O F W A T · Awarded contract
Awarded

Advisory Services on Inflation and Cost of Debt for Water Regulation

Awarded 18 Dec 2025

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Awarded18 Dec 2025
Value£89,640.00
AgencyO F W A T
RegionWest Midlands
CategoryConsultancy & Legal
Ended 7mo ago3mo term
Awarded 18 Dec 2025Expired 30 Mar 2026

O F W A T awarded a contract to Steer Davies & Gleave Limited for advice on inflation and the cost of debt in water regulation.

The contract, valued at £89,640, was awarded using Crown Commercial Service (CCS) Management Consultancy Framework Four (MCF4) (RM6309), Lot 4 Finance.

The work involves considering Ofgem's approach to setting a nominal allowance for fixed-rate debt and indexing the Regulatory Asset Value (RAV), which could reduce windfall gains and losses for customers and investors.

This aligns with the Independent Water Commission's recommendation to reduce volatility of returns and consider indexing components of the Weighted Average Cost of Capital (WACC).

The resulting report is expected to inform stakeholder discussions in the water industry.

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