Pennon Group (PNN): K8 capital investment programme
This situation live
PNN Pennon Group
27 Nov 2025 · Over 1,000 schemes underway; over 60% of programme in progress · −1% until the next step
Having ramped up expenditure during K7, we have made a fast start with over 60% of the K8 Price Control Delivery programme in progress.
10 Mar 2026 · Year 1 deliverables on track; efficiencies emerging · −8% until the next step
We mobilised early for the AMP 8 capital programme and Year 1 Price Control Deliverables remain on track.
10 Jun 2026 · Year 1 done: £643.6m capex, mobilising · −34% until the next step
A focused start to our AMP8 capital investment programme, with £643.6 million of capital investment across the Group in 2025/26
7 Oct 2026 · Programme enlarged to c.£3.6bn over AMP8 · +3% since
Capital investment in the regulated water businesses over AMP8 is now expected to be approximately £3.6 billion1, around £1 billion1 more than Pennon's original plan based on the AMP8 Final Determinat
7 Oct 2026 · Programme enlarged to c.£3.6bn; draft determination out · +3% since
Representations on the draft determination were submitted on 24 September 2026 and Ofwat's final determination is expected by not later than 15 December 2026.
K8 capital investment programme
Programme enlarged to c.£3.6bn; draft determination out
DEC15
Next: Ofwat final determination on 2026 cost change in 52 days
Every step · 5
- 27 Nov 2025 Over 1,000 schemes underway; over 60% of programme in progress – Having ramped up expenditure during K7, we have made a fast start with over 60% of the K8 Price Control Delivery programme in progress. ↗
- 10 Mar 2026 Year 1 deliverables on track; efficiencies emerging – We mobilised early for the AMP 8 capital programme and Year 1 Price Control Deliverables remain on track. ↗
- 10 Jun 2026 Year 1 done: £643.6m capex, mobilising – A focused start to our AMP8 capital investment programme, with £643.6 million of capital investment across the Group in 2025/26 ↗
- 7 Oct 2026 Programme enlarged to c.£3.6bn over AMP8 – Capital investment in the regulated water businesses over AMP8 is now expected to be approximately £3.6 billion1, around £1 billion1 more than Pennon's... ↗
- 7 Oct 2026 Programme enlarged to c.£3.6bn; draft determination out – Representations on the draft determination were submitted on 24 September 2026 and Ofwat's final determination is expected by not later than 15 December 2026. ↗
What is happening
Pennon Group: K8 capital investment programme – Programme enlarged to c.£3.6bn; draft determination out. ['Programme enlarged to c.£3.6bn; draft determination out']
- In short
- The K8/AMP8 programme is enlarged to about £3.6bn, around £1bn above the original plan, to lift asset health. The rights issue now funds it. Ofwat provisionally allowed £230m of cost change; the company targets £400m additional RCV through the cost change process, with RCV growth over 40%.
- Announced
- 27 Nov 2025 · Over 1,000 schemes underway; over 60% of programme in progress
- Latest
- 7 Oct 2026 · Programme enlarged to c.£3.6bn; draft determination out
- AMP8 capex
- approximately £3.6 billion, around £1 billion more than original plan
- Ofwat draft
- £230 million nominal provisionally allowed (£190 million in 2022/23 prices)
- Further investment
- around £170 million through 2027 and 2028 cost change processes, subject to Ofwat approval
- RCV target
- over 40% growth across AMP8, up from 34%
- Next milestone
- Ofwat final determination expected by not later than 15 December 2026
- Size
- approximately £3.6 billion over AMP8, around £1 billion more than original plan
- Target
- additional RCV of £400 million through cost change in 2026 and subsequent years
What comes next
Ofwat final determination on 2026 cost change (15 Dec 2026).
From the company's own announcements. Not investment advice.
Briefing
Pennon Group in 4 minutes
Pennon owns water and sewerage companies in the South West of England and water-only companies around Bristol and in Surrey. It returned to profit in 2025/26 as a record investment programme began to lift its allowed...
- Act 1Buying Sutton and East Surrey, funded by shareholders
- Act 2The loss year and a bigger raise
- Act 3Profit returns, but the weather and the targets bite
Also at Pennon Group 6 open
New CEO / resetCEO succession – Plan announced, actions under way
Dilutive fundraiseRights issue – Terms set; subscription period opens 12 October
Disposal of a part (break-up)Sale of Pennon Power – Proposed; listed in funding plan
Project milestonesPennon Power build-out – Fife and Aberdeenshire energised, generating revenue
Turnaround plan with targetsWastewater pollution reduction plan – Pollutions down c.34%; EPA 1* provisional
Pennon Group – company page →