The regulator has responded to concerns that current arrangements for charging are “too complex, unpredictable and unfair”. It is consulting on proposals to create a “clearer and more customer-centric” charging framework.
Proposals published in March were met with concern from stakeholders at the lack of a standardised structure for new connections charges.
Ofwat said it would monitor the development of companies’ charging arrangements, and would consider further standardisation or guidance in future “should the circumstances warrant it”.
The regulator’s new, enhanced proposals will deliver “major benefits” to developers and other customers, it said. They will also protect new appointees and self-lay organisations from being disadvantaged or discriminated against.
Ofwat will use a wide range of regulatory tools, including a requirement for companies to publish an ‘annual assurance report’, and improved annual performance reporting to monitor companies’ spending and revenues. It will also look at using risk-based reviews to encourage companies to engage more with their stakeholders.
The Department for Environment, Food and Rural Affairs is expected to publish more detailed guidance on new connections charges in autumn 2016.
“Implementation for April 2017 means timetables could be challenging,” Ofwat said. “We think the timing is possible and will allow the potential benefits of the new charging rules to be delivered as soon as practicably possible.”
The consultation will close 26 August.