South West Water

South West Water is the licensed water and sewerage service provider for Devon, Cornwall and parts of Dorset and Somerset. The company serves a region of nearly 10,300 square kilometres with over 1.65 million residents. In addition over 39 million visitor nights as recorded by South West Tourism were spent in the region in 2009. On average each day it distributes over 420 Megalitres (Ml) of treated water and disposes of around 235 Ml of waste water through an asset base comprising:

Since privatisation in 1989 the company has successfully delivered the largest capital programme per capita of any of the water and sewerage companies with an initial focus on improving coastal waste water treatment and disposal. The region currently has 144 EU designated bathing waters, almost one third of the total in England and Wales, and 132 of these have benefited over the last 19 years from the company’s marine investment programme. Following completion of an entire overhaul of water resources, water treatment and distribution over the same period we are able to demonstrate major improvements in water supply quality and reliability for our customers.

South West Water expects to create value through delivering the regulatory contract agreed with Ofwat. The contract scope is reviewed every five years. As well as determining outputs, Ofwat sets prices to enable efficient companies to earn a reasonable rate of return on their assets.

For the new regulatory period which started in April 2010 Ofwat assumed that the equity cost of capital for all companies will be 7.1% real after tax with an overall weighted average cost of capital of 4.5% real after tax.

www.southwestwater.co.uk