Water Charges Plan Decision Paper (Executive Summary)

Water Charges Plan Decision Paper (Executive Summary) DOCUMENT TYPE: REFERENCE: DATE PUBLISHED: QUERIES TO: Decision Paper CER/14/746 30 September 2014 waterchargesplan@cer.ie The Commission for Energy Regulation, The Exchange, Belgard Square North, Tallaght, Dublin 24. www.cer.ie

Executive Summary In July 2014, the CER published a consultation paper on Irish Water s proposed Water Charges Plan. The CER has received 345 responses and queries to the consultation from public and private sector bodies and associations, businesses, public representatives, and a significant number of members of the public. We have reviewed each response in relation to the issues raised and reached decisions on all matters in the consultation, which are set out in this summary decision paper. The CER has decided to approve Irish Water s Water Charges Plan for the period 1st October 2014 31st December 2016 with some modifications from that proposed in the consultation. The key changes which the CER has required Irish Water to implement relate to improved customer protection in the application of water charges to domestic customers and seek to address the concerns and issues raised by respondents. The CER considers that these amendments are fairer and more equitable to customers and will bring greater customer certainty on what charges customers can expect to pay. The key changes are as follows: All customers will have their total water charges capped at the unmetered assessed charge for nine months, extended from six months in the public consultation. Customers will receive a 100% discount on the water supply element of their charge where the water is unfit for human consumption, once the boil water notice is in place for at least 24 hours. In other words, there will be no water supply charge to customers in this case. This compares with the public consultation where a 50% reduction was proposed for up to 3 months and a 100% reduction only applied thereafter. These customers will continue to be charged for their wastewater where they are a customer of Irish Water. Where a customer s metered water consumption is shown to be less than the assessed consumption used in the assessed charge, a rebate will be given to the customer after a period of six months. In the consultation a 12 month period was suggested. The annual minimum charge for a combined water supply and wastewater service at a nonprimary residence has been reduced from 160 to 125 per annum, or 62.50 per service per annum. Interim Revenue Review The CER has reviewed and considered all responses in relation to Irish Water s Interim Price Control for the period 2014-2016. Each of the comments or issues raised is discussed in detail in the Revenue Response and Decision Paper CER14/454. The CER has decided to implement the proposed allowed revenue and all underlying elements of the interim price control as set out in the consultation paper. The table below summarises the CER s review of Irish Water s costs which will see an 8.2% cut to Irish Water proposed costs, giving an allowed revenue of 2,078m. It is this allowed revenue figure that is recoverable by Irish Water over the period of the review and ultimately determines the charges to customers. Irish Water s Proposed Costs ( m) CER Proposed Costs ( m) CER % Cut Total Allowed Revenue (Net Present Value) 2,263 2,078-8.2% The CER notes that this is the first phase of the regulatory revenue review process and that the second phase will be the first full revenue review, Price Review 1 (2017 2022), as set out in the CER s Advice to the Minister on its Economic Regulatory Framework. In the first full review, the CER will have established a data framework against which to set more challenging efficiency targets, to benefit consumers. The key decisions on each of the costs components which underpin this allowed revenue are:

Establishment Costs The CER has approved an allowance of 172.8m to cover Irish Water s project and pre Q4 2014 operational establishment costs for inclusion as part of Irish Water s opening Regulatory Asset Base. This represents a cut of 9.1m, which reflects the CER s view that Irish Water s project management costs were high relative to the benchmarks considered and a further cut of around 5m to Irish Water s internal labour costs. The level of approved establishment cost is predicated on the justification that it will enable Irish Water to drive substantial cost savings and service quality improvements over the interim review and for many years to come. Capital Expenditure The CER has decided to maintain the proposed allowance for capital expenditure at 1,383m (NPV), noting that in the interests of customers, only 75% is recoverable through tariffs within the revenue period 2014-2016. As stated in the consultation, if Irish Water is successful in achieving 100% of the funding sought the full value of the efficiently incurred capital programme will be allowed for in the next review period. In terms of overall cost efficiency targets, the CER has decided to impose the 7% annual capex efficiency challenge to non-committed capital costs, excluding capital maintenance. This efficiency challenge requires Irish Water to deliver capital projects around 14% more efficiently by the end of the review period. The CER has decided to disallow legacy accounts for ex ante contractor claims by 50m. The CER has also decided to adopt an uncertainty mechanism to address any change in connection