StockMarketWire.com - Water company United Utilities said it expected to reduce average bills by 10.5% in real terms between 2020 and 2025.

As part of a new business plan, the company said it also planned to reduce capital expenditure by over £1bn compared with the so-called AMP5 regulator framework.

United Utilities said it was also planning a balanced outcome delivery package for the period with a range of outcomes estimated at plus or minus 2% of return on regulated equity across the AMP7 framework, equivalent to around plus or minus £410m.

It also said it would deliver delivering a 'major water resilience scheme' with estimated construction costs of over £750m in the AMP7 and AMP8 frameworks, to be directly procured for customers in Manchester and the Pennines.

An RPI-stripped appointee cost of capital of 2.4% would be applied, consistent with regulator Ofwat's early view.

'Our business plan sets out our ambition to build on our achievements in AMP6 and deliver a better quality, more reliable water and wastewater service for customers in the North West of England to 2025 and beyond,' chief executive Steve Mogford said.

'We are cutting bills such that they will be lower in real terms in 2025 than they were 15 years ago, whilst also delivering higher standards of service, increasing resilience, delivering innovation and investing for the long-term.'

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