Ofwat rejects Anglian plea to raise bills

The water industry regulator, Philip Fletcher, rejected an attempt by Anglian Water to increase its future bills to the 1.8m households it supplies in the east of England yesterday.

The water industry regulator, Philip Fletcher, rejected an attempt by Anglian Water to increase its future bills to the 1.8m households it supplies in the east of England yesterday.

However, Ofwat agreed to a slight increase in future bills from Tendring Hundred, a small unquoted water company serving 62,00 households in Essex. Tendring can now increase by £1 to £137 its average bill to households in 2005. Ofwat also said it was undecided on a similar appeal from Welsh Water

Yesterday's provisional determination, on which a final decision from Ofwat is due by Christmas, dismissed Anglian's argument that a greater-than-expected switch to metering by households in its area justified an increase in bills.

Households that take up meters to determine their bills typically see substantial savings, resulting in a loss of revenue for their water suppliers.

The appeal, which covered the years 2000-2005, will mean that Anglian's water bills will average, as originally determined last year, £247 per household at the end of that period.

Water companies that have experienced changes that will adjust annual revenues by 10 per cent or more qualify for a revision in the price controls imposed by the regulator. Ofwat, which will now consult on yesterday's judgement, said that Anglian did not qualify.

Graham Franklin, a spokesman for Anglian, refused to put a figure on the level of increase in bills sought by the company. He said that the take-up of metering this year was three times that predicted by Ofwat. Shares in AWG, Anglian's parent company, closed down 23.5p at 613p.