policy which may impact over the period of the review. If Irish Water does not achieve the desired level of funding it will need to prioritise the capital projects it undertakes. Further work is required to set out clearly the approach to prioritisation and to put in place a framework for monitoring implementation and outputs. The CER is continuing to engage the Department of the Environment, Community and Local Government and the Environmental Protection Agency to define the terms of reference, composition and reporting requirements of the monitoring group. The CER notes that over the period of the consultation, Irish Water has made a revised submission in relation to the Capital Investment Plan (CIP). This revised project listing will form the basis for a baseline plan against which Irish Water s delivery of the CIP will be monitored. The CER will continue to engage with Irish Water to secure comprehensive information regarding Irish Water s approach to prioritisation and a populated baseline plan by the end of 2014. The CER will also work with the Department of the Environment, Community and Local Government and the Environmental Protection Agency to put in place arrangements regarding the governance of capital investment matters for the first full price control period. The governance structure should provide a forum to ensure stakeholders views on the capital investment plan are considered, and provide a forum for engagement between Irish Water and these stakeholders. Operational Expenditure Irish Water had proposed operating expenditure of around 2.5billion over 2014-16, with an average 2.2% efficiency target for 2015 and 2016. The CER has decided to impose an average annual efficiency challenge of 7% over the revenue period. Noting that Irish Water s submitted costs are high when benchmarked against other utilities, and that some costs are not fully within Irish Water s direct control, the CER considers that a 7% challenge is reasonable in the context of what other water utilities have achieved at a comparable stage. The CER intends to profile these efficiency cuts such that production costs are consistent with the Market Corporation Test. As set out in the consultation paper, the efficiency target is set globally, for all operational costs, and so it is up to Irish Water to determine how it delivers the efficiencies from the different cost categories. The CER will continue to work with Irish Water to benchmark operational costs, including labour costs over the interim review period, for use in assessing Irish Water s business plan submission for the first full review period in 2017. The CER has also decided to allow a 2m innovation fund within the allowed operational revenue.

RAB & Depreciation The CER has decided to set an opening regulated asset base (RAB) of 1,037m reflecting the costs incurred in the establishment period, net of the proposed reductions for efficiency, as well as liabilities transferred from the Local Authorities. CER proposes to roll-forward the RAB based on well-established capitalisation and depreciation rules applied to other network regulated entities as set out in the consultation paper. Allowed Rate of Return The CER has decided to apply a pre-tax Weighted Average Cost of Capital of 5.1% which is consistent with the CER s approach to deregulated companies in energy. The CER will conduct a review of the rate of return after a period of 12 months. Monitoring & Service Levels As stated above, the CER will implement a framework for the prioritisation of capital expenditure projects, and establish an outputs monitoring group to agree changes to the agreed baseline capital programme. This outputs monitoring group will monitor associated capital inputs and outputs. The CER has also decided to implement a partial overall performance assessment which will incentivise Irish Water to improve its performance around a set of key metrics, e.g. service delivery. The CER will issue a consultation on the reporting requirements for the overall performance framework in November 2014. The partial overall performance framework reflects the fact that there are constraints on the extent of network data currently available. However, the CER will require Irish Water to establish a timeline for the collection of data for a full OPA to be implemented at the start of the next price control. The details of the programme of work for the first full price control will be published by the CER in 2015. In additional to the monitoring on capital spend and operational performance, the CER will also monitor Irish Water s performance in relation to the requirements of the Customer Handbook as set out in Handbook CER14/364. The Customer Handbook requires Irish Water to prepare a number of Codes of Practice including the Customer Terms and Conditions which underpin the Water Charges Plan. The Codes of Practice and the Customer Terms and Conditions are published on Irish Water s website www.water.ie Allowed Revenue Taking account of the decisions set out above, the CER has decided on an allowed revenue of 2,078m over the interim revenue period. This would result in a gross average household cost of 594 when calculated on the same basis as the consultation paper. The government funding means that the average annual household cost to customers is reduced to 238, by the same calculation. Not all households are the same size or use water in the same way; some will use more, some less. This means that individual customers bills