United Utilities has welcomed the publication of Ofwat’s Draft Decision in respect of the 2026 Cost Change re-opener, which supports the substantial majority of the company's first AMP8 Business Plan submission.
The Draft Decision includes allowances of c.£975 million and which the firm says keeps it f"irmly on track to deliver approximately £2.5 billion of investment through the annualised AMP8 re-opener mechanism." The water company said the investment will enhance resilience across its network and provide additional water and wastewater capacity, to support economic growth in the North West enabling the Government's housing, digital infrastructure and climate policy ambitions.
“The Draft Decision demonstrates the value of Ofwat's new Cost Change framework in facilitating timely investment where additional needs emerge during the regulatory period. The framework provides greater flexibility to enable and accelerate infrastructure to support regional economic priorities while maintaining strong protections for customers.” United Utilities commented.
The utility reiterates its financial framework, including c.£11.5 billion of capital investment, with regulatory capital value expected to grow at around 10% per annum to approximately £25 billion by 2030. The company continues to target average regulatory returns of 10-11%. Its financial framework also remains unchanged with its dividend growing in line with CPIH, and a target gearing range at 55-65%.
Whilst substantially all of United Utilities’ proposed programme has been supported in the Draft Decision, Ofwat has requested additional evidence for a limited number of projects as part of the consultation process. The company says it looks forward to continuing constructive engagement with Ofwat and is "confident in providing the further information required" to demonstrate that the proposals represent the best value outcome for customers, remain fully deliverable and support long-term regional growth.
United Utilities will submit its response by 24 September 2026 ahead of Ofwat’s Final Decision in December 2026.
Louise Beardmore, Chief Executive Officer said:
"It is great to see this in-period regulatory mechanism working well, providing the opportunity to deliver the additional infrastructure needed to support the rapid economic growth we are seeing here in the North West, enabling businesses to grow, houses to be built and additional high quality jobs to be created."
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