LONDON (Reuters) - Britain's water regulator has proposed that most of Britain's water suppliers should reduce their consumer bills by an average of 5 percent by the end of the decade.
Ofwat regulates the prices which water utilities are allowed to charge their customers and a review is currently under way to set those pricing models for 2015 to 2020.
The watchdog said in a draft assessment of 14 out of 18 water suppliers' pricing suggestions that they should reduce tariffs over the next five years by 5 percent in real terms.
London-listed Severn Trent should reduce bills by 5.7 percent by the end of the decade, the regulator proposed, while unlisted SembCorp Bournemouth and Anglian were recommended to introduce the steepest cuts - 13.9 percent and 10.9 percent, respectively.
"Some will find this tough, but companies which really stretch themselves will reap the benefits of increased customer trust and confidence," said Ofwat Chief Executive Cathryn Ross in a statement.
Four other water suppliers, including Pennon Group's South West Water, were awarded 'enhanced status' earlier this year, meaning their pricing models were largely approved in a draft decision by the regulator.
United Utilities was reprimanded this month for proposing prices that were considerably higher than the regulator's assessment and was asked to resubmit its plans.
All companies face a deadline of Oct. 3 to respond to the regulator's draft proposal. Ofwat will publish its final decisions on Dec. 12.
Ofwat sets the water utilities' pricing and service framework every five years, a process which the watchdog says gives companies greater accountability for their service.