will vary depending on the number of people in the house and how much water they actually use. The actual tariffs for water consumption are set out in Irish Water s Water Charges Plan. Revenue Assurance The CER has approved an allowed revenue of 2,078m for Irish Water for the period 2014-2016, with provision for a correction factor. However, it is important that Irish Water is correctly incentivised to makes full endeavours to collect all appropriate revenue to ensure that the general customer does not fund non-payment. Therefore the CER has required that Irish Water should submit a Revenue Assurance plan, identifying what mitigations have been implemented, or are planned to be implemented, to protect revenue. The Revenue Assurance Plan should be in place for the commencement of billing in January 2015 and the CER will monitor the implementation and effectiveness of these measures through regular reporting. Water Charges Plan Domestic Customers The CER received a significant number of responses to the Water Charges Plan, in particular on aspects of the Water Charges Plan relating to domestic charges. The CER has considered all responses and each of the comments or issues raised are discussed in detail in the Water Charges Plan Domestic Response and Decision Paper CER14/452.

The CER has endeavoured to both address the issues and accommodate the concerns of respondents where possible within this review period. The CER also notes that some aspects of the Water Charges Plan have been specified in legislation or the Water Charges Policy Direction 2014, from the Minister for the Environment, Community and Local Government. The key decisions to be incorporated into Irish Water s Water Charges Plan in relation to domestic customers are as follows: Water & Wastewater Services The CER has decided that Irish Water will provide water and wastewater services to customers where domestic tariffs are calculated on a national basis, with separate tariffs for water and wastewater calculated on a 50/50 cost basis, with no standing charge for a primary residence. Unmetered customers will be charged on the basis of adult occupancy. Allowances The CER has approved Irish Water s proposal to set household consumption at 66,000 litres per annum for a single occupancy household, with an additional 21,000 litres per annum for each additional adult. Each household will benefit from an annual allowance of 30,000 litres per service, per household, as per the Minister s Water Charges Policy Direction 2014. The CER has also approved Irish Water s proposal to apply the same consumption level for children as for adults. This means that the government allowances, as per the Minister s Policy Direction 2014 will be set at 21,000 litres per child. This decision is based on data from a survey conducted by Irish Water and published as part of the consultation. The CER has received a further submission from Irish Water on this study which provides additional reassurance regarding the survey s conclusions. This submission is published alongside this decision paper. The CER recognises that this survey data recommends a significant reduction to the annual estimate of a child s normal consumption, as set out in the Ministers Policy Direction which was 38, 000 litres. However, this survey represents the best available data on water consumption in Ireland at this time. Noting that Irish Water s information on consumption patterns will improve over time with the commencement of charges and the completion of the metering programme, the CER has required Irish Water to provide quarterly monitoring reports to the CER. Where the CER finds that the consumption estimates do not reflect normal consumption levels for adults or children, the CER will review the allowances and tariffs in this context. The CER has also decided that it is in customers interest that Irish Water should facilitate the transfer of the household allowances where the customer moves their primary residence. Irish Water should also facilitate the transfer of the children s allowance where the child s primary residence changes. As the child s water allowance is linked to the child benefit payment from the Department of Social Protection, the transfer of a child s water allowance will only be facilitated with the permission of the holder of the child benefit allowance. This facility to move allowances should be available for temporary moves also. The allowance year will commence from 1 st October 2014 for those customers who register within the validation period. Where customers do not register within the period of the validation campaign, they should be facilitated with a 60 day look-back period within which all eligible allowances will be applied to their account i.e. if the validation campaign terminates on 31 st October 2014 and the customer validates on 1 st January 2015, they will only be eligible for allowances from 2 nd November 2014 i.e. 60 days prior to the date of validation. The CER will determine the date of the termination of the validation campaign, and the application of the look back rule. For new customers, the allowance year will commence when they become customers of Irish Water. All allowances should be pro-rated daily by Irish Water and any unused allowances should be carried over between quarters on the customer s bill. All allowances should be used within 12 months from the date of registration or 1 st October 2014 whichever is the later. Allowances will not carry over between years.

