In December 2024, as part of our PR24 final determinations we said that for specific critical costs areas we would introduce an adjustment mechanism for price controls that would make it easier for companies to access additional revenue in-period, if necessary. This would require changes to companies’ licences.
We consulted on our draft proposals and the licence changes for the cost change process from 8 July 2025 to 1 September 2025. In November 2025 we published our final decisions.
We have now introduced a cost change process for the period from 1 April 2025 to 31 March 2030. This process applies to critical cost areas, and will minimise delays in delivery for these critical areas. These cost areas are:
- cyber security;
- additional schemes to ensure the safety of drinking water with respect to ‘forever chemicals’ (PFAS);
- asset health;
- growth;
- schemes included in our large schemes gated process
- development of the Havant Thicket reservoir; and
- development costs for major projects.
Companies will be able to submit claims in 2026, 2027 and 2028.
Supporting documents
- Cost change information notice
- Cost change process guidance note
- Cost change process data tables- February 2026
- Cost change process data tables definitions – February 2026
- Large Gated Schemes – Cost change tables
- Cost change model (Excel file)
- Cost change model (Openbox file)
- PR24 cost change process – demand growth investment additional guidance consultation
- Asset health assessment guidance
- Ofwat gravity sewers assessment guidance
- Consultation on proposed modifications to Condition B of the licences of Anglian Water, Northumbrian Water, Southern Water and South East Water