Response to Further Ofwat Section 13 Notice

PENNON GROUP PLC

RESPONSE TO FURTHER OFWAT SECTION 13 NOTICE TO MODIFY WATER COMPANY LICENCES

The Board of Pennon Group's subsidiary, South West Water, has agreed to accept the Section 13 Notice issued on 21 December 2012 setting out proposed changes to its Licence as a water and sewerage undertaker.These Licence proposals were prepared as a result of extensive constructive discussions between Ofwat and water companies following the previous Section 13 Notice issued in October 2012. South West Water welcomes the significant changes which have been made to the previous proposals.

17 January 2013