Determination of NWC Review of Rates - April 2008

On October 19th 2007 NWC submitted an initial set of proposals but did not satisfy the Office’s minimum rate review information requirements until December 14, 2007. The proposals included an application for a 44% increase of all its rates and charges. The NWC stated that its analysis showed that in order to carry out its mandate to provide reliable service and expand its existing service a 45.8% increase is required. However, it believes that it can strive to improve efficiency in its operations but this will translate to only a 1.8% increase in revenues. Consequently, the company is applying for a tariff increase of 44% on its billed revenues. This increase was expected to become effective at the beginning of financial year 2008/09 and last for a period of three years, that is, to 2010/11. The NWC in addition submitted a proposal for further funding by way of a K-factor sufficient to finance capital costs for rehabilitation and mains repair totalling $32,265M. The K-factor would repay the financing of loans of ten year tenure. NWC did not propose any specific percentage change in rates for the K-factor but the Office estimates that this would necessitate an additional 5% in the first year.

Sector: 
Water & Sewerage
Document Type: 
Determination Notices
Parent document: