An announcement made this week by industry watchdog OFWAT, says that water companies will be ordered to cut prices to consumers in the UK by around 4% over the next five years. They have also concerned the industry and it’s investors by lowering the amount of profit that water companies can make.
OFWAT wants to see domestic water bills fall by about £14 a year to £330 by 2015. the watchdog suggests that this will clamp down on water companies profits while helping the consumer to save money.
The report says that water company profits will be limited to 4.5% on a post tax basis, leading to an investor sell off on Thursday.
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