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OFWAT

LETTERS

In the debate on whether OFWAT takes sufficient account of environmental concerns when setting price limits (NCE last week), Stephen Battersby stated that in the recent OFWAT report on the development of enhanced serviceability indicators for sewerage assets, the criteria adopted 'ignores all but the most obvious problems'.

As project manager for this report on the development of enhanced serviceability indicators for sewerage assets for OFWAT and the Environment Agency, I can confirm that the focus was to develop additional indicators for use in the next Periodic Review in 2004. The intention is that the first reporting of results will be in the 2002 June returns.

These enhanced indicators aim to use readily available data or emerging data and reflect some of the current priorities of economic and environmental regulators.

Infiltration was considered, but a robust technical conclusion could not be reached and the reasons are set out in our report. Further work may remedy that position. The absence of such an indicator, however, should not exclude it as a driver for remedial work in appropriate cases.

Serviceability indicators that better inform future funding requirements for capital maintenance will undoubtedly continue to evolve and be developed. The influences on this process are driving the ongoing challenge to ascribe the appropriate level of risk and cost of maintaining service and to balance the relative importance of a range of social, environmental and economic influences.

Bruce Smith, technical director, Ewan Associates, bruce. smith@ewanexeter. demon.co.uk

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