Households could see their water bills rise next year as providers aim to tackle sewage spills and meet environmental requirements.
Bills could increase from “an average of about £450 to £680”, said The Times, as utilities companies need the extra cash to “meet strict pollution targets”.
It comes amid worries about the levels of debt at the UK’s largest water company, Thames Water.
The water company, which serves a quarter of the UK population, “has billions in debt”, said BBC News, and loses “the equivalent of up to 250 Olympic-size swimming pools every day from its pipes”.
Its chief executive Sarah Bentley resigned last week over sewage spills and the firm has since been fined £3.3m by the Environment Agency after discharging millions of litres of undiluted sewage into the Gatwick Stream and River Mole on the border of West Sussex and Surrey.
Thames Water’s £13.7bn debt “is not unique in the industry”, said CityAM.
Debt is common among water suppliers, explained the newspaper, which all adds to the “painful possibility” of higher bills.
Here is how your water bill is calculated and ways to reduce some of the cost.
Water bills explained
Unlike gas and electricity, you can’t choose where you get your water from. You are “stuck with the supplier” where you live, said Ideal Home.
Companies include Thames Water, Affinity Water and United Utilities.
You can find out who your supplier is by entering your postcode on the website of trade body Water UK.
One company may supply drinking water, and handle waste water, or a separate company may “collect the wastewater from your sinks and toilets”, said Money.co.uk.
The amount you pay for your water depends on the size of the region you live in and availability of water, explained uSwitch. Most people are charged an annual water rate based on the rateable value of the property “which covers the domestic water supply and associated costs such as maintaining water quality”.
Instead of a flat rate, said industry regulator Ofwat, you can choose to be charged “according to the amount of water you use” by having a water meter installed. This may be cheaper and you can track your actual water usage, “which benefits the environment and helps address water scarcity”.
What is the average water bill?
Water bills rose by 7.5% or £35 this year to £448, according to Water UK, which is “lower, in real terms, than they were a decade ago”.
These costs are “helping fund the highest level of investment in history into our water and sewage systems”, said the industry body.
That is just an average though, said LoveMoney, and the “actual adjustment” will depend on your usage and where you live.
However, there is the possibility bills could rise further in the future.
Companies have been asked to submit investment plans to Ofwat by October on how they will fulfil commitments to tackle pollution from sewage.
To fund this, firms are asking the regulator to approve “real-terms price increases of, on average, 25% between 2025 and 2030”, said The Times.
How to cut your water bill
There are some steps you can take to reduce your water bill.
It may be worth switching to a water meter “if there are more bedrooms in your home than people, or the same number”, said MoneySavingExpert.
It is free to switch in England and Wales but there is a charge in Scotland and Northern Ireland.
The Consumer Council for Water (CCW) has a free water meter calculator that asks questions about your water usage to see whether you can save with a meter.
If the estimated meter bill is less than what you’re paying now, added MoneySavingExpert, “you could be quids in” but if the savings are small, then non-metered water bills “give you surety of knowing exactly what you’ll pay”.
Reducing your water usage is also likely to help with the overall amount of a bill.
Shortening your showering time by one minute could help save a family of four “£45 per year”, said The Money Edit, while not overfilling the kettle “saves £6 a year”.
In addition, using less water is beneficial for the environment.
Most water companies offer “widgets and gadgets” to help you cut your water use, said LoveMoney. These include shower heads or tap inserts that regulate how much water is used.
It is illegal for water companies to “disconnect or restrict your water supply”, if you owe them money, said Citizens Advice, but they could take you to court to recoup what you owe.
Some providers offer discounted or social tariffs for customers on low incomes.
People on benefits “who use a lot of water for essential family or health reasons”, said WaterUK, may also qualify for capped bills under the WaterSure scheme.
Your water company may provide this information or you can check what support is available on the CCW website.
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Marc Shoffman is an award-winning freelance journalist, specialising in business, property and personal finance. He has a master’s degree in financial journalism from City University and has previously written for FT Adviser, This Is Money, the Mail on Sunday and MoneyWeek.