Press Releases

26 November 2009

The Water Services Regulatory Authority (Ofwat) has this morning published its Final Determination in respect of the K5 period (2010 - 2015). The key elements for South West Water include:

• A cost of capital for the industry of 4.5% (real, post tax basis and equivalent to 5.1% vanilla)
• 'K' price increases (above RPI inflation) averaging 1.9% per annum over the five years
• A capital programme of around £670m at 2007/08 prices (net of grants and contributions)
• A Capital Incentive Scheme (CIS) score of 105 (water) and 110 (sewerage)
• Base operating efficiency improvements of 1.7% per annum

South West Water is now reviewing the package proposed by Ofwat and has until the end of January 2010 to respond.

Further information on Pennon and South West Water can be found on the Group's website,
www.pennon-group.co.uk

For further information, please contact:                

Pennon:
David Dupont - Group Director of Finance	01392 443998
Jo Finely - Investor Relations Manager	01392 443401
Finsbury:
Sally Hogan	0207 251 3801