Unmetered Charges The CER has decided that unmetered charges will be assessed on the basis of the number of adult occupants where the government allowance, as set out above, means that there is no charge for children. Based on CER calculations, a household with a single adult occupant will have an annual charge of 176 for both services, with an approximately an additional 102 for every extra adult in the household. The unmetered charges will be pro-rated daily on the customers bill. The CER has decided that Irish Water should facilitate a change in customer circumstances, which changes the occupancy in the household and the associated assessed tariff. This facility should be available for temporary changes in occupancy level also. However, for operational efficiency it is necessary that a minimum period should apply to a temporary change in occupancy; the minimum period is specified in the Water Charges Plan as 3 months. Where the change in occupancy is from a single occupant household to zero occupancy, the tariff will revert to the non-primary residence charge. This measure is not necessary for metered customers. The CER notes that unmetered charges present additional complexity when ensuring the equitable treatment of all customers as illustrated by the change in occupancy example. These issues will be addressed by the full implementation of the metering programme which is at 399,000 on 30 th September. There are 33,000 meters being installed monthly which will see 817,000 customers with meters installed by the end of 2015, and 1.06 million by the end of the interim review period at the end of 2016. Metered Charges The CER has decided on a volumetric unit rate of 2.44 per 1,000 litres for each service in the Water Charges Plan. This results in a combined charge of 4.88 per 1,000 litres for water and wastewater services. The CER has made this decision in the interests of customers such that final unit rates should not exceed those proposed in the consultation and cause confusion at the outset of the implementation of the water charging regime. Further to responses received to the consultation, the CER has also made some positive customer amendments to the provisions of Water Charges Plan which it considers will assist customers and ease the transition to a water charging regime. These amendments will have an impact on the billable revenue available to Irish Water, with respect to the allowed revenue as set out above. For example, the extension of the cap on metered charges from six to nine months and the reduction in the minimum charge for nonprimary residences along with some other minor modifications will reduce the billable revenue available to Irish Water with respects to the 2,078m allowed revenue. In terms of the revenue shortfall that these amendments will create the CER notes that Irish Water did not include a provision for tariff recovery from a significant number of premises in the original Water Charges Plan submission. Irish Water has identified a group of approximately 230,000 premises which have been recorded as vacant premises in the 2011 census, as calculated by the Central Statistics Office. The CER considers that the complete exclusion of these premises forgoes potential revenue to Irish Water and is inconsistent with some of the principles set out in the Water Charges Plan; namely equity, non-discrimination between customers, and cost recovery. Therefore, the CER has required that Irish Water should take account of these additional premises with reference to the billing assumptions set out in the Appendix to the letter of 17 th September 2014. The CER estimates that this additional revenue stream is sufficient to address any revenue shortfall due to the extension of the cap on metered charges, the reduction in the minimum charge for nonprimary residences and other minor modifications. However, the CER notes that these estimates are based on a number of assumptions regarding the level of billable premises. Therefore, where the ex-ante assumptions in relation to the tariff schedule and charging base lead to an over or under recovery of revenue relative to allowed revenue, a correction factor (k factor) may be applied to allow for a true-up of actual revenues relative to those allowed over the interim review period. This correction is in line with the regulatory framework as set out in the CER s Advice to the Minister (CER14/076).

