Ofwat (Water Services Regulation Authority)
Role
Economic regulator of the water and wastewater sector in England and Wales. Sets price controls via periodic reviews (most recently PR24, December 2024). Enforces performance commitments and customer protections. Water companies are required to invest under Ofwat determinations.
Key determination: PR24 (December 2024)
- £104 billion total investment (2025-2030)
- £88 billion in upgrades and improvements
- 44% reduction in storm overflow spills by 2030 (vs. 2021)
- Leakage reduction; new water supply; nutrient removal; drought resilience; digital monitoring
Critical uncertainty: Water White Paper (January 2026)
The White Paper proposes merging Ofwat, the Drinking Water Inspectorate (DWI), Environment Agency water functions, and Natural England water functions into a single new regulator. A Transition Plan is due in 2026.
This creates a significant tension: Ofwat’s PR24 determinations are already legally binding for 2025-2030, but the regulatory body enforcing them may be restructured or abolished during that period. Water companies are investing under a framework that the government has announced will be changed.
Tensions
- water-regulator-reform-pr24-uncertainty — Proposed abolition/merger during active PR24 enforcement cycle; creates regulatory uncertainty for £104bn investment programme