On Friday 27 March, the Panel held its second meeting in seven days to progress urgent Authority Timetabled changes to support the water retail market during the COVID-19 pandemic.

During the meeting, Ofwat raised and approved the implementation of CPW091: ‘Temporary Changes to Vacancy’ and CPW093: ‘Payment deferral interim measures’.

Change proposal CPW091 allows retailers to change a premises' occupancy status to ‘Vacant’ within CMOS, where levels of water and sewerage usage have significantly reduced, for reasons such as temporary closure. This will prevent the inappropriate use of volume estimates and settlement based on historical meter reads for business premises will may have closed temporarily as a result of COVID-19.

Change proposal CPW093 permits the deferral of payments between retailers and wholesalers on a percentage of payments invoiced, but not yet due in March 2020, and on settlement in April and May 2020.

These change proposals were implemented today, Monday 30 March 2020 at 8am, following the High Level Group discussions on Wednesday 25 March. The High Level Group, convened by MOSL, is made up of Ofwat, Defra, CCW, Water UK, UKWRC and senior representative from wholesalers and retailers.

In its decision letter for CPW093, Ofwat confirmed it will continue to work closely with MOSL and other stakeholders to develop a medium-term solution to the liquidity issues currently facing the non-household sector by the end of April.
Ofwat also confirmed its intention to develop a longer-term solution to unwind the cash flow impacts of the COVID-19 pandemic. This includes proposals for addressing levels of bad debt which exceed the ‘normal’ levels of bad debt that retailers are already compensated for in the Retail Exit Code (REC). The work, which will require consultation with the sector, will be developed as soon as possible.

The Panel will meet again tomorrow, Tuesday 31 March, for its regular monthly meeting. The meeting’s full agenda includes recommendation reports on Rebalancing Unsecured Credit Allowance (CPW086) and Unsecured Credit Allowance based on Payment History (CPW061).

For more information the Panel, market governance and upcoming changes visit our Changes page on the MOSL website.


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