Regulators are gearing up for the biggest shakeup of the water market in almost 30 years, with more than 1m businesses free to shop around for the best deals from next April.
The water regulator Ofwat said 1.2m businesses in England stand to benefit from the changes, which will allow them to switch water supplier.
Ofwat said: “A year from now, all businesses, charities and public sector organisations in England, from the smallest charity to the largest corporate, will be able to do something new – switch their water retailer.
“It’s part of the biggest shakeup to the water industry since privatisation in 1989 and has major implications for companies and consumers alike.”
The Department for Environment, Food and Rural Affairs (Defra) is working with Ofwat and claims the changes could deliver £200m in benefits to customers and the UK economy.
Ofwat said business customers opting to switch will be able to benefit from lower bills and an improved service as competition is introduced. Bigger companies with several suppliers around the country will be able to make administrative savings by having just one bill, and not “the dozens, possibly hundreds, some companies currently receive”, Ofwat added.
The industry has a year to prepare for the changes, and private company Market Operator Services Limited (MOSL) is working on behalf of the water companies to create the IT infrastructure to enable switching to happen.
Ofwat said that while the option to switch would not be open to consumers, a review was under way to investigate whether competition in the market should be opened up to benefit households.
Ofwat will give initial thoughts on the matter in the summer, but the government would ultimately make the decision on competition in the water market for consumers.
The regulator, Defra and MOSL have a year to communicate the changes to businesses, to encourage them to benefit from the changes.
Cathryn Ross, the chief executive of Ofwat, and Ben Jeffs, the chief executive of MOSL, were expected to give further details on the plans on Monday.
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