Ofwat publishes eftec reports on customer behaviour

01 November 2011

Ofwat (the Water Services Regulation Authority) has published two reports prepared by eftec in association with Cascade Consulting on the role of revealed customer behaviour in providing evidence to support water companies’ business plans.

The reports cover both conventional economic revealed preference methods and more general customer behaviours, such as complaints, that can be observed in relation to water, wastewater and environmental services.

The reports show that there are a number of opportunities for water companies and other stakeholders to make use of the information revealed by actual customer behaviour when assessing their customers’ priorities. This includes the following recommendations:

• Companies’ business cases should be supported by an appropriate and sufficient qualitative, quantitative and valuation evidence base;
• Companies should consider the use of surveys to understand better the actions customers take in response to service failures;
• All stakeholders should review the approach to valuing the environmental quality improvements associated with implementation of the Water Framework Directive.
• Further scoping is required to establish the potential for estimating the impact disamenities from sewage treatment works, such as odour, have on property prices; and
• Opportunities to combine revealed preference and stated preference approaches should be considered.

The reports can be downloaded directly from the Ofwat website here. For further information please contact Allan Provins.