Capped Charges The CER has decided to extend the cap for all metered customers at the assessed charge for a period of nine months, as opposed to six months which was proposed by Irish Water in the consultation. The cap will apply from 1 st October or from the date that the meter is installed, whichever is the later. This means that metered customers consuming less than the level of the assessed charge will pay the lesser amount. Default Charges The CER has decided to approve Irish Water s proposal to apply a default unmetered tariff to households that fail to validate their details. The default tariff will be set at the assessed charge for a household with two adults without the benefit of the household or child allowances. The CER has also decided that where a customer registers with Irish Water after the period of the validation campaign they should be facilitated with a 60 day look back rule. The CER will review the progress of the validation campaign with respect to customer sign up and determine the final date of the validation campaign for the purposes of applying the default tariff. Rebates Acknowledging the concerns of respondents, the CER has decided that rebates will be made to customers that transition from an assessed charge to a lower metered charge. Rebates will be calculated on the basis of the customer s average usage over a six month metered billing period following meter installation where the customer has been on an unmetered charge for at least 3 months. All rebates will be processed automatically; with no minimum rebate threshold applying. Rebates will be paid after the first bill following the six month rebate calculation period. Non-Primary Residences The CER has decided to reduce the level of the minimum charge per service per annum to metered and unmetered premises that are not permanently occupied. The CER considered that the 80 charge per service represented a disproportionately high charge when compared with an occupied property. The CER has reviewed charges in comparable regulated regions and has decided to apply a benchmark combined charge of 125 for non-primary, or vacant, premises equating to a 62.50 charge per service, per annum. The CER considers that this level of charge is also comparable to standing charges for gas and electricity customer in Ireland. Discounts for Water Unfit for Human Consumption The CER has decided that where water is unfit for human consumption (to include, but not limited to, a Boil Water Notice and Drinking Water Restriction Notice) for more than 24 hours, a 100% discount would be applied to the water supply portion of a customer s bill 24 hours from the issuance of the notice. The CER notes that in instances of force majeure, where a discount would not apply, the CER will monitor Irish Water s efforts to restore service in a reasonable time. While the CER notes that a significant number of respondents raised the issue of hard water as one that should qualify for discounts, the CER notes that hard water does not render the water supply unfit for human consumption and as such it will not qualify for the discount described above. Essential Medical Use Customers Customers with medical conditions which require increased water consumption will be capped at the assessed charge for that household even if they have a meter. Where relevant, customers should make a declaration that they have a medical condition requiring the use of additional water when completing their Irish Water application form. There is no requirement for the customer to state the medical condition and there will be no list of qualifying medical conditions, however Irish Water may seek evidence of their medical condition (medical certificate or similar) and Irish Water may investigate instances of high usage to determine if there is other water use (e.g. business) or leakage at the property. Billing Arrangements Bills will be issued quarterly in line with the CER Codes of Practice. Payment Options The CER has approved Irish Water s proposals with respect to the payment of bills through direct debit, cheque, credit/debit cards, over the counter arrangements, and electronic funds transfer. The CER notes that for operational reasons some of these payment channels cannot be set up until the first bill has issued.

