How The Market Works - MOSL

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About the Business Retail Market (BRM)

The market opened in April 2017, allowing more than 1.2 million business customers – such as small businesses, charities and public sector organisations – to choose who provides their water and wastewater retail services.

This means customers are able to shop around for, or renegotiate, better deals and additional services like water efficiency audits, more frequent meter reads or bundling utility services.

Customers are also able to self-supply, meaning they can become their own retailer – dealing directly with wholesalers.

The market is governed through rules known as the Market Arrangements Code (MAC). We provide expert guidance and secretariat services for the independent MAC Panel and its subcommittees which, oversee and review these rules, with valuable support and input from trading parties.

The retail market in Scotland has been open since 2008 and is regulated by the Water Industry Commission for Scotland. The eligibility rules are different for customers in Wales. To find out more about the non-household water retail market, please visit the Open Water website.

How the market works

Simply, it works similar to markets for telecoms, gas and electricity. Retailers buy wholesale services (in this case, water supply and wastewater removal), package these up and sell them to eligible customers.

Customers can engage directly with retailers, use brokers, comparison websites or specialist providers to find the best deal for them – including additional services, such as water efficiency support, alongside potential cost savings.

Incumbent water companies still provide the physical services and retailers engage with them on their customers’ behalf to address issues that might come up, such as installing or repairing meters.

MOSL operates and maintains CMOS – the Central Market Operating System – the central IT system which manages over 90,000 transactions every day. Retailers and wholesalers upload data on meter reads, tariffs and customer data – including when they switch retailer.

MOSL, through CMOS, uses this information to calculate and share settlement data – the amount each retailer owes wholesalers, which is used to work out customers’ bills.

Trading parties, MOSL and Ofwat can all suggest improvements to the market through the code change process, to enable the market to deliver better outcomes and make the market more efficient.

The Strategic Panel reviews all code changes raised and makes a recommendation to Ofwat about whether the changes should be made to the market codes or not. MOSL works with parties proposing a change to support its development and acts as Secretariat to the Strategic Panel.

Governance and Regulation

  • Ofwat is the economic regulator for the water sector in England and Wales, sets the prices wholesalers can charge and issues the licences new entrants require
  • CCW is the customer watchdog for the sector. It tracks complaints made against water companies and retailers and can investigate and intervene on customers’ behalf
  • MOSL Board oversees our performance and ensures we meet our obligations to the market and our members
  • The Strategic Panel is the senior industry group overseeing how the market works and how it might change to promote competition, benefit customers and improve efficiency and effectiveness. This includes changes to the markets ‘rule books’ such as the Wholesale Retail Code and the Market Arrangements Code.
  • The Market Arrangements Code (MAC) is signed by all retailers and wholesalers – as well as MOSL as the market operator. It outlines how everyone involved in the market works together to govern and develop the market – including how MOSL is governed and financed and the constitution of the Panel
  • The Wholesale Retail Code is a statutory agreement between wholesalers and the retailers they serve and forms the basis of how they interact
  • The Customer Protection Code of Practice (CPCoP) is set by Ofwat and outlines the minimum standards all retailers must adhere to when dealing with customers at every point of the customer journey.

Related pages

Market Training

Our bespoke market training programme

View

The Strategic Panel

The MAC Panel which helps oversee and improve the market

View

Market Improvement

How we work across the market to make improvements

View

Making Changes

How changes are made to the market codes

View

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