Customers in England and Wales are in for a surprise as water regulator Ofwat has approved a significant increase in water bills. The approved increase of 36% over the next five years is a stark contrast to the expected average rise of £20 per year per household. This decision comes as part of Ofwat’s plan to fund a £104 billion upgrade in the water sector, promising substantial and lasting improvements for customers and the environment.
Impact on Consumers
Households will feel the immediate impact of this decision, with an average increase of £86 or 20% in the next year alone, excluding inflation. This hike will be followed by smaller percentage increases in each of the subsequent four years. The rise in water bills will vary among different companies, with Southern Water customers facing the largest increase of 53%, while Wessex Water customers will experience the lowest increase at 21%.
Ofwat’s Perspective
Ofwat chief executive David Black emphasized the necessity of this increase to drive investment and enhance overall performance in the water sector. He assured that the regulator will closely monitor companies’ investment programs to ensure they deliver real improvements while providing value for money. Ofwat’s stringent evaluation process led to the removal of £8 billion in unjustified costs from companies’ funding requests and saved customers £2.8 billion by setting a rate of return.
Breakdown by Company
The approved increases by water company range from 21% to 53%, with each company contributing to the overall investment in the water sector. Anglian Water, Dwr Cymru, Hafren Dyfrdwy, Severn Trent Water, and other major companies will see varying degrees of bill hikes over the coming years. Water-only companies like Affinity Water, Portsmouth Water, and South East Water are also set to implement increases to support the sector’s development.
It is important for consumers to be aware of these changes and plan their finances accordingly to accommodate the upcoming increase in water bills. Stay informed about how these changes may impact you and your household to navigate the shifting landscape of water utility costs.
