UNITED UTILITIES PR14 BUSINESS PLAN

However, in order to support the financeability of our plan on a notional company basis, it has also been necessary to advance revenues by increasing PAYG above the “natural” rate by 1. Our full PR19 business plan can be accessed at the following link: We have applied PAYG rates broadly consistent with operating costs which includes infrastructure renewals expenditure as a proportion of totex for each price control. Lower base costs to maintain services, including reduced recovery of pension deficit payments. The table below identifies the costs included within the building blocks of the allowed revenue:

The table below shows the impact of these adjustments on average customer bills: In many ways, we are already leading the way for the industry in the areas of operational, corporate and financial resilience and our plan sets out how we intend to raise the bar even further. To mitigate the impact of this on customer bills, we have also re-profiled revenues to ‘flatten’ the profile of key ratios over , and hence minimise the required level of PAYG advancement. However, in order to support the financeability of our plan on a notional company basis, it has also been necessary to advance revenues by increasing PAYG above the “natural” rate by 1. We recognise the importance of dividends to our shareholders, however our United Utilities Group PLC dividend policy will not be decided by the Board and announced until we have received our final determination. In adopting Ofwat’s early view WACC guidance for the plan, we are committing to a plan that delivers the best affordability for customers on an efficiently financed basis.

This mechanism provides scope for flexible acceleration in adopting new technology so it can improve service delivery to customers faster. How we monitor the utllities retail market. We are cutting bills such that they will be lower in real terms in than they were 15 years ago, whilst also delivering higher standards of service, increasing resilience, delivering innovation and investing for the long-term.

United Utilities – Behind the scenes in developing a fast-track business plan

The table below shows how this WACC is broken down: This is a strong value for money proposition, which research shows over 80 per cent of our customers support, and which we are committed to deliver. The presentation can also be accessed via a live audio-only call facility by dialling: RCV unted year-end nominal. Customer and developer services experience. We have significantly reduced leakage over the last 25 years and have met our leakage target for over a decade.

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These include significant reductions in leakage, sewer flooding, and supply interruptions, as well as further developments in our industry leading pollution performance and integrated catchment management approach. It is one of the reasons I am proud to work for Businesx Utilities and proud of the plan we have proposed.

Terms and conditions relating to the ugilities and distribution of this information may apply. Better challenge of cost needs internally and with quality regulators.

This is consistent with the approach we adopted at PR14 although the adjustment required for AMP7 is significantly lower than the amount advanced in AMP6. uinted

united utilities pr14 business plan

We now routinely investigate ideas with customers — this sometimes leads to co-created solutions and uniited means we have had to return to the drawing board and start again. Choosing your water retailer. A utiliites view of our objectives and responsibilities. We are proposing a This resulted in a plan that offered a The webcast will be available on demand from Wednesday 5 September at the following link: Gaynor Kenyon – Corporate Affairs Director.

These significant savings are achieved through innovations applied in AMP6 and planned for AMP7, market testing our cost base and a better challenge of needs both internally and externally with our quality regulators. This includes a small adjustment to the PAYG ratios that we have used to mitigate financeability constraints by keeping FFO to debt ynited above the minimum threshold during AMP7 on a notional company basis.

Fundamental throughout our plan is a bold strategy of innovation, drawing on new initiatives, learning and inspiration from unitdd the UK water sector. However, in order to support the financeability of our plan on a notional company basis, it has also been necessary to advance revenues by increasing PAYG above the “natural” rate by 1.

united utilities pr14 business plan

The table below shows the impact of these adjustments on average customer bills: We recognise the importance of dividends to our shareholders, however our United Utilities Group PLC dividend policy will not be decided by the Board and announced until we have received our final determination. Delivering this for our customers will also mean that average bills will be around 14 per cent lower in real terms in than they were 15 years ago inwhilst service standards and environmental quality continue a path of significant improvement.

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Becoming a new supplier. We support the wider application of financial incentives to performance commitments and have applied financial incentives to almost all husiness measures, with most subject to both outperformance payments for stretching performance and underperformance penalties.

United Utilities – Behind the scenes in developing a fast-track business plan – Ofwat

Our regional supply-demand surplus has historically meant that there has not been a strong water resource driver to reduce leakage beyond the sustainable economic level, however we recognise there are wider benefits to leakage reductions and have therefore set a target to deliver a 15 per cent reduction by the end of AMP7.

This target is stretching, but one that we think we have a good opportunity of achieving. In many ways, we are already leading the way for the industry in the areas of operational, corporate and financial resilience and our plan sets out how we intend to raise the bar even further. We have designed a package of performance commitments, targets and incentives that covers all aspects of service and environmental performance that are important to customers and stakeholders and that incentivises innovation in our operations.

We took the time to understand more about customer motives and behaviour, to utilise this to deliver services more effectively and efficiently. Although we have assessed that certain sub-elements of the appointee cost of capital are, on an individual basis, set at the very low end of or even below an acceptable range, we have been able to adopt the Ofwat early view WACC on an overall basis, as part of the risk and return balance and price control package set out in our full business plan document.

Our plan represents the next step towards our vision to be the best UK water and wastewater company and has benefited from extensive engagement with customers and other stakeholders in our region.

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