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Household water bills to go up by 21% over the next five years


Cropped shot of woman's hand filling a glass of filtered water right from the tap in the kitchen sink at home

The regulator said water firms proposed increases averaging £144 over five years (Picture: Getty)

Household water bills in England and Wales are to rise by an average £19 a year over the next five years – a third less than the increase requested by companies, under draft proposals announced by Ofwat.

The regulator said water firms proposed increases averaging £144 over five years.

For example, Thames Water’s proposed increase of £191 by 2030 has been reduced to £99, while Severn Trent’s proposed rise of £144 has been cut to £93.

Ofwat chief executive David Black said: ‘Customers want to see radical change in the way water companies care for the environment. Our draft decisions on company plans approve a tripling of investment to make sustained improvement to customer service and the environment at a fair price for customers.

‘These proposals aim to deliver a 44% reduction in spills from storm overflows compared to levels in 2021. We expect all companies to embrace innovation and go further and faster to reduce spills wherever possible.

‘Today’s announcement also increases the resilience of our water supplies to the impact of climate change and will reduce how much water is taken from rivers by enabling a range of long-term water supply projects, which includes plans for nine reservoirs.

‘Let me be very clear to water companies – we will be closely scrutinising the delivery of their plans and will hold them to account to deliver real improvements to the environment and for customers and on their investment programmes.’

Ofwat said it has imposed a ‘turnaround oversight regime’ on Thames Water and opposed the utility firm’s planned 44% hike in consumer bills over the next five years.

The cash-strapped firm said the bills hike will help fund £19.8 billion of improvements to its network of drains, sewers and reservoirs.

It has also asked Ofwat to lower the amount it fines the water company for incidents such as sewage spills and leakages.

Thames Water said the bills hike will help fund £19.8 billion of improvements to its network of drains, sewers and reservoirs (Picture: Reuters)

Thames warned on Tuesday that it has only enough money to last it until the end of May 2025 before it goes out of business.

The water firm is drowning in more than £15 billion of debt, and said on Tuesday that it needs fresh investment in the coming months to keep it afloat.

Already, existing shareholders pulled the plug on £500 million worth of emergency funding in March.

Thames said Ofwat’s initial assessments of its business plan had made the company “uninvestable”.

If it ultimately fails to attract fresh funding, Thames’ fraying finances will present Sir Keir Starmer’s newly elected Labour Government with a significant industrial crisis.

A blueprint codenamed Project Timber was being drawn up in Whitehall in the spring, according to reports, which could see the company effectively nationalised.

Ofwat’s ruling on Thursday is only a draft decision, and kicks off a period of negotiation until its final verdict in December.

But the regulator has rarely made major deviations between its draft and …read more

Source:: Metro

      

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