Ofwat Announces Final Price L

RNS Number : 1239D

Northumbrian Water Group PLC

26 November 2009

Northumbrian Water Group plc

(the Company or the Group)

Ofwat announces final price limits

The Group's principal subsidiary, Northumbrian Water Limited (NWL), has received Ofwat's final determination of price limits to be applied during the period 2010 to 2015. This is Ofwat's response to the very detailed Business Plan submitted by NWL in April 2009 and the consultation following the draft determination issued by Ofwat in July 2009.

Ofwat's proposals allow average annual household bills to rise, in real terms, by £14 over the five-year period to £313 in the North East for water and sewerage services. For water services in the area served by Essex & Suffolk Water, the proposals see bills rise by £21 to £190. The proposals include an investment programme of over £1.2 billion (2007/08 prices) with CIS ratios of 103 (water) and 101 (sewerage). The proposals also include challenging annual base operating efficiency targets of 1.2% (water) and 2.4% (sewerage).

Managing Director, John Cuthbert said: "The proposed price limits are just one part of a detailed pack of information provided by Ofwat. The NWL board need to consider the detail carefully before reaching a conclusion on the final determination and the Group Board will make an announcement in due course."