Ofwat issues final bulk charging rules for English water undertakers
The Water Services Regulation Authority (Ofwat) has issued final rules for bulk charges for new appointments and variations applicable to English undertakers under sections 40E and 110F of the Water Industry Act 1991. The rules take effect from 1 April 2026, with certain provisions (rules 21, 23, 24 and 25) taking effect from 1 April 2027. The rules apply to incumbent English water companies providing bulk supply and discharge services to new appointment and variation sites approved on or after 1 April 2018 under consent or unserved criteria. Key provisions include mandatory adoption of a wholesale-minus approach requiring deduction of avoided costs from wholesale charges, consultation requirements for material changes to charges, charging principles emphasising fairness and cost-reflectivity, and publication requirements including bulk charges schedules by 1 February each year. The rules also establish board assurance statement requirements and specify that bulk charges should not penalise new appointees for promoting water efficiency. Ofwat received 14 responses to its September 2025 consultation and made refinements to the rules based on industry feedback. Common Terms and Worked Examples will be developed through an industry working group and remain advisory for 2026-27 charges before becoming mandatory from 1 April 2027.