Press Releases 2010

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Competition brings benefits for water customers and Scottish environment

17 December 2010

The Water Industry Commission for Scotland (WICS) today launches its latest report, which outlines the benefits for customers and the environment of competition in Scotland. The report draws on an independent cost/benefit assessment that has been undertaken for the Commission.

Since April 2008, all 130,000 businesses, public sector and other organisations across the country – from the smallest corner store to the largest international company – have been able to choose the retailer that best suits their needs. The retail competition framework in Scotland is working well.
• Over 45,000 customers in Scotland have renegotiated the terms of their supplies – receiving either better prices or more tailored levels of service, and in many cases both.
• Around 40% of the market is enjoying the direct benefits of the new arrangements. The savings for customers are forecast to exceed £110 million over the next decade.
• Public sector organisations – which comprise around a third of eligible customers – are waking up to the potential benefits for them of the new market.

One of the key achievements of the introduction of competition is that there is now greater awareness among business customers of the environmental benefits and cost savings to be made from being more water efficient. New initiatives are helping customers keep a close eye on their bills. Services include online account management, online payment and meter reading, and e-billing.

Alan Sutherland, Chief Executive of WICS, commented: “The environmental benefits associated with competition, in addition to all of the other savings, are significant. Customers are being given advice to reduce their water use, and this is bringing benefits for the environment in both lower abstraction and through lower energy use.”

The benefits for customers are not only limited to reducing their water bills. Many customers also reduce the amount of hot water they use, which helps cut their energy bills and their carbon footprint.

The report also includes information about how the market is operating. Customer awareness of the opportunities available to them is growing, and customers appear to find it easy to switch between retail suppliers and to deal directly with their chosen supplier.

Mr Sutherland added:
“We have always been conscious of the need for the benefits of competition to outweigh the costs associated with establishing the framework and continuing to oversee and develop the market. We therefore welcome the findings of the independent review which showed that the benefits of competition are likely to exceed the costs by 3:1.”

To see the Competition Report in full, click here

ENDS

For more press information please contact: Duncan Mackenzie-Reid College Hill, 020 7457 2020 or on mobile 07807 239 764/07792 918 648  [email protected]
Katherine Russell, WICS’ Director of Corporate Affairs, 01786 430 200

Notes to editors:

1. WICS is the economic regulator of the Scottish water industry. It has a statutory duty to determine charge caps for Scottish Water based on the lowest overall reasonable cost of achieving Ministers’ objectives for the industry.

2. The independent cost/benefit assessment was carried out for WICS by Grant Thornton UK.

3. The water and sewerage market operates in much the same way as in other utilities, where retail suppliers compete for business by offering the best deals. There are currently five active retailers in the market, including two major English companies.

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