Water bills to be cut by £50 a year
Water firms will be forced to cut customer bills by an average of £50 a year and invest an extra £6m every day over the next five years to improve the environment and services for customers.
The plans are part of a major package of investment which Ofwat says will signal “a new era” for what the water sector delivers for customers and the environment.
The announcement is laid out in Ofwat’s price review draft determinations for 14 of the 17 water companies in England and Wales. Three water companies, Severn Trent, South West Water and United Utilities, have already been fast-tracked through this stage of the price review in recognition of their high-quality plans for the next five years.
The price review includes ambitious new targets to drive water companies to do even more for customers and the environment.
These include: cutting pollution incidents by more than a third; reducing supply interruptions by almost two-thirds; helping 1.5 million customers who are struggling to pay; and cutting leakage to save enough water equivalent to the needs of the population of Manchester, Leeds, Leicester and Cardiff.
Safeguarding the future
Ofwat said extreme weather events, climate change and population growth mean water companies need to act now so they can continue to provide safe and reliable water and wastewater services.
Ofwat’s draft determinations provide more money for new and improved services with an additional £12bn to be invested over and above business-as-usual costs and investments.
This extra funding is to improve services for future generations, including by building reservoirs, moving water to where it is needed most, and protecting the environment.
Rachel Fletcher, Ofwat chief executive, said: “The package we are unveiling today signals a brighter future for customers, with better services, a healthier natural environment and lower bills.
“To get there we are calling for extra investment of £6m each and every day to improve the environment and provide services for a growing population. At the same time we expect to see customers’ bills cut by an average of £50.
“These are seriously stretching goals for the sector, but we know they can be achieved. We have seen three water companies leading the way and we now want the rest to show the ambition and drive to deliver this new era for customers and the environment.”