deliver in a document called the Water Industry National Environment Programme (WINEP).

We submitted proposed options to address these outputs in November 2022, with a further submission in January 2023 particularly covering our nutrient and storm overflow reduction proposals.

These submissions took into account legislation and regulator guidance as known at the time, with subsequent revisions to accommodate updated legislation and guidance, eg, updates to the government’s Storm Overflows Discharge Reduction Plan in September 2023 and the Levelling-up and Regeneration Act becoming law from October 2023.

Our submitted business plan in October 2023 – and the associated prior customer and stakeholder engagement – was based on our best interpretation of existing and forthcoming regulator expectations.

Ofwat considered stakeholders' comments on the draft methodology, and published the final methodology in December 2022.

The Drinking Water Inspectorate oversees the drinking water quality aspects of our plan. We submitted documentation to the DWI to gain its support for some specific investment proposals for 2025-30. We received formal letters of support from the DWI, which we included in our October 2023 business plan submission to Ofwat.

Thank you to everyone who came to the events we held across our region and our online 'Your water, your say' session. The events gave customers the chance to find out more about our future plans and have their say. We combined these learnings with other feedback from our extensive customer and stakeholder engagement programme to help us finalise our business plan.

We made significant changes to our DWMP to reflect feedback from the draft DWMP consultation – our Statement of Response (in Annex H of the full report) shows how we listened and responded to the comments. We also made changes to account for further guidance from regulators, and Ofwat’s long-term delivery strategy methodology. We published our final DWMP on 31 May 2023 - it is available on our DWMP page.

We went through a further stage of research to test customers’ views on how acceptable and affordable they thought the plan was.

Some early submissions to Ofwat were required, for example for adjustments to our costs that are not applicable to all companies.

The final versions of these cost adjustment claims were formally submitted to Ofwat as part of our main October 2023 business plan submission – and are available at WSX08 and WSX09.

We updated our draft WRMP based on consultation feedback and updates to requirements. The revised draft plan was submitted to Defra in August 2023 and published on our WRMP page in October 2023. Defra will now determine whether this can be published as our final plan.

We submitted our plan to Ofwat – the documents are available in our Business Plan document library.

A period of ongoing discussion and review with Ofwat. We ran an online ‘Your water, your say’ session in November 2023 to help Ofwat understand customers’ and stakeholders’ views on the business plan we submitted.

Ofwat published its provisional assessment of our business plan. We are reviewing what these draft decisions mean for our plan and will provide a response to Ofwat by the end of August.

The final documentation that outlines our allowed investment is due to be published in December 2024.

Once the plan is agreed, from April 2025 we will then start delivering the improvements set out in our 2025-30 business plan.