Charges for Additional Services for Domestic Customers In the consultation the CER set out a requirement for Irish Water to provide further evidence to the CER for review prior to consultation and approval of charges for additional services such as a site inspection where a blockage or leak is suspected. The CER is currently reviewing this information and will publish a separate consultation on additional charges in October 2014. In the interim the CER notes the charges set out in Irish Water s Water Charges Plan as they apply to domestic customers. The CER proposes that these charges will apply until the consultation on additional charges has concluded and a final decision has been made. Further to that decision, Irish Water will be required to provide a rebate where the charge to the customer is lower than the currently cited in the Water Charges Plan. First Fix The CER has decided that where a customer leak has been identified under the first fix policy, the customers charges will be capped at the assessed level until the leak is fixed by Irish Water. Irish Water has made a proposal to the CER regarding a first fix policy. The CER notes that this is a new proposal and as such will consult on it separately to the Water Charges Plan. In the interim please note that all metered customers will be capped at the assessed level of charges for nine months. We will consult and implement a first fix policy within this period. Supporting Documentation The CER recognises that the provisions for customers as set out in the Water Charges Plan are described at a high level, intended to provide sufficient detail for customers to understand how charges will be levied by Irish Water. However, the CER requires that Irish Water should also prepare for publication of a more detailed process manual to support the Water Charges Plan. The process manual should set out all the business rules that underpin the conditions set out in the Water Charges Plan, with detailed information regarding the implementation of those rules. The level of detail should be sufficient to understand billing processes and how the business rules will be applied to customer transactions. The CER requires Irish Water to produce an initial draft of the process manual for review no later than 31 st October 2014. The CER intends to publish the Process Manual no later than 1 st December 2014. Water Charges Plan Non-Domestic Customers Tariffs Existing charges for non-domestic water and/or wastewater customers as determined under relevant Government policy and applied by Local Authorities prior to 1st January 2014 will necessarily by default continue to apply for the foreseeable future. This will be the case until the CER is presented with the necessary information so that it is in a position to consider the manner and method by which charges are calculated. Non-domestic customers will retain their current payment options and terms unless they decided to opt in to Irish Water s payment options. The CER will not be in a position to make determinations on disputes regarding the actual non-domestic tariff levels and/or their basis until the enduring tariff framework has been established. The CER considers that it is not in a position to consider individual agreements at this time. In the interim, there will be a moratorium on individual contracts. The CER has requested that Irish Water modify its Water Charges Plan from that submitted to reflect the fact that contracts entered into from 1 st October 2014 shall include provision to provide for the fact that new tariff arrangements shall be approved by the CER in due course and shall apply from the appropriate date as determined by the CER. The CER will publish a timeline for the establishment of an enduring tariff framework by the end of Q4 2014. This timeline will include CER milestones and what is required of Irish Water. The CER will also publish Irish Water s data migration plan once received (expected end-q4 2014) and will monitor Irish Water s progress against this plan. The CER will publish Irish Water s plan for engagement with non-domestic stakeholders upon receipt by the end of Q4 2014. In addition, the CER will establish a Large Water Users Group in Q4 of 2014.

Discounts for Water Unfit for Human Consumption Where water is unfit for human consumption, i.e. where a Boil Water Notice or a Drinking Water Restriction Notice has been issued for more than 24 hours, Irish Water should apply a 40% discount to the customers water services charge. Large Water Users, defined as those that consume in excess of 50,000,000 litres per annum, may be dealt with on a case by case basis and may be assigned a discount of up to 40%. A document for the CER s approval that sets out the process for assessing the consumption of a Large Water User, the timeline for the carrying out of this assessment and the basis for the relevant discount to apply will be submitted by Irish Water by 31 st October 2014. The CER will approve the scope and timeline for the micro-component study of non-domestic customers water consumption and it should be submitted to the CER for approval no later than 31 st October 2014. The definition of force majeure shall apply to discounts for non-domestic customers as it does for domestic customers. The CER notes that in instances of force majeure, where a discount would not apply, the CER will monitor Irish Water s efforts to restore service in a reasonable time. Additional Services for Non-Domestic Customers The current arrangements for additional services will be retained for non-domestic customers by default. These charges will be reviewed as part of the development of an enduring tariff