Bristol Water has published a statement aimed at clarifying the bill reduction for its customers following the impact of Competition & Markets Authority decision on the price review.

Following Ofwat’s Price Review in December 2014, the average annual household bill fell from £197 to £162 and this took effect in April 2015. Bills were then set to continue to fall to £152 in April 2016.

Bristol Water appealed against this and the Competition and Markets Authority have set new price levels so that bills, excluding inflation, will be £160 in April 2016.

The water company said that this week the CMA had announced a 16% drop in Bristol Water bills and it wished to clarify what this meant for customers.

The statement says that Bristol Water bills will change very little – probably by a few pence a month. The exact figure will be announced once inflation is set in December.

Bristol Water said the 16% reduction can be broken down into three sections in order to understand the impact on customers and the business as follows:

• 5% is the amount we were going to reduce bills anyway in our Business Plan
• 6% reduction in scope. Key projects such as Cheddar 2 have not been approved, so the construction has been postponed and customers do not have to pay for it
• 5% further efficiencies and lower profits, beyond those we already planned

The water company concluded:

“ CMA review means that our Business Plan has been scrutinised at the highest level and we now have a better outcome than the original Price Review from Ofwat. We put our faith in this process to strike the right balance between bills and investment for this five year plan. Bills have dropped but so has the scope of our work, and we are committed to ensure that the service we provide our customers is not compromised.”