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Ofwat Could Relax Targets to Focus on Customers During Coronavirus

Demonstrating that they acted in the best interest of their customers could earn companies some leeway from the utility’s regulator Ofwat. This could be welcome news for companies that are already stressed due to the coronavirus pandemic that has not yet shown any signs of slowing down.

Possible Relaxation for Water Companies

Ofwat is currently considering a series of regulatory measures. These would provide some relaxation to water companies that are unable to meet their yearly performance targets because of the Covid-19 crisis. However- it does not come without a catch. Businesses must show that they acted in the best of interests of their customers to get that flexibility. This comes in the wake of the current circumstances with staff shortage and disruptions due to the countrywide lockdown.


Ofwat is encouraging industry leaders to give priority to customers. It has ensured companies that they should put customers first and not let incentives or penalties affect decision-making. With this consideration, Ofwat has also laid down a set of strategic goals.

A New Approach

Ofwat spoke to over 250 organizations and people to understand how they can help deliver what matters the most for the public. This included affordable tariffs, improvement of the environment, providing high-quality and robust services as well as ensuring that companies act in the benefit of the environment and the society.

These conversations helped Ofwat to setup its strategic goals. The first goal is to help better the performance of water companies for their customers. Their 2nd goal aims to help water companies overcome their long-term challenges by increased partnership and collaboration. The final goal laid down by Ofwat is to ensure that these companies help deliver more for their customers, the society, and the environment overall, serving a greater public purpose.


New Targets for the Industry

While companies can worry less about penalties and incentives, they now would require having an increased focus on the long-term targets laid down by Ofwat. The regulator is now laying greater importance for water companies to serve the public from their work. It is an expectation of the people that companies would act with ethics and keep in mind the interests of society and the environment. Ofwat wants that the water companies should lead the way in adopting a sector-wide approach towards this. It would help build trust among the public and set a path for other sectors to follow

As per Rachel Fletcher, who is a Chief Executive with Ofwat, the water sector is facing profound challenges. These range from the population explosion to climatic changes and increasing expectations from customers. Apart from this, it also must deal with the demand in places where there is a shortage of water and the environment under threat. Now is the time to act if we want to secure the future for the coming generations.

Rachel also stated that this strategy sets the stage for their agenda to transform the water sector. It lays down what Ofwat would do to evolve and make a difference. Meeting the environment’s and society’s long-term needs would help them form a legacy that they can all take pride in and help make life better with water.


Rebecca Pow, Environment Minister, has stressed the importance for regulators, the water industry, and the government to come and work together to help deliver more for the customers, the society, and their environment. In her words, a water industry for everyone is the need of this hour. Chief Executive of the Environment Agency Sir James Bevan has welcomed Ofwat’s new strategy. Water is our most precious natural resource but under increasing pressure due to the greater demand and climate change.

Everyone must play their part to overcome the challenges that are expected ahead.  Ofwat has taken a step in the same direction to help companies focus on what matters the most in times like these. These measures are what the water industry needs to benefit not just themselves, but also the customers and the environment as a whole.