The company is the first to challenge Ofwat, which has asked 19 utilities to restrict their price rises next year. Under a price formula set before privatisation, North West was allowed to increase prices by 5 per cent above inflation annually.
But earlier this month, it was asked to raise them by just 3 per cent above inflation. Ofwat's move was prompted by a substantial savings made by the companies in their capital spending due to a fall in construction costs.
However, North West has made a counter proposal to Ofwat in which it wants the full increase because it faces additional pounds 430m costs not envisaged before its sell- off. The extra spending will go on the clean-up of the Mersey estuary and beaches along the Fylde and Cumbrian coasts, it said. Ofwat will examine the counter proposal over the next few weeks.Reuse content