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Water companies' plans hint at higher returns

All three UK-listed water companies won 'fast-track' status, entitling them to higher returns over the next regulatory period
February 4, 2019

Pennon (PNN), Severn Trent (SVT) and United Utilities (UU) have won praise from the water regulator for their business plans, increasing expected returns for the five years from the start of 2020.

The plans outline how water companies intend to handle their various responsibilities – to shareholders, customers and the environment – over the next asset management period.

The three UK-listed groups were the only in the water sector classified as 'fast track'. This entitles them to higher levels of returns on regulated equity, financial rewards of £6.5m for Pennon, £18m for Severn Trent and £22m for United Utilities, as well as earlier draft determinations. They will receive those determinations in April, instead of July for lower-rated peers, increasing clarity on their future returns.

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