Water companies might get some leeway in Ofwat’s final determination in December, according to analysts at Jefferies after meeting with officials from the
Data on outcome delivery incentives (ODIs) is helping to give a greater understanding of sector performance, said the US bank, which Jefferies believes might mean a more balanced ODI framework at final determinations.
On allowed returns, Jefferies also sees scope for positive revisions on total expenditure (totex), while the outturn inflow of equity and debt investment is seen as a determinant of success/failure of regulation while more sensible debt management in the sector is required.
Final Determinations are set for 19 December with Ofwat ‘on track’ to publish the numbers on that day.
Jefferies also noted that the concept of a single social tariff is picking up traction said the officials.
Severn Trent PLC (LSE:SVT), which reports tomorrow, was up 0.3% at 2,711p, United Utilities up 1% at 1,102p and Pennon up 1% at 570p.