framework for non-domestic customers. Where provision does not exist for a specific additional service, Irish Water will apply the approved domestic charge for that service. Water Charges Plan Group Water Schemes Group Water Schemes (GWS) should continue to be treated as non-domestic customers, as this seems pragmatic in light of the information currently available to the CER. All measure that apply to non-domestic customers will therefore extend to GWSs. GWSs will not be covered under the Irish Water Customer Handbook at this point. The CER will be guided by the Department for the Environment, Community and Local Government regarding the treatment of such schemes, and the CER will update the Handbook accordingly, as appropriate. Water Charges Plan Mixed Use Customers The non-domestic component of mixed use customers should continue to be billed for their nondomestic consumption as of 31 st December 2014. This includes the retention of the provision of the Local Authority free Domestic Allowance. The domestic component of mixed use customers should be billed as unmetered domestic customers based on the number of adults in the dwelling and subject to all applicable domestic allowances i.e. 30,000 litres per household and 21,000 litres per child. Where a mixed use customer has metered evidence that their overall consumption is lower than their assessed domestic consumption, or where the free domestic allowance provided to the nondomestic bill is lower than the assessed domestic consumption for that household, customers are eligible for a rebate at the appropriate domestic unit rate. Where a customer has a precautionary connection to the public water system and normally uses a private water supply, the customer should pay their unmetered charge once their consumption exceeds their applicable allowances. Rebates to mixed use customers should be applied automatically once their Local Authority has been migrated on to the Irish Water system. Where a customer s Local Authority has not migrated by 1 st October 2015, that customer may request a rebate subject to verification. Water Charges Plan Connections The CER will publish the timeline for the consultation on new connection charges with its decision paper on the Water Charges Plan. Until the CER receives and reaches decisions on proposals from Irish Water for a new connection charging policy Irish Water should, by default, apply the arrangements that are in place in each Local Authority as on 31 st December 2013.

The CER acknowledges that the arrangements in place in the Local Authorities may not be appropriate in all cases given the advent of Irish Water. Therefore, the CER will consult on interim arrangements regarding the following in October 2014: Interim Financial Security Policy; Interim General Conditions for a Water and Wastewater Connection Agreement; Pro Forma Agreement(s). In the period from 1 st October 2014 to the approval of such interim arrangements, the CER notes that Irish Water has advised that it will continue to engage with customers on these issues as it has done to date, by default. The CER is not in a position to resolve disputes regarding the actual connection charge (levels and/or basis). The CER will not be in a position to consider individual agreements at this time. Water Charges Plan Next Steps The table below sets out some of the key work items over the coming months in relation to the interim revenue review and the Water Charges Plan. A full programme of work will be published by the CER in early 2015. Revenue Review Nov 14 The CER will consult on the Operational Performance Assessment metrics for the Interim Review Nov 15 The CER will conduct a review of the allowed rate of return after a period of 12 months. WCP Domestic Dec 14 Feb 15 The CER will consult on the First Fix proposal by Irish Water The CER will consult on charges for additional services for domestic customers The CER will publish the Water Charges Plan Process Manual The CER will commence monitoring the consumption data once billing has commenced in January 15. WCP Non-Domestic Dec 14 Irish Water shall submit a paper on process for assessing large water users for discount purposes for CER approval by 31 st October 2014. Irish Water shall submit the proposed scope of the micro-component study to the CER by the end of October 2014. CER monitoring and periodic updates from Irish Water on the progress of the data migration project will continue. The CER will publish Irish Water s data migration plan once received (expected end Q4 2014).

Dec 14 The CER will publish the timeline on the establishment of an enduring tariff framework by the end of 2014. This timeline will include the development of charges for non-domestic customers, mixed-use customers and GWSs as well as the development of additional service charges for these customers. Dec 14 A Large Water Users Group will be established by the CER in Q4 2014. Dec 14 The CER will publish an information note regarding the terms of reference, composition and reporting requirements of the OMG for the interim review period by the end of 2014. The CER will engage with Irish Water to secure comprehensive information regarding Irish Water s approach to prioritisation and a populated baseline plan based on that approach as soon as possible but in any event by the end of 2014. Connections The CER will consult on Irish Water s interim connection arrangements, namely security policy, terms and conditions and pro forma agreement(s), in October 2014. Jan 15 The CER will consult on an enduring connection charging policy in January 2015. Apr 15 The enduring connection charging policy will be established